Ukraine politics

A crowd waits in Kiev’s Independence Square to hear the names of the new Cabinet members. “There is not a single name on the list associated in any way with Yanukovich’s regime,” said analyst Igor Popov. (Bulent Kilic / AFP/Getty Images / February 26, 2014)

MOSCOW — Russia mobilizes 150,000 troops to test their battle readiness. Opposing groups clash over whether Ukraine will look to Moscow or Brussels. Triumphant demonstrators in Kiev celebrate the nomination of an interim government likely to turn westward.

Those ominous events, however, may obscure what is largely a meeting of minds among Russian President Vladimir Putin, European Union officials, the White House and more pragmatic elements of Ukraine's new leadership.

A confrontation over Ukraine or a breakup into a European-oriented western half and Russian-allied eastern and southern regions would help no one. The country needs peace and a representative interim government to manage an infusion of foreign aid and avert bankruptcy.

No matter who is in charge in Kiev, the capital, Ukraine and Russia both benefit from Moscow's natural gas pipelines that cross Ukraine on their way to feeding Western Europe. Both gain from Russia's long-term lease on a Crimean base for its Black Sea fleet. And large parts of their industrial economies are interdependent.

Putin ordered military maneuvers in central and western Russia on Wednesday, fueling fear of an aggressive reaction by the Kremlin. But Russian officials characterize the exercise as routine. NATO Secretary-General Anders Fogh Rasmussen said in Brussels that the alliance had been given advance notice.

The move was apparently intended to impress on the new Kiev leadership that it should keep in mind the interests of Ukraine's Russian-speaking minority. However, Moscow's heads-up to the North Atlantic Treaty Organization quietly underscored the Putin administration's repeated assurances that it has no intention of interfering in Ukraine's domestic crisis, much less sending troops or encouraging secession.

Secretary of State John F. Kerry warned Russia against intervening militarily in Ukraine, but also emphasized that the Obama administration does not see the issue in Cold War terms.

"This is not 'Rocky IV,'" Kerry told a group of reporters.

Demonstrators were called to Kiev's Independence Square late Wednesday to hear the nominations for

a transitional leadership to rule until a May 25 presidential election and a vote for a new parliament in the summer. They roared their approval for most of the names, which will be voted on by the opposition-controlled parliament.

Former foreign minister, economist and lawyer Arseny Yatsenyuk was proposed to take over as prime minister. Yatsenyuk is second-in-command in the Batkivshchyna party of ousted President Viktor Yanukovich's foe, Yulia Tymoshenko, who was released from prison Saturday.

"There is not a single name on the list associated in any way with Yanukovich's regime," said Igor Popov, head of Kiev's Politika Analytical Center.

What Russian-oriented areas that once supported Yanukovich will make of the new leadership wasn't immediately apparent. But his support has been dwindling rapidly because of bad governance and revelations of garish self-enrichment and corruption that have pushed the country to the brink of default.

Ukraine needs a $35-billion bailout over the next two years. Its only hope of getting the money is if a new government can make a credible commitment to reform and advocate for the interests of all ethnic and political factions in the country, representatives of the EU, the International Monetary Fund and the Russian and U.S. governments have said.

Putin had offered Yanukovich $15 billion in loans and energy subsidies to keep the country solvent as billions in dollar-denominated bonds come due in the next few months. Moscow spent about $3 billion in December to buy up dubious securities issued by a government already unable to service its debt. An additional $2 billion was to have been released last week, but Russian Finance Minister Anton Siluanov said Moscow was withholding further aid until the makeup of the incoming government was clearer.

Kerry said the U.S. is considering a $1-billion loan guarantee plus a direct grant to supplement an aid package being put together by the International Monetary Fund.

Though the opposition-dominated transitional government isn't likely to be one that Russia would choose,

it will remain in the Kremlin's interest to help ensure Kiev's solvency and social peace.

Unpaid pensions and government salaries could fuel further unrest and idle industries. Eastern mines, factories and metalworks depend on trade with Russia in both parts and finished products. And much of their output is sent to Russia.

Gas and oil exports provide more than half of Russia's national budget. Exports to Europe are especially profitable, and an estimated 70% travels through pipelines on Ukrainian soil, making the Russian economy vulnerable to retaliation should Moscow try to punish Ukraine.

For its part, Ukraine benefits from transit fees and the 30% discount Moscow has offered during the years that the two countries have maintained good trade relations, said Leonid Grigoriev, a senior advisor at the Analytical Center for the Government of the Russian Federation. Any rupture in that relationship would be disaster for both sides, he said.

Military interdependency also will push them toward continued cooperation. Moscow's lease on a base in the Crimean port of Sevastopol for its Black Sea fleet runs for three more decades. A stable Russian presence helps Kiev as much as Moscow, analysts say, because the Ukrainian navy operates out of the same ports and its ships are supplied by the same military-industrial complex.

Nearly 1 in 4 Ukrainians claims Russian as their native language, and the majority of Crimea's citizens are ethnic Russians or culturally oriented toward Moscow. The area includes large numbers of retired Russian military personnel from the Black Sea fleet. That has made the peninsula a focal point of tension in Ukraine's volatile transition.

Distrust between the pro-Russia and pro-Europe factions in the Crimean Peninsula spawned huge demonstrations and some fistfights Wednesday in Simferopol, political seat of the region.

About 10,000 Crimean Tatars, descendants of a Turkic Muslim community exiled by Josef Stalin in 1944, rallied in front of the regional assembly to proclaim their allegiance to a united Ukraine. The rally came after a Russian nationalist lawmaker said Moscow would send troops to Crimea if needed to guarantee the Russian community's rights.

Russian Foreign Minister Sergei Lavrov vowed Tuesday that Moscow would not interfere in Ukraine's internal affairs. The speaker of the upper house of the parliament, Federation Council chief Valentina Matvienko, on Wednesday dismissed nationalist rumblings about Russian military moves into Ukraine as "impossible."

Ukraine's acting president, Oleksandr Turchynov, reiterated Wednesday night after announcement of interim government nominations that the new leadership is determined to keep the country united despite the tension in Crimea and Yanukovich's power base in the industrial east.

"We will cope with this," he said.

carol.williams@latimes.com

sergei.loiko@latimes.com

Williams reported from Moscow and Loiko from Kiev. Times staff writer Paul Richter in Washington contributed to this report.