Ukraine 101:

• Millions of dollars in cash, valuable artworks, luxury watches and giant mansions—that’s just a taste of the riches Ukrainian officials have revealed in asset declarations that international lenders have demanded to help stamp out decades of post-Soviet corruption. Perceived excesses in lawmakers' lifestyles—ill-gotten or not—have drawn condemnation in a country where government statistics put the average household monthly income at around $200. State corruption is the second-top concern for Ukrainians after the two-year Russian-backed insurgency in the nation’s east, a Sept. 28-Oct. 7 poll showed Oct. 31. Embarrassed members of Ukraine's parliament have given up a pay raise to try to defuse public anger after the revelations.(Bloomberg, 10.31.16, RFE/RL, 10.31.16, Kyiv Post/Financial Times, 11.02.16)
• Ukraine’s gross domestic product per capita was $2,115 last year, Europe’s second-lowest after Moldova, World Bank data show. The indicator in neighboring Poland, which was almost level with Ukraine in 1990 before the Soviet collapse, was $12,500. (Bloomberg, 10.31.16)

West’s leverage over Russia:

• Russia’s Gazprom and the European Union’s competition watchdog on Oct. 26 announced they would attempt to settle a longstanding antitrust case and that the state-controlled energy company would soon submit concrete commitments to change behaviors in exchange for escaping a hefty fine. (Wall Street Journal, 10.26.16)
• Former Finnish Ambassador to Russia Rene Nyberg argues that “there are plenty of reasons for the Kremlin to look for a settlement with the West, the most compelling ones being economic. But the record of the Putin administration shows that in the end, economics always defers to politics.” (Carnegie, 10.31.16)

Russia’s leverage over West:

• SAIS fellow and LSE associate David Cadier: “In the lead up to the French election in spring 2017, nearly all of the opposition parties—whether on the right, far right or far left—have bemoaned the degradation of ties with Russia under the government of President François Hollande, arguing that it breaks with France’s tradition of diplomatic engagement and political dialogue with Moscow and that it is detrimental to French economic interests.” (Foreign Affairs, 10.31.16)
• Rumen Radev, the main opposition contender in Bulgaria's presidential election, vowed on Oct. 24 to seek better relations with Russia and a lifting of EU sanctions that he called harmful to both sides. (Reuters, 10.24.16)
• A joint U.S., Russian and Japanese crew has landed safely in Kazakhstan following a 115-day mission aboard the International Space Station. (RFE/RL, 10.30.16)

Russia’s leverage over Ukraine:

• No significant developments.

Casualties and costs for Russia, West and Ukraine:

• At least six people died in clashes between government forces and Russia-backed separatists in eastern Ukraine, officials said Oct. 28. The separatists' news agency said at least two of their fighters were killed and another six wounded Oct. 27. A Ukrainian military spokesman said on Nov.2 that two more Ukrainian soldiers were killed and five wounded in eastern Ukraine. (RFE/RL, 10.29.16, UAToday, 11.02.16)
• As the economy continues to struggle under the weight of low oil prices and sanctions, Russian authorities have decided to cut defense spending next year by 1,000 billion rubles ($15.89 billion), or by approximately 30%. Overall, spending on national defense in the federal budget for 2017 is envisaged at 2,840 billion rubles ($45.15 billion), or 3.3% of GDP. In 2018 Russian defense spending will amount to 3% of GDP, while in 2019 it will drop to 2.8%. (RBTH, 11.01.16)
• The sanctions imposed on the Russian economy cost the country up to 1% of GDP growth every year but they do not work as an instrument of political influence, former Russian Finance Minister Alexei Kudrin has said. Kudrin predicted the growth rate of Russia's economy will remain around 1% until 2020. (The Moscow Times, 10.31.16, Sputnik, 10.26.16)
• Ukraine's anti-monopoly watchdog has filed a request with Kiev Commercial Court seeking 171.8 billion hryvnia ($6.8 billion) from the Russian natural gas giant Gazprom for abusing its monopoly on the Ukrainian gas transit market. (RAPSI, 10.31.16)
• Russian President Vladimir Putin has signed a federal law on suspending the Russian-U.S. intergovernmental agreement on disposal of weapons-grade plutonium. (TASS, 10.31.16)
• Sweden has all but abandoned the neutral stance it projected during the Cold War and is now firmly siding with NATO and helping it shore up Europe's eastern flank, as Russia builds up its military capabilities in the region. (The Wall Street Journal, 10.27.16)
• Norway will allow U.S. troops to be stationed on its soil for a limited period from next year, the defense ministry said Oct. 25, marking the first time foreign troops have been posted on its territory since the end of World War II. Some 330 U.S. Marines will be stationed at the Vaernes military base in central Norway from January, the ministry said in a statement, adding that the trial would be reviewed in the course of the year. (Reuters, 10.24.16)
• Russia lost its seat on the main UN body devoted to human rights on Oct. 28, signaling international dismay over its military's conduct in Syria. (New York Times, 10.28.16)
• Russia is having to shrink its embassy in London because of extended delays by British authorities in issuing visas to diplomats, its ambassador has said, in a sign of the deep deterioration in relations between the two countries. (Financial Times, 10.22.16)

Red lines and tripwires:

• No significant developments.

Factors and scenarios that could cause resumption of large-scale hostilities or lead to accidents between Western and Russian forces in Europe:

• A senior Russian official has spoken of a Cabinet meeting where President Vladimir Putin reported on a “high-risk” incident in which Russian military jets buzzed the U.S. Navy in the Black Sea. When some at the table cheered with phrases like, “They deserve it!” Putin shut them down, saying, “Are you crazy?” The official spoke on condition of anonymity pursuant to the rules of the annual Valdai International Discussion Club gathering. (Bloomberg , 10.26.16)
• “Russia has no intention of attacking anyone. … All of the NATO members together with the USA have a total population of 600 million, probably. But Russia has only 146 million. It is simply absurd to even conceive such thoughts,” Russian President Vladimir Putin said at the final session of the Valdai International Discussion Club on Oct. 27. Putin also condemned remarks made more than two years ago by Russian TV anchor Dmitry Kiselyov that “Russia is the only country in the world capable of turning the United States into radioactive ash”: “Threatening nuclear weapons is the very last resort. It’s harmful rhetoric, and it’s not something I welcome.” The new first deputy head of Putin’s administration criticized Kiselyov for the same comments the following week. (Kremlin.ru, 10.27.16, The Moscow Times, 10.27.16, 11.2.16)
• Technological progress may lead to humans giving robots the power to press "the red button" and launch a nuclear strike. This was the warning Deputy Prime Minister Dmitry Rogozin had for students and scientists during a meeting at the Tomsk Polytechnic University. (The Moscow Times, 10.28.16)
• NATO countries have refused to discuss issues of air security in the Baltic at an expert meeting in Moscow, Russia’s Permanent Representative to NATO Alexander Grushko said Oct. 31. (TASS, 10.31.16)

Arming and training of Ukrainian forces by Western countries:

• Ukraine is refitting and expanding its naval fleet, including repairing its flagship, the frigate Hetman Sahaydachnyy, to counter a Russian military build-up. The upgrade will be helped by $30 million worth of U.S. aid, part of a $500 million package from Washington for the Ukrainian military, which Kiev expects to receive next year. (Reuters, 11.02.16)
• Ukrainian lawmakers ratified a joint UK-Ukraine memorandum on cooperation in defense. The memorandum states that bilateral military training will be held at Ukrainian firing ranges. (UAToday, 11.02.16)

Strategies and actions recommended:

• Georgetown University’s Angela Stent: “Resuming talks over a U.S.-Russian cyber agreement and restoring high-level military channels might be possible.” (Carnegie, 10.31.16)
• German political scientist Andreas Umland: “The repercussions of Ukraine’s failure to properly study, acknowledge, and teach the darker sides of its past are making themselves felt. … Ukraine should embrace a more academic and less escapist approach to understanding its wartime history—as most Western countries have eventually done.” (Foreign Policy, 10.25.16)

Analysis:

• No significant developments.

Other important news:

• A new opinion poll in Ukraine showed that 43% of respondents would vote "yes" in a referendum on Ukraine's accession to NATO, up from 39% in a June poll. Some 29% said they were against Kiev joining the military alliance. The survey also showed that 57% of Ukrainians describe themselves as having either "cold" or "very cold" feelings toward Russia. (RFE/RL, 12.01.16)
• Moscow supports the idea of creating an armed OSCE police mission in eastern Ukraine but doubts such a force could be formed soon. (RFE/RL, 10.24.16)
• The European security organization tasked with monitoring deadly violence between government forces and Russian-backed separatists in eastern Ukraine has lost its most effective surveillance tool in the conflict: long-range unmanned aerial vehicles, or drones. (Foreign Policy, 10.28.16)
• The Kremlin has challenged the authenticity of leaked emails purportedly from the inbox of presidential aide Vladislav Surkov that appear to show the Russian government's coordination with separatists in eastern Ukraine. The cache of emails published by a hacktivist group called CyberHunta dates from September 2013 through November 2014. Several documents in the leak suggest Surkov was a Kremlin point man in dealing with the separatists. These include one purportedly sent from the office of Russian tycoon Konstantin Malofeyev, who is believed to have bankrolled much of the separatist movement in Ukraine. Columnist Leonid Bershidsky points out that, while the allegedly hacked emails seem to be authentic, they failed to produce “any direct evidence of Surkov's personal involvement in the running of the separatist regions or the disruption of Ukrainian political life.” (RFE/RL, 10.26.16, Bloomberg View, 10.26.16)
• Russia's Supreme Court has upheld lengthy sentences for two Ukrainian citizens convicted of fighting alongside Chechen separatists in the 1990s. In May, Chechnya's Supreme Court sentenced Mykola Karpyuk and Stanislav Klykh to 22 and 20 years in prison, respectively. (RFE/RL, 10.26.16)
• Dutch Prime Minister Mark Rutte on Oct. 31 struck a tentative deal with Dutch opposition lawmakers that could keep afloat a key trade pact between the European Union and Ukraine.(The Wall Street Journal, 10.31.16)
• If Hillary Clinton is elected, which looks likely if current public opinion polls hold, it’s possible the job of overseeing U.S. ties with Ukraine could shift back to the State Department. (Foreign Policy, 10.30.16)
• Ukrainian President Petro Poroshenko’s party had just 10% backing, lower than the 13% support for ex-Prime Minister Yulia Tymoshenko’s party, according to a survey of 2,400 people for the Canadian International Republican Institute. (Bloomberg, 10.31.16)
• Artem Shevalev, Ukraine's former deputy finance minister and now its representative at the European Bank for Reconstruction and Development, said the December timeframe for the next $1.3 billion IMF loan was "extremely ambitious and challenging." (Reuters, 10.25.16)
• State-owned nuclear companies Nucleoelétrica Argentina SA and Energoatom of Ukraine have signed a memorandum of understanding aiming to promote bilateral nuclear power development efforts. (World Nuclear News, 10.31.16)

News items for this digest curated by Simon Saradzhyan, director of the Russia Matters Project.