Ukraine security services investigate opposition for coup plotting
The Ukrainian security services have launched a criminal investigation into "activities aimed at overthrowing the government" as hundreds of thousands of pro-EU protesters gathered on Sunday in Kiev in response to calls for a "million-man march."
The SBU said it was investigating several opposition leaders on suspicion of plotting to seize power as political allies of Viktor Yanukovich, Ukraine's president, repeated accusations that the demonstrators were plotting a coup.
The SBU's move came as what appeared to be the largest crowds yet in the 18 days of protests continued calls for Kiev to sign historic EU integration agreements rather than strengthen ties with Russia. Led by a mix of activists and opposition politicians, the protesters called for snap presidential and parliamentary elections and surrounded government buildings chanting: "Resign, resign, resign. Out with the bandits. Ukraine is Europe."
As darkness fell, demonstrators pulled down and decapitated the city's landmark statue of Lenin and attacked it with hammers—a gesture representing a clear rejection of Russian influence over the country. "Yanukovich is next," said Mykola Kokhanivsky, one of those who had toppled the statue.
There were signs that opponents of Mr Yanukovich were preparing for a protracted stay on the streets. Demonstrators who a week ago took up residence in Kiev's main square began erecting more barricades and tents several blocks away around state buildings. Although these were guarded by thousands of riot police there was no sign of the violence of the past few days.
The whereabouts of Mr Yanukovich, who has been criticized at home and abroad for imprisoning political rivals and eroding the country's post-Soviet democratic gains, was unclear. Opposition lawmakers pledged to follow up by erecting permanent protest camps outside his heavily guarded estate some 16 kilometers north of Kiev called Mezhyhirya.
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Protest organizers insist their intentions are for peaceful demonstrations to pressure Mr Yanukovich into signing the EU agreements. But calls for more radical action by ordinary citizens and some activists who want to forcefully "sweep Mr Yanukovich from power" were heard on Kiev's streets.
"We hope to achieve our results peacefully [and] democratically through snap elections," said 51-year-old Volodymyr Rykmas, one of about 1,000 Afghan war veterans who are protecting the crowds from riot police and "provocateurs" after violent clashes in recent days.
"We will stand to the end," he added. "We have enough troops on the ground … enough resolve."
José Manuel Barroso, the European Commission president, spoke with Mr Yanukovich on Sunday to urge him to "exert maximum restraint" with the demonstrators. He also said he would send Catherine Ashton, the EU's foreign policy chief, to Kiev this week to help to mediate in the crisis.
The stand-off is putting further strain on the cash-strapped government and an economy in the grip of a second recession in five years.
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Figures released on Friday reveal that central bank reserves fell more than expected in November, down to nearly two months of import coverage. This has complicated the government's attempts to stop what appears to be the imminent devaluation of the hryvna, the domestic currency.
Foreign currency reserves declined by almost 9 per cent, down $2 billion to some $18.8 billion, owing to currency interventions last month, the National Bank of Ukraine revealed.
Speaking on state television on Saturday, first deputy prime minister Serhiy Arbuzov said his government needed at least $10 billion in loans to cover near-term balance-of-payment needs. With rating agencies downgrading Ukraine's sovereign rating and talk by the US Federal Reserve of "tapering", or reducing its quantitative easing program, analysts said borrowing on the eurobond market has become too expensive for Kiev.
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The International Monetary Fund has expressed its willingness to bail out Kiev but local authorities have balked at its loan conditions. In an interview with a local newspaper published this weekend, the IMF's local representative denied Kiev's claims that it was demanding sharp rises in energy prices for the poorest as a condition for a loan.
Instead, the IMF wanted incremental increases of up to 40 per cent for wealthier Ukrainians, allowing subsidies for the poor to be sustained while also reducing the budget deficit.
Local analysts said Mr Yanukovich, who is expected to seek re-election in 2015, is seeking instead a bailout and political guarantees from Russia's president, Vladimir Putin.
Citing talks Mr Yanukovich held with Mr Putin in Russia's Black Sea resort town of Sochi on Friday, Ukrainian officials said both sides were closer to signing a strategic agreement that could bring badly needed funds and lower prices on natural gas that fuels the nation's energy inefficient economy. They refrained from providing further details.
Addressing protesters on Sunday, Oleg Tyahnybok, leader of Ukraine's nationalist Svoboda party, called on Mr Yanukovich to make details of closed-door talks public. "They are falling on their knees before Putin, before the Kremlin, betraying Ukraine. We will not allow this," Mr Tyahnybok said.
—By The Financial Times' Roman Olearchyk in Kiev; Additional reporting by Peter Spiegel in Brussels.