Foreign policy and international agenda
Last week in the field of foreign policy and international context was full of events for Ukraine. In the context of the country's multilateral cooperation, the main news concerned contacts with the European Union, the Associated Trio, and the Lublin Triangle. Also, important messages came from the energy sector initiatives and digital programs.
The Heads of Governments of the Associated Trio countries met with the Heads of the European Commission, the Council of the EU, and the European Parliament. The parties discussed issues of further European integration of Georgia, Moldova, and Ukraine, joint countering of threats, energy security, trade, and healthcare.
The President of Ukraine Volodymyr Zelenskyi had an online conversation with the President of Lithuania Gitanas Nauseda and the President of Poland Andrzej Duda. This is the first conversation of the heads of the three states in the format of the Lublin Triangle. As a result of the discussion, the presidents adopted a joint statement, in which they called on the international community to strengthen sanctions against the Russian Federation because of its continuing aggression against Ukraine.
Ukraine took over the chairmanship of the Energy Community. Deputy Minister of European and Euro-Atlantic Integration Yaroslav Demchenkov said that during its presidency Ukraine would make efforts to strengthen the role of energy solidarity, which is extremely important in the current energy crisis.
The Ministry of Digital Transformation of Ukraine and Apple Inc signed a Memorandum. The document provides for cooperation, exchange of information, and support of the Ukrainian government by the corporation on a number of initiatives. In particular, the company will cooperate with the Ministry within the framework of the Ukrainian Population Census 2023.
In the domain of the domestic policy of Ukraine, the main events of last week were traditionally related to the spread of COVID-19, as well as to the adoption of new regulations in the economic sphere and the announcement of new decisions announced by President Volodymyr Zelensky during his annual address to the Verkhovna Rada.
The spread of COVID-19 in Ukraine has been declining for four weeks. This was reported by the Prime Minister of Ukraine Denys Shmyhal at the beginning of last week. Nevertheless, quarantine was not eased last week in any of the regions of Ukraine where the highest level of epidemic danger was established.
The Verkhovna Rada of Ukraine approved the state budget for 2022. The state budget deficit will remain at 3.5% of GDP, as envisaged by the memorandum between Ukraine and the IMF signed in November. The state budget of Ukraine for 2022 is based in particular on the tax lawNo5600, which was also adopted last week.
The President of Ukraine Volodymyr Zelensky addressed the Verkhovna Rada of Ukraine with an annual report on the internal and external situation in Ukraine. In particular, the President announced the submission of bills on the introduction of the "economic passport of Ukrainians" and on multiple citizenships.
The domain of security was among the most fruitful ones last week due to a number of importantdevelopments. They included Ukraine’s participation in the foreign ministers’ meeting within theNorth Atlantic Council of NATO, an EU decision to provide defence assistance for Ukraine through the European Peace Facility, plans regarding participation in multinational exercises, and strengthening capabilities of the Ukrainian Navy.
First of all, Dmytro Kuleba took part in the meeting of NATO foreign ministers where he paid attention to the aggravation of the security situation in Donbas and the Russian military build-up near Ukrainian borders. He also gained support from Great Britain, Estonia, Latvia, the Netherlands, and Canada to take concrete steps to prevent further Russian aggression against Ukraine.
Moreover, the Council of the EU made a decision to provide defence assistance for Ukrainethrough the European Peace Facility. It is expected that €31 million will be allocated during 2021–2024 with the aim to enhance Ukraine’s resilience and strengthen its Armed Forces.
At the same time, it is expected that the Armed Forces of Ukraine will participate in 26 multinational military exercises in 2022.
Also, a French shipbuilding company will help to strengthen the Ukrainian Navy by building 20 ships together with a Ukrainian company for the State Border Guard Service of Ukraine.
Meanwhile, the situation in Donbas remained stable with 28 ceasefire violations on the part of separatist militants. As a result of the violations, 4 Ukrainian soldiers were injured and 1 was killed.
• Bilateral relations
The bilateral sphere of Ukraine’s foreign policy was quite active last week. A lot of bilateral meetings were held on the sidelines of the NATO foreign ministers’ meeting in Riga and of theOSCE Ministerial Meeting in Stockholm. However, one of the most prominent bilateral tracks included Ukraine-Israel and Ukraine-US tracks. At the same time, the Ukraine-Belarus track experienced some downgrade.
Ukraine-Israel relations were on the rise last week as the 12th meeting within the Joint Ukrainian- Israeli Commission on Trade and Economic Cooperation gave impetus for further development of perspective bilateral areas such as high-tech, agriculture, and joint gas production in the Black Sea.
Ukraine-US relations were also in the spotlight of attention, especially after the meeting between Antony Blinken and Dmytro Kuleba on the margins of the OSCE Ministerial Meeting in Stockholm. The counterparts agreed to further elaborate a deterrence package aimed at discouraging Russia to pursue aggressive actions against Ukraine.
Meanwhile, Ukraine-Belarus relations are worsening given the recent allegations on the part of Belarus that the State Border Guard Service of Ukraine has allegedly violated Belarusian air space. Thus, the Defence Ministry of Belarus summoned a Ukrainian military attaché to give him a note of protest regarding this alleged violation of airspace.
Foreign policy and international agenda
The Heads of Governments of the Associated Trio countries met with the heads of the main institutions of the European Union. Their visit to Brussels is part of preparations for the Eastern Partnership summit.
In particular, the Prime Ministers of Georgia, Moldova, and Ukraine discussed with the President of the European Commission Ursula von der Leyen the energy security of the continent and the integration of the EU's eastern partners into the single European energy market as part of its provision. The Prime Minister of Ukraine Denys Shmyhal said that Kyiv had submitted its proposals to Brussels to strengthen countering threats in this area.
The Prime Ministers of the three Eastern Partnership countries also discussed with the President of the Council of the EU Charles Michel further steps in the European integration of Georgia, Moldova, and Ukraine. The countries of the Associated Trio welcomed the intention of the Brussels partners to declare 2022 the year of European security. In particular, Denys Shmyhal hopes that the EU would deepen cooperation with the Eastern Partnership countries in this component to counter hybrid threats and strengthen the resilience of Georgia, Moldova, and Ukraine.
In addition, the Heads of Governments of the Associated Trio countries met with the President of the European Parliament David Sassoli. They discussed deepening the European integration of Chisinau, Kyiv, and Tbilisi, including building cooperation between them and Brussels in the areas of trade, health, and security.
The President of Ukraine Volodymyr Zelenskyi had an online conversation with the President of Lithuania Gitanas Nauseda and the President of Poland Andrzej Duda. This is the first conversation of the heads of the three states in the format of the Lublin Triangle. As a result of the discussion, the presidents adopted a joint statement. In it, they mentioned the common democratic traditions that unite the Belarusian, Lithuanian, Polish and Ukrainian nations. The heads of state stressed the need to deepen Lithuanian-Polish-Ukrainian cooperation in security, economy, and energy.
They also reaffirmed their readiness to jointly counter hybrid threats arising in particular from Russian aggression and to strengthen mutual resilience to them. In this context, the presidents mentioned the migration crisis on the border between Belarus and the EU. Finally, the heads of state reaffirmed their full support for Ukraine's territorial integrity and sovereignty and called on the international community to strengthen sanctions against the Russian Federation for its aggression against Ukraine.
Ukraine took over the chairmanship of the Energy Community. It will last a year. Deputy Minister of European and Euro-Atlantic Integration Yaroslav Demchenkov said that during its presidency Ukraine would make efforts to strengthen the role of energy solidarity, which is extremely important in the energy crisis that many countries are currently experiencing. During the meeting of the Energy Community Council of Ministers on the transfer of the presidency to Ukraine, the legislative packages EU's Clean Energy for All Europeans and the European Union's General Guidelines for Adopting the Decarbonisation Roadmap for the Energy Community Contracting Parties were adopted.
The Ministry of Digital Transformation of Ukraine and Apple Inc signed a Memorandum. The document provides for cooperation, exchange of information, and support of the Ukrainian government by the corporation on a number of initiatives. In particular, the company will cooperate with the Ministry within the framework of the Ukrainian Population Census 2023. Ukraine will be the second country in the world after the United States to conduct such a census with Apple. The company will support the Ministry of Digital Transformation of Ukraine in developing and identifying priority projects for Ukraine's transition to a paperless regime. For example, Apple will provide support in the use and improvement of the application "Diia" based on the iOS operating system. According to the Memorandum, the company will also cooperate with the Ukrainian government to increase the digital literacy of Ukrainian citizens.
The spread of COVID-19 in Ukraine has been declining for four weeks. This was reported by the Prime Minister of Ukraine Denys Shmyhal at the beginning of last week. In particular, according to him, at that time in Ukraine, there were 100 thousand fewer patients than in early November. Nevertheless, quarantine was not eased last week in any of the regions of Ukraine where the highest level of epidemic danger was established. The Minister of Health of Ukraine Viktor Lyashko also said that the state is currently developing a plan to combat the spread of the coronavirus strain Omicron. In particular, citizens who have been in countries where cases of this version of the disease were detected must undergo 14 days of self-isolation upon arrival in Ukraine. Finally, after increasing the rate of vaccination of the population of Ukraine from COVID-19 in October – November, the weekly number of first doses returned to the level of 400 thousand (precisely – 432 thousand during the last week). As of now, 13.75 million people in the country have received one dose of the vaccine and 11.8 million – the second.
The Verkhovna Rada of Ukraine approved the state budget for 2022. Revenues of the state budget in 2022 will amount to 1.322 trillion hryvnias. Expenditures next year will reach 1.497 trillion hryvnias. This means that the state budget deficit will remain at 3.5% of GDP, as envisaged in the memorandum signed between Ukraine and the IMF in November. The document also contains a forecast of the country's nominal GDP for 2022 in the amount of 5.39 trillion hryvnias, and growth of the real GDP – by 3.8%. The authors of the document set the forecast of the average exchange rate of hryvnia to the dollar at the level of 28.6 – 28.7 hryvnias per dollar.
The state budget of Ukraine for 2022 is based in particular on the tax law No5600, which was alsoadopted last week. This document, in particular, introduces a tax on the sale of third and subsequent real estate for one year at 18% of the transaction amount. The law also requires agricultural landowners to pay 5% of the value of the plot per year. In addition, the document increases the excise tax by 5%. The law tripled the environmental tax rate on carbon emissions to 30 hryvnias per tonne. At the same time, it remains the lowest carbon tax rate in Europe.
The President of Ukraine Volodymyr Zelensky addressed the Verkhovna Rada of Ukraine with an annual report on the internal and external situation in Ukraine. In particular, the head of stateannounced the "Ukrainian Dream" program for citizens to obtain a loan to buy real estate, an electric car, or pay for tuition in Ukraine, as well as the "Large thermo-modernization" program to insulate apartment buildings, schools, kindergartens, and hospitals. He also announced the introduction of a bill on the economic passport of Ukrainians, according to which fees for the use of Ukrainian subsoil will be accumulated in the personal accounts of children of Ukrainian citizens.
In addition, the President emphasized the achievements in strengthening international support for Ukraine's sovereignty and de-occupation of the temporarily occupied territories. In particular, he mentioned the creation of the Crimean Platform, which was attended by 46 delegations. Also in this context, he stressed the preservation of US support, deepening cooperation with the United Kingdom, Lithuania, Poland, and Turkey. Finally, Volodymyr Zelensky noted that an important component of Ukraine's international policy is to maintain the support of Ukrainians all over the world. In this context,he announced the introduction of a bill on multiple citizenships to the Verkhovna Rada.
Ukraine’s participation in the North Atlantic Council: Dmytro Kuleba, the Minister for Foreign Affairs of Ukraine, took part in the meeting of NATO foreign ministers within the framework of the North Atlantic Council held from 30 November to 1 December in Riga, Latvia. Mr. Kuleba informed his NATO counterparts about the aggravation of the security situation by the Russian Federation in Donbas, Russian military build-up near the borders with Ukraine, and a threat of a new Russian incursion.“Ukraine is actively working with partners to implement a comprehensive deterrent package comprisingpolitical, economic, and security measures. It is aimed at discouraging Russia from the worst-case scenario. By demonstrating strength now we are avoiding the need to prove it later”, stated the Minister for Foreign Affairs of Ukraine.
Furthermore, Dmytro Kuleba gained the support of Great Britain, Estonia, Latvia, the Netherlands, andCanada to take concrete steps regarding the elaboration of the comprehensive of deterring Russia from further aggression against Ukraine.
Ukraine and the European Peace Facility: The Council of the European Union made a decision to launch practical cooperation with Ukraine within the framework of the newly established European Peace Facility.
The decision provides the allocation of €31 million for Ukraine during 2021-2024. The press release reads as follows: “This assistance measure will enhance the overall resilience of Ukraine and help strengthen the capacities of the Ukrainian Armed Forces, including their ability to provide their servicesto civilians in crises or emergency situations”. In particular, the assistance will include granting military medical units, including field hospitals, engineering, mobility and logistics units, and supportingUkraine’s cybersecurity. At the same time, according to the Minister for Foreign Affairs of Ukraine, the EU-Ukraine cooperation within the European Peace Facility will be long-term and will last during 2021- 2027.
Military exercises: According to Anna Maliar, the Deputy Defence Minister, the Armed Forces of Ukraine will participate in 26 multinational military exercises, namely in 16 exercises abroad and 10 on the territory of Ukraine in 2022. "In 2022, we plan to hold 10 multinational exercises on the territory of Ukraine and are set to involve about 21,500 Ukrainian forces and about 11,000 foreign participants,"said the Deputy Defence Minister.
In addition, the Ukrainian Army is taking part in the exercises “Combined Resolve 2021” (17 November– 20 December 2021, Germany) for the first time. The exercises are organized by the US 7th Army Training Command and encompass approximately 4,600 Soldiers from Bulgaria, Georgia, Greece, Italy, Lithuania, Poland, Serbia, Slovenia, Ukraine, United Kingdom, and the United States.
Strengthening the Ukrainian Navy: The French shipbuilding company OCEA and Ukraine's NIBULON signed a contract on 30 November for the construction of five ships for the Ukrainian State Border Guard Service in Mykolaiv. It is expected that the 5 ships will be ready till the end of 2023, according to theMinistry of Internal Affairs of Ukraine.
In total, Ukraine and France agreed that the Ukrainian Border Guard Service would receive 20 ships with 15 of them to be built in France.
Ceasefire regime in Donbas: According to the Joint Operation Forces reports, pro-Russian militants violated the cease-fire regime 28 times as of 29 November- 5 December. As a result of the violations, 4 Ukrainian soldiers were injured and 1 was killed
Ukraine-Israel relations: A Ukrainian delegation headed by Oleksii Reznikov, the Minister of Defence of Ukraine, had a working visit to Israel during 29-30 November to take part in the 12th meeting of the Joint Ukrainian-Israeli Commission on Trade and Economic Cooperation. Prior to the work of the Commission, Mr. Reznikov met with Eyal Hulta
Moreover, 30 November was marked with the meeting of the Joint Ukrainian-Israeli Commission on Trade and Economic Cooperation. Key areas of discussion included economics, investments, innovations, agriculture, energy, healthcare, regional development, science, education, tourism, transport, and communication. As a result of the meeting, the most prospective areas for bilateral cooperation comprised high tech, agriculture, irrigation as well as tourism, healthcare, security, and energy, including joint gas production in the shelf area of the Black Sea.
Ukraine-US relations: The Minister for Foreign Affairs of Ukraine Dmytro Kuleba met with Secretary of State Antony Blinken on the sidelines of the OSCE Ministerial Meeting in Stockholm, Sweden. The counterparts discussed the practical implementation of the comprehensive deterrence package againstRussian aggressive actions. ”As we see Russia provokes Ukraine militarily but also diplomatically, we will continue to demonstrate restraint. At the same time, we will continue working and calling on — with partners and calling on them to prepare a deterrent package that will make President Putin think twice before resorting to military force. I think that all of us have to be focused on deterring Russia at this point, and we have no intentions to provoke them or to hold military operations in Donbas”, stated the Ukrainian Foreign Minister. At the same time, according to Mr. Kuleba, the deterrence package will include severe economic sanctions.
Ukraine-Belarus relations: The State Border Committee of Belarus stated that a Ukrainian helicopter Mi-8 allegedly violated Belarusian air space on 4 December.
The State Border Guard Service of Ukraine is conducting a training operation “Polissia” in order to work out reactions to potential attempts to illegally breach the border given the ongoing migrant crisis on the borders between Belarus and the EU countries. But according to the State Border Guard Service of Ukraine, the Belarusian statement is not true.
Meanwhile, the Defence Ministry of Belarus has summoned a Ukrainian military attaché to protest against the alleged violation of Belarusian air space by a Ukrainian aircraft.