Putin orders forces to breakaway Ukraine areas in escalation

President Vladimir Putin announced he is recognising two self-proclaimed separatist republics in eastern Ukraine, a dramatic escalation in Russia’s standoff with the West as the U.S. and its allies continue to warn it could soon invade its neighbour.

The decrees signed by Putin included an order to send what he called “peacekeeping forces” to the breakaway regions of Donetsk and Luhansk. Russia gave no details so far on how many troops might go in, or when, but Moscow has previously accused Ukraine of having a significant deployment of its own soldiers on the line of contact with the separatists.

Ukrainian President Volodymyr Zelenskiy urged calm in a late-night address to the nation, saying Putin has in practice merely “legalised” troops already present in self-proclaimed republics since 2014. He assured his citizens that Ukraine’s borders were safely guarded, saying “there are no reasons for your sleepless night.”

Yet hours later at an emergency meeting of the United Nations Security Council, Ukraine’s ambassador to the global body warned there “will be a further invasion.”

“Putin said himself he’s going to send additional troops to Ukraine,” envoy Sergiy Kyslytsya said in response to a reporter’s question on whether the Russian leader plans to invade. “Read Putin’s words.”

Russia’s latest move generated condemnation from the U.S., European Union and nearly all representatives of the UN Security Council who spoke on Monday night. China’s ambassador to the UN, Zhang Jun, called on all sides to exercise restraint in brief remarks.

President Joe Biden issued an executive order prohibiting U.S. investment, trade, and financing to separatist regions of Ukraine, and Ambassador Linda Thomas-Greenfield said additional American sanctions against Russia would be coming on Tuesday.

Hope for Diplomacy

A senior administration official separately told reporters the steps are separate from the more severe economic measures the Biden administration has warned it would impose should Putin move forward with an invasion. The official said the White House was still open to a meeting between Biden and Putin - predicated on Russia not proceeding with an attack. But Russia is continuing to prepare for military action that could occur in the coming hours or days, the official said.

“We are committed to finding a diplomatic resolution that avoids a brutal and costly conflict, but diplomacy cannot succeed unless Russia changes course,” the U.S. State Department said in a statement Monday night.

While the U.S. and its allies have warned that any intervention in Ukraine would prompt severe economic sanctions against Russia, it is not certain how far they may go in response to Putin’s decision to recognise the breakaway regions. They have also made clear they would not send troops into Ukraine themselves if Putin attacked.

Equity Selloff

Russia’s stocks and the ruble were the worst performers globally on Monday. The ruble weakened to 80 per dollar during Putin’s televised address and stocks slumped as much as 18% in evening trading. A global equity selloff extended into Asia on Tuesday, with regional stocks and the U.S. index futures sliding. Shares of Moscow-based United Co Rusal International PJSC in Hong Kong plunged as much as 22%, their biggest drop since April 2018.

Putin signed aid and cooperation pacts with the separatist leaders at a Kremlin ceremony recognising their “independence and sovereignty” after a televised address to Russians late Monday. He followed up with a demand that the government in Kyiv stop all military action immediately or bear full responsibility for “the possible continuation of bloodshed.”

Still, it is still unclear what his announcement means for the risk of a large-scale Russian invasion of Ukraine that the U.S. and NATO have warned about for months. They accuse Russia of massing more than 150,000 troops near Ukraine in preparation for a possible attack, something the Kremlin has repeatedly denied. Putin said at a meeting of his Security Council Monday that Russia was not considering the question of annexing the two territories.

The decree is the latest move in Putin’s 20-year campaign to restore Russia’s dominance over its former Soviet neighbours and prevent them forging closer ties with the West, particularly with the North Atlantic Treaty Organization. The Russian leader has railed against NATO’s expansion into the east and raised the stakes in the latest crisis by demanding the military alliance exclude Ukraine from future membership and roll back its forces to positions they held in 1997.

The Russian president’s decision to recognise the separatists effectively torpedoes years of diplomatic efforts to implement a peace accord to resolve a conflict that has killed 14,000 since Russia-backed separatists seized control of the two areas in 2014. In his address to Russians late Monday, Putin devoted part of his argument to a historical recitation aimed at showing that Russia’s former Soviet neighbours were created by the Bolsheviks and do not deserve to be considered as genuine independent states.

News of the decree drew rebukes from across the EU, including smaller states located in the bloc’s far east. The U.K. is set to impose sanctions on Russia as soon as Tuesday, and the EU will start the process of agreeing penalties for Putin’s move, diplomats familiar with the conversations said.

“I don’t know what is in his mind,” U.K. Prime Minister Boris Johnson told a Downing Street press conference. “There’s a chance he could row back from this.”

While Russia will argue that Putin’s recognition of the separatist regions gives a legal basis for the presence of its troops, the move risks putting his forces closer to direct confrontation with Ukrainian soldiers.

“We can say the worst hasn’t happened - a major new war hasn’t started, at least for now,” said Andrey Kortunov, head of the Kremlin-founded Russian International Affairs Council. “But after the recognition we’re likely to see Russian troops deployed up to the border with the rest of Ukraine and this will be seen as an act of aggression with all the consequences.”

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