Russia’s de facto annexation of Crimea from Ukraine, to which it legally belongs, its parliamentary approval of the use of military force in Ukraine, as well as its unfounded claim that Russian-speaking citizens in eastern Ukraine are being mistreated by Kiev’s new government, have presented Europe with its most dangerous crisis since the end of the Cold War.

Russian President Vladimir Putin, while harbouring some legitimate concerns over the turn of events in Ukraine after the toppling of President Viktor Yanukovych, has shown a total disregard for international law by sending troops into Crimea and has laid the basis for a potential new Cold War.

The fact that Moscow continues to deny that such troops are Russian, insisting that they are Crimean “self defence militias” is even more worrying.

Putin has broken Russia’s 1997 base agreement with Ukraine, which states that Russian troops need to request permission from the Ukrainian authorities 10 days in advance to be able to leave their bases. Furthermore, while Russia can have up to 25,000 troops and personnel in Crimea, only 1,987 members of the Russian military contingent can be marines and ground troops.

In response to Russia’s actions, the European Union has so far decided to halt talks on easing visa restrictions on Russian citizens and on a new pact to replace the 1997 Russia-EU Partnership and Co-operation Agreement. It has also frozen the assets of 18 former Ukrainian officials, including ousted president Viktor Yanukovych.

The US has imposed a visa ban on a number of Russian and Ukrainian individuals. Both the EU and US have indicated that further measures could be taken, such as economic sanctions, if Russia continues to destabilise the situation, but have left the door open for more diplomacy, and rightly so.

Russia was also harshly criticised by the G-7 leaders who suspended their participation in activities associated with the preparation of the G-8 Summit in Sochi in June. The countries, Canada, France, Germany, Italy, Japan, the UK and the United States, said Moscow’s actions in Ukraine “contravene the principles and values on which the G-7 and the G-8 operate”.

US Secretary of State John Kerry and British Foreign Secretary William Hague were right to visit Kiev to express their solidarity with Ukraine. Mr Kerry’s announcement that the US will grant Ukraine $1 billion to meet its energy demands is particularly welcome, as was the EU’s declaration that it will provide Kiev with an €11 billion aid package.

Economic sanctions would certainly hurt Moscow, whose economy is more fragile than its Western counterparts. Of course, Russia could retaliate with sanctions or asset freezes of its own, and it could turn the off the gas supply to Europe (and Ukraine). Sixty per cent of the EU’s gas supply (and 30 per cent of Germany’s) comes from Russia; however, I not sure Russia could afford to lose such much needed revenue.

Rightly or wrongly, Russia believes that the US and EU are determined to take Ukraine into their orbit and deny Moscow an important ally in its backyard. This concern must be addressed and it is good that direct talks took place during the week between Russia’s Foreign Minister Sergei Lavrov and Mr Kerry and other EU foreign ministers. It’s a pity, however, that Russia still doesn’t recognise the new Ukrainian government and has refused to enter into direct talks with it.

Crimea is important to Russia because its population is 60 per cent Russian and its entire Black Sea fleet is based there at Sevastopol. It used to be part of Russia but was given to Ukraine by Soviet leader Nikita Khrushchev in 1954 (himself born at the border with Ukraine) as a gesture of goodwill. While Russia does have legitimate interests in Crimea, it has certainly not handled the situation properly. Will it now send in troops to eastern Ukraine where the majority of the population are Russian speakers?

Russian President Vladimir Putin has shown a total disregard for international law

The only way this situation can be resolved is by direct talks between Moscow and Kiev, and Russia must recognise Ukraine’s new government. Ukraine, on the other hand, must also act responsibly. It has so far not reacted to Russian provocation, which is admirable, but some of its actions have certainly been offensive, such as its decision to remove Russian as an official language, which I believe is now under review, and its appointment of right-wing Nationalist (i.e. anti-Russian) figures to position of authority in the security forces.

Ukraine certainly has a right to be part of the European family of nations and Russia has no business objecting to this.

However, it is important that Russia does not feel threatened by Ukraine’s new orientation; the model that Kiev should go for is Finland, which is an EU member state but not a Nato one.

This served Finland (and the Soviet Union) well during the Cold War and did not prevent Helsinki joining the EU in 1995.

Indeed, Nato, while expressing solidarity with Ukraine, should not take an active role in this crisis for the moment. It is the EU (and the US) which take a leading role in trying to resolve this problem.

Russia might be convinced to recognise the government in Ukraine and not to intervene in eastern Ukraine, but I doubt it will relinquish Crimea.

Crimea’s Parliament last week announced it would hold a referendum on March 16 on whether to join Russia or remain part of Ukraine, which under the Ukrainian Constitution is illegal.

Perhaps one solution could be a special status for Crimea, with joint Russian-Ukrainian sovereignty, the retention of Russia’s base, and full respect for the rights of the Ukrainian and Tartar minorities.

This is not an ideal solution, because it legitimises Russia’s flaunting of international law, but it is more a case of realpolitik.

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