Ukraine’s parliament voted for the bill allowing the Cabinet of Ministers to impose tit-for-tat sanctions against Russia. The amendment to the law of Ukraine on International Business Activity authorizes economic penalties against Russia in response to discriminatory actions of the aggressor state. 291 MPs, that is more than necessary number of lawmakers (226) voted in favor of the bill. The law will come into effect starting from January 1, 2016. Ukraine’s Economy Ministry has already suggested banning import of several Russian products from January 10, 2016. The list includes restrictions on baked goods, flour confectionery, chocolates, meat, fish, coffee, black tea, baby food, filtered cigarettes, beer, vodka and other goods. Ukraine’s Prime Minister Arseniy Yatsenyuk said that Ukraine would consider avoiding the sanctions if Moscow cancels product embargo on Ukraine and implements agreement with Ukraine on the Free Trade Zone.

The Ukraine’s decision followed Russian move to impose economic sanctions on Kiev due to its joining of anti-Russia sanctions by the European Union and the U.S. The decree signed by the Russian Prime Minister Dmitry Medvedev considers sanctions against Kiev from January 1, 2016 instead of free trade zone agreement in the framework of CIS. The existing framework implies duty free import of all Ukrainian goods to the Russian Federation, excluding sugar. Ukraine estimates $600 million in economic losses as a result of the sanctions.

Ukraine and the European Union signed an agreement on free trade that comes into effect starting from January 2016. Last-ditch negotiations in Brussels that aimed to address Russia’s concerns, failed without producing any tangible results. Moscow says the trade accord will allow cheap EU products into Ukraine that can eventually make their way into the Russian market, Ukraine cannot take part in two free-trade zones according to Medvedev. These developments took place along the extended EU and U.S. sanctions on Russia. On 21 December, 2015 the European Council prolonged EU economic sanctions against Russia for six more months due to Russia’s failure to comply with the Minsk Agreement. With the same reason, the U.S. tightened economic pressure on Russia by further sanctions on dozens of individuals and companies linked to Russian activities in Ukraine.

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News Briefs:

• Afghanistan is planning to form a 7,000-member security force to protect Turkmenistan-Afghanistan-Pakistan-India (TAPI) gas pipeline on its territory. The force will provide security for the project during the implementation and demining the pipeline route in the territory of Afghanistan. Clearing the pipeline passage is already planned to start in April 2016. An intergovernmental joint security task force will also be proposed. The project faces considerable logistical challenges as it will pass through the territories of Afghanistan and Pakistan threatened by Taliban and separatist insurgents. Contraction of the 1,800km long pipeline has already started earlier in December and is intended to be completed by December 2018.

• Georgian parliament has approved Georgi Kvirikashvili as a candidate for the prime minister post. The vote took place after Irakli Garibashvili has unexpectedly resigned without giving a specific reason for his decision. Kvirikashvili, 48, who was a deputy prime minister before, said he will continue Euro-Atlantic integration and a pragmatic policy towards Russia. He became the economy minister after the Georgian Dream coalition came to power in 2012 and was appointed foreign minister in September this year. Kvirikashvili spent most of his career in financial and banking sectors and was a director of former Prime Minister Bidzina Ivanishvili’s Cartu Bank.

• The Russian oil company, Lukoil decided to pull out of Lithuania and Latvia. Its subsidiary Lukoil Batlija operating 109 gas stations in Lithuania and other Baltic states announced about its decision to sell its assets due to political situation in these countries. As the Lukoil president Vagit Alekperov said the selling decision owes to anti-Russian sentiments in Lithuania and Latvia. Lukoil has already withdrawn from businesses in some other European countries, including selling 37 gas stations and assets in Estonia.

• Iran fired rockets close to American aircraft carrier USS Harry S. Truman in the Strait of Hormuz. The incident occurred shortly after the Iranian navy announced about a plan to conduct a live-fire training exercise. The U.S. Command spokesman called the event contrary to efforts to ensure freedom of navigation and maritime safety in the global commons. The carrier arrived in the Persian Gulf to support coalition airstrikes against ISIS in Iraq and Syria.

• Estonia’s national airline Estonian Air is declared bankrupt. An Estonian court has formally made the declaration after the airline ceased operations last month following the European Union order to repay millions in state aid. The EU executive committee said that Estonia has breached EU rules by injecting capital into the ailing carrier for years and imposed 85 million euros payment to the airline plus interest to the Estonian taxpayers. The Estonian government already established a new airline, Nordic Aviation Group earlier this year that started operation immediately after the EU decision.

• Russian envoy says the U.S. and NATO failed operations in Afghanistan. Russian president’s special envoy for Afghanistan, Zamir Kabulov called the U.S. mission a complete failure in evaluating the ISAF effectiveness. He said the U.S. has not accomplished any of the tasks it had set before the operation, including preparing Afghan governmental forces who “lack arms and equipment, as well as an insufficient level of training and low morale”. Kabulov also stressed that Russia is ready to help Afghanistan deal with its security issues and is flexible over a potential easing of the UN Security Council’s sanctions regime against Taliban if it does not contradict the Afghan national interests. Russia is expected to deliver 10,000 AK047 assault rifles to the Afghan army in January 2016 and is holding talks about helicopter shipments. As Kabulov mentioned, Russia has delivered 57 KAMAZ trucks, worth $2.5 million to Afghanistan free of charge.