Ukraine: Daily Briefing – July 24, 2018, 5 PM Kyiv time

Ukraine’s Ministry of Defense reported at 12:30 PM Kyiv time that in the last 24 hours, no Ukrainian soldiers were killed and two Ukrainian soldiers were wounded in action. In the last 24 hours, Russian-terrorist forces opened fire on Ukrainian positions on the Luhansk and Donetsk sectors of the front 21 times in total, including at least 6 times with heavy weapons – mortars and anti-tank rockets.

Reuters reported on July 23, “Ukraine is preparing to ramp up its borrowing, its new acting finance minister told Reuters on Monday, with plans to restart bond issuance in euros and look at issuing debt in currencies such as China’s yuan for the first time.

          Oksana Markarova said the country would borrow in dollars but also step up issuance in its domestic currency as it looks to manage hefty debts and reduce its sensitivity to exchange rates, which arises from much of its borrowing being dollar-denominated. […]

          Bond issues would help Ukraine to manage $15 billion in foreign currency debt that needs to be repaid or refinanced by 2020 – $8 billion of which is due by next year – with its program with the International Monetary Fund (IMF) well off track. A euro issuance could come this year, depending on market conditions, Markarova said, but issues in other currencies like the yuan are further into the future.

          Ukraine’s plan for servicing its debt would be made public in its upcoming mid-term debt strategy she said. The 2018 budget envisages total borrowing of between $2 billion and $2.5 billion, with Markarova expecting about $1.5 billion of that to come from the market. The rest is expected to come from sources such as the IMF and the European Union.

         Ukraine is still at odds with the IMF over a number of outstanding measures in its $17.5 billion aid program, of which it has received about $8.7 billion so far. Recent tweaks to plans to establish a court to target corruption are believed to have received IMF approval but there is still a stalemate over demands for another rise in gas prices and measures to plug some other recent budget shortfalls. There is no firm date yet for the IMF’s team to visit Ukraine again, though the two sides are in regular contact, Markarova said.”

Writing for the Atlantic Council, Paul Niland stated, “The unarmed men and women in flak jackets and helmets who document Ukraine’s grinding war in the east for the Organization for Security and Cooperation in Europe have my utmost respect. […] The problem is that while these individuals make great sacrifices, the mission itself is compromised by Russia.

          A recent investigative report by German broadcaster ARD has leveled new allegations about the role of the Russian observers in the mission; some of the Russian observers are spies with links to Russian military intelligence.

          According to the ARD report, these Russian individuals have been gathering personal information about other monitors, including personal information like mobile phone numbers addresses, and blood types. True to form, they have also been making notes on potentially damaging or compromising issues, such as drinking habits, sexual activity, and financial issues. The ARD report is consistent with conversations that UkraineAlert has had with former SMM observers who asked not to be named. […]

           In October 2015, Russian national Maxim Udovichenko was expelled from the mission for admitting, when drunk, that he was a Russian spy. Following that incident, a SMM spokesman stated that the mission ‘relies on the good faith of member states to send monitors to the OSCE who will work on the basis of impartiality.’ Are we really relying on Russia to act in ‘good faith’? Still?

More reporters need to dig into this story. We have encountered allegations that Russian observers have changed field reports as well, but additional reporting is required to verify this claim.  […]

          The argument will be made that there have to be Russian monitors because any mission constituted by the OSCE requires a mandate that is unanimously backed by all 57 OSCE member states, and Russia is a member, so they essentially have an ultimate veto. Without Russia’s sign off on how the mission is constituted, there would be no mission at all. Technically, this is true, but there’s a precedent for excluding them.

          During the Balkans conflict, Yugoslavia was obviously a party to the conflict, and it was set aside; decisions were then made on a new basis simply called ‘unanimity minus one.’ The restriction of voting rights within the OSCE is a sanction against Russia that should have been imposed long ago. […]

          The OSCE SMM has been compromised. It cannot serve in the unbiased way that it is meant to as long as there is a gaggle of Russian spies sitting in the heart of the mission that is designed to inform the world about events from a conflict that Russia itself has created. The only way around this problem, and the only appropriate sanction against Russia for its deliberate efforts to compromise the mission, not to say endangering the monitors involved, is the unanimity minus one principle. […] The OSCE must move to immediately suspend any Russian input whatsoever in the mission they are clearly trying to undermine from within.
The full report is available here: Russia has no place in the OSCE Special Monitoring Mission in Ukraine

Ukraine Business Journal reported, “Hutchison Ports, one of the worlds largest port operators, is ready to enter the Ukrainian market. The company – privately incorporated in the British Virgin Islands – has registered a Ukrainian subsidiary in Odesa, according to official state registers. Hutchison specialises in cargo handling, transit and other activities in the field of maritime transport.