Ukraine Won’t Receive Loan From Russia: What Next?

Ukraine Protest

Ukraine stands on the brink of defaulting on its debts, an occurrence that is looking more and more likely after Russia made the decision not to follow through on a promised loan to the Ukrainian government. This is just one in a long list of concerns for Ukraine’s government at present, most notably the continued protests and unrest in Kiev, set off by a combination of a denied European trade deal — passed up in favor of Russian relations — and a series of restrictive anti-democratic legislation passed in the Ukrainian Rada.

Now, in light of a visit from the European Union’s High Representative, Catherine Ashton, it seems that the EU could be one source of economic support for the struggling nation — though the timing of that support should it come, could be too little too late to prevent default — and Ashton spoke harshly on the remaining violence and government restrictions.

Although there is a sense of violence decreasing, there is still great concern about the situation on the ground, great concern to see that those who have committed violence are brought to justice and a great desire to see some kind of transparent and independent process to achieve that,” said Ashton. She also touched on Constitutional reform, acknowledging the opposition’s desire to return to the constitution of 2004, while adding some of the changes deemed necessary by others.

“Of course we talked about economic issues. I’ve talked many times in the course of the last month about the importance of supporting the economy in Ukraine,” she said, but emphasizing that this would not something “unconditionally” done. “It is really important to see the sort of economic reforms that will be necessary, because this is real economic support and investment,” she said.

Ukraine’s President, Viktor Yanukovych, spoke with U.S. Vice President Joe Biden on Tuesday. According to the White House readout of the phone call, Biden emphasized the need to “take advantage of every opportunity, including offers of international support, to reduce tensions and build trust with the people of Ukraine” in efforts to stabilize the present political crisis. Echoing Ashton’s stance, Biden spoke on the need for “accountability for those responsible for beatings and attacks on journalists and protestors,” mentioning also those protestors still being detained by the government.

The EU mentioned Russia’s importance to Ukraine in a speech given by European Commissioner for Enlargement and Neighborhood Policy, Stefan Fule, on Wednesday — though he skirted around some of the political vying and tensions rooted there. “It is clear we need the dialogue with Russia. Our policy vis-à-vis neighbors should also be a policy vis-à-vis neighbors of our neighbors. If we were serious about reforming that part of Europe, have we been also serious about using the most powerful instrument of transformation?” said Fule.

He noted progress made so far, listing the removal of January 16 undemocratic legislation, the resignation of the Prime Minister and his cabinet, and the imperfect, but still present amnesty legislation, as well as the reduction in violence on the ground from police forces. Even so, he notes that “the case of Automaidan leader, D. Bulatov,” who was tortured and abducted, “has shown that despite these results there are still issues related to fundamental rights we have to watch closely.”

More From Wall St. Cheat Sheet: