Peter Jones: How Ukraine crisis may hurt us all

As Ukrainian tanks rolled through Konstantinovka yesterday, Vladimir Putin trained his fire on Kiev. Picture: Reuters

Horrific though the killing of 298 utterly innocent people, including 80 children, is in the downing of Malaysia Airlines flight MH17, it hasn’t altered much in the dreadful power conflict in Ukraine. And much though it may seem to us in Scotland as a faraway fight that we can neither influence nor be affected by, it now looks likely we will be hurt by it.

Russian president Vladimir Putin is still the key figure. It is in his hands to expedite the international investigation at the crash site and to make sure that grieving relatives receive the bodies of their loved ones as soon as possible. It is also in his power to end the fighting between the Ukrainian government and the pro-Russian separatists in eastern Ukraine who are now pretty much conclusively identified as responsible for the atrocity.

Yet while the responsibility trail also almost certainly leads from the Ukrainian killers to his desk in Moscow, there is as yet little sign that this monstrosity will divert him from his strategic goal; that is to prevent the US and the EU from gaining any leverage in what he regards not just as Russia’s backyard, but as an essential key to Russia’s security and power in the world.

The importance to him of that strategic aim is why little has changed in Ukraine. The reaction of western leaders to the mass killing shows a certain stiffening of determination to make Mr Putin’s Russia pay. But his response to western leaders also shows that he detects a degree of weakness which he will seek to exploit.

Before the MH17 disaster, he was playing a twin-track game. On the one hand, he was pledging support for a negotiated political settlement in Ukraine; on the other, he was supplying the eastern insurgents with enough weaponry, intelligence and military advisers in the field to keep the fighting going on.

In that second part, he could claim to be merely countering the $20 billion of military assistance the American government is reported to be giving the government in Kiev. He isn’t making that claim because the military error made by Russia was to give powerful sophisticated weaponry – the Buk missile system believed to have hit the plane – to unsophisticated militias keener to use it just to prove their muscle than to bother identifying what they were actually firing it at.

What has happened on the ground since then has, however, given Mr Putin an opportunity to divert western attention from the strategic problem. The behaviour of the militias in hindering access to the crash site and in taking away the bodies has become the primary problem in the western mind.

Thus western leaders demand the investigators have unrestricted access and Mr Putin appears on television to echo that demand. But, while saying nothing about the missile, he continues to blame the tragedy on the Ukrainian government in Kiev for ending a ceasefire and resuming military assaults on pro-Russia separatists.

That explanation looks entirely spurious, but Mr Putin probably believes he has recovered some ground by appearing to sound reasonable and, with respect to access for investigators, standing in line with international opinion.

But once the investigation has produced its results and the dead have been buried, what then? This is where western leaders, from Mr Putin’s perspective, have looked a little weak.

They did not immediately blame Russia, nor did they respond robustly to Russian attempts to deflect blame elsewhere. Instead they called for the investigation and its findings. And while it is now clear it was a Buk missile, and where exactly in eastern Ukraine under separatist control it was launched, much less simple is clarifying where they got the missile from.

What is plainly apparent is that the conflict is costing lives. Before MH17 was downed, reliable reports say that nearly 500 civilians in eastern Ukraine had been killed and nearly three times as many injured. And now Kiev seems to be intensifying an assault on the eastern city of Donetsk, which may well double the death and injury toll.

Reports vary on how the civilian population is taking this. Some say that they are turning against the pro-Russia insurgents, others that they are blaming Kiev. If opinion really is that fluid, then Ukrainian president Petro Poroshenko’s drive to kill as many pro-Russia insurgents as possible and drive the rest out of the cities could go horribly wrong if there are major civilian casualties.

Mr Poroshenko may well regain ostensible control of the country, but the lesson of other such military campaigns, particularly if public opinion is not with the victor, is that a guerrilla campaign of terrorism may well continue.

That could suit Mr Putin just as well, for his minimal aim seems to be to achieve a political settlement in which eastern Ukraine has sufficient autonomy from Kiev that it becomes a separate administration in all but name, rendering the idea of a united Ukraine as more fiction than reality.

The only leverage that the west has to weaken Mr Putin’s hand is economic sanctions. This has mostly been done so far by cutting off big Russian companies’ access to American capital markets and by creating such uncertainty that foreign investors are suddenly wary of putting their money into Russia.

It seems to have been surprisingly effective, pushing Russia’s economy to the brink of recession. But the problem here is that the European economy, which has been doing well out of growing trade with Russia, is also weak. And while the outrage at MH17 felt in Berlin, Brussels, the Hague, London and Copenhagen is certainly genuine, European leaders are lagging far behind Washington in the sanctions they are willing to apply.

Just as the sanctions on Russia seem to have had a bigger effect than expected, so a downturn in Russia could have a larger effect on European economies than anticipated. Some commentators are speculating that this could turn out to be a sufficient shock on the eurozone to tip it into deflation, which would have a calamitous effect on demand.

That in turn would cause a dip in British exports, dampening if not stalling the economic recovery and checking the growth in employment. Scotland could not escape that. The question we all have to ask ourselves is whether we are willing to bear that pain in the name of pushing the pace towards a peaceful settlement in Ukraine?