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00:00That's right. It's it's the right question to be asking at this point in time. And I would put a lot of explanatory power here behind local actors and each sides of the conflict. A number of war veterans in Ukraine who who used a large amount of political power here are increasingly frustrated with the slow pace of the conflict and on the separatist side as well in the so-called Donetsk and Lugansk People's Republic. These upticks in fighting happen from time to time sometimes a way of almost lobbying for additional support from Russia. I think on each side of the aisle not only are they looking at the on their own local politics and trying to win support for a more aggressive stance for their own sides here but they're also looking to see how the outside powers that are looking at this conflict will react in this case. In the case of Russia I think it's important to keep in mind here that Russia is still hoping to engage with the United States in a Donald Trump administration in hopes of reaching some sort of their detente and perhaps a deal that could eventually see some easing of Sec of sanctions what are your insights into why Russia has recently moved really on a number of big fronts of the eastern Ukraine effect recognizing passports here kind of extending a de facto citizenship to the region and introducing the ruble as a currency confiscating a series of Ukrainian companies businesses that were based in that region. Why this now so I think the territories here are increasingly in need of greater financial and economic support from Russia while the rest of Ukraine is seeing gradual recovery and of course relies to a greater extent than often realized on the steel industry and other areas of production that are still connected to parts of the Donbass valley here. These territories are extraordinary dependent on Russia here. I think Russia is offering them a sort of concession while also holding out a threat for the future where if things stay this way forever they will not always. If the situation requires it stay committed to the stalled Mideast peace process which is the case for now which I think probably would still be the case for the future but the threat is there and I think that's an important signal we fully appreciate. In the West the extent to which Russia's got a lot to lose here there's a lot of innocents face at play in terms of domestic Russian politics vis a vis how this conflict plays out and what happens to these so-called rebels in the eastern Ukraine . Well I think that is quite true. And yet time probably is on Moscow's side here. And to a large extent they have achieved many of the basic gains that they would have wanted from the war in Ukraine as it is played out. It is what is often called the misnomer of a frozen conflict. Keeping in mind that shelling continues on a regular basis uptick or not. People die in this place on a monthly basis or more frequently here. And yet so long as this conflict is in place it undermines the prospect for Ukraine to move towards NATO membership. It puts a question over their political and economic future and as it has posed really an extraordinary test of the United States and European commitment towards Ukraine one that is going to be constantly re-evaluated particularly with the Trump administration office now what kind of financial pressure though do you think this conflict is creating for Russia. I mean the cost supposedly of maintaining Crimea now is a de facto Russian protectorate . Hundreds of millions of dollars annually obviously here affects to Russian industry business trade with the Ukraine potential military costs. Can Russia keep this up indefinitely . Indefinitely is still a question of time here. As far as I'm concerned for the next several years I am not worried about the state of the Russian economy. It is returning to growth moderately slowly but it is there in large part because of rising oil prices. Its fiscal and financial situation is fairly stable. Fiscal planners have maintained a very tight budget and while they have drawn down on some of their fiscal reserves particularly in the reserve fund which I believe is down to somewhere around 10 15 billion dollars at this point they can keep this keep their economy running for some time now . I think the bigger question in the future is whether they will be able to implement the structural reforms that are needed to see more than 1 to 2 percent growth on average for the next five years or longer here. So I wouldn't be looking to the state of Russia's finances or the economy for clues in how much it's going to support the breakaway republics in Ukraine for Russia and particularly for the Kremlin here. This has been a geopolitical consideration that has trumped any economics that have come alongside. They're quite literally let's start finally and on the government in Kiev. What is its condition . I mean there is a sense here that yes an economic recovery is underway in western Ukraine but really people still saying corruption is endemic and it's displayed pervasive incompetence in terms of how it's fought this war it's fought this conflict there is a lot of frustration in Ukraine. I can think of very few political leaders right now who have approval ratings even in the double digits if they're able to achieve that much here . Most of this concern really is directed towards slow progress on combating corruption slow progress and bringing out the level of reforms and the transformation of the political culture in Ukraine towards one that is much more progressive and oriented towards clean government and effective government here. There is frustration conflict as well as I mentioned before. This has gone on for for very for several years now since mid 2014. And despite the amount of time and the amount of lives that have been lost and can continue to be lost it is stuck in place right now. And a lot of Ukraine's I think are frustrated with that. They'd like to see more pressure often on pressure exerted from outside on Russia to implement its end of the Minsk peace process here . But I think there is some frustration as well with the way in which the government is has been handling going forward .

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Ukraine, Russia Face Off in UN Court

Today the International Court of Justice in The Hague commenced hearings for a case brought by Ukraine against Russia, accusing Moscow of illegally annexing Crimea and illicitly funding separatist rebels. In an interview with Bloomberg TV Canada’s Rudyard Griffiths, Zachary Witlin, analyst with Eurasia Group, gives his take on the Ukraine-Russia conflict, how the western world should respond and what the future holds for Ukraine. (Source: Bloomberg)

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