Ukraine: Minsk summit breaks down

The summit organized by the OSCE on Saturday in Minsk, which aimed to end the months of fighting between the Ukrainian military and separatist groups came to an end just hours after the meeting was convened. The talks ended with “no signature” on any proposals, and discussions were unlikely to resume the following day. One diplomatic source who reported to CNN said that differences were very wide and the atmosphere was described as “not fruitful [sic] to agreement or cooperation.”

The representatives present at the meeting were the Ukrainian government, Russian government and OSCE mediators, as well as representatives from the Donetsk People’s Republic and Luhansk People’s Republic. These talks, which were an agreed extension of high-level discussions that took place in Astana, Kazakhstan between Russian, German, and OSCE officials is indicative of how unwilling stakeholders are to come to the negotiating table at the present time.

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News Briefs:

  • The government of Mongolia has arrested 3 mining executives on tax evasion charges, including one American and two Filipinos for a sentence of five years, which has put to rest a case that has deterred investors. Resource nationalism in Mongolia has been a consistent stumbling block of the economy’s health, which saw foreign direct investment decline 71% last year. The men, besides being imprisoned, were employees of the Canadian SouthGobi Resources, Ltd. which was fined an additional $18 million.
  • More artillery fire has killed another 12 in eastern Ukraine over the weekend. Many are targeted in areas like bus stops and community centers where aid is distributed. It is unclear which side was at fault for the latest barrage, but both sides have access to advanced rocket artillery technology. The UN expressed its concern that increasingly there is evidence of collateral damage of civilians and their property.
  • Iranian President Hassan Rouhani has publicly accused Iran hardliners of impeding prospects for a nuclear deal, in what is seen as a growing cleavage between domestic groups in Iran, one dominated by religious clerics who favor independence and aggressive military policy at the expense of sanctions and the other more focused on restoring economic health at the cost of the nuclear program. Rouhani accused these hardliners of cheering on the other side.
  • The official 2015 Russian GDP estimates are down 3 percent, far more optimistic than most investors’ generous forecasts of a 4-5% slowdown. New growth predictions were released by Russian Economy Minister Alexei Ulyukayev, and assumed an average 2015 price of $50 a barrel, which accounts for no further decreases in price. Oil and gas revenues and taxes account for roughly half of federal budget revenues, and it was already announced that a 10% cut in budgets across all ministries was being considered.
  • Another currency devaluation for Kazakhstan appears to be inevitable, as the European Bank for Reconstruction and Development (EBRD) lowered its forecast for economic growth in Kazakhstan to 1.5%, despite its estimate last September being a startling 5.1%. Last February, investors and citizens were shocked and angry after a 19% devaluation against the dollar occurred almost overnight. Devaluation is expected due to two factors: low oil prices and the depreciation of the Russian ruble, but for Kazakhstan the lower price of oil is the far more salient factor.
  • Silk Road Reporters has an interesting article on new military aid from the US to Uzbekistan. US Deputy Assistant Secretary of State for Central Asia Daniel Rosenblum called the aid “non-lethal” and “defensive” vehicles, and constitutes the largest donation of military aid to a Central Asian country ever. Military sanctions have been lifted on Uzbekistan since 2011, when they were imposed in 2004 for opposing basic political freedoms. The US maintains that the aid is not a tacit endorsement of the regime.

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