Kerry warns Russia that the 'window to change course is closing'

 

Secretary of State John Kerry warned Russia that the "window to change course is closing," in what appeared to be a final warning to Moscow that the U.S. was readying severe economic sanctions over the situation in Ukraine.

"Let me be clear," Kerry said. "If Russia continues in this direction, it will not just be a grave mistake, it will be an expensive mistake."

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Speaking at the State Department one week after foreign ministers from Russia, Ukraine, the U.S. and the European Union penned an agreement designed to de-escalate the crisis there, Kerry accused the Kremlin of "a full-throated effort to actively sabotage the democratic effort" in Ukraine.

"Russia has put its faith in distraction, deception and destabilization," Kerry said. "For seven days Russia has refused to take a single concrete step in the right direction."

But Kerry stopped short of providing a concrete deadline for Russia to change course. Nor did Kerry outline the scope of economic penalties the U.S. and its allies would impose if Russian continued its provocations.

Instead, Kerry again made the case that "in plain sight, Russia continues to fund, coordinate and fuel a heavily armed separatist movement."

He accused Russian officials and media of an active propaganda campaign designed to spur separatist sentiment in Ukraine, and said the Kremlin was attempting to "achieve with the barrel of a gun and the force of a mob what couldn't be achieved any other way."

"Let's get real," Kerry said. "The Geneva agreement is not open to interpretation."

Kerry's statement came hours after violent clashes in eastern Ukraine left as many as five pro-Russian separatists dead, according to Ukraine's interior ministry.

According to multiple media reports, Ukrainian soldiers moved to dismantle checkpoints established by pro-Russian militants in the city of Slovyansk. Kiev said one Ukrainian soldier was also wounded in fighting, which spread to an arms depot and government building in the area.

The violence came a day after interim Ukrainian president Oleksandr Turchynov announced that Kiev would resume "counter-terrorism" efforts in the eastern region of the country. 

The Ukrainian military had suspended its crackdown against the pro-Russian separatists last week after signing the Geneva agreement.

But militants have not disassembled checkpoints or left occupied buildings, prompting the U.S. and Ukraine to complain that Moscow had reneged on the agreement.

"The world knows that peaceful protesters don't come armed with grenade launchers," Kerry said.

At a press conference earlier Thursday in Japan, President Obama said Russia had failed to "abide by the spirit or the letter of the agreement in Geneva."

"Instead, we continue to see militias and armed men taking over buildings, harassing folks who are disagreeing with them and destabilizing the region, and we haven’t seen Russia step up and discourage that," Obama said.

Later Thursday, Russian President Vladimir Putin denounced the military action undertaken by Kiev.

“If the Kiev regime has started to use the army against the population inside the country, it, beyond any doubt, is a very serious crime,” Putin said at a media forum in St. Petersburg, according to The Washington Post

The Russian president also warned the Ukrainian action would have "consequences" and said the effort was "proof that we have acted correctly and on time" in taking over Crimea. Moscow's annexation of the ethnically Russian peninsula has been widely denounced as a violation of international law by international powers, including the United States.

Russia's defense minister also announced a new set of military exercises along the Ukrainian border following the clashes in Slovyansk. 

"We have to react to these developments somehow," Russian Defense Minister Sergei Shoigu said, according to The Associated Press. 

Meanwhile, Russian bankers appeared to be bracing for broad sectoral sanctions from the West.

The country's RTS equities index fell to a one-month low, and Russia's treasury pulled a bond auction scheduled for Thursday. Gazprom, the national energy supplier, and a top Russian bank both saw dramatic losses in volatile trading.

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