Focus Ukraine: Disproportionate resources of the warring parties require Ukraine to make unconventional decisions in war

Ihor Petrenko, Dmytro Levus, Petro Oleshchuk, Oleksiy Kushch

14 mins - 20 de Febrero de 2024, 07:00

Agenda Pública and United Ukraine Think Tank present Focus Ukraine, a weekly article series analysing how the military conflict in Ukraine and the political and economic situation in the country will evolve. The articles are written by Ihor Petrenko, Dmytro Levus, Petro Oleshchuk and Oleksiy Kushch, experts of the United Ukraine Think Tank.
Despite the lack of resources and military potential that is not comparable to that of Russia, Ukraine continues to actively resist and implement its strategy within the framework of a full-scale high-intensity war, as evidenced by the destruction of another large landing ship of the Russian Black Sea Fleet and drone strikes on facilities in Russia related to fuel processing and storage. The last week was also marked by difficult decisions by the Ukrainian command near Avdiivka, the reflection on the decisions of the 19th meeting of the Contact Group on Ukraine's Defense in the Ramstein format, and the strengthening of existing and creation of new military coalitions in support of Ukraine. Ukraine continues to seek the support of the international community, strengthen its military-industrial complex, and seek answers to complex issues of financing its military needs.

The perception that is emerging in the world that the Russian-Ukrainian war has become something insignificant and non-dynamic, that it is "fading away," is completely false. This becomes apparent when observing the course of hostilities, even over a very short period of time. Active hostilities are taking place both on the land front and at sea. The fight in the air is also ongoing, and air strikes remain an important factor in influencing the course of the war.

Apogee of "meat assaults" by the Russian Federation, withdrawal from Avdiivka, continued attempts to transfer hostilities to the aggressor's territory
As expected, the main epicenter of the fighting remained the city of Avdiivka in Donetsk Oblast, which Ukrainian troops had been defending for almost a decade. It was obvious that Russia had deployed huge forces and resources to capture the city. Avdiivka's importance lies not only in the fact that the city is a kind of "key" to Donetsk and important roads for logistics deep in the territory occupied by the Russians in 2014. Avdiivka has been artificially transformed by Russian propaganda into a symbol of success, which is necessary as evidence of a "victory" before Putin's re-election as president of the Russian Federation in March 2024. In view of the above, Russia does not count losses in these battles. It is significant that the limit of Russian losses of 400,000 manpower was overcome during this week of intense fighting. The destruction of three new Russian aircraft (2 Su-34 and 1 Su-35) on February 17 in the eastern sector is due to the active use of aviation by the invaders to strike at Ukrainian positions when it is impossible to operate from a safe distance without getting into the air defense zone. The situation around Avdiivka has been difficult for a long time. Within a week, Ukrainian troops had to abandon the Zenit position near Avdiivka, which was surrounded. On the night of February 17, the Commander-in-Chief, General Oleksandr Syrsky, said that "based on the operational situation around Avdiivka, in order to avoid encirclement and preserve the lives and health of the military, I decided to withdraw our units from the city and move to defense on more favorable lines. Our soldiers performed their military duty with dignity, did everything possible to destroy the best Russian military units, and inflicted significant losses in manpower and equipment on the enemy. We are taking measures to stabilize the situation and hold our positions. The lives of our servicemen are the highest value." Specially trained reserves were deployed to help the Ukrainian Armed Forces withdraw from the city. Russian propagandists confirm the very high level of losses of the invaders' troops. In this regard, the defense of Avdiivka played a very important role.

During the week, a massive Russian missile attack took place, which put the entire territory of Ukraine under threat. A total of 26 Russian missiles of various types were launched, 13 of which were shot down (including 1 Iskander-M ballistic missile). On another night, a massive attack on Ukraine with Shahed UAVs took place, with about 90% of the drones shot down by Ukrainian air defense forces, although there were also hits to infrastructure. But the war inevitably returns to where it started. Predictably, Ukraine continued to strike with drones at facilities in Russia related to fuel processing and storage. For example, it was reported several times that nighttime drone strikes by the Ukrainian Defense Forces had caused large-scale fires at an oil depot in the village of Polyove in the Kursk region of Russia. There were other similar reports. Explosions were heard in Belgorod, a city that provides rear support to the group of Russian troops attacking Kharkiv region, and S-300 missiles were fired from Belgorod at Kharkiv. The Russians claimed to have hit a shopping center in Belgorod and that there were Russian civilian casualties. It is possible that this is the result of unprofessional actions of the Russian air defense system. To prevent anything like this from happening, Russia must stop its aggression and get out of Ukraine. Every death as a result of the hostilities that have been taking place in Ukraine since 2014 and now on the territory of the Russian Federation is the result of Russian aggression, the Kremlin's aggressive policy and the support of aggression by the Russian population.

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Russian aggression began in Crimea, and the peninsula is important for controlling the Black Sea. Naturally, Ukraine attaches great importance to regaining control over it. On February 14, the Ukrainian Defense Forces destroyed another large landing ship of the Russian Black Sea Fleet, the Caesar Kunikov, off the Crimean coast. This ship is a major repeat offender. During Russia's war against Georgia in 2008, it was the flagship of the Russian naval group. In 2014, it participated in the seizure of Crimea. Since 2022, it has been fighting against Ukraine. In March 2022, it was stationed in Berdiansk, along with several other large landing ships of the Black Sea Fleet, delivering ammunition and equipment. Then, as a result of a strike by the Ukrainian Defense Forces, the Saratov was destroyed, and other occupiers' ships were damaged. Then, in 2022, its commander was killed on the Caesar Kunik. The current video from the drones that attacked the ship unequivocally confirms the success of the attack. It is obvious that the Caesar Kunikov was currently carrying out an important transportation in the interests of the Russian occupation forces. Its loss is extremely sensitive for the Black Sea Fleet.

The issue of arming Ukraine remains important. On February 14, the 19th meeting of the Contact Group on Ukraine's Defense in the Ramstein format was held via videoconference. The Coalition for Integrated Air and Missile Defense, which brings together 15 countries led by Germany, France, and the United States, the Drone Coalition, which consists of 8 countries (Sweden, Britain, Denmark, Germany, Lithuania, Estonia, the Netherlands, and Latvia), and the Coalition for Demining, led by Lithuania, have already united 20 countries. They also discussed the joint production of artillery systems and shells. Implementation of the F16 agreement is proceeding according to the previously agreed schedule.

The issues of foreign aid, mobilization and protection of economic potential remain key to the country's survival
After the discussion on the resignation of Commander-in-Chief V. Zaluzhnyi and the appointment of O. Syrskyi was completed, Ukraine's political life returned to the usual format, which involves a "quiet" political struggle around key issues: mobilization, the situation at the front, and the economic situation in the country.

As for mobilization, the relevant draft law on changes to it is stuck in the Verkhovna Rada. So far, having approved the draft in the first reading, MPs are making amendments to it, and it is already clear that there will be many amendments. Thus, some MPs are simply trying to postpone the voting as long as possible, as they simply do not want to take responsibility for it. At the same time, the decision itself will have to be made, as the Ukrainian army needs new soldiers. First of all, to ensure the rotation of current soldiers who have been serving for almost two years without interruption. This makes changes to the legislation on mobilization inevitable, and the Verkhovna Rada should still vote on them in March, although this process will obviously take some time.

As for the situation at the front, the key political topic was, of course, the situation around Avdiivka, from which the Ukrainian army was forced to retreat after long and exhausting battles. And although the retreat itself is perceived in society as quite painful, at the same time, there is a consensus that these actions are inevitable and necessary in order to save the lives of the defenders of Avdiivka.

As for the blame for the fact that the Ukrainian army has to retreat from Ukrainian cities almost two years after the start of the full-scale war, the prevailing sentiment in Ukrainian society is that of general guilt in the situation on the part of Ukraine's "Western partners" who made public commitments to support Ukraine but failed to fulfill them. This applies to both Ukraine's European partners, who have been unable to provide Ukraine with the promised million artillery shells. This also applies to the United States, where the Congress has not yet passed an aid package for Ukraine for 2024, which means that in practice there will be no supplies of weapons and ammunition from the United States to Ukraine starting in the new year.

This situation creates the perception in Ukrainian society that the West is "betraying" Ukraine in the face of the Russian military threat, which should have united the entire civilized world.

The perception of the situation is somewhat positively influenced by Ukraine's signing of security treaties with a number of states. In particular, the relevant agreement was first signed with the United Kingdom, and on February 16, 2024, with France and Germany. These documents set out commitments to support Ukraine over the next ten years, both financially and militarily. In particular, in terms of providing weapons and implementing joint projects for their production. At the same time, these framework agreements will require further specification and content. It is clear that there is skepticism in Ukrainian society about the possibility of any "security guarantees" from Western states, as "guarantees" are associated with the Budapest Memorandum, a document according to which Ukraine gave up nuclear weapons in exchange for the commitment of a number of states (the United States, the United Kingdom, and Russia) to guarantee Ukraine's security. This document proved to be ineffective and failed to guarantee security for Ukraine.

A separate issue is another blockade of the Polish-Ukrainian border by Polish farmers, which was accompanied by aggressive actions against Ukrainian carriers and Ukrainian grain. All of this is perceived in Ukraine as a "stab in the back" by Poland and has a very negative impact on attitudes toward Poland and the Poles.

In general, constant delays in aid, failure to fulfill obligations, obstacles and blockages, along with the anti-Ukrainian rhetoric of certain politicians in the West, have a negative impact on Ukrainians. Accordingly, Ukraine is waiting for concrete steps from its partners to help solve existing problems rather than create new ones.

With every day that the US financial assistance is postponed, Kyiv is becoming increasingly concerned about the state of the debt burden on the state budget
In 2024, Ukraine will have to pay nearly UAH 1 trillion 30 billion in external and internal debts in the face of war, which is comparable to the cost of the Armed Forces.

Almost UAH 400 billion will be spent on paying interest on the national debt.

About UAH 600 billion will be used to repay the state's debt to private creditors, international financial organizations, and strategic partner countries.

On the one hand, the debt burden issue has been partially resolved: payments to private creditors on Eurobonds have been postponed for four years, until 2027.

On the other hand, Ukraine continues to service both its domestic and foreign debt, in particular, to the IMF.

By the way, the new Extended Fund Facility program between Ukraine and the IMF worth almost $15 billion provides for the payment of considerable interest on the funds received - almost 7% per annum. At the same time, most of the funds received by Ukraine from the IMF should be used to repay previous debts to the Fund, i.e., refinancing, not new loans.

Thus, spending almost €25 billion a year on public debt repayment, Ukraine has to find a difficult balance between financing the Armed Forces and external and internal creditors.

At the same time, external support packages have not yet been determined. At present, Ukraine can count on EU macro-financial assistance worth €50 billion for four years and on IMF loans, which are provided under rather strict obligations (structural beacons).

There are also support packages from individual countries, such as Japan, Norway, and Germany.

But the key support program from the United States worth $60 billion, which is at least 50% of Ukraine's external support, is currently on hold.

In this context, the sources of post-war recovery of the war-torn country are also rather uncertain.

One of the working versions is that Ukraine will issue special bonds, the repayment of which will be secured by blocked Russian assets.

Currently, Euroclear holds about 191 billion euros belonging to the Russian central bank, but Ukraine has some reason to doubt whether it will not be liable for the bonds issued when the seizure of Russian assets is suspended by a court order.

Given the problems with the repayment of the state's debt, one of the key questions remains whether Ukraine will use its historic window of opportunity to write off its external public debt.
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