Russia Said to Put 6,000 Kids in Re-Education

(Bloomberg) — The US will push for Ukraine’s allies to deliver more anti-air defense capabilities to fend off Russia, which still has “a substantial number of aircraft” left in its arsenal, Defense Secretary Lloyd Austin said. He spoke after defense chiefs from NATO countries met in Brussels to discuss weapons deliveries, including tanks and ammunition for Kyiv.

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Ukraine’s President Volodymyr Zelenskiy said “speed is very important” in delivering on such pledges.

Russia has placed thousands of Ukrainian children in camps where they’re subjected to Russian propaganda and forcible adoption by Russian families, with some even undergoing military training, a US government-backed report from Yale University found.

(See RSAN on the Bloomberg Terminal for the Russian Sanctions Dashboard.)

Key Developments

  • NATO Struggles to Meet Spending Goals as It Mulls Higher Target

  • Ukraine Defense Chief Shakes Up Ministry Amid Corruption Probes

  • Banks With Russia Ties Targeted by US Treasury Whistleblowers

  • JPMorgan to Help Ukraine on Debt Capital Markets, Reconstruction

  • Russia Put 6,000 Ukrainian Kids in Re-Education Camps, Yale Says

On the Ground

Russian forces continued their offensive, focusing on Kupyansk, Lyman, Bakhmut and Avdiivka in the Kharkiv and Donetsk regions, according to Ukraine’s armed forces general staff. The Institute for the Study of War said that Russian forces made marginal territorial gains near Bakhmut and continued to conduct ground attacks across the Donetsk region. The Russian army also unsuccessfully attacked Ukrainian positions in western Zaporizhzhia region while continuing to fortify positions in the region.

(All times CET)

Zelenskiy Urges Partners to Speed Weapons Deliveries (9:25 p.m.)

Zelenskiy said in his regular evening address that allies meeting in Brussels agreed that his country needs more tanks, artillery and air defenses because “Ukraine must be successful.”

“But speed is very important”, Zelenskiy said. “Speed — in decision-making, in the implementation of decisions, in supply and training. Speed saves lives and returns safety.”

Russia Put 6,000 Ukrainian Kids in Re-Education Camps, Yale Says (8:56 p.m.)

Russia has placed thousands of Ukrainian children in camps where they’re subjected to Russian propaganda and forcible adoption by Russian families, with some even undergoing military training, a US government-backed report from Yale University found.

The campaign violates the Geneva Conventions and could constitute war crimes, crimes against humanity and possibly genocide, researchers from the Yale School of Public Health’s Humanitarian Research Lab said. It’s involved children from four months old to 17 years.

Russia has portrayed its adoption program as humanitarian aid to abandoned children.

Ukraine Needs More Air Defense Help, Austin Says (6:06 p.m.)

Austin said western allies haven’t given Ukraine enough air defense systems and the US would press for more, given the threat posed by Russia’s air force.

“It’s not enough and we’re gonna keep pushing until we get more because that threat is out there,” Austin told a news conference, when asked about the flow of air defenses to President Volodymyr Zelenskiy’s government. “We do know that Russia has a substantial number of aircraft in his inventory and a lot of capability left.”

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Austin spoke alongside General Mark Milley, chairman of the US Joint Chiefs of Staff, on the sidelines of a Ukraine Defense Contact Group meeting in Brussels. A top Ukrainian demand has been for increasingly advanced air-defense systems, from shoulder-fired Stinger missiles at the start of the war to Patriot missile interceptors in recent months.

Spain to Deploy Anti-Air Battery in Estonia (4:27 p.m.)

Spain will send a NASAMS anti-aircraft unit in April to defend Estonia’s main military base in Tapa for four months, the Estonian Defense Ministry said in a statement.

The Spanish weapon system will fill a gap as Estonia finalizes the procurement of its own air defense system and the “short-term solution” with Spain could later become a “rotational” framework akin to the Baltic Air Policing mission.

Russia Seeks to Jeopardize Water Supply, Ukrainian Premier Says (4:21 p.m.)

Russia has opened sluices at the Kakhovska heating power dam, seeking to reduce water supply from the Dnipro River, Ukraine’s Prime Minister Denys Shmyhal said during a government meeting in Kyiv.

This threatens to leave without water supply 70% of the towns and villages along the Dnipro as well as endangering safety of the Russia-occupied Zaporizhzhia nuclear power plant, which needs water for cooling, he said.

Shmyhal added that Ukraine expects to get more than $2 billion from the US, World Bank and other international donors in February. Ukraine began talks with the International Monetary Fund mission on the new monitoring program on Monday in Warsaw, Poland.

Russia Faces Years of Headwinds From Sanctions, EU Says (3:45 p.m.)

EU sanctions are “biting hard” and are contributing to a sustained economic recession in Russia despite record high energy prices last year, European Commission Vice President Valdis Dombrovskis told a news conference.

“Economic headwinds are likely to persist for years to come,” he said. The commission is monitoring the implementation of sanctions closely to ensure their success, he added.

Romania Sends Jets Over Unidentified Object (3:23 p.m.)

Romania scrambled fighter jets after the Air Force detected a small-sized aerial target, similar to a weather balloon, spotted flying at about 11,000 meters (36,000 feet) altitude in the southeastern part of the country, the Defense Ministry said in a statement.

However, the two MiG-21 fighter jets weren’t able to confirm the presence of any object once in the area, where they remained for 30 minutes before returning to base.

US Treasury Targets Banks With Russia Ties (2:20 p.m.)

A US law passed after Russia invaded Ukraine has given a boost to a flawed Treasury Department program that lawyers claimed deterred whistleblowers from providing tips on the role of banks in sanctions and anti-money laundering violations.

As a result, Treasury’s Financial Crimes Enforcement Network has gotten more than 100 whistleblower submissions over a three-week period this year, according to people familiar with the matter. The agency fielded just 100 tips in the program’s first two years and made no payments to whistleblowers.

Moldova Temporarily Closes Airspace (2:06 p.m.)

Moldova temporarily closed its airspace Tuesday, according to national airline Air Moldova, which didn’t give a reason for the restrictions. The airline said in Facebook statement that it was waiting for flights to resume, but that there would be disruptions to its flight schedule.

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Kyiv said last week that rockets fired from Russian ships in the Black Sea traversed Moldova before hitting targets in western Ukraine. On Monday, Moldova’s president called for heightened security and “maximum vigilance” after she cited fresh intelligence detailing Russian attempts to destabilize the country and overthrow her government.

Ukraine’s Reznikov Picks New Deputies After Graft Scandal (1:13 p.m.)

Ukrainian Defense Minister Oleksii Reznikov said he picked three new deputies to strengthen his team after a graft scandal shook his ministry.

Reznikov nominated Oleksandr Pavlyuk, who was commanding forces to protect Kyiv when Russia launched its invasion last February, according to his post on Facebook. Pavlyuk was also a commander of Ukrainian troops in Donbas, where Russia stoked a military conflict nearly nine years ago.

The defense minister said he also tapped Vitaliy Deynega, an IT specialist who set up a charity in 2014 to help rebuild the Ukrainian army, and Andriy Shevchenko, the former Ukrainian ambassador to Canada.

Germany Questions State of Polish Battle Tanks (10:23 a.m.)

German Defense Minister Boris Pistorius questioned Poland’s contribution to an international coalition sending Leopard battle tanks to Ukraine, suggesting the nation’s older A4 models were not in adequate condition to be deployed.

Germany has promised 14 Leopard A6 battle tanks and Portugal three, and additional commitments of the more modern version are currently not under discussion among allies, Pistorius told reporters in Brussels. Poland is taking the lead on supplying the older A4 model but the condition of its tanks is “nothing to write home about, to put it diplomatically,” he said.

NATO Chief Says Focus on Sweden, Finland’s Swift Accession (10:23 a.m.)

The main question for NATO is not whether Finland and Sweden are ratified together but whether they join as soon as possible, the alliance chief, Jens Stoltenberg, told reporters when asked how NATO would respond if Turkey only ratified Finland but not Sweden’s accession.

Stoltenberg said the Nordic countries are increasingly integrating into NATO, and added “I’m confident that both will become full members and working hard to get them ratified as soon as possible.”

EU to Propose Joint Funds to Procure Ammunition (9:58 a.m.)

The EU’s foreign policy chief, Josep Borrell, said he’ll present the bloc’s foreign ministers with a proposal to use the European Peace Facility to jointly procure ammunition for Ukraine when they meet in Brussels on Monday.

Speaking to reporters ahead of meetings at NATO, Borrell said the EPF “could perfectly mobilize its resources in a more common way,” than it currently does as an inter-governmental fund to refund member states that buy weapons for Ukraine.

Dutch Jets Intercept Russian Planes Near Polish Border (9:58 a.m.)

Dutch fighter jets intercepted three Russian planes near Polish airspace, according to a statement from the Dutch defense ministry on Monday. Two F-35s identified and escorted the Russian jets coming from Kaliningrad before handing over to NATO partners.

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Ewa Zlotnicka, a spokesperson for the Polish Armed Forces Operational Command, said the nation’s airspace wasn’t breached by Russian jets, which were flying over international waters.

“Each such incident should be interpreted as Russian provocation and their number has slightly increased during the last months,” she said.

US ‘Concerned’ Over Alleged Russian Coup Plan in Moldova (9:58 a.m.)

Russia’s alleged plan to overthrow the government in Moldova is deeply concerning, according to a top Biden administration spokesman, as it fits President Vladimir Putin’s “playbook.” However, the US hasn’t seen independent assessments verifying the coup reports, he added.

“Deeply concerning reports. Certainly not outside the bounds of Russian behavior,” National Security Council spokesman John Kirby said on Monday. “I don’t know independent confirmation, but we’re certainly not questioning their capacity,” adding that it’s “a page right out of his playbook.”

The comments came after Moldovan President Maia Sandu accused Moscow of trying to destabilize the country and overthrow her government by using foreign military experts and pro-Russian forces to trigger violent domestic protests. Russia has regularly denied meddling in Moldovan affairs.

NATO Chief Says Fighter Planes Not ‘Urgent’ (9:35 a.m.)

Fighter jets are “not the most urgent issue” now but are part of ongoing discussion about weapons deliveries to Ukraine, Stoltenberg told reporters ahead of meetings of the Ukraine Defense Contact Group and the alliance’s defense ministers in Brussels.

Dutch Defense Minister Kajsa Ollongren told reporters that any decision on sending fighter jets would take time, after Ukraine requested F-16s.

“This is a complex weapons system and we have to debate this with our partners, including the US,” she said, adding that the Dutch government would have to take into account feasibility as well as the consequence of sending jets.

Ukraine Needs up to $48 Billion in Funding This Year, IMF Says (7:34 a.m.)

Ukraine needs between $40 billion to $48 billion of funding this year in order for its economy to function, the head of the International Monetary Fund told a conference in Dubai.

The fund is working on a program with Ukraine and has been supporting it in running a “war economy,” IMF Managing Director Kristalina Georgieva said. The US and European Union are involved.

“I am full of admiration for the Ukrainian authorities,” she said. She described hearing sirens and Ukrainian officials run for cover during their virtual meetings with the Washington-based lender.

NATO Struggles to Meet Spending Goals as it Eyes New Target (7:34 a.m.)

North Atlantic Treaty Organization Countries are aiming to refine their defense spending targets by their next summit in Vilnius in July. Stoltneberg has said that 2% of gross domestic product should be a floor, not a ceiling.

NATO countries have pledged to spend more on defense following Russia’s invasion of Ukraine last year, but many nations — including Luxembourg, Canada and Italy — are still struggling to comply with the old guideline.

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