AFP

President Vladimir Putin ordered a partial military mobilisation and vowed on Wednesday to use “all available means” to protect Russian territory, after Moscow-held regions of Ukraine suddenly announced annexation referendums.

The votes, already denounced by Kyiv and the West as a “sham”, will dramatically up the stakes in the seven-month old conflict in Ukraine by giving Moscow the ability to accuse Ukrainian forces of attacking its own territory.

Four Russian-occupied regions of Ukraine — Donetsk and Lugansk in the east and Kherson and Zaporizhzhia in the south — said on Tuesday that they would hold the votes over five days beginning Friday.

In a pre-recorded address to the nation early on Wednesday, Putin accused the West of trying to “destroy” his country through its backing of Kyiv, and said Russia needed to support those in Ukraine who wanted to “determine their own future”.

The Russian leader announced a partial military mobilisation, with Defence Minister Sergei Shoigu telling state television that some 300,000 reservists would be called up.

– ‘Not a bluff’ –

“When the territorial integrity of our country is threatened, we will certainly use all the means at our disposal to protect Russia and our people. This is not a bluff,” Putin said.

“Those who are trying to blackmail us with nuclear weapons should know that the wind can also turn in their direction,” Putin added. 

Putin said that through its support for Ukraine the West was trying to “weaken, divide and ultimately destroy our country”, while Shoigu said Moscow was “fighting not so much Ukraine as the collective West” in Ukraine. 

The sudden flurry of moves by Moscow this week came with Russian forces in Ukraine facing their biggest challenge since the start of the conflict.

In a rare admission of military losses from Moscow, Shoigu said Wednesday 5,937 Russian soldiers had died in Ukraine since the launch of the military intervention in February.

A sweeping Ukrainian counter-offensive in recent weeks has seen Kyiv’s forces retake hundreds of towns and villages that had been controlled by Russia for months.

The referendums follow a pattern first established in 2014, when Russia annexed the Crimea peninsula from Ukraine after a similar vote.

Like in 2014, Washington, Berlin and Paris denounced the latest referendums and said the international community would never recognise the results.

German Chancellor Olaf Scholz said they were a “sham”, French President Emmanuel Macron called them a “travesty”, and White House National Security Advisor Jake Sullivan said they were “an affront to the principles of sovereignty and territorial integrity”.

“Sham referenda and mobilisation are signs of weakness, of Russian failure,” the US ambassador in Ukraine, Bridget Brink, said on Twitter.

“I thank all the friends and partners of Ukraine for their massive and firm condemnation of Russia’s intentions to organise yet more pseudo-referendums,” Ukrainian President Volodymyr Zelensky said in response.

– Strike at nuclear plant –

Kyiv said the referendums were meaningless and vowed to “eliminate” threats posed by Russia, saying its forces would keep retaking territory regardless of what Moscow or its proxies announced.

Political analyst Tatiana Stanovaya said the vote announcements were a direct result of the success of Ukraine’s eastern counter-offensive.

“Putin does not want to win this war on the battlefield. Putin wants to force Kyiv to surrender without a fight,” she said.

The Ukrainian nuclear operator Energoatom meanwhile on Wednesday accused Russia of again striking the Zaporizhzhia atomic power plant in southern Ukraine.

The strike damaged a power line causing the stoppage of several transformers of the number six reactor of the plant and forcing a brief start of emergency generators, Energoatom said.

“Even the presence of inspectors from the International Atomic Energy Agency (IAEA) does not stop” the Russians, it said, calling on the agency to “more resolute actions” against Moscow.

Europe’s largest nuclear facility, located in Russian-held territory, has become a hot spot for concerns after tit-for-tat claims of attacks there.

The Federal Reserve is poised to roll out another big increase in interest rates Wednesday as it tries to cool the economy to tamp down the highest inflation in 40 years, but recession fears are rising.

Soaring prices that are putting the squeeze on American families and businesses have already become a political liability for President Joe Biden, as he faces midterm congressional elections in early November.

But a contraction of the world’s largest economy would be a more damaging blow to Biden, to the Fed’s credibility and the world at large.

Federal Reserve Chair Jerome Powell has made it clear that officials will continue to act aggressively to cool the economy and avoid a repeat of the 1970s and early 1980s, the last time US inflation got out of control.

It took tough action — and a recession — to finally bring prices down in the 1980s, and the Fed is unwilling to give up its hard-won, inflation-fighting credibility.

Many economists are expecting a third straight three-quarter point rate hike when the meeting concludes Wednesday, which would be an unprecedented action since that era. But there is a chance the Fed could opt for a full point increase.

Powell and other central bankers have been sending the same message: a downturn is better than continued high inflation given the pain that would inflict, especially on those least able to withstand it.

“Since inflation began to accelerate in early 2021, Fed officials have been overly optimistic that it would quickly recede to the central bank’s 2% target,” economists Mickey Levy and Andrew Levin wrote in The Wall Street Journal.

“The economy now faces a serious risk of persistent high inflation.”

The Fed’s policy-setting Federal Open Market Committee (FOMC) is scheduled to announce its decision at 1600 GMT Wednesday.

Powell’s press conference after the meeting will be closely scrutinized for clues on how much more he thinks the Fed will have to do before it declares victory in the inflation fight.

– Avoiding a downturn –

Inflation is a global phenomenon amid the Russian war in Ukraine on top of global supply chain snarls and Covid lockdowns in China, and other major central banks are taking action as well.

European Central Bank President Christine Lagarde said Tuesday that more increases will be needed to stop inflation from taking hold. 

US policymakers have the luxury of a strong job market, and low unemployment, which gives it some leeway to tackle high prices.

Even so, many economists say at least a short period of negative GDP in the first half of 2023 will be needed before inflation starts coming down.

Despite the welcome drop in gasoline prices at the pump in recent weeks, the disappointing consumer price report for August showed widespread increases. 

But Ian Shepherdson of Pantheon Macroeconomics, who believes inflation has peaked, said incomes are growing amid rising wages, which bodes well for the outlook.

“The US economy is not in recession or headed there,” he said in an analysis.

The Fed has front-loaded its rate hikes, cranking up the benchmark lending rate four times this year, including two straight three-quarter-point hikes in June and July.

The aim is to raise the cost of borrowing and cool demand, and it is having an impact: the housing market has slowed as mortgage rates have surged.

Recent statements from Fed officials indicate more rate hikes are coming, and no cuts until inflation is under control — dousing hopes that had built up in markets following the July policy meeting.

“The irony here is that just as the Fed is ratcheting-up the anti-inflation rhetoric to fever-pitch, the forces needed to drive down inflation over the next year are now in place,” Shepherdson said.

The FOMC also will release the quarterly forecasts from members, which will show how they feel about the direction of the economy and the impact of the policy moves, and how soon inflation will come down.

The Global Fund to Fight AIDS, Tuberculosis and Malaria will hold a donor conference Wednesday in New York, where it aims to raise at least $18 billion during an event hosted by US President Joe Biden.

It is the highest ever “replenishment” goal set by the organization, and comes amid rising economic pressures — both on donor countries and recipients — following the Covid-19 pandemic and the food and energy crises caused by the Ukraine conflict.

But spokeswoman Francoise Vanni told AFP she was buoyed by recent pledges — including most recently 1.3 billion euros from Germany, which followed $6 billion from the United States and $1.08 billion from Japan — that had brought the fund “about halfway” to its target.

“There’s a lot at stake, and the $18 billion target is very much based on getting back on track to end AIDS, TB and malaria by 2030, recovering ground lost during the Covid pandemic and saving no less than 20 million lives over the next three years,” she said.

“Everything is still at play and no decision has been made until it’s been made…But we have very strong pledges already in the bag.”

The amount is 30 percent more than that raised during the organization’s sixth and most recent replenishment, hosted by President Emmanuel Macron of France in 2019, which raised a then-record $14 billion.

The Global Fund was created in 2002 and brings together governments, multilateral agencies, bilateral partners, civil society groups, and the private sector to tackle the three deadly diseases, with new funding cycles usually every three years.

Vanni said she hoped donors would look at the fund’s track record of success — last week it announced it had helped save 50 million lives over the past 20 years.

What’s more, “countries around the world realize that no one is safe until everyone is safe. We’ve been saying that during Covid-19, and we cannot lose that momentum.”

– Signs of recovery – 

Last year, the Global Fund warned that the pandemic was having a “devastating” impact on its work, leading to declining results across the board for the first time in the fund’s history.

But it said last week that the massive resources it had pumped to counter the downturn had paid off and “recovery is underway” against all three diseases.

For example, the number of people dying from TB rose for the first time in a decade in 2020, when it caused an estimated 1.5 million deaths, making it the world’s second biggest infectious disease killer behind Covid.

But the Global Fund, which provides 76 percent of all international financing for fighting TB, said the programs had shown signs of recovery last year.

Similarly, the number of people reached with HIV prevention services rose again after dropping in 2020, reaching 12.5 million people worldwide, it said. The fund provides nearly a third of all international financing to battle HIV.

Per an act of Congress, the United States cannot provide more than one-third of funding for the Global Fund — a limit that serves as a matching challenge to other nations to double the American pledge.