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Ukraine reached a preliminary deal with the International Monetary Fund to unlock $27 billion of international support to avert default and limit economic damage from a four-month political crisis.
The government in Kiev reached a staff-level agreement with the Washington-based lender for a two-year loan of $14 billion to $18 billion, the IMF said in an e-mailed statement today. The IMF’s board must still sign off on the package, Ukraine’s third since 2008, and the government needs to complete “prior actions” to receive the first installment.
The government, which came to power after an uprising ousted President Viktor Yanukovych last month, is grappling with an economy threatening to slide into a third recession in six years, dwindling reserves and a weakening currency. Ukrainian asset prices have also suffered as Russia’s takeover of the Black Sea Crimean peninsula sparked European and U.S. sanctions and rekindled memories of the Cold War.
Approval is “expected in April, following the authorities’ adoption of a strong and comprehensive package of prior actions aiming to stabilize the economy and create conditions for sustained growth,” IMF mission chief Nikolay Gueorguiev said in the statement. Disbursement may start next month, he said at a news conference in Kiev.
The United States welcomes the preliminary agreement between the Government of Ukraine and International Monetary Fund (IMF) staff on a loan program of $14-18 billion. This represents a powerful sign of support from the international community for the Ukrainian government, as we help them stabilize and grow their economy, and move their democracy forward. The agreement is expected to unlock roughly $27 billion in total support from the international community for Ukraine's people over the next two years, as the country implements historic reforms to address long-standing problems that have undermined Ukraine’s economic strength and prosperity. It is important now for both the Government of Ukraine and the IMF to move expeditiously and complete the steps necessary to gain approval from the IMF Executive Board.
Together with our allies and partners, President Obama will continue to build international support for the Ukrainian people at this critical time. The IMF program will be a central component of a package of assistance to support Ukraine as it implements reforms and conducts free and fair elections that will allow all the Ukrainian people to determine the future of their country. We are working alongside international partners, including the World Bank and the European Bank for Reconstruction and Development (EBRD), to disburse rapid additional assistance to complement the IMF program and ease Ukraine’s economic transition, particularly for the most vulnerable. As part of this international effort, we are working with Congress to quickly provide a $1 billion loan guarantee and are offering technical and financial assistance to help Ukraine meet its most pressing needs. We also remain committed to providing the IMF with the resources it needs – in partnership with Congress – to provide strong support to countries like Ukraine as well as reinforcing the Fund’s governance to reflect the global economy.
U.S. President Barack Obama waves after delivering a speech at Palais des Beaux-Arts (BOZAR) in Brussels, Belgium March 26, 2014. Earlier in the day, Obama visited the Flanders Field American war cemetery. His visit and the symbolism of transatlantic unity had added resonance at a time when tensions in Europe are running high because of Russia's military occupation and annexation of Ukraine's Crimea region. (Kevin Lamarque/Reuters)
As Prepared for Delivery –
Good evening! Goede avond. Bonsoir. Guten abend. Thank you, Laura, for your kind introduction and for your outstanding work—reminding us that our future will be defined by our young people.
Your Majesties, Mr. Prime Minister, and the people of Belgium—on behalf of the American people, we are grateful for your friendship, we stand together as inseparable allies, and I thank you for your wonderful hospitality. I have to admit, it’s easy to love a country famous for chocolate and beer.
Leaders and dignitaries of the European Union; representatives of our NATO Alliance; distinguished guests – we meet here at a moment of testing for Europe and the United States, and for the international order that we have worked for generations to build.
Throughout human history, societies have grappled with the question of how to organize themselves – the proper relationship between the individual and the state; and the best means to resolve inevitable conflicts between states. And it was here in Europe, through centuries of struggle—through war and Enlightenment, repression and revolution—that a particular set of ideals began to emerge. The belief that through conscience and free will, each of us has the right to live as we choose. The belief that power is derived from the consent of the governed, and that laws and institutions should be established to protect that understanding. Those ideas eventually inspired a band of colonists across an ocean, and they wrote them into the Founding documents that still guide America today, including the simple truth that all men—and women—are created equal.
But those ideals have also been tested – and threatened – by an older, more traditional view of power. This alternative vision argues that ordinary men and women are too small-minded to govern their own affairs, and that order and progress can only come when individuals surrender their rights to an all-powerful sovereign. Often, it roots itself in the notion that by virtue of race or faith or ethnicity, some are inherently superior to others, and that individual identity must be defined by “us” versus “them” or that national greatness must flow – not by what a people stand for, but by what they are against.
In many ways, the history of Europe in the 20th century represented the ongoing clash of these two sets of ideas, both within nations and among nations. The advance of industry and technology outpaced our ability to resolve our differences peacefully, and even the most seemingly civilized of societies descended into barbarism. This morning at Flanders Field, I was reminded how war between peoples sent a generation to their deaths in the trenches and gas of the First World War. Just two decades later, extreme nationalism plunged this continent into war once more—with populations enslaved, great cities reduced to rubble, and tens of millions slaughtered, including those lost in the Holocaust.
It is in response to this tragic history that, in the aftermath of World War II, America joined with Europe to reject the darker forces of the past, and build a new architecture of peace. Workers and engineers gave life to the Marshall Plan. Sentinels stood vigilant in a NATO Alliance that would become the strongest the world has ever known. And across the Atlantic, we embraced a shared vision of Europe; a vision based on representative democracy, individual rights, and a belief that nations can meet the interests of their citizens through trade and open markets; a social safety net and respect for those of different faiths and backgrounds.
For decades, this vision stood in sharp contrast to life on the other side of an Iron Curtain. For decades, a contest was waged, and ultimately that contest was won – not by tanks and missiles, but because our ideals stirred the hearts of Hungarians who sparked a revolution; Poles in their shipyards who stood in Solidarity; Czechs who waged a Velvet Revolution without firing a shot; and East Berliners who marched past the guards and finally tore down that wall.
Today, what would have seemed impossible in the trenches of Flanders, the rubble of Berlin, or a dissident’s prison cell is taken for granted. A Germany unified. The nations of Central and Eastern Europe, welcomed into the family of democracies. Here in this country, once the battleground of Europe, we meet in the hub of a Union that brings together age-old adversaries in peace and cooperation. The people of Europe—hundreds of millions of citizens, east and west, north and south—are more secure and more prosperous because we stood together for the ideals we share.
This story of human progress was by no means limited to Europe. Indeed, the ideals that came to define our alliance also inspired movements across the globe - among those very people who had too often been denied their full rights by Western powers. After the Second World War, people from Africa to India threw off the yoke of colonialism to secure their independence. In America, citizens took freedom rides and endured beatings to put an end to segregation, and to secure their civil rights. As the Iron Curtain fell here in Europe, the iron fist of Apartheid was unclenched, and Nelson Mandela emerged from prison to lead a multi-racial democracy. Latin American nations rejected dictatorship and built new democracies, and Asian nations showed that development and democracy could go hand in hand.
The young people in the audience today were born in a place and time where there is less conflict, more prosperity and more freedom than any time in human history. But that’s not because man’s darkest impulses have vanished. Even here, in Europe, we have seen ethnic cleansing in the Balkans that shocked our conscience. The difficulties of integration and globalization, recently amplified by the worst economic crisis of our lifetimes, strained the European project, and stirred the rise of a politics that targets immigrants or gays or those who seem somehow different. While technology has opened up vast opportunities for trade and innovation and cultural understanding, it has also allowed terrorists to kill on a horrifying scale. Around the world, sectarian warfare and ethnic conflicts continue to claim thousands of lives. And once again, we are confronted with the belief that bigger nations can bully smaller ones to get their way – that recycled maxim that might makes right.
So I come here today to insist that we must never take for granted the progress that has been won here in Europe, and advanced around the world. Because the contest of ideas continues for your generation. And that is what’s at stake in Ukraine today. Russia’s leadership is challenging truths that only a few weeks ago seemed self-evident: that in the 21st century, the borders of Europe cannot be redrawn with force; that international law matters; and that people and nations can make their own decisions about their future.
To be honest, if we defined our interests narrowly, with a cold-hearted calculus, we might decide to look the other way. Our economy is not deeply integrated with Ukraine’s. Our people and our homeland face no direct threat from the invasion of Crimea. Our own borders are not threatened by Russia’s annexation. But that kind of casual indifference would ignore the lessons that are written in the cemeteries of this continent. It would allow the old way of doing things to gain a foothold in this young century. And that message would be heard – not just in Europe –but in Asia and the Americas; in Africa and the Middle East.
Moreover, the consequences that would arise from complacency are not abstract; they impact the lives of real people – men and women just like us. Just look at the young people of Ukraine, who were determined to take back their future from a government rotted by corruption; the portraits of the fallen shot by snipers; the visitors who pay their respects at the Maidan. There was the university student, wrapped in the Ukrainian flag, expressing her hope that, “every country should live by the law.” A post graduate student, speaking of her fellow protestors, said, “I want these people who are here to have dignity.” Imagine, for a moment, that you are the young woman who said, “there are some things that fear, police sticks and tear gas can’t destroy.”
We have never met these people, but we know them. Their voices echo calls for human dignity that rang out in European streets and squares for generations. They echo those around the world who fight for their dignity still. These Ukrainians rejected a government that was stealing from the people instead of serving them, and are reaching for the same ideals that allow us to be here today.
None of us can know for certain what the coming days will bring in Ukraine, but I am confident that eventually, those voices for human dignity and opportunity, for individual rights and the rule of law, will triumph. I believe that over the long haul, as free nations and free people, the future is ours. I believe this not because of the strength of our arms or even the size of our economies, but rather because these ideals are true, and these ideals are universal.
Yes, we believe in democracy – with elections that are free and fair; independent judiciaries and opposition parties; civil society and uncensored information, so that individuals can make their own choices. We believe in open economies based on free markets and innovation; individual initiative and entrepreneurship; trade and investment that creates a broader prosperity. And we believe in human dignity – that every person is created equal, no matter who you are, or what you look like, or who you love, or where you come from. That’s what we believe. That’s what makes us strong.
Our enduring strength is also reflected in our respect for an international system that protects the rights of both nations and people – a United Nations and a Universal Declaration of Human Rights; international laws, and the means to enforce them. But we also know that these rules are not self-executing; they depend on people and nations of goodwill continually affirming them. That is why Russia’s violation of international law – its assault on Ukraine’s sovereignty and territorial integrity – must be met with condemnation. Not because we are trying to keep Russia down, but because the principles that have meant so much to Europe and the world must be lifted up.
Over the last several days, the United States, Europe, and our partners around the world have been united in defense of these ideals, and united in support of the Ukrainian people. Together, we have condemned Russia’s invasion of Ukraine, and rejected the legitimacy of the Crimean referendum. Together, we have isolated Russia politically, suspending it from the G-8 nations, and down-grading our bilateral ties. Together, we are imposing costs through sanctions that have left a mark on Russia and those accountable for its actions. And if the Russian leadership stays on its current course, this isolation will deepen. Sanctions will expand. The toll on Russia’s economy – and standing in the world – will only grow.
Meanwhile, the United States and our allies will continue to support the government of Ukraine as they chart a democratic course. Together, we are going to provide a significant package of assistance that can help stabilize the Ukrainian economy, and meet the basic needs of the people. Make no mistake: neither the United States, nor Europe, has any interest in controlling Ukraine. We have sent no troops there. What we want is for the Ukrainian people to make their own decisions, just like other free people around the world.
Understand, this is not another Cold War we are entering into. After all, unlike the Soviet Union, Russia leads no bloc of nations, no global ideology. Nor does the United States, or NATO, seek any conflict with Russia. Indeed, for more than 60 years, we have come together in NATO—not to claim other lands, but to keep nations free. What we will do – always – is uphold our solemn obligation, our Article 5 duty, to defend the sovereignty and territorial integrity of our allies. And in that promise we will never waver; NATO nations never stand alone.
Today, NATO planes patrol the skies over the Baltics, and we have reinforced our presence in Poland. And we are prepared to do more. Going forward, every NATO member state must step up and carry its share of the burden – by showing the political will to invest in our collective defense, and by developing the capabilities to serve as a source of international peace and security.
Of course, Ukraine is not a member of NATO – in part, because of its close and complex history with Russia. Nor will Russia be dislodged from Crimea or deterred from further escalation by military force. But with time, so long as we remain united, the Russian people will recognize that they cannot achieve security, prosperity, and the status they seek through brute force. That’s why, throughout this crisis, we will combine our substantial pressure on Russia with an open door for diplomacy. I believe that for both Ukraine and Russia, a stable peace will come through de-escalation – direct dialogue between Russia, the government of Ukraine, and the international community; monitors who can ensure that the rights of all Ukrainians are protected; a process of Constitutional reform within Ukraine itself, and free and fair elections this spring.
So far, Russia has resisted diplomatic overtures, annexing Crimea and massing large forces along Ukraine’s borders. Russia has justified these actions as an effort to prevent problems on its borders, and to protect ethnic Russians inside Ukraine. Of course, there is no evidence, and never has been, of systemic violence against ethnic Russians there. Moreover, many countries around the world face similar questions about their borders and ethnic minorities abroad; about sovereignty and self-determination – tensions that have led to debate and democratic referendums; conflicts and uneasy co-existence. It is precisely because these questions are hard that they must be addressed through constitutional means and international laws – so that majorities cannot suppress minorities, and big countries can’t bully the small.
In defending its actions, Russian leaders have further claimed Kosovo as a precedent – an example of the West interfering in the affairs of a smaller nation, just as they are doing now. But NATO only intervened after the people of Kosovo were systematically brutalized and killed for years. And Kosovo only left Serbia after a referendum was organized – not outside the boundaries of international law – but in careful cooperation with the United Nations, and with Kosovo’s neighbors. None of that happened in Crimea.
More recently, Russia has pointed to America’s decision to go into Iraq as an example of Western hypocrisy. It is true that the Iraq War was a subject of vigorous debate – not just around the world, but in the United States as well. I happened to oppose our military intervention there. But even in Iraq, America sought to work within the international system. We did not claim or annex Iraq’s territory, nor did we grab its resources for our own gain. Instead, we ended our war and left Iraq to its people and a fully sovereign Iraqi state could make decisions about its own future.
Of course, neither the United States, nor Europe, are perfect in adherence to our ideals, nor do we claim to be the sole arbiter of what is right or wrong in the world. We are human, after all, and face difficult choices about how to exercise our power. But part of what makes us different is that we welcome criticism, just as we also welcome the responsibilities that come with our leadership. We look to the East and the South and see nations poised to play a growing role on the world stage – and that’s a good thing. It reflects the same diversity that makes us stronger as a nation, and the forces of integration and cooperation that Europe has advanced for decades. And in a world of challenges that are increasingly global, all of us have an interest in nations stepping forward to play their part; to bear their share of the burden; and to uphold international norms.
Indeed, our approach stands in stark contrast to the arguments coming out of Russia these days. It is absurd to suggest, as a steady drumbeat of Russian voices do, that America is conspiring with fascists inside Ukraine, or failing to respect the Russian people. My grandfather served in Patton’s Army, just as many of your fathers and grandfather’s fought against fascism. We Americans remember well the unimaginable sacrifices made by the Russian people in World War II, and have honored them. Since the end of the Cold War, we have worked with Russia under successive Administrations to build ties of culture, commerce and international community – not as a favor to Russia, but because it was in our national interest. And together, we’ve secured nuclear materials from terrorists. We welcomed Russia into the G-8 and the World Trade Organization. From the reduction of nuclear arms, to the elimination of Syria’s chemical weapons, the world has benefited when Russia chooses to cooperate on the basis of mutual interests and mutual respect.
So the world has an interest in a strong and responsible Russia, not a weak one. And we want the Russian people to live in security, prosperity, and dignity like everyone else – proud of their own history. But that does not mean that Russia can run roughshod over its neighbors. Just because Russia has a deep history with Ukraine does not mean it should be able to dictate Ukraine’s future. No amount of propaganda can make right something that the world knows is wrong.
In the end, every society must chart its own course. America’s path – or Europe’s path – is not the only ways to reach freedom and justice. But on the fundamental principle that is at stake here – the ability of nations and peoples to make their own choices – there can be no going back. It is not America that filled the Maidan with protesters – it was Ukrainians. No foreign forces compelled the citizens of Tunis and Tripoli to rise up – they did so on their own. From the Burmese parliamentarian pursuing reform, to the young leaders fighting corruption and intolerance in Africa – we see something irreducible that all of us share as human beings; a truth that will persevere in the face of violence and repression and, ultimately, overcome it.
For the young people here today, I know it may be easy to see these events as removed from our lives – remote from our daily routines, distant from concerns closer to home. I recognize that there is more than enough to worry about in the affairs of our own countries. There will always be voices who will say that what happens in the wider world is not our concern, nor our responsibility. But we must never forget that we are heirs to a struggle for freedom. Our democracy, our individual opportunity, only exists because those who came before us had the wisdom, and the courage, to recognize that our ideals will only endure if we see our self-interest in the success of other peoples and nations.
Now is not the time for bluster. The situation in Ukraine, like crises in many parts of the world, does not have easy answers, nor a military solution. But at this moment, we must meet the challenge to our ideals – to our very international order – with strength and conviction.
And it is you, the young people of Europe, who will help decide which way the currents of history will flow. Don’t think for a moment that your own freedom, your own prosperity, your own moral imagination is bound by the limits of your community or even your country. You can choose a better history. That’s what Europe tells us. That’s what the American experience is all about.
I say this as the President of a country that looked to Europe for the values that are written into our founding documents, and which spilled blood to ensure that those values could endure on these shores. I also say that as the son of a Kenyan whose grandfather was a cook for the British, and as a person who once lived in Indonesia as it emerged from colonialism. The ideals that unite us matter equally to the young people of Boston or Brussels, Jakarta or Nairobi, Krakow or Kyiv.
In the end, the success of our ideals comes down to us— including the example of our own lives; our own societies. We know that there will always be intolerance. But instead of fearing the immigrant, we can welcome him. We can insist on policies that benefit the many, not just the few; that an age of globalization and dizzying change opens doors of opportunity to the marginalized, and not just a privileged few. Instead of targeting our gay and lesbian brothers and sisters, we can use our laws to protect their rights. Instead of defining ourselves in opposition to others, we can affirm the aspirations we hold in common. That’s what makes us strong. That’s what makes us who we are.
And just as we meet our responsibilities as individuals, we must be prepared to meet them as nations. Because we live in a world in which our ideals are going to be challenged – again and again – by forces that would drag us back into conflict or corruption. We cannot count on others to rise to meet those tests. The policies of your government – the principles of your European Union – will make a difference in whether or not the international order that so many generations before you have strived for continues to move forward, or whether it retreats.
That’s the question we all must answer – what kind of Europe, what kind of world, we will leave behind. If we hold firm to our principles, and are willing to back our beliefs with courage and resolve, then I have no doubt that hope will overcome fear, and freedom will continue to triumph over tyranny – because that is what forever stirs the human heart.
While President Obama insisted again on Tuesday that the West would not recognize the annexation of Crimea, officials in the United States and Europe have privately concluded that Crimea is lost and that the real challenge is stopping Russia from further destabilizing Ukraine.
After meeting with allies in Europe and suspending Russia from theGroup of 8, Mr. Obama indicated no plans for additional sanctions unless Russia’s president, Vladimir V. Putin, makes another provocative move. Every reference to further action against Russia during a 40-minute news conference in The Hague came with conditional phrases like “if the situation gets worse.”
Mr. Obama acknowledged that “the facts on the ground” meant that Crimea was under Russian control. “It would be dishonest to suggest that there’s a simple solution to resolving what has already taken place in Crimea,” he said, “although you know, history has a funny way of moving in twists and turns and not just in a straight line.”
For the United States and its European allies, the question is whether Mr. Putin will simply pocket his victory in Crimea and leave it at that. Mr. Putin has been unmoved by the cancellation of trade talks, suspension of military cooperation, and travel bans and asset freezes imposed on a handful of his aides and allies. But he has not made clear whether he feels emboldened enough to press for further territorial or political gains in Ukraine in the face of threats of more sweeping sanctions against Russian arms, energy and banking sectors.
The gloomy assessment, far more negative than Russian government forecasts, came on a day when U.S. President Barack Obama was meeting European Union and NATO leaders to discuss how to reduce Europe's dependence on Russian energy and bolster NATO defenses of east European allies borderingRussia and Ukraine.
Obama and leaders of the Group of Seven major industrialized nations agreed this week to hold off on tougher economic sanctions unless President Vladimir Putin takes further action to destabilize Ukraine or other former Soviet republics.
Western concern has focused on Russian troops massed on Ukraine's eastern border amid Kremlin allegations of attacks on Russian speakers in that industrial region of the country.
But Polish Prime Minister Donald Tusk said on Wednesday it seemed likely that the firm Western response so far would stop Russia undertaking what he called "other acts of aggression and interference on the territory of Ukraine".
A World Bank report on the Russian economy, compiled before the most recent evidence of the scale of capital flight, made clear Moscow was already set to pay a significant price in lost growth due to the most serious East-West confrontation since the end of the Cold War.
Gross domestic product (GDP) could contract by as much as 1.8 percent in 2014 if the crisis persists, it said. That high-risk forecast assumes that the international community would still refrain from trade sanctions.
Mitt Romney blames former Secretary of State Hillary Clinton along with President Barack Obama for the situation in Ukraine, saying they both misunderstood the world stage.
“There’s no question, but that over the four years where he and Secretary Clinton were working together, and now the year since then, it’s hard to name a single country that holds America in more esteem and respect than when the president took office five years ago,” Romney said on Fox News’s “Hannity”on Tuesday. “It has not been a time of building America’s respect and admiration and esteem and frankly our soft power or our hard power around the world.”
Romney invoked Clinton — seen as the frontrunner for the Democratic presidential nomination in 2016 — when asked about Obama’s response to a question during a press conference in Europe on Tuesday about Romney’s 2012 assertion that Russia was the U.S.’s No. 1 geopolitical foe and whether the situation in Ukraine proves that to be true. Obama was dismissive, but Romney said the president knows it is accurate, even if he doesn’t want to admit it.
“We need a president that understands that not everybody around the world has the same interests. Some people around the world want to oppress other people and expand territory, and take from the resources of other people,” Romney said. “That’s what’s happening. The jihadists want to do that, clearly Russia is intent on doing that.”
The former Republican governor said Obama and Clinton gave Russia “gifts” early in the administration.
“I would not have given Russia the gifts that Secretary Clinton and President Obama gave Russia, this whole reset with the smiling pictures of them pressing the button, it’s like are you kidding me?” Romney said. “Don’t you understand that Russia has different — Putin has different interests than America, and they will pursue those interests?”
In its invasion and annexation of Crimea, Russia has seized 51 vessels belonging to the Ukrainian navy, according to information compiled by Dmitry Tymchuk, director of the Center of Military and Political Research in Kyiv.
Among the Ukrainian vessels reportedly captured by the Russians are submarine Zaporizhia, management ship Slavutych, landing ship Konstantin Olshansky, landing ship Kirovohrad, minesweeper Chernihiv and minesweeper Cherkasy.
The Cherkasy was the last of the ships to have been overtaken following weeks of threats and ultimatums to surrender. It was finally chased down and overtaken by the Russian navy on March 25 after failing to slip past a blockade of two ships intentionally sunk by the Russians to trap it and other vessels in a narrow gulf, keeping them from escaping into the Black Sea.