Emerging Europe This Week

No peace talks until Russia withdraws from Ukraine

Catch up quickly with the stories from Central and Eastern Europe that matter, this week led by news of a major Ukraine peace conference in Switzerland.

Russia’s war on Ukraine

Kyiv will hold peace talks with Russia tomorrow if Moscow pulls out of all Ukrainian territory, President Volodymyr Zelensky said last weekend.

But speaking at the close of a summit for peace in Switzerland, he said Russian President Vladimir Putin would not end the war and had to be stopped “in any way we can”, whether by military or diplomatic means.

Western aid was not enough to win the war, he added, but the summit had shown that international support for Ukraine was not weakening.

The meeting concluded with dozens of countries committing to Ukraine’s territorial integrity. A final document was adopted which blamed the war’s widespread suffering and destruction firmly on Russia. However, several countries attending including India, South Africa and Saudi Arabia did not sign it.

More than 90 countries and international organisations attended the summit.

Russia was not invited, and its biggest backer China was not present, leading some to cast doubt on the summit’s effectiveness.

Ukraine this week urged international bondholders to accept deep cuts on the value of more than 20 billion US dollars in debt in order to help finance the nation’s war effort, after initial talks just months before a payment standstill expires failed to produce a deal.

Bondholders turned down Ukraine’s proposal to reduce the value of foreign currency bonds by up to 60 per cent in negotiations this month, the country’s finance ministry said on Monday.

Zelensky’s government is facing a tight deadline to secure the debt restructuring, which it needs in order to continue receiving a bailout from the IMF and to restore flows of private funding for reconstruction. Bondholders granted Kyiv a two-year moratorium on payments in the months following Russia’s invasion in early 2022, but this is set to run out in August.

The early talks on a restructuring have reflected deep investor uncertainty about the course of the war and how much debt Ukraine’s economy will be able to carry.

Mark Rutte will be the next NATO secretary-general after all 32 members of the alliance agreed that the outgoing Dutch prime minister will succeed Jens Stoltenberg.

Following endorsements from Hungary and Slovakia on Tuesday, Romania confirmed its support for Rutte on Thursday, with Romanian President Klaus Iohannis withdrawing his candidacy for the NATO top job.

During a meeting of the Supreme Council of National Defence, Iohannis said he had notified NATO allies about the withdrawal of his candidacy.

At the same meeting, Romania promised to send a full Patriot air defence system to Ukraine—on the condition that the United States help cover the gap.

“Considering the significant deterioration of the security situation in Ukraine…Council members decided to donate a Patriot system to Ukraine,” the Romanian president’s office said in a statement.

Other news from the region

Hungary’s government announced on Tuesday that its upcoming presidency of the European Union will be held under the motto “Make Europe Great Again,” but played down any parallels with Donald Trump’s MAGA movement in the United States. “This is a reference to an active presidency,” Hungary’s EU Affairs Minister János Bóka said as he outlined Budapest’s programme for its six month presidency, starting on July 1. “It actually shows manifest the expectation that together we should be stronger than individually, but that we should be allowed to remain who we are when we come together,” he told reporters.

Poland’s commissioner for human rights, Marcin Wiącek, this week voiced concern over the exclusion zone introduced by the government at the border with Belarus in response to a surge in attempted crossings by migrants. He warned that the measures will “interfere with basic constitutional freedoms”, including the right to information and freedom of movement, and “impede the provision of humanitarian, medical and legal assistance” to those crossing the border. Last Thursday, regulations banning unauthorised people from entering an area along 60km of the border with Belarus came into force. 

US chipmaker Onsemi will invest up to two billion US dollars to boost its semiconductor output in Czechia, it said on Wednesday, expanding the company’s European capacity as the European Union seeks self-sufficiency in critical supplies.The brownfield project would be the largest one-off direct foreign investment in Czechia. Pending approval of state aid, Onsemi will expand its operations in the eastern town of Roznov pod Radhostem to house the full production chain for silicon carbide semiconductors including final chip modules used in the automotive and renewables sectors.

Serbia is preparing to give Rio Tinto the green light to develop Europe’s largest lithium mine two years after Belgrade called off the project, paving the way for a significant boost for the continent’s electric vehicle industry. President Aleksandar Vučić said in an interview with the Financial Times this week that “new guarantees” from the Anglo-Australian miner and EU looked set to address Serbia’s concerns over whether necessary environmental standards would be met at the Jadar site in the west of the country. Vučić said the mine, “might be a game-changer for Serbia and the entire region”.

CVC Capital Partners is planning to list Żabka Polska in an initial public offering expected to value Poland’s biggest convenience store chain at 7.5 billion to eight billion US dollars, it was reported this week. The Warsaw IPO could raise between one billion and 1.5 billion US dollars and is expected to launch as soon as September. CVC bought Żabka from Mid Europa Partners in 2017, in what was then the biggest deal in the country’s food retail sector. The convenience store chain operates more than 10,000 branches.

Citizens of Kosovo and Israel will be able to visit the other nation without a visa following an agreement between the two governments signed Tuesday, the Kosovar Foreign Ministry said. The visa waiver agreement was signed in the Kosovar capital, Prishtina, by visiting Israeli Interior Minister Moshe Arbel and Kosovar Foreign Minister Donika Gervalla. Gervalla said the agreement will “open a new chapter in promoting our country, our cooperation and economic development, youngsters’ educational development and the implementation of joint initiatives and projects.”

Bulgarian President Rumen Radev walked out of a planned meeting with Montenegro’s prime minister on Monday—because the PM was four minutes late. Radev, who led a delegation to Podgorica this week, had been due to meet Montenegrin PM Milojko Spajić at the government building’s reception hall Monday evening after first meeting with the country’s president, Jakov Milatović. But those plans were canceled when Spajić didn’t immediately turn up and Radev refused to wait. Spajić, a 36-year-old ex-Goldman Sachs banker, was elected last October and is Europe’s youngest prime minister.

Armenian Prime Minister Nikol Pashinyan has ordered the drafting of a new constitution amid demands by Azerbaijan that a reference to Nagorno-Karabakh be removed from Armenia’s fundamental law. Pashinyan gave the Council of Constitutional Reforms until December 30, 2026, to draft and approve the new constitution. Azerbaijani President Ilham Aliyev has repeatedly demanded that Yerevan change its constitution as a main condition for concluding a peace treaty with Armenia. Baku wants a reference to Nagorno-Karabakh’s unification with Armenia removed from the constitution.

Photo: Volodymyr Zelensky official Facebook page.

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