By Taras Kuzio
After the fall of president Viktor Yanukovich, the Euromaidan leadership turned to Ukraine’s eastern oligarchs to take charge of the Donbas region. Rinat Akhmetov, one of the world’s 50 wealthiest people, was offered the governorship of Donetsk, now at the centre of clashes between Ukrainian forces and pro-Russian separatists.
Akhmetov turned the job down and it went instead to Serhiy Taruta, a fellow billionaire who recently told the FT the region’s youth saw a “brighter future in integration with the EU” than in following Crimea into Russia’s embrace.
Akhemtov, however, has preferred to bide his time and trade his support with Kiev and Moscow. Continue reading »
There is no doubt that emerging market (EM) investors have cheered up considerably of late. Following a torrid January and February, virtually all asset classes in the EM universe appear – on aggregate at least – to be gaining in value.
The bellwether stock index, the MSCI EM index, is up 9.6 per cent from its low on February 5. EM sovereign bonds are yielding an average of 5.51 per cent, down 0.37 per cent since January 1. Local currency bonds are, in many cases, producing stellar returns sharpened by windfall currency gains. Indeed, some EM currencies are among the world’s best performers, with the Indonesian rupiah rising 7.81 per cent, the Brazilian real gaining 7.3 per cent and the Indian rupee climbing 2.8 per cent so far this year. Continue reading »
By Danylo Lubkivsky, deputy foreign minister of Ukraine
Putin’s aggression against Ukraine had the same effect on the world as the recent Ebola outbreak had on Africa. Everybody knew it was possible but nobody really saw it coming. Once it happened and the initial shock passed, efforts ensued to localise the pandemic. They are scattered at first, and then more sophisticated, but mostly beside the point, for one reason: Russia’s actions are even more irrational than Ebola. Continue reading »
Simferopol airport: all change
Ukraine’s aviation market has been badly hit by the political turmoil surrounding Russia’s annexation of Crimea. Airlines have been forced to cut flights and adjust networks due to a significant decline in passenger traffic.
Mid-sized commercial carrier Dniproavia issued a statement on Monday saying it would “optimize the operations grid”. Continue reading »
By Ben Aris of bne
When he first assumed power in 2000, the press corps spent the first six months asking one question: “Who is Vladimir Putin?”
At first the media assumed he was a puppet of the oligarchs, handpicked by Roman Abramovich and Boris Yeltsin’s daughter Tatyana Dyachenko, who at the time were effectively running the country. But after Putin moved forcefully to sweep business from the corridors of power and return control of Russia to the centre, everyone had to recalibrate. Continue reading »
By Oleg Batyuk
The barricades are still being dismantled in the Maidan but we are already witnessing a significant step-change in how business is done in Ukraine. While the world is watching events in Crimea with fearfully bated breath, Kiev is not losing any time in implementing serious and rapid changes to its business landscape.
A key risk of doing business in Ukraine, particularly in the past five years, has been the spreading culture of corporate raiding. This process is already being reversed. Continue reading »
By Roland Nash of Verno Investment Research
As the conflict between Russia and the west for influence in Ukraine unfolds, finance has found itself in the unfortunate position of sitting squarely in the front line. From the acceptance by Viktor Yanukovich of a $15bn loan from Russia to the freezing of oligarch bank accounts in the US and Europe, finance has been used as a tool to push the political agenda of both sides.
The immediate consequence has been a fall in the value of Russian assets, the latest of many that have plagued Russia over the past 20 years. If a market correction is the only impact, recent weeks will prove little more than another example of how Russian markets have a tendency to overreact to newsflow. But there could well be a more far reaching impact – and perhaps with rather different consequences from those intended by the US and EU. Continue reading »
By Taras Kuzio
Viktor Yanukovich has been a state official all his working life, first in transport, then as a regional governor of Donetsk, twice as prime minister under presidents Leonid Kuchma and Viktor Yushchenko and finally as president. Corruption has always plagued the Ukrainian state but the extent of rapacious greed fundamentally increased after Yanukovich was elected. He and Nikolai Azarov, his prime minister, did not focus on economic growth but on asset stripping and corporate raiding. Continue reading »
By Nick Davidov
The hallmark of the Ukraine crisis is uncertainty – we simply don’t know how it is going to develop. Normally, this would be a drain on confidence. But as the situation stands, investment remains strong, particularly in Russia’s tech sector. This is because Russian tech companies are fully integrated into the global economy – they don’t just sell products and services to western markets. Major players like virtualisation company Parallels Inc and security software firm Kaspersky are particularly strong in emerging markets. Continue reading »
After paying a record bail of $174m, Russia-linked Ukrainian oligarch Dmitry Firtash – arrested last week at the request of US law enforcement – was released from an Austrian prison on Friday on condition that he does not leave the country.
“The last week has been a testing time for my family and me. I would like to thank personally all of my friends and colleagues who have supported me through this difficult period,” he was quoted as saying in a statement upon release.
But Firtash is not off the hook yet. Continue reading »
Even with the threat of Russian invasion and economic punishment hanging over them, Ukraine’s authorities are busy hunting down what they consider to be the cronies of toppled president Viktor Yanukovich.
The most recent of a dozen or so individuals to be put on the wanted list – some of them former government officials – is Serhiy Kurchenko. Continue reading »
By Bruce Misamore, former CFO of Yukos
As the world flails about looking for ways to get Russia’s attention over the Ukraine and Crimean crises, and Vladimir Putin looks on impassively, the UK has a unique opportunity to take a long overdue and meaningful action: delist Rosneft from the London Stock Exchange. Continue reading »
As tensions between Russia and Ukraine escalate over Crimea, a new front has opened in the simmering chocolate war. Law enforcers in Lipetsk in southern Russia shut down the Roshen confectionery plant on Thursday, choking off the Ukrainian company’s access to the lucrative Russian candy market.
“Police arrived at the Lipetsk plant on Wednesday morning and took away the keys,” Alexander Zolotarev, press spokesman for Roshen CIS, said. “They sent all the workers home. The plant is closed.” Continue reading »
By David Buxton of Arachnys
It is clear in the light of just-released sanctions lists from the EU and the US that neither power has the appetite for serious confrontation with Russia. Indeed, in the short term the sanctions look like having the obverse effect of restoring confidence in the market, which had been spooked by the possibility that serious, systematic sanctions might be implemented. After the release of the lists and Putin’s subsequent speech to the Russian parliament, both the Russian Micex and the FTSE Eurofist recorded strong gains. But the sanctions also highlight the practical difficulties faced by countries hoping to use such punitive measures. Continue reading »
The stronger Russia’s grip on Crimea becomes, the more support is needed for pro-Ukrainian residents and military personnel there. However, the past weeks have demonstrated that government officials in Kiev are failing to provide such support and the burden has fallen to self-organized groups of volunteers. Why is this the case? Continue reading »