EU's Rehn promises swift Ukraine aid, plays down Russia sanctions

ATHENS Tue Apr 1, 2014 9:07am EDT

European Economic and Monetary Affairs Commissioner Olli Rehn addresses a news conference on macro-financial assistance to Ukraine, in Brussels March 19, 2014. REUTERS/Francois Lenoir

European Economic and Monetary Affairs Commissioner Olli Rehn addresses a news conference on macro-financial assistance to Ukraine, in Brussels March 19, 2014.

Credit: Reuters/Francois Lenoir

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ATHENS (Reuters) - The European Union will make a swift payment of financial aid to Ukraine, the European Union's economy chief said on Tuesday, dismissing the possibility of economic sanctions against Russia unless it takes more action.

Olli Rehn's comments offered the prospect of quick financial backing from Europe for Ukraine, as Kiev faces a price hike on the gas that it buys from Russia following its attempt to resist interference from Moscow.

The European Union has pledged 11 billion euros as part of a package of support with the International Monetary Fund.

"It is in the interests of Ukraine and Europe to maintain peace and stability on our continent," Rehn told journalists on the sidelines of a meeting of European finance ministers in Athens, saying that the first payment would be "made swiftly".

But while he underscored Brussels' desire to back Ukraine, he played down the idea of stiffer penalties on Russia following its annexation of the Ukraine's Crimea.

"As regards sanctions, no sensible European would want to see economic sanctions," he said, adding that none should be necessary if Moscow too no action.

"In case Russia would not escalate the crisis, then we should be able to avoid this sanctions," he said.

So far, the United States and the EU have imposed personal sanctions against Russian and Crimean officials involved in the seizure of the peninsula and Washington has slapped visa bans and asset freezes on senior business figures close to Russian President Vladimir Putin.

Last month, leaders of the Group of Seven major industrial powers decided to hold off on sanctions targeting Moscow's economy unless Putin took further action to destabilise Ukraine or other former Soviet republics.

"It should be possible for Ukraine to develop closer economic and political ties with the EU and maintain good neighbourly relations with Russia," said Rehn.

(Reporting By John O'Donnell; Editing by Tom Heneghan)

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Comments (6)
SeniorMoment wrote:
This is almost exactly the same kind of appeasement policy that Europe took with Nazi Germany before World War II, just acceptance with in this case mild sanctions that hurt only individuals.
With Ukraine’s reputation though for official corruption the European and IMF funds should be directly controlled by financial auditors from Europe to avoid it just winding up in the pockets of officials while Ukraine’s debt increases. Ukraine too absolutely must phase out the subsidy of fuel, which is exactly opposite European policy which heavy fuel taxes to discourage energy inefficiency. Some phase in of the change though may be necessary so that it coincides with rising standards of living as have happened in Ukraine’s neighbor Poland.

Europe must also bite the bullet and accept fracking rather than assume the USA will simply meet its needs for natural gas and additional oil when Europe has the means and geology to produce its own fuel. Europe needs to be reminded just how energy dependent the USA was on petroleum and natural gas imports just five years ago.

If fracking does significant damage to groundwater supplies in the USA, particularly in parts of the Western USA dependent on ground water, fracking could come to a rapid halt, although it is unlikely to stop where already being done less use of chemicals in the process may be required.

Europe needs to look at energy independence as just as important as food independence for the EU is. No nation can prosper in the long run if it is highly dependent on imported food and fuels. In the case of the USA, food independence has long been an economic mainstay, but fuel independence took effort and risk.

Americans as a whole will not take unlimited risks in fracking for Europe unless it is a temporary situation. Everyone realizes that sooner or later all fuels will be in short supply and the global economy depends on fuel. Burning half of natural gas to fuel conversion of the remainder to liquid natural gas, LNG, simply depletes the nation’s supply twice as fast.

If trade returns to sailing ships global trade will fundamentally change and only the nations with enough energy supplies from whatever sources can prosper. As long as food imports are added value to a nation and not the core calories needed for survival food imports are fine.

Europe will regret its energy and minerals partial dependence on Russia, which in the days of the USSR deliberately moved part of its population to other republics in the USSR as a future way of putting pressure on the nations of the former USSR and so it could to itself justify taking territory from those former USSR nations because of the Russians they accepted. Even the USA now has I understand 6 million people of Russian descent which includes both long established families in American and fresh refugees and immigrants from Russia. Russia under Putin is falling apart and can’t even charge its own people the world price for petroleum products because of the weak, resource dependent economy which doesn’t provide the incomes necessary to pay high prices.

Apr 01, 2014 11:11am EDT  --  Report as abuse
SeniorMoment wrote:
This is almost exactly the same kind of appeasement policy that Europe took with Nazi Germany before World War II, just acceptance with in this case mild sanctions that hurt only individuals.
With Ukraine’s reputation though for official corruption the European and IMF funds should be directly controlled by financial auditors from Europe to avoid it just winding up in the pockets of officials while Ukraine’s debt increases. Ukraine too absolutely must phase out the subsidy of fuel, which is exactly opposite European policy which heavy fuel taxes to discourage energy inefficiency. Some phase in of the change though may be necessary so that it coincides with rising standards of living as have happened in Ukraine’s neighbor Poland.

Europe must also bite the bullet and accept fracking rather than assume the USA will simply meet its needs for natural gas and additional oil when Europe has the means and geology to produce its own fuel. Europe needs to be reminded just how energy dependent the USA was on petroleum and natural gas imports just five years ago.

If fracking does significant damage to groundwater supplies in the USA, particularly in parts of the Western USA dependent on ground water, fracking could come to a rapid halt, although it is unlikely to stop where already being done less use of chemicals in the process may be required.

Europe needs to look at energy independence as just as important as food independence for the EU is. No nation can prosper in the long run if it is highly dependent on imported food and fuels. In the case of the USA, food independence has long been an economic mainstay, but fuel independence took effort and risk.

Americans as a whole will not take unlimited risks in fracking for Europe unless it is a temporary situation. Everyone realizes that sooner or later all fuels will be in short supply and the global economy depends on fuel. Burning half of natural gas to fuel conversion of the remainder to liquid natural gas, LNG, simply depletes the nation’s supply twice as fast.

If trade returns to sailing ships global trade will fundamentally change and only the nations with enough energy supplies from whatever sources can prosper. As long as food imports are added value to a nation and not the core calories needed for survival food imports are fine.

Europe will regret its energy and minerals partial dependence on Russia, which in the days of the USSR deliberately moved part of its population to other republics in the USSR as a future way of putting pressure on the nations of the former USSR and so it could to itself justify taking territory from those former USSR nations because of the Russians they accepted. Even the USA now has I understand 6 million people of Russian descent which includes both long established families in American and fresh refugees and immigrants from Russia. Russia under Putin is falling apart and can’t even charge its own people the world price for petroleum products because of the weak, resource dependent economy which doesn’t provide the incomes necessary to pay high prices.

Apr 01, 2014 11:11am EDT  --  Report as abuse
SeniorMoment wrote:
This is almost exactly the same kind of appeasement policy that Europe took with Nazi Germany before World War II, just acceptance with in this case mild sanctions that hurt only individuals.
With Ukraine’s reputation though for official corruption the European and IMF funds should be directly controlled by financial auditors from Europe to avoid it just winding up in the pockets of officials while Ukraine’s debt increases. Ukraine too absolutely must phase out the subsidy of fuel, which is exactly opposite European policy which heavy fuel taxes to discourage energy inefficiency. Some phase in of the change though may be necessary so that it coincides with rising standards of living as have happened in Ukraine’s neighbor Poland.

Europe must also bite the bullet and accept fracking rather than assume the USA will simply meet its needs for natural gas and additional oil when Europe has the means and geology to produce its own fuel. Europe needs to be reminded just how energy dependent the USA was on petroleum and natural gas imports just five years ago.

If fracking does significant damage to groundwater supplies in the USA, particularly in parts of the Western USA dependent on ground water, fracking could come to a rapid halt, although it is unlikely to stop where already being done less use of chemicals in the process may be required.

Europe needs to look at energy independence as just as important as food independence for the EU is. No nation can prosper in the long run if it is highly dependent on imported food and fuels. In the case of the USA, food independence has long been an economic mainstay, but fuel independence took effort and risk.

Americans as a whole will not take unlimited risks in fracking for Europe unless it is a temporary situation. Everyone realizes that sooner or later all fuels will be in short supply and the global economy depends on fuel. Burning half of natural gas to fuel conversion of the remainder to liquid natural gas, LNG, simply depletes the nation’s supply twice as fast.

If trade returns to sailing ships global trade will fundamentally change and only the nations with enough energy supplies from whatever sources can prosper. As long as food imports are added value to a nation and not the core calories needed for survival food imports are fine.

Europe will regret its energy and minerals partial dependence on Russia, which in the days of the USSR deliberately moved part of its population to other republics in the USSR as a future way of putting pressure on the nations of the former USSR and so it could to itself justify taking territory from those former USSR nations because of the Russians they accepted. Even the USA now has I understand 6 million people of Russian descent which includes both long established families in American and fresh refugees and immigrants from Russia. Russia under Putin is falling apart and can’t even charge its own people the world price for petroleum products because of the weak, resource dependent economy which doesn’t provide the incomes necessary to pay high prices.

Apr 01, 2014 11:11am EDT  --  Report as abuse
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