Sunday, November 03, 2013

Will the IMF be a Player in the EU-Russian Tug-o-war Over Ukraine?

The increased coziness with the EU has annoyed Moscow, which wants Ukraine to instead join the customs union it has formed with several other former Soviet republics. As in other similar cases, there have been vague threats that Moscow might use its control of energy resources to punish Kiev for tilting westward. Lithuania's president said recently that Ukraine faces "huge, huge pressure from Russia" not to ink the agreement with the EU.

If Ukraine persists, there's a real chance of economic retaliation from Moscow. And that in turn could put the International Monetary Fund smack in the middle of the high-stakes dispute.


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