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Ukraine Blames Russia for Unrest as Protesters Seize Offices

April 7 (Bloomberg) -- Pro-Russian separatists seized administration buildings in Ukraine’s east as the government in Kiev accused President Vladimir Putin of stoking unrest.

Russian forces shot a Ukrainian military officer to death in Crimea, according to the Kiev-based Defense Ministry, after protesters with Russian flags stormed administration offices in the cities of Donetsk and Luhansk. The Donetsk demonstrators called for a referendum to join Russia and for the boycott of Ukraine’s May 25 presidential election. Ukrainian Prime Minister Arseniy Yatsenyuk said Russia’s government was trying to split up Ukraine.

“The aim of this scenario is to divide Ukraine into parts and to turn part of Ukraine into a territory of slavery under a Russian dictatorship,” Yatsenyuk said today in televised remarks in Kiev. “It’s crystal clear that an anti-Ukrainian plan” is under way, he said, “a plan to destabilize the situation, a plan so that foreign troops cross the border.”

The demonstrations echoed the actions of pro-Moscow protesters who stormed Crimea’s assembly and paved the way for Russia to annex the province last month. Putin says he has the right to defend Russian speakers from attack by neo-Nazis and Russophobes in Ukraine. In Kiev, officials say Russia has sent agents to foment unrest and justify carving off more of the country since the ousting of Russian-backed President Viktor Yanukovych.

Markets Slide

The U.S. and its European allies have slapped sanctions on members of Putin’s inner circle and urged his government to withdraw thousands of troops massed on Ukraine’s eastern border in the worst standoff since the Cold War.

The escalation prompted investors to sell Russian assets. The ruble depreciated 1.2 percent against the central bank’s basket of dollars and euros by 4:16 p.m. in Moscow, paring three weeks of gains in the largest slide in a month. The Micex fell 2.9 percent. In Ukraine, the hryvnia was down 30 percent this year, the worst among global currencies tracked by Bloomberg.

Officials from the Kiev government traveled to the regions to handle the unrest,while acting President Oleksandr Turchynov canceled a trip to Lithuania and convened a special meeting of law enforcement officials, who agreed to use anti-terrorist measures against armed separatists and send more police to fortify the country’s eastern border.

Separatist Push

Billionaire lawmaker Petro Poroshenko, the country’s most popular presidential candidate, told Hromadske Radio today that moves to destabilize Ukraine’s eastern regions are aimed at disrupting next month’s elections. His challenger Yulia Tymoshenko said the “aggression” was aimed at annexing Ukraine’s east “following a Crimean scenario.”

“Any attempts to split Ukraine by the Kremlin and its puppets will be dismissed and will be met with decisive resistance from the Ukrainian society,” she said today in a statement on her party’s website.

Russian forces killed a Ukrainian army officer last night in Crimea, where Ukraine’s government is withdrawing its military, Defense Ministry spokesman Vladyslav Seleznyov said on Channel 5.

About 300 pro-Russian activists temporarily took over the regional government office in Kharkiv, demanding the local authorities carry out a referendum on federalization, according to the Ukrainska Pravda website. Later, the building was “fully freed,” according to a post on Interior Minister Arsen Avakov’s Facebook page.

Russian Disruption

Some 200 people seized the governor’s office in Donetsk, Alla Konyk, a spokeswoman for the regional prosecutor’s office, said in remarks on Channel 5. Three people, including a policeman, were injured in Luhansk during the storming of the regional directorate of Ukraine’s security service.

The separatists in Donetsk said they would dissolve the region’s parliament and vote for a referendum to give Donetsk “self-determination,” online newswire Ostrov reported. The region’s lawmakers were not among those demanding a plebiscite, assembly member Mykola Zagoruyko said by phone.

Officials have closed the roads into Luhansk and police began investigations in each of the three cities where the unrest was unfolding.

While Russia may be trying to disrupt the situation in Ukraine, it will be harder for it to repeat the scenario in Crimea. Even as people with Russian heritage made up a majority of the Black Sea peninusula’s population, they are outnumbered in Ukraine’s south and east, according to Amanda Paul, policy analyst at the European Policy Center in Brussels

Ukraine Accuses

“Obviously Russia is trying to create some tensions in the lead-up to the presidential elections,” Paul said by phone today. “But at the same time, let’s not go out of context. You also have a substantial amount of Ukrainian population that lives in these regions that no way want the repeat of what happened in Crimea.”

Leaders of the Luhansk and Donetsk protests are mostly local, not initiated by Russia, said Tetyana Malyarenko, a law professor at Donetsk State University of Management. There appears to be more violence than when pro-Russian activists stormed the regional prosecutors’ office last month, she said.

“In Luhansk the situation is more serious, because the rebel groups are better organized and have access to weapons,” Malyarenko said by e-mail. She said the Donetsk protesters “represent marginal civil society organizations which do not have the support of the local elite and population.”

Dairies Banned

Yatsenyuk has accused Putin of plotting to invade its eastern regions and has vowed military retaliation if Russian troops cross the border. Russia has as many as 40,000 soldiers stationed across the frontier on main arteries leading to large Ukrainian cities, according to officials from the U.S. and the North Atlantic Treaty Organization. Putin says the forces are conducting military exercises and will withdraw when they end.

Russia’s consumer watchdog banned imports from six Ukrainian dairy producers, saying they violated norms. Russia has also banned products made by Ukrainian chocolate maker Roshen, owned by Poroshenko, for what it calls “deceitful practices’’ in trading.

Putin’s government has imposed bans on imports from Ukraine, which depends on Russia as its biggest export market, during disputes during the past decade. The U.S. and EU have said they may intensify sanctions on Russia if it tries to destabilize Ukraine by using trade and other measures.

Watchdog Warning

Today’s agitation followed a warning by a European human- rights watchdog that anecdotal reports of discrimination could strengthen Russian separatist sentiment in eastern and southern Ukraine.

An advisory committee to the Council of Europe last week rejected Putin’s argument that Russian-speaking minorities have been victimized by Ukraine’s new government. Still, it called for steps “to avoid further isolation and radicalization” of the pro-Russian community.

The committee expressed “urgent concerns” for the ethnic Tatars that make up about 12 percent of Crimea’s population. The Turkic-speaking Muslim group, once persecuted by Stalin, is now at “particular risk,” the committee said.

“We have to remain vigilant to make sure that minorities aren’t taken advantage of for political purposes, since this danger remains,” Austrian Foreign Minister Sebastian Kurz, chairman of the 47-nation group’s committee of ministers, said in a statement yesterday.

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