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16 Mar 2014
Crimea says yes to Russian rule
FXStreet (Bali) - With Russian State News reporting an overwhelming 95.5% of Crimea's voters supporting an annexation from Ukraine to join back Russia, a new future for the peninsula has been determined.
As mentioned, 95.5% of the voters among the 2m population, of whom 58 percent of are ethnic Russians, were in favor of returning under Moscow's rule.
The fate of Crimea has in fact been sealed since the regional parliament approved joining Russia on February 28, and scheduled a referendum on the peninsula's future, just five days after Ukraine´s president Viktor Yanukovych was ousted and the 2004 constitution was reinstated in the country.
Crimea, which is a relatively small economy, is of substantial strategic importance to Russian President Vladimir Putin who would like to see his influence spreading again over the post-Soviet states. Russia has a naval base on the peninsula and the majority of people living there are ethnic Russians so it was fairly easy for Moscow to push through Crimea's annexation.
As this kind of referendum is without precedent it remains unclear what immediate or longer-term consequences will it have for the region or how will the international community react. The sanctions against Russia, including travel bans and asset freezes, which are to be imposed by the EU on Monday do not seem to deter Putin from his actions in Crimea and against Ukraine.
In the opinion of Valeria Bednarik “The market has already priced in the fact that Russia will use Crimea’s referendum to legitimize the military occupation of the Ukrainian republic, as the ethnic Russian population is significant in the area. However, that doesn’t diminish chances of risk rallies with Sunday opening, as the West world had already expressed its concerns over the crisis, and the US has clearly stated that they support Crimea as a part of Ukraine, and will not recognize the result of the referendum as legal.”
“Both the US and EU have menaced to impose sanctions to Russia if the country maintains its position, but so far Putin ignores them: those sanctions and any upcoming consequence on it is what may triggers runs towards safety, looking mostly for more yen gains across the board.”
As mentioned, 95.5% of the voters among the 2m population, of whom 58 percent of are ethnic Russians, were in favor of returning under Moscow's rule.
The fate of Crimea has in fact been sealed since the regional parliament approved joining Russia on February 28, and scheduled a referendum on the peninsula's future, just five days after Ukraine´s president Viktor Yanukovych was ousted and the 2004 constitution was reinstated in the country.
Crimea, which is a relatively small economy, is of substantial strategic importance to Russian President Vladimir Putin who would like to see his influence spreading again over the post-Soviet states. Russia has a naval base on the peninsula and the majority of people living there are ethnic Russians so it was fairly easy for Moscow to push through Crimea's annexation.
As this kind of referendum is without precedent it remains unclear what immediate or longer-term consequences will it have for the region or how will the international community react. The sanctions against Russia, including travel bans and asset freezes, which are to be imposed by the EU on Monday do not seem to deter Putin from his actions in Crimea and against Ukraine.
In the opinion of Valeria Bednarik “The market has already priced in the fact that Russia will use Crimea’s referendum to legitimize the military occupation of the Ukrainian republic, as the ethnic Russian population is significant in the area. However, that doesn’t diminish chances of risk rallies with Sunday opening, as the West world had already expressed its concerns over the crisis, and the US has clearly stated that they support Crimea as a part of Ukraine, and will not recognize the result of the referendum as legal.”
“Both the US and EU have menaced to impose sanctions to Russia if the country maintains its position, but so far Putin ignores them: those sanctions and any upcoming consequence on it is what may triggers runs towards safety, looking mostly for more yen gains across the board.”