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Historical background of the Ukrainian statehood

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The German occupation forces were those who have been the first to create and recognize a short-lived state’s independence of Ukraine in January 1918 during the time of their-own inspired and supported anti-Russian Bolshevik Revolution of 1917−1921. As reoccupied by the Bolshevik Red Army, the eastern and southern parts of the present-day territory of (a Greater) Ukraine joined in 1922 the USSR as a separate Soviet Socialist Republic (without Crimea).

According to 1926 Soviet census of Crimea, the majority of its population were the Russians (382.645). The second largest ethnic group were the Tartars (179.094). Therefore, a Jew V. I. Lenin has to be considered as the real historical father of the Ukrainian statehood but also and as of the contemporary nationhood. Ukraine was the most fertile agricultural Soviet republic but particularly catastrophically affected by (Georgian) Stalin’s economic policy in the 1930s which neglected agricultural production in favour of the speed industrialisation of the country. The result was a great famine (holodomor) with around seven million people dead but majority of them were of the ethnic Russian origin. A territory of the present-day Ukraine was devastated during the WWII by the Nazi German occupation forces from 1941 to 1944 who installed in Ukraine a puppet and criminal regime of S. Bandera (1900−1959) under which a genocide on Poles, Jews and Russians was committed [on Stepan Bandera, see: Grzegorz Rossoliński-Liebe, Stepan Bandera: The Life and Afterlife of a Ukrainian Nationalist. Fascism, Genocide, and Cult, Stuttgart, ibidem, 2014]. For instance, the Ukrainian militia (12.000) directly participated in the 1942 holocaust of some 200.000 Volhynian Jews together with 140.000 German policemen. The Ukrainian mass killers learned their job from the Germans and applied their knowledge as well as on the Poles [Timothy Snyder, Tautų rekonstrukcija: Lieuva, Lenkija, Ukraina, Baltarusija 1569−1999, Vilnius: Mintis, 2009, 183].

bandera

Stepan Bandera declares independence of Ukraine (June 30th, 1941)

After the war J. V. Stalin, supported by the Ukrainian party-cadre N. Khrushchev, deported about 300.000 Ukrainians from their homeland as they have been accused for the collaboration with the Nazi regime during the war and the participation in genocide done by S. Bandera’s government. However, after the war the Ukrainians have been and directly rewarded by Moscow for the collaboration with the Germans and participation in S. Bandera’s organized genocide as the lands of Transcarpathia, littoral Moldova (Bessarabia), Polish Galicia and part of Romania’s Bukovina in 1945 followed by Crimea in 1954 became annexed by the Soviet Socialist Republic of Ukraine. These territories, which never have been part of any kind of Ukraine and overwhelmingly not populated by the ethnolinguistic Ukrainians were included into the Soviet Ukraine primarily due to the political activity by the strongest Ukrainian cadre in the USSR – N. Khrushchev, a person who inherited Stalin’s throne in Moscow in 1953. On this place, a parallel with Croatia is an absolute: for the Croat committed genocide on the Serbs, Jews and Roma by A. Pavelić’s regime (a Croat version of S. Bandera) during the WWII on the territory of the Independent State of Croatia a post-war (Socialist Republic of) Croatia was awarded by a Croat-Slovenian dictator of Yugoslavia J. B. Tito with the lands of Istria, Adriatic islands and Dubrovnik – all of them never have been in any kind of the state of Croatia before the WWII.  

M. Gorbachev’s policy of deliberate dissolution of the USSR from the time of Reykjavik bilateral meeting with Ronald Reagan in 1988 caused a revival of the ethnic nationalism of the Ukrainians who proclaimed an independence on August 24th, 1991 (confirmed on referendum on December 1st, 1991 only by those who did not boycott it) in the wake of anti-Gorbachev’s military putsch in Moscow (mis)using the political situation of paralyzed central government in the country. The state’s independence of Ukraine was proclaimed and later internationally recognized within the borders of a Greater Stalin-Khrushchev’s Ukraine with at least 20% of the ethic Russian population living in a compact area in the eastern part of the country and as well as making a qualified (2/3) majority of Crimea’s population. The coming years saw the rifts with neighbouring Russia with the main political task by Kiev to commit as possible as the Ukrainization (assimilation) of ethnic Russians (similar to the policy of the Croatization of ethnic Serbs in Croatia orchestrated by the neo-Nazi government in Zagreb led by Dr. Franjo Tuđman). At the same time the Russian majority in Crimea constantly required the peninsula’s reunification with mother Russia but getting only an autonomous status within Ukraine – a country which they never considered as their natural-historical homeland. The Russians of Ukraine were becoming more and more unsatisfied with conditions in which they have been leaving from the time when in 1998−2001 the Ukrainian taxation system collapsed what meant that the central government in Kiev was not able to pay the salaries and pensions to its own citizens. A very weak Ukrainian state became in fact unable to function normally (“failed state”) and as a consequence it did not have a power to prevent a series of politically motivated assassinations followed by popular protests which had been also very much inspired by economic decline of the country [on history of Ukraine and the Ukrainians, see more and compare with: Andrew Wilson, The Ukrainians: Unexpected Nation, New Heaven: Yale University Press, 2009; Serhii Plokhy, The Gates of Europe: A History of Ukraine, New York: Basic Books, 2015; Anna Reid, Borderland: A Journey Through the History of Ukraine, New York: Basic Books, 2015].

As a matter of fact, it has to be stressed that the Ukrainian historiography on their own history of the land and the people is extremely nationalistic and in very cases not objective like many other national historiographies. It is basically politically coloured with the main task to present the Ukrainians as a natural ethnolinguistic nation who have been historically fighting to create a united independent national state and unjustifiably claiming certain territories to be ethnohistorically the “Ukrainian”. As a typical example of such tendency to rewrite history of the East Europe according to the nationalistic and politically correct framework is, for instance, the book by Serhy Jekelčyk on the birth of a modern Ukrainian nation in which, among other quasi-historical facts based on the self-interpreted events, is written that the USSR in 1939−1940 annexed from Poland and Romania the “West Ukrainian land” [Serhy Jekelčyk, Ukraina: Modernios nacijos gimimas, Vilnius: Baltos lankos, 2009, 17]. However, this “West Ukrainian land” never was part of any kind of Ukraine before the WWII as Ukraine as a state or administrative province never existed before V. I. Lenin created in 1923 a Soviet Socialist Republic of Ukraine within the USSR but at that time without the “West Ukrainian land” as it was not a part of the USSR. Moreover, the Ukrainians were either not leaving or being just minority on this land what means that Ukraine even did not have ethnic rights over the biggest part of the “West Ukraine”. Even today around half of Ukraine’s state’s territory is not populated by the Ukrainians as a majority of the population. Moreover, in some regions there are no Ukrainians at all. Therefore, the cardinal question became: On which principles the Ukrainian borders are formed?

ukrmap1

How historical parts of Ukraine voted in 1994 Presidential elections

As another example of the Ukrainian historiographic nationalistic misleading we can find in an academic brochure on Bukovina’s Metropolitan’s residence, published in 2007 by the National University of Chernivtsi. In the brochure is written that this university is “…one of the oldest classical universities of Ukraine” [The Architecturial Complex of Bukovynian Metropolitan’s Residence, Chernivtsi: Yuriy Fedkovych National University of Chernivtsi, 2007, 31] that is true only from the present-day rough political perspective but not and from a moral-historic point of view. Namely, the university is located in the North Bukovina which in 1775 the Habsburg Monarchy had obtained. The land was from 1786 administrated within the Chernivtsi district of Galicia and one hundred years after the affiliation of Bukovina to the monarchy, the Franz-Josephs-Universität was inaugurated on October 4th, 1875 (the name day of the emperor). In the other words, the university’s origin as whole Bukovina has nothing to do with any kind of both historical Ukraine and ethnic Ukrainians as before 1940 it was outside of administrative territory of Ukraine when the whole North Bukovina on August 13th, became annexed by the USSR according to the Hitler-Stalin Pact (or the Ribbentrop-Molotov Pact) signed on August 23rd, 1939 [Ibid.]. Therefore, two notorious bandits (one Nazi another Bolshevik) decided to transfer the North Bukovina to the USSR and the land became after the WWII part of a Greater (Stalin’s) Ukrainian SSR. Nevertheless, while the Ukrainian nationalists claim that “Russia” (in fact anti-Russian USSR) occupied Ukraine, the annexation of the North Bukovina and other territories from Poland, Czechoslovakia and Romania in 1940 are for them a legitimate act of historical justice. Here we have to notice that according to the same pact, the territories of the independent states of Lithuania, Latvia and Estonia are as well as annexed by the USSR that is considered by their historians and politicians as “occupation”, what means (illegal) act of aggression that is braking international law and legitimate order. Nevertheless, they never accused Ukraine of doing the same in regard to occupied lands from its three western neighbours in 1940/1944 [see, for instance: Priit Raudkivi, Estonian History in Pictures, Tallinn: Eesti Instituut, 2004 (without numeration of the pages); Arūnas Gumuliauskas, Lietuvos istorija (1795−2009), Šiauliai: Lucilijus, 2010, 279−295].  

Political assimilation of certain separate Slavonic ethnolinguistic groups in Ukraine was and is one of the standardized instruments for the creation and maintaining of the Ukrainian national identity in the 20th century. The most brutal case is of the Ruthenians (Rusyns) who are simply proclaimed as historical Ukrainians known under such name till the WWII. Their land, which was in the interwar period part of Czechoslovakia, that was annexed by the USSR at the end of the WWII and included into a Greater Soviet Ukraine is simply renamed from Ruthenia into the Sub-Carpathian Ukraine. However, the Ruthenians and the Ukrainians are two separate Slavonic ethnolinguistic groups as such officially recognized, for example, in Serbia’s Autonomous Province of Vojvodina where the Ruthenian (Rusyn) language is even standardized and studied together with Ruthenian philology and literature at a separate department at the University of Novi Sad. Unfortunately, the Ruthenian position in Ukraine is even worst in comparison with the Kurdish position in Turkey as the process of Ruthenian assimilation is much speeder than of the Kurdish case.

From the current perspective of the Ukrainian crisis and in general from the point of solving the “Ukrainian Question” it has to be noticed a very historical fact that a part of the present-day East Ukraine became legally incorporated into the Russian Empire in 1654 as a consequence of the decision by the local hetman of Zaporozhian territory Bohdan Khmelnytsky (c. 1595−1657) based on a popular revolt against the Polish-Lithuanian (the Roman Catholic) occupation of Ukraine which broke out in 1648 [Alfredas Bumblauskas, Senosios Lietuvos istorija, 1009−1795, Vilnius: R. Paknio leidykla, 2007, 306; Jevgenij Anisimov, Rusijos istorija nuo Riuriko iki Putino: Žmonės. Įvykiai. Datos, Vilnius: Mokslo ir enciklopedijų leidybos centras, 2014, 185−186]. It means that the core of the present-day Ukraine voluntarily joined Russia, therefore escaping from the Roman Catholic Polish-Lithuanian oppression. Subsequently, B. Khmelnytsky’s ruled territory has to be considered from a historical point of view as the motherland of all present-day Ukraine – the motherland which already in 1654 chose Russia.  

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Eastern Europe

Shifting Geography of the South Caucasus

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One year since the end of the second Nagorno-Karabakh war allows us to wrap up major changes in and around the South Caucasus. Most of the changes discussed in the scholarly works so far focused on the role of Turkey and Russia. The shifting geography of the South Caucasus, however, has been disregarded.

In many ways, the war accelerated the pre-existing trends, but also initiated new developments. The first and foremost change concerns geography. The South Caucasus has been historically dominated by neighboring states. Whether it is the Sasanian and Byzantine empires in late antiquity or later Ottoman and Persian states, the region was exclusively subject to one or two powers. The idea is that the region was mostly closed to the outside, non-regional influence. The trend continued in 19th-20th centuries when the South Caucasus was exclusively dominated by Russian power. The end of the Soviet Union changed this geopolitical reality when several powers were able to penetrate the region. Yet the pace of the change was relatively slow – Russia was still able to minimize the extent to which the neighboring or non-regional countries were able to act in the South Caucasus: Turkey, Iran, US, EU, and to a certain extent, China have been influencing the region to a limited degree.

But the second Nagorno-Karabakh war accelerated this process. The South Caucasus’ borders are increasingly shifting. No single power or even a duo of countries can dominate the region. It reflects geopolitical changes in the world where the emerging multi-polar world ushers in a different set of rules. Exclusive geopolitical control is no longer viable and the 2020 war showed exactly this.

There is also yet another dimension of the unfolding geographic change. The war also solidified that the Caspian basin and South Caucasus are inextricably linked to the greater Middle East. Russia and Turkey are basing their strategies in the region on developments in the Middle East and the Black Sea region. Not since the end of the Soviet Union has the South Caucasus been such a critical point for the powers around it. In a way, this re-emergence of close contacts between the South Caucasus and the Middle East is a return to normalcy which was disrupted in the early 19th century by Russian annexation of the South Caucasus. Indeed, in pure geographic terms the region is better connected to Turkey and Iran than to Russia, with which it shares the impassable Caucasus Mountain range.

This also means that the role of the South Caucasus in the thinking of Iran and Turkey, and by extension Russia, has grown. Considered if not as a complete backwater region in the calculus of large powers, the South Caucasus has nevertheless experienced a lack of attention. This was especially true for Iran, which now struggles to retain its weakening position in the region.

It is true that Iran was never a dominant power in the South Caucasus. Unlike Russia or Turkey, the traditional power brokers, it has not had a true ally. Tehran was certainly part of the calculus for states in the region, but it was not feared, like Ankara or Moscow. And yet, the South Caucasus represents an area of key influence for Iran, based on millennia of close political and cultural contacts various Persian empires had with the South Caucasus.

The 2020 war changed Iran’s calculus in the region as the Islamic Republic’s interests were largely unheeded. Iran has now to adjust to the changed geopolitical landscape and it can be even argued that the recent escalation it had with Azerbaijan over the detained trucks, drills, and alleged Israeli influence, was an effort to wedge itself back into the geopolitics of the South Caucasus.

Yet there is little Iran can realistically do to boost its position in the region. The South Caucasus will certainly feature higher in Tehran’s foreign policy agenda than before. But Tehran does not have an ally in the region, nor does it have financial means to strengthen its soft power. Iran can support Armenia in its efforts to balance the triumphant Azerbaijan.

The lifting of US-imposed sanctions could augment Iran’s projection of financial and diplomatic power in the South Caucasus. Still, a more realistic approach for Tehran would be to build closer cooperation with Russia. Both loath growing Turkish influence and the Islamic Republic does not object to growing Russian influence as much as it does resent the West’s and Turkey’s presence. Surely, interests with Russia do not align always, but for Tehran, Moscow is a traditional power in the South Caucasus which is about maintaining a status quo. Turkey, on the other hand, disrupts it seeking greater influence.

There has been a certain retrenchment of the Western influence in the South Caucasus. While it does not signify a definitive decline in West’s fortunes, it is nevertheless important for Washington and Brussels to formulate a more robust approach toward the region. Decreasing the tensions with the Turkey could be one of the steps. Increasing economic engagement with the region would be another. Delay could be damaging. Georgia, which serves as a door for the West to the Caspian basin and on to Central Asia, could be the biggest loser if Washington shifts its foreign policy away from the region. An alternative could be a Russian model of peacebuilding and regional order where Georgia, Armenia, and Azerbaijan will face a lack of foreign policy options if the West’s unwillingness to commit to the region continues to grow. Author’s note: first published in caucasuswatch

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Russia: The Neighbor From Hell

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Photo: Kuźnica Białostocka, Poland. Migrants' encampment area. Army, Border Guard and Police on the border. Credit: Polish Territorial Defence Force

From Belarus to Ukraine to Georgia, an arc of instability has emerged, offering opportunities for malign activities by foreign powers. This has proved too tempting for Vladimir Putin’s Russia, which openly pursues an activist foreign policy seeking gains for the Kremlin at whatever cost to its neighbors. For the West, it is time to consider the wider Black Sea region as a whole and to develop a strategy. 

The migrant crisis unfolding on the Belarusian-Polish border is the most pressing and serious emergency. For some months, the Belarus dictator Aliaksandr Lukashenka and his security services have been funneling thousands of Middle Eastern migrants toward the EU border. Officially, Russia has distanced itself from the crisis, with President Vladimir Putin on November 13 denying claims he had helped to orchestrate a crisis.  

Russia is often disbelieved by neighbors with unhappy experiences of its statecraft. In this case, too, there are reasons to doubt Putin’s words. Firstly, the Belarus migrant drama bears an uncanny resemblance to the events of 2016, when the Kremlin unleashed a sudden wave of developing world migrants across Finland’s and Norway’s Arctic borders. Secondly, few believe Lukashenka’s regime on its own is sufficiently organized to orchestrate events of complexity spanning two continents.  

Russia’s rapid dispatch of advanced combat aircraft and paratroopers (two of whom died in the exercise) to the Belarus-Poland border and Putin’s contemptuous dismissal of Germany’s Chancellor and the EU’s senior head of government Angela Merkel (she was told to call Lukashenka herself) were open signals of approval for the Belarusian position. Only when Lukashenka mused that he might cut off gas supplies to Europe was he publicly slapped down by Russia. It was also notable that Russia and Belarus recently agreed on further steps in their on-again-off-again Union state. 

To the south, in eastern Ukraine, the clouds are also gathering. Fighting is worsening with Russia’s separatists in Donbas, and ceasefire violations are spiking. US briefings now suggest around 100,000 military personnel and large amounts of armored equipment are located within reach of the border; military movements are being organized at night. Not only does this follow the deployment of large Russian formations for exercises in the Spring, but it also matches a threatening drumbeat of anti-Ukrainian rhetoric from Russian leaders including Putin, who have questioned the country’s right to an independent existence. The Kremlin has increased funding for the Donbas and pledged humanitarian support to the rebel-controlled regions thus facilitating trade between Russia and parts of Donetsk and Luhansk. 

The bottom line is that Russia is putting Ukraine back on the agenda and — as some predicted — forcing the Biden administration to take notice, despite its desire to park Russia and focus on China. Putin and his aides remain determined to build a near-exclusive sphere of influence in its neighborhood and Ukraine is the crown jewel in its geopolitical thinking. If Russia is finally seeking a settlement to its seven-year-long forever war, that would require agreement from Ukraine to effectively hand control of eastern regions to Russia and its local agents, plus a commitment to stop the country from joining Western military and economic institutions. There is no sign that Ukraine will agree to such constraints on its sovereignty. 

Further south in the South Caucasus, Georgia, the West’s only partner in the region, is suffering a continuing crisis following the municipal elections in October and the former president Mikheil Saakashvili’s stealthy return to the country. He is now in prison on a hunger strike. Russia lurks here too. It might not be orchestrating the crisis, as in Belarus, but it does benefit. Russian media has been actively addressing the events in Georgia and playing on recurrent tensions between the country and its Western partners, especially the European Union (EU). As always, chaos — sometimes resulting from direct Russian interference, and sometimes not — makes it harder for candidate countries to meet the membership terms of Western clubs while emboldening those European countries sympathetic to Russia and skeptical of expansion. This makes it harder for organizations like the EU to engage Georgia.

Russia’s grand strategic aim is to maintain its power in neighboring states. That means keeping the West at bay, and political instability serves that purpose. Belarus, Ukraine, and Georgia are distant, but the Kremlin is always present. In some cases, it resorts to military pressure to gain momentum, in other cases it sits and waits, but the pattern signals a clever use of opportunities as they arise, exploiting the space given by a West signaling decreasing willingness to engage in the wider Black Sea region. 

Seen from the long-term perspective, the 1990s and 2000s were a period of a slow but steady decline of Russian influence in what then constituted the former Soviet Union. From the Kremlin’s point of view, the present period is much more productive, with concrete gains and the reversal of the West’s military and economic expansion. For Putin and his ministers, it seems likely that the US considers defending Ukraine, Georgia, and even involvement in the Belarus-Poland border crisis costlier than the potential benefits of having these countries within America’s geopolitical perimeter.

The ground is now prepared to seek a reversal of the West’s geopolitical gains and cast aside the wishes of the people of Ukraine and Georgia. The push against aspiring liberal democracies is now gathering pace, timed to coincide with a wider geopolitical shift, namely the recalibration of US foreign policy to east Asia. 

Author’s note: first published in cepa

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Five Important Principles for a Successful Mandatory Funded Pension for Ukraine

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The government’s plans to launch a mandatory funded pension scheme (the so-called second pillar) has provoked a lot of debate about future of pensions in Ukraine. Over the past quarter century, second pillars were introduced in several of Ukraine’s neighboring countries. Contrary to common belief, such schemes are not immune to politics, as they change and evolve constantly. So, it would be important to ensure a design for the program that can be preserved and perpetuated in Ukraine’s specific economic, social and political context.

Neither of the two types of pension schemes – solidarity and fully funded – is better than the other. In fact, they work best when they complement each other, as each is exposed to different risks. Thus, an effective reform will need to be centered around enabling synergies between the two schemes.

While the funded system is proposed as a risk mitigation strategy for the solidarity system in Ukraine, it also carries important implementation risks. To make Ukraine’s pensioners more secure, the Ukrainian government will need to map out all such risks and address them along the path to launching the new system. From global experience assessed by the World Bank, there are five key principles that should guide the preparatory work.

1. Strong regulatory and fiduciary framework. This is a key precondition for safety of the pension assets. First, no funded system should start without a regulator that is well-equipped and able to effectively enforce all legal provisions. Bill 5865 in Rada introduces a proper regulatory framework and powers of the regulator. This bill should certainly form part of the reform package. Second, it will also be important to establish proper segregation of assets and records between the activities of the existing voluntary plans and the new mandatory scheme. And third, several governance issues pertaining to non-state pension funds (especially the ultimate fiduciary responsibility of their boards, risk management and internal controls) will need to be addressed to have these funds prepared for their new role and be seen by the public as effective and trusted custodians of their pension assets.

2. Sustainable financing. The funded system can be introduced either as a complementary scheme to the current solidarity system or as a substitutional system. The current government proposal is a hybrid: on the benefit side, it is complementary, but on the revenue side, part of the solidarity system contributions is proposed to finance the new funded scheme. Such an approach may limit the effectiveness of the new system fiscally and socially, aggravating the risk of falling benefits in the solidarity system. This may result in no net improvement in the future combined retirement benefits from this reform. Instead, to maximize the impact of the new funded system, it will need to be funded from new contributions, without tapping into the same fiscal space that provides for the wellbeing of current pensioners. Ideally, these new contributions should come from employee wages, so there is personal attachment to the pension account – a signature element of individual responsibility in such programs. Such employee contributions could further be co-financed by the employer and/or by the government, as an incentive to contribute more for retirement.

3. Efficient administration. The mechanism of money and information flows in the new system should be carefully designed and tested, so that the administrative costs of the new system are minimized. No single Hryvna should be lost on its way from employers to an individual account, as it passes through the government machinery of revenue collection. For this, every detail of the process needs to be elaborated and all risks mapped and mitigated.  It can be shown that a 1% annual charge on pension assets over someone’s full work career reduces around 20% of their pension benefits by the time of retirement. Therefore, cost reduction is key – and it has been shown that centralizing core administrative functions is an effective cost reduction strategy. Finally, simple provisions need to be introduced for individuals who do not actively choose a fund. This would pave the way to establishing a “default” fund with a life-cycle investment strategy. Importantly, a gradual implementation approach should help minimize various operational risks. So, Ukraine should start with a simple design that can be easily understood by the general public – and add more complex elements to the system over time.

4. Overall pension system design. The new funded scheme will be only a small supplement to the current system. With a 4 percent contribution rate, it will take an individual about 25 years of contributions for the account value to reach their corresponding annual wage in that year in the future. This is a rather insignificant amount, considering that this accumulated amount equivalent to one year’s wage will have to be spread over the remaining life of an individual after retirement. Therefore, better coordination with the solidarity system, especially its system of minimum income guarantees, is required

5. Well-defined role of the state. Explicit legal provisions about what government can and cannot do will put the system on the right track. The state plays several important roles here: ensuring proper regulations and fair competition in service provision; facilitating a “default” fund; providing co-financing from the general budget to stimulate participation; enabling core record-keeping infrastructure and standards of member services; facilitating markets for financial instruments to promote diversification of investments; providing well-coordinated general minimum income guarantees at retirement, through the solidarity system; and so on. So, having a clear implementation plan and well-defined transitional arrangements will be instrumental to the success of this reform.

A lot of work needs to be done to ensure that Ukraine’s future pensioners have an adequate pension that will allow them a dignified retirement. Therefore, learning from the successes and mistakes of other countries, the government should target a realistic timeline to build the second pillar – with well-coordinated preparatory work yielding a consensus on key design elements (incorporating all the above principles).

Originally published in UKRINFORM via World Bank

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