The blockade of Railways leads to the aggravation of the economic crisis in Ukraine

Divisions within the Ukrainian leadership can further exacerbate an already difficult political and economic situation in the country and lead to even greater dissociation of the Donetsk and Lugansk industrial regions, controlled by Pro-Russian rebels, the so-called “people’s republics” DNR and LC.

Since January 25, railway lines connecting the DNI and LC with the rest of Ukraine, blocked by veterans of the ATO.

By rail delivered coal for power plants and metallurgical enterprises located in the Kiev-controlled territories and in the direction of the DNI and LC was iron ore for steel plants in these republics. The blockade of rail tracks has caused considerable damage to the economies of both sides.

In such circumstances, representatives of the Ukrainian authorities disagree on whether to continue the blockade. President Petro Poroshenko called to remove her, while Prosecutor General Yury Lutsenko, and also the number of MPs previously fought in volunteer battalions in favour of its continuation. The Minister of internal Affairs Arsen Avakov appealed to the anti-terrorism Committee, that he was given the authority to use force against those who blocked the work of the railway. But the Minister wasn’t even in control of their subordinates. On Tuesday, the Donetsk region police arrested 37 people who tried to clear the railroad tracks. That is, law enforcement has teamed up with those who obstruct the movement of vehicles from one area to another.

On Tuesday in Kiev at the meeting of government members and representatives of the metallurgical enterprises, the Prime Minister Vladimir Groysman said that he agreed with the Minister of internal Affairs, but not commented on the question of entitlement. For his part, the President of Association of enterprises “Ukrmetallurgprom” Oleksandr Kalenkov said that due to coal blockade on Donbass Ukraine may lose about us $ 3.5 billion foreign exchange earnings per year and 75 thousand jobs. Added to the shortfall in tax revenues and the decline in rail traffic. According to estimates Poroshenko, the number of lost work, the place can reach 300 thousand.

To resolve this situation, the head of the breakaway DND and LNR Alexander Zakharchenko and Yury Carpenter issued an ultimatum, offering to Kiev until March 1 to remove the blockade. Otherwise, the major Ukrainian mining and metallurgical enterprises located in the territory of the DNI and the LC and revenue-generating tax payments to Kiev, will be transferred under external management.

To the greatest extent, such a “nationalization” will affect the Donetsk native Rinat Akhmetov, who pays wages to thousands of workers in the DNI and LC, as well as distributes humanitarian aid in the territory where live more than three million people. The head of the breakaway republics say that will sell coal to Russia, but Moscow has not yet announced whether it was ready to buy this coal. It is doubtful that, in addition to spending on military and economic aid to the rebels, the Kremlin still wants to take on the role of financial maintenance of these areas, which now plays Akhmetov.

Plenipotentiary representative of Russia in the Contact group on settling the situation in Donbass Boris Gryzlov, a former interior Minister, has warned Kiev that if the embargo is not lifted, it will inevitably be followed by retaliatory measures.

On the other hand, coal and metallurgical products produced in the DNI and LC, are legally Ukrainian and can be sold on the world market. But in the case of “nationalization” of these companies selling these products can be called into question.

The damages caused by the embargo, all increases and idle enterprises aggravate, sometimes in irreversible form, the economic devastation of the once the most developed industrial region in the Ukraine.