September 28th, 2015
By: Inessa Sinchougova (text and translation)
In 2014, a referendum was held to see whether Crimeans wished to join the Russian Federation or stay a part of the Ukraine. Around 83% of Crimeans turned out to vote, resulting in a 97% vote to secede from Ukraine.
Contrary to common knowledge, the Crimea was a part of the Russian Empire before it was gifted by Kruschev to the Ukraine in 1954. This happened by one man’s decree, as there was insufficient quorum in the Supreme Soviet (yes the Soviet Union had a voting system!)
A large majority of Crimeans identify as ethnic Russians to this day. In this address, Vitaly Klitschko, in his role as head of Kiev City Administration, urged Crimeans not to take part in the referendum. This is the response that he received.
It is worthy of noting that the Crimean referendum took place during the illegitimate, unelected government of Turchynov in 2014, following the coup d’etat in Kiev. The unelected Prime Minister, during his short tenure and under instruction of the IMF, imposed austerity measures. He removed subsidies on natural gas by 50% and cut pensions by 50% .
And these are only some of the measures: the civil service has been slashed, government owned natural gas companies will be privatized (resulting in higher prices down the road), the ban on selling agricultural land to foreigners has been lifted, and so on. (Joe Biden, the US vice-president’s son, now sits on the board of Burisma, Ukraine’s largest gas producer.)
Who do such austerity measures benefit? Firstly, Western European banks, who will continue to receive principal and interest payments from the IMF, whose bailout loans the Ukraine has now defaulted on. Creditors will get their money back through privatization of state assets.
Secondly, global currency speculators who will be able to sell Ukrainian currency to the Ukrainian central bank at a subsidized price. Also, some large Ukrainian companies will be given export credits (government support) to continue selling to Western Europe. Western European companies that import the Ukrainian exports will be doing so at a more attractive price.
Aided by the IMF as part of ‘foreign direct investment’ requirements of a EU/IMF bailout deal, multinationals will ‘invest’ in the Ukraine. Western banks will be paid significant fees (and allow Ukrainian banks to share as junior partners in the process). When multinational corporations overrun Ukrainian industries, the country will become integrated into multinational corporations’ global expansion and production plans.
Downsizing and ‘restructuring’ of key industries will follow. Ukrainians will lose jobs, their wages stagnate and benefits are cut—as is the case going on globally for workers across all industries today, including the EU and USA. This scenario is not specific to the Ukraine.
I can’t say the previous government was not corrupt, because it was. But it is difficult to conclude that Crimea didn’t do the right thing for most of their population by joining Russia. A year on, it is evident that the Crimea escaped the same destiny as that of Greece.
As a side note, one of the first things that Putin did when he came to power in Russia in the 2000s, is repay all IMF loans accumulated under the Yeltsin years, and he did so much ahead of schedule. This was done as part of a long term strategy that ensures this organisation never has leverage over Russia. (Mrs Lagarde of course, head of IMF, earns a tax-free salary.)