How Russia invaded Ukraine in 2014. And how the markets crashed
Russian President Vladimir Putin (center) listens to the head of the Russian army’s main combat readiness department Ivan Buvaltsev (right) while watching military exercises at the Kirillovsky firing range in the Leningrad region, the March 3, 2014, with Defense Minister Sergei Shoigu (L)attending.
Mikhail Klimentiev | AFP | Getty Images
Warnings of full-scale war and the vast build-up of troops near the Ukrainian border give viewers more than just a hint of deja vu.
The recent tension has revived memories of the early stages of a conflict that began eight years ago, which saw the Russian annexation of Crimea to Ukraine, and the start of bloodshed in the regions of Donetsk and Luhansk, in the east of the country, which still continue to this day.
Russia’s takeover of Crimea has its roots in a long history between the two former Soviet states, but it was a destabilized government and street protests in Kiev in early 2014 that led Russian President Vladimir Putin to act .
EU rejection
In November 2013, Viktor Yanukovych, the pro-Russian Ukrainian president, rejected rapprochement with the European Union by refusing to sign an association agreement on the eve of a summit in Vilnius, Lithuania.
Yanukovych came under pressure from Russia, which later offered Ukraine $15 billion in economic aid. But there are also accusations that Brussels and the International Monetary Fund have been slow and inflexible in their own plans to bail out Ukraine’s ailing economy.
Beeldbewerk | iStock | Getty Images
The markets collapsed
A stock market rally on Wall Street fizzled out on Friday afternoon on rumors of Russian military action. That week, the ruble also fell to an all-time low against the euro and a five-year low against the dollar. The Ukrainian hryvnia had already collapsed on fear of a default.
The following Monday, after a weekend of Ukraine bracing for war, Germany’s DAX – with its heavy exposure to Russian gas – fell 3.3%, its biggest fall at the time since May 2012. Russian stocks fell 10.8% on the same day.
Moscow-listed shares of mobile operator MegaFon fell 11%, while oil company Rosneft closed 4%, Gazprom fell 14.5% and Sberbank sank 15%. Shares of Russian companies QIWI and Mobile Telesystems were also affected, closing 11% and 12.6% respectively.
Elsewhere, companies with heavy exposure to Russia and Ukraine include French automaker Renault, which fell 5% on Monday, and Italy’s UniCredit, which fell 4.1%.
“Little Green Men”
The Russian president initially denied that the unbadged soldiers in Crimea – now known as Putin’s “little green men” – were Russian troops, before being admitted the following month.
Soldiers among the hundreds who took up positions around a Ukrainian military base stand near the outskirts of the base in Crimea March 2, 2014 in Perevalne, Ukraine.
Sean Gallup | Getty Images
In March, Crimea voted overwhelmingly to leave Ukraine in a referendum that Europe and the United States called illegal and triggered sanctions.
On March 21, Putin signed legislation that completed the process of Russia’s absorption of Crimea, challenging Western leaders like then-US President Barack Obama, who have since come under heavy criticism. for being too lenient with the Russian invasion.
William Hague, then British Foreign Secretary, called Russia’s actions “Europe’s greatest crisis of the 21st century”.