HomeAnalyticsDaily Highlights: 19/10/2014

Daily Highlights: 19/10/2014

Ukraine is establishing a controlled border with DPR and LPR. Situation in the conflict zone in Donbass remains tense. A law enforcing a stricter liability for interference in the election process has been signed. Resolution of the natural gas issue has been postponed until the next week.

Ukraine

●      President Poroshenko signed the law, which is toughening responsibility for breaching elections rights of citizens, in particular for voters bribery, for influence on elections commission members and for intrusion to the election process. Police has already opened 144 criminal cases for episodes of bribing voters.
●      Prime Minister Yatsenyuk believes that lustration of government officials and judges according to the newly adopted «Authorities purification act» is fully possible to accomplish in 2 years.
●      Presidential party “Poroshenko block” is ready to sign a coalition agreement with «Narodny Front» party before the elections. The result of the elections, as per Prime Minister Yatsenyuk opinion, should be new a government and a new coalition.
●      New Military Prosecutor stressed, that Russian security services are behind the action by National Guard soldiers near the Presidential Administration. SSU Head Nalyvajchenko reported that Russian agents, who’ve financed these protests, have been captured.
●      Head of the Committee on Intelligence Smeshko believes that within the framework of the National Intelligence Program to collect all of the services that control the telecommunications, the type of United States National Security Agency.
Head of the Intelligence Committee Smishko believes that all government services, which control communications, should be brought together within the National Intelligence Program, in analogy to the National Security Agency in the USA.

War in Ukraine

●      Shelling of Ukrainian army positions and residential areas are ongoing in Donetsk and Luhansk regions, in Dokusheivs’k, Mykolaivka, Avdiivka, Donetsk International Airport, Gorlivka, Smile, Debaltseve and Bagmutivka.
Unloading of ammunition from white trucks of  another «humanitarian convoy» has been evidenced in Donetsk and Lagutino.
Firefights using artillery and armored vehicles often occur between different militant groups and the Russian army for the redistribution of spheres of influence.
Overall, the situation in the conflict zone remains tense.
●      Ukraine established border control on the border with the territory controlled by DPR  and LPR.
●      Leader of the terrorists Donetsk «republic» declared that the territory will live according to the Moscow time and that the transition will come into force by the year end.
●      DPR and LPR are getting ready to «nationalize» various properties of Ukrainian oligarchs on the territories they control.
●      Payment of pensions and social security has been renewed in several towns liberated by Ukrainian army in Luhansk region.
●      Russian human rights activist Vasilyeva, who is a founder of the “Cargo 200 from Ukraine to Russia” activist group, announced that Russian army casualties in Ukraine are about 4 300 killed vs 900 officially recognized.
●      OSCE refused to accept drones from Germany motivating the decision by formal impossibility to employ German military specialists within the mission mandate.

International

●      German Intelligence Services confirmed that MH-17 flight was shot down by pro-Russian terrorists.
●      Defense Ministry of Sweeden announced about the launch of a rescue operation to raise a Russian submarine, which is supposedly had an accident in Swedish territorial waters.
●      According to the statement of the Prime Minister Yatsenyuk, an agreement on natural gas supplies has not been achieved at the talks in Milan. However, Ukraine has enough gas in the underground storage facilities to survive the winter. Visit of EU Energy Commissioner Oettinger to Kiev can bring the parties closer to a contract and agreed price.

Trends

●      Reduction and the abolition of custom duties by the EU did not significantly increase the positive balance of foreign trade between Ukraine and the EU, as determining factors are the certification and quotas.
●      Transformation of the Ministry of Taxes and Levies into a fiscal service has not led to an increase in budget revenues. As local currency depreciated more that 1.5 times, “tax pits” continue to operate,  the tax pressure on small and medium-sized businesses has increased, tax administration became even worse compared to the time of ex-president Yanukovych’s regime.

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