Ukraine Q&A

Lots of queries around Ukraine, so I thought I would put my points down in Q&A format

Q? So is it really all about Donbas?

Hell no. But it was also not about NATO expansion or perceived security threats to Russia from NATO or Ukraine. It’s about Putin’s obsession with Ukraine and the fact he just cannot accept Ukraine’s right to exist as an independent, sovereign state, able to make its own decisions and the ability of its peoples to live freely as they chose. Putin wants a vassal state in Ukraine, to live under Russian subjugation. Read the essay which he wrote last summer and distributed to every member of the Russian armed forces. It spelled it all out and gave Russian troops the ideology for going to war. In that essay he dismissed Ukrainians’ separate identity and right to exist as distinct from Russians. For Putin Russians and Ukrainians are one people. And this war he is waging is about bringing them back together and putting right what he saw as the biggest catastrophe of the 20th century - the collapse of the USSR. It’s about a Greater Russia agenda.

Q? So why now the message that the focus is Donbas?

Answer - I think it is clear that Russia’s military campaign has gone spectacularly wrong. As Mike Kofman says the Russian military had too many centres of gravity to the point that they had none. Three fronts, in effect but with none really having sufficient force strength to succeed. Intelligence was lacking - they thought that Ukrainians would not fight and would welcome Russian troops with open arms. Tactics were poor - they played to Ukrainian strengths by putting boots on the ground and leaving their troops exposed to overwhelming numbers of Ukrainian insurgents. Morale was low - not helped by the fact the Kremlin lied to its own people saying no war was coming. Imagine a Russian soldier hearing the Kremlin say that they were not stupid enough to be pulled into an Iraq/Afghan style war in Ukraine, only for them to be sent into exactly that war. And kit has underperformed. The myth that Russian military technology is quality and much better value for money has been exploded - whereas only 40% of Russian cruise missiles seemed to explode. This came after Russian military kit was trounced in the recent conflict in Nagorni Karabakh by Israeli and Turkish technology. Russian military arms sales will suffer for years to come because of this.

So now saying the focus is on Donbas, and was all along, is just a face saving exercise. Even if Russia manages to take the whole of Donbas, and perhaps even secure a land corridor to Crimea, this is still a huge military failure by Russia.

Yes, they might take Donbas, what is left of it, and that land corridor to Crimea, but at what cost?

First, likely this will have cost the lives of thousands (anywhere from 1,351 to 15,000 already) of Russian soldiers. Likely more died than during a near decade of conflict in Afghanistan and multiples more than the U.S. lost in Afghanistan and Iraq combined. Large numbers of body bags will be going home to Russian mothers.

Second, thousands of Ukrainians have been killed. Russia has brutalised the population of a Ukraine it now aims to rule. Most of the young and economically active population will have left. How is Russia going to rule this territory? It is just insane in particular that Russia has been bombing civilians in cities like Kharkhiv, Sumy and Mariupol which are mostly Russian speaking and historically more inclined towards Russia. No longer.

Third, having destroyed most of the economic infrastructure in now occupied lands, the rebuild costs will be immense - likely hundreds of billions of dollars.

Fourth, but because of this invasion Russia will remain under sanctions and will retain international pariah status for years to come - likely until Putin leaves office. Foreign financing will not be provided for reconstruction. Rather the Russian economy is likely to push deep into recession this year and remain stagnant thereafter. Living standards will collapse, inflation soar, shortages will result. The risk is of social unrest as a result.

Fifth, we might debate the timing of when Europe will wean itself off Russian energy, but there is little doubt that it will over the medium term. Russia’s golden goose has been cooked and it will not be laying golden eggs in the future. Putin has revealed to the world that Russia is a threat to the security of Europe and the West will now get the message and cut Russia out of supply chains. That will be devastating long term for Russia.

Sixth, the invasion has further served to unite the Ukrainian population against Russia. If opinion polls had suggested 10-15% support for Russia in Ukraine, that’s likely low single digits now.

And unoccupied Ukraine will re-arm like crazy to prevent another invasion from Russia. The West will assist it therein. So if Putin was unable to take the whole of Ukraine this time around he will never be able to in the future.

Even if Ukraine has to give up NATO membership aspirations and agree to neutral status, through this war it has proven able to defend itself. That ability will be multiplied from now on in.

Putin has lost Ukraine for Russia forever. He will go down as the leader who rather United back Russia with Ukraine but finally lost Ukraine to Russia. Putin the loser.

Q? Why was Russian intelligence so wrong?

Answer: Well it goes back to Putin’s essay and his assumption that Ukrainians are really just Russians. It shows a lazy approach from Russia of not really trying to understand their “enemy”. But anyone who has spent anytime in Ukraine will know Ukrainians are really very different to Russians. Ukrainians are often incredibly frustrating - independent minded. Ukrainian politics is a reflection of that - lots of centres of power, different ideas, lots of leaders. But a bottom up farming based culture I think based on the country’s smallholding/Cossack tradition that Stalin tried to exterminate but failed. Remember Ukrainians fought through two post Soviet revolutions already. They know what they want - a European orientation. And they absolutely know what they don’t want - autocratic rule, and have proven willing to fight and win against that. They will win this time - Slava Ukraini!

Putin thought he could try and invade from Belarus, take Kyiv, kill Zelensky and take off the head and the country would roll over to him - likely because that would happen in Russia. But even if he had succeeded there are plenty of other political leaders in Ukraine who could have taken the baton - Poroshenko, Tymoshenko, the Klitchkos, Avakov, Yatsenyuk, et al but then all the regional mayors who have stood up and been counted like Kim in Mykolayiv.

And then there has been the remarkable spirit of defiance and innovation shown by Ukrainians through this conflict. Traitors taking out Russian tanks. But also the skills to be able to keep the power grid, railways and mobile phone network working despite a month of bombardment. A simply incredible effort. It reminds me a bit of the State of Israel - when your nations very survival is at risk you cannot afford to lose. You have to think quickly and innovate. And this has been the reality since 2014 and the annexation of Crimea and invasion of Donbas. Ukrainians have recognised that there very survival as a nation and race is under threat. They have not relied on NATO and others for their defence. They recognised if they are to survive then it’s up to them in the end. A truly remarkable people. But perhaps there the experience of the Holodymyr, WW2, surviving the Soviet period and post Soviet difficult economic transition.

Putin has got himself into one hell of a fight here.

Q? So where is this conflict going now?

Answer - it seems as though Putin will focus on Donbas, and encircling the 40-50,000 Ukrainians troops in the JFO. He hopes to devastate the JFO, while engaging in long range artillery and missile strikes against Ukrainian cities to sap confidence. His troops around Kyiv are digging in for the long haul but surely are vulnerable to insurgent attacks, with supply lines stretched.

Likely Putin hopes the destruction of the JFO and the attacks on cities will eventually force the Ukrainian leadership to concede defeat.

I also expect Russia to hit Western supply routes into Ukraine to try and dry up arms deliveries that are the life line of Ukrainian defenders.

But it is now clear that Russia cannot take he whole of Ukraine, or even Kyiv. A free Ukraine will endure, remain, even if Russia continues to occupy large swathes of Ukrainian territory for some time to come. The free Ukrainian territory will be a strident buffer against Russia - supported by the West. It will be exactly the anti Putin’s Russia that the Russian President fears.

Q? Do you expect more Western sanctions?

Answer: Existing sanctions will be tightened. I expect the message to countries like Turkey and the UAE which might be seen as conduits for sanctions breaking or arbitrage will be so this at you risk. We will hit you with secondary sanctions if you go down that route.

New targets for Western sanctions will be FATF black listing of Russia, all banks sanctioned, and I think beyond May 25 OFAC will not extend the general licence allowing debt service by Russia. At that point Russia will go into full default - a default which will take years to clear. I also think German resistance to an energy sector blockade will eventually crumple - because opinion polls suggest the vast majority of Germans now support a blockade. It seems to be German big business that is resisting. This resistance is unsustainable.