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Enhancing Prospects for Peace in Ukraine
Enhancing Prospects for Peace in Ukraine

Ukraine: Running out of Time

Ukraine needs a government of national unity that reaches out to its own people and tackles the country’s long overdue reforms; both Russia and Western powers should back a vision for the country as a bridge between East and West, not a geopolitical battleground.

Executive Summary

Ukraine’s provisional government faces an uphill struggle to make it to the 25 May presidential election. Shaken by separatist agitation and distracted by Russian troops on its borders, it has not asserted itself coherently and has lost control of the eastern oblasts (regions) of Donetsk and Luhansk, which have voted for independence in contentious referendums. It appears incapable of keeping order in much of the south east, where separatists, supported and encouraged by Moscow, threaten the state’s viability and unity. Kyiv and the presidential candidates should reach out to the south east, explaining plans for local self-government and minority rights, and for Ukraine to be a bridge between Russia and Europe, not a geopolitical battleground. With relations between Moscow and the West deeply chilled, the U.S. and EU should continue tough sanctions to show Russia it will pay an increasing cost for destabilising or dismembering its neighbour, while pursuing parallel, vigorous diplomacy to reach understandings that avoid the worst and respect mutual interest.

The situation has consistently worsened since late February, as much of the optimism from the Maidan protests that brought down the Yanukovych government has faded. Following Russia’s annexation of Crimea, “volunteers” and quite possibly special forces (Spetsnaz) dispatched by the Kremlin have seized the initiative in the south east. The separatists’ objective seems to be to provoke sufficient disruption and bloodshed so that President Vladimir Putin can assert, if he chooses, what he says is Moscow’s right to protect Russian speakers anywhere – in the worst case scenario by carving off what would in effect be a new autonomous entity embracing almost a third of the country and many of its most viable economic resources, which might eventually be absorbed into the Russian Federation. All this deepens the crisis between the West and Russia, making the rapproche­ment necessary to resolve it much more difficult.

The chaos in the south east seriously threatens the presidential election. The govern­­ment formed in February after months of street demonstrations and fighting barely functions, consists mostly of veterans of a discredited political system and new faces with little or no government experience. Communication within government institutions seems weak, with the public as a whole almost non-existent. Moscow’s depiction of a country in the thrall of a fascist coup, dominated by ultra-right militias, has persuaded the Russian public and for lack of alternatives has taken root in parts of Ukraine.

Kyiv must urgently talk to its own people, especially in the south east, where, unlike Crimea, ethnic Russians are not a majority, and even some leading members of the Yanukovych-era ruling party denounce calls to break up the country. Language, self-government and corruption – the latter of immense public concern – should be high on the government agenda and publicised as such. So too should preparing the population for the inevitable pain of deep reforms required to save an economy wrecked by two decades of endemic corruption and incompetence.

Military efforts to restore order in the south east have underlined both the government’s weakness and the pressing need for a solution through dialogue, not force. Such a solution is made more difficult by the competing prisms through which the crisis is viewed. For much of Ukraine and the West, a popular uprising in support of a more European-oriented Ukraine is being stymied by Russian revanchism; for Russia, the Maidan revolution was another calculated move, since the collapse of the Soviet Union, to surround and threaten Russia with enemies and humiliate it.

President Putin appears to consider that a West-leaning Ukraine government born of mass protests would set a dangerous example at home and thwart his ambition of establishing dominant Russian influence over as much of the former Soviet republics as possible. Russia is changing fast, and buoyed by overwhelming public support after the annexation of Crimea, Putin is rapidly creating an avowedly conservative ideology that consciously rejects many of the principles and concepts of Western democracy. In bringing Ukraine to its knees, however, Russia may also have lost its neighbour as a cultural and political ally in the long term.

A mid-April four-party – Russia, Kyiv, U.S., EU – Geneva agreement to calm the situation was ignored by the separatist forces, so is a dead letter. Nevertheless, the effort should be renewed as soon as possible. Ukrainian leaders – particularly presidential candidates – should commit to forming a post-election government of national unity with important representation from the south east and emphasise, as the guiding principle for rapprochement, that they want their country to link, not divide, Russia and Europe. They should also say forthrightly that they do not desire NATO membership and will guarantee continuation of Russia’s important defence industry and other ties to the south east, indeed to all Ukraine.

The dysfunction within the provisional government has complicated a slow and often fragmented Western response. The U.S. and EU need now to convey a consistent, firm, united and measured message, recognising – even if not accepting – Moscow’s take on the crisis’s origins. Its components should be political support for Kyiv to conduct elections, and political, financial and expert support for a national unity government to carry through the necessary stabilisation measures; measures to make Ukraine viable for foreign investment; further sanctions, to bite deeper into Russia’s economy if it does not change course; and quiet high-level talks with Moscow and facilitation of Kyiv-Moscow talks with a view to calming the situation and allowing Ukraine’s future to resolve itself organically over a period of years.

It is important to recognise that the new Russian readiness to use force to change borders, first evident a half-dozen years ago in Georgia, now clearly requires a firm deterrent response including sanctions and reassuring NATO members of the commitment to fulfil collective security obligations. Those actions must, however, be paralleled by diplomatic steps to lessen the confrontation. On the ground in Ukraine today, Russia has immediate advantages of escalation; over time, the West likely has the economic and soft-power edge. A successful, democratic Ukraine, substantially integrated economically in the West, but outside military alliances and a close cultural, linguistic and trading partner mindful of Russian interests would benefit all. Finally, as Kyiv and its international supporters look to the future, all should keep in the centre of their attention that Ukraine is a profoundly damaged country. This damage goes far beyond separatism and is the fruit of the poor governance and massive corruption that, over the past two decades, has all but destroyed it.

Enhancing Prospects for Peace in Ukraine

EU-Russia ties are frostier than ever. In this excerpt from the Watch List 2021 – Spring Update, Crisis Group urges the EU and its member states to forge consensus with the U.S. and UK on responses to any threats, or evidence, of Russian attacks on Ukraine, and to work with the U.S. on breaking the impasse in talks.

Relations between Russia and the European Union (EU) are frostier than ever. Reasons include disagreements old and new, with Europeans concerned about issues from Moscow’s treatment of opposition activist Alexei Navalny and other dissidents, to its alleged meddling in their elections, to newly surfaced reports of Russian involvement in a 2014 explosion at a Czech munitions depot. Those reports formed the backdrop for a rash of diplomatic expulsions by Prague and other European capitals, on one hand, and Moscow on the other. But it is the continuing war between Russian-backed separatists and Ukrainian state forces in Ukraine’s eastern Donbas region that remains the sorest point of friction.

Russia raised worries of a substantial escalation in Kyiv and among Ukraine’s Western partners when it massed forces near Ukraine’s borders in March and April. While these anxieties were largely assuaged when Russia started to pull back its forces in late April, the situation as a whole remains fraught. A ceasefire Kyiv and Moscow agreed to in July 2020 has broken down. Negotiations between Kyiv and Moscow are deadlocked. Neither side is taking steps prescribed by the 2014-2015 Minsk agreements that ended the worst of the fighting and were intended to bring peace. The Normandy Format peace process that includes France, Germany, Russia and Ukraine is largely dormant, with no new summit on the horizon. Absent changes, the coming year could bring new problems and new dangers of further outbreaks of violence. The EU, for all its difficulties with Moscow, can and should work with member states and allies to mitigate the risks and seek ways to break the impasse.

To deter future threats to Ukraine and reduce tensions with Moscow, the EU and its member states should:

  • Forge consensus with the U.S. and UK about how they would respond to evidence of Russian threats to attack or actual attacks on Ukraine, focusing on what additional sanctions they would apply and under what circumstances. Options for increasing military pressure should be viewed cautiously, given that they could bring further risks of escalation.
  • For purposes of deterrence, quietly communicate agreed-upon red lines and repercussions to the Kremlin, being careful not to rely on bluffs that Moscow would be likely to call.
  • Encourage Kyiv, on one side, and Moscow and its proxies, on the other, to return to observing the July 2020 ceasefire as a prelude to renewed talks among the Normandy Format countries and the U.S.
  • Work with the Biden administration to create incentives for breaking the long-running impasse in talks, including by delineating, and communicating, a clear plan for gradual, reversible sanctions relief for Russia in response to measurable progress.
  • Develop and propose economic incentives to aid and support Kyiv’s planning for Donbas’s eventual reintegration, to include proposals for restoring social, economic and transport links between government-controlled and separatist-held Donbas.

Political Stalemates

In December 2019, as French, German, Ukrainian and Russian leaders met in Paris to hold their first Normandy Format meeting to advance the Ukrainian peace process in three years, there seemed to be cause for hope. With a new Ukrainian president, Volodymyr Zelenskyy, who had averred his commitment to peace both on the campaign trail and upon taking office, the summit might have been a first step on a new path after years of stalemate and disappointment.

A year and a half later, those hopes are foundering. The conflict parties have taken only two of the seven joint steps promised in Paris: Kyiv and the Russian-backed leadership of the self-proclaimed Donetsk and Luhansk People’s Republics in Donbas exchanged detainees in December 2019 and April 2020, and Kyiv and Moscow agreed to a ceasefire starting 27 July 2020. But other important steps – including, crucially, disengagement of forces from front lines, demining, particularly around key infrastructure facilities located on the line of separation between Ukrainian and separatist forces, and full access for the Organization for Security and Co-operation in Europe (OSCE) monitoring mission – remain outstanding.

Moreover, even the slim progress made in 2019 and 2020 has begun to unravel. By March 2021, the ceasefire, the most successful of the many reached since the war began, had collapsed. As shelling and sniper fire resumed across the line of separation, a new crisis emerged. Russian troop build-ups near Ukraine in late March and early April sparked fears of a return to large-scale combat. The Kremlin said the soldiers were conducting routine training, but the deployment of paratroopers to Crimea, which Russia annexed in 2014, and establishment of a base camp at Voronezh (a few hours’ drive from the Ukrainian border) were nonetheless unusual and, understandably, alarming for Kyiv and its Western allies. When Ukraine asked for help, European countries, the EU, U.S. and UK spoke supportively but took no overt action in response.

At the end of April, ten days after Presidents Vladimir Putin and Joe Biden discussed a possible summit in a call, Moscow announced that the troops had completed their training and would be coming home. The announcement helped assuage concerns (although leaving unclear what precisely Moscow’s motives had been), but by then relations between Russia and the West were taking new twists and turns. In mid-April, the Czech Republic made public its findings of Russian involvement in a 2014 explosion at a Czech munitions depot and announced the expulsion of eighteen Russians affiliated with Moscow’s mission in Prague. Further expulsions by both sides ensued, with other European countries also expelling dozens of Russian diplomats. At around the same time, Washington announced its own expulsions of Russian diplomats along with new sanctions in retaliation for Russia’s alleged hack of U.S. government infrastructure through software provided by the SolarWinds company. In response, on 14 May, Russia said it deemed the Czech Republic and the U.S. “unfriendly” countries, curtailing the staff of their diplomatic missions. Then on 19 May, Washington imposed sanctions on a total of thirteen Russian vessels involved in laying the Nord Stream 2 pipeline, which will bypass traditional routes for which Russia pays lucrative gas transit fees to Ukraine and pump Russian gas directly to Germany.

Yet amid the rancour there are positive signs. Even as the new U.S. sanctions were announced, when Putin and Biden’s top diplomats met in Iceland in preparation for their possible summit in June, they noted their differences but struck an optimistic tone. Moreover, the Kremlin and Kyiv were exchanging invitations for summits of their own: Zelenskyy invited his Russian counterpart to meet in Donbas and Putin countered with an invitation to Moscow – although only to discuss issues unrelated to the war. Ukraine and Russia confirmed in late May that preparations for a meeting between Putin and Zelenskyy were under way.

But for there to be any chance of progress toward resolving the Donbas conflict, itself necessary for improving relations between Moscow and the West, the parties will need to address certain core areas of disagreement relating to implementation of the Minsk agreements. Among the most contentious is a Minsk requirement that Kyiv grant local autonomy (“special status”) to the separatist-held areas and hold local elections there in exchange for Ukraine regaining control of its eastern border. Ukraine says it cannot run credible polls in these regions until it has reassumed territorial control, and indeed its parliament has prohibited elections without first regaining such control. Russia says Minsk is clear: elections and special status come first, control only afterward. Moving past this fundamental impasse will be hard, but in theory, a deal is possible. The parties might agree, for example, that the OSCE and UN will monitor the border and region as a whole while elections are held, in order to assuage Kyiv’s concerns about their integrity.

The longer the war continues, the more positions harden, and the more difficult concessions seem.

In practice, however, the longer the war continues, the more positions harden, and the more difficult concessions seem. Complicating things further, Moscow sees Donbas-related sanctions as part and parcel of a broader Western pressure campaign, with Ukraine only one component. Russia is particularly rankled by what it perceives as the EU’s interference in its domestic politics. Russian parliamentary elections scheduled for September are likely to be a source of friction alongside the dispute over Navalny, particularly if, as appears likely, the Kremlin escalates its crackdowns on independent media and opposition. European positions may also harden due to forthcoming polls in European countries – notably Germany in September – in which European leaders will likely fear Russian meddling given Moscow’s previous alleged interference. Broader tensions make it all the harder to find mutually acceptable ways forward on Donbas.

Recommendations for the EU and Its Member States

Still, with Russia reversing its troop build-up and Washington interested in a June summit with Moscow, the EU and its member states may have an opportunity to work with the U.S. and UK to develop a joint deterrence strategy and revive the peace process.

Brussels, Washington and London should coordinate a common approach to deterrence in the face of future threats or aggression in Donbas. The first step would be to reach agreement on both red lines and consequences if Russia crosses them. For these purposes, sanctions, for all their limits, remain the primary non-military tool at the West’s disposal. Existing sanctions could be augmented through steps that would curtail lending to certain Russian enterprises, cut off Russian access to the SWIFT banking network or block Russian purchases of sovereign debt on the secondary market. Moscow is likely to be particularly concerned about the possibility of U.S. secondary sanctions, through which the U.S. could block access to the U.S. financial system for third parties that engage in prohibited transactions. The secondary sanctions could have a negative impact on EU member states, however, and risk adding to transatlantic tensions over the cost to European companies of U.S. sanctions on Nord Stream 2. (On the latter front, in a nod to ties with Berlin, the Biden administration waived sanctions on the company behind the pipeline and its chief executive.) Brussels and Washington should reach as good an understanding as possible about when Europe would back U.S. sanctions of this nature.

As for whether military pressure could be useful for purposes of deterrence, the West’s somewhat muffled response to the Russian troop build-up only reinforced awareness on all sides that neither the U.S. nor European countries want to get drawn into conflict in Ukraine. The Western powers should not make bluffs that Russia could well call. They should be extremely cautious about taking or threatening measures that would increase the likelihood of confrontation – such as putting Western advisers on the front line in Ukraine. While ramping up the provision of weapons to Kyiv might be less risky, doing so is not likely to yield the kind of battlefield advantage that would change Moscow’s calculations.

Whatever combination of economic and other measures the EU, U.S. and UK agree upon, they should communicate clearly to Moscow what their red lines are and what the consequences will be for crossing them.

Whatever combination of economic and other measures the EU, U.S. and UK agree upon, they should communicate clearly to Moscow what their red lines are and what the consequences will be for crossing them. Sending the message through quiet rather than public channels may give Moscow more political room to absorb it without reacting counterproductively. To maximise the usefulness of sanctions as leverage, the Western powers should not threaten measures that they would be unwilling or unable to rescind in the event that Russia reverses course.

As the EU and its partners are developing their approach to deterrence, they should also be focusing on easing tensions on the ground and encouraging dialogue. This means getting the parties back to the table, ideally for a near-term summit among the Normandy Four and possibly the U.S. Either before or at the summit, France and Germany could press for a suite of de-escalatory measures: for example, returning to the July 2020 ceasefire; broader and freer access for OSCE ceasefire monitors; a roadmap to restoring civilian freedom of movement across the line of separation; and broader military deconfliction and resumption of prisoner exchanges.

Ideally, over the course of the summit and ensuing negotiations, the EU, U.S. and UK would also present Moscow with incentives for charting a path out of the current standoff. They could, for example – as Crisis Group has argued before – offer the Kremlin a concrete plan to exchange the lifting of specific Minsk-related sanctions (eg, against banks and companies) for specific Russian military and political concessions in Donbas (eg, compromises on the Ukrainian border, disarmament of combatants or flexibility on special status). The proposal would make clear that should Russia or its proxies renege, the sanctions will be reimposed. There is some risk in this course of action: should Russia pocket the concessions and then backslide, Brussels may find it difficult to cobble back together the consensus required for the reimposition of sanctions. But if the U.S. and its European partners are not ready to use sanctions relief to motivate incremental progress by Moscow, the combination of high demands and inflexible tools offers little hope of breaking the deadlock.

Brussels should also work with Kyiv to encourage flexible thinking along the lines suggested above about how to work through the impasse over “special status” and begin planning for the near-term reintegration of Donetsk and Luhansk. The latter point is controversial: on one hand, Zelenskyy’s team has rallied to produce a roadmap for reintegration, but on the other, they appear to increasingly favour relegating the task to a distant and speculative future. If Brussels wants to help reverse this tide, it should keep up its promises of an EU economic support package to help rehabilitate the war-torn region, as well as offer plentiful guidance on overhauling Donbas’s fossil fuel-dependent economy. As further preparation for reintegration, Brussels should also maintain pressure on Kyiv to build an independent judiciary and adopt transitional justice legislation that encourages combatants to disarm and provides a framework for the fair trial of accused war criminals on both sides.