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Ukraine Legalizes Blockade on Rebels, Sanctions Russian Banks

France says blockade will heighten tensions, following a series of provocative moves by rebels and Moscow.

17 March 2017

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Ukraine announced sanctions on five Russian-owned banks yesterday, a day after imposing a rail and road blockade on transport from rebel-held areas in the eastern Donbas region. Only humanitarian supplies will be exempt from the blockade, Ukraine’s national security council said, according to Deutsche Welle.

 

The blockade follows the move by the two breakaway “people’s republics” to seize many Ukrainian-owned businesses. Trade across the front lines has continued unabated during the three-year war, as both sides depend on Donbas coal for heavy industry and power generation. The Ukrainian central bank said economic growth could fall by half this year unless trade resumes, DW reports.

 

Ukraine began implementing the blockade yesterday, also announcing the sanction on five Kremlin-controlled banks, The Irish Times reports.

 

The Kremlin denounced the banking sanctions.

 

Peskov_100
“Of course, we will if necessary use all available and legal methods to defend the interests of our credit and financial institutions,” Kremlin spokesman Dmitry Peskov (pictured) said. “Really, the Ukraine situation is scary because of its tendency towards further deterioration and an increase in tension,” he added.

 

France and Germany yesterday expressed concern about the latest developments in Ukraine. The French Foreign Ministry said Russia’s recent decision to recognize documents issued by Ukrainian separatists, and rebels’ seizure of Ukrainian assets, were raising tensions, and also said it was “very concerned” by Ukraine’s transport blockade, the Irish Times says.

 

Kyiv has in effect legalized the informal rail blockades run by nationalist groups since January. The government had earlier criticized such actions, and this week dismantled a camp used by blockaders and detained 40 activists, who were later released, Politico reports.

 

Small demonstrations in support of the blockaders took place in Kyiv and other cities, and protesters vandalized the offices of two Russian banks in the capital.

 

The government’s recent actions show that nationalist protesters have “increasingly shaped the country’s political agenda,” The Associated Press writes.

 

 

  • The five banks hit with sanctions include Russia’s largest, Sberbank; the second-largest, VTB; and the development bank Vnesheconombank. All are state-owned, the AP says.

 

  • Ukraine will receive a further 600 million euros ($645 million) in EU aid, the European Commission announced yesterday, bringing total EU funding since 2014 to 2.8 billion euros.

 

  • Most of the assets seized by rebels belong to companies controlled by Ukraine’s richest man, Rinat Akhmetov, DW says.

Compiled by Mate Mohos

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