In negotiations last October, the IMF demanded that Ukraine double prices for gas and electricity to industry and homes, that they lift a ban on private sale of Ukraine’s rich agriculture lands, make a major overhaul of their economic holdings, devalue the currency, slash state funds for school children and the elderly to “balance the budget.” In return Ukraine would get a paltry $4 billion.
Before the ouster of the Moscow-leaning Yanukovich government last week, Moscow was prepared to buy some $15 billion of Ukraine debt and to slash its gas prices by fully one-third. Now, understandably, Russia is unlikely to give that support. The economic cooperation between Ukraine and Moscow was something Washington was determined to sabotage at all costs. This drama is far from over. The stakes involve the very future of Russia, the EU-Russian relations, and the global power of Washington, or at least that faction in Washington that sees further wars as the prime instrument of policy.