A woman enters a bank which re-opened near a barricade in central Kiev on 25 February, 2014. Photograph: Getty Images.
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Investors hesitate as Ukraine teeters on the precipice

In recent days Ukrainian bonds suffered the worst selloff on record and the stock index fell 2.8 per cent

As central Kiev has descended further into violence, the complexity of the divisions - beyond a simple fissure between east and west - have become apparent.

The focal point of the Orange Revolution of 2004-05 was simple: Viktor Yushchenko was the legitimate winner of the presidential election and the people went onto the street to protest the rigged ballot that gave Yanukovych the presidency. Protests were peaceful, the movement had a single figurehead and the objective was clear.

The situation in 2014 is far more complex. Demonstrations were triggered by Yanukovych’s decision not to sign a wide-ranging association agreement with the European Union - a decision the western media attributed to pressure from Russia.

This obviates the role ill-informed EU policy played. In demanding a final, all or nothing, response from Ukraine, a country in need of emergency funding, Yanukovych was left with little room for manoeuvre. President Vladimir Putin was offering cash. The EU was making promises and in so doing, Brussels misplayed its hand.

Branding Yanukovych as "pro-Russia" ignores the competing pressures within Ukrainian politics, particularly when he has taken significant steps to strengthen relations with the west. Ukraine is one of Europe’s most promising energy frontiers and hosts Europe’s third largest shale gas reserves. In November 2013 Kiev signed a production sharing agreement (PSA) with Chevron of the US, worth up to USD 10 billion, to explore for and produce shale gas in the Oleska field in western Ukraine. This was followed in January 2014, with the signing of a similar deal with Royal Dutch Shell for the Yuzivska field in the east of the country.

Conventional oil and gas exploration deals are also being signed. Ukraine agreed a PSA with an ExxonMobil-led consortium to exploit a field of the western coast of the Black Sea.

The signing of such deals with western oil majors is a significant departure from what has gone before. Even under Yushchenko’s pro-western leadership after the Orange Revolution, western companies were largely shut out the country’s energy sector, or put off by uncertain legislation.

Yanukovych, who became president in 2010, in contrast, has been more pragmatic in terms of opening the hydrocarbons production to the west. Efforts have also been made to significantly improve the legislative environment.

Despite this evolution, Ukraine has limited room for political and economic manoeuvre, a fact the EU appears to have ignored during negotiations. Irrespective of the international orientation of its leaders, the Ukraine remains heavily dependent on Moscow for its gas supply, with Russian imports accounting for 60 per cent of consumption. In retaliation for the Orange Revolution, Moscow raised gas prices and cut off supplies in 2006 and 2009, amid pricing disputes. The agreement that ended the 2009 cut-off left Ukraine paying some of the highest prices in Europe.

Unless Ukraine is able to develop its shale gas reserves and wean itself off dependence on Russian energy this cycle of economic vulnerability will continue.

Investors are ditching assets; punishing Ukraine for the protests. In recent days Ukrainian bonds suffered the worst selloff on record and the stock index fell 2.8 per cent. Yields on government bonds maturing in June reached an all-time high of 34 per cent, trading a yield on the 2014 note traded a record 23 per cent about the rate on debt maturing in April 2023.

Ukraine is grappling with a record current-account deficit and foreign reserves are at the lowest level since 2006. The country has USD17 billion of liabilities coming due, excluding interest, through the end of 2015 and at the time of writing Moscow has delayed a USD2 billion purchase of Eurobonds citing "technical delays".

The EU is threatening sanctions, a move that will have limited short-term impact and will do little to end the bloodshed, particularly if Putin opens his cheque book.

In the medium term, Ukraine’s gas reserves and agricultural output have the potential to make it a relatively wealthy country. In the short term, investors are panicking, sending the economy to the brink of a precipice.

The insurance market has all but closed its books to new Ukrainian risk. While there is relative optimism around Ukraine’s prospects over a six month time horizon, in the immediate term underwriters and investors want to minimise their exposures.

It is unclear where the protests go from here. Yanukovych won a relatively free and fair election and it could be considered a loss for democracy if he is forced from office. If he succumbs to pressure who should replace him? The opposition, unlike 2004-05, cannot offer an undisputed successor. It is a disparate grouping with several figureheads, radical elements and no clear leadership.

The departure of Yanuckovych does not provide a viable solution. There is widespread concern in Ukraine about the level of corruption in government. Even if Yanukovych is removed from office corruption will not necessarily diminish. A big question is how intrinsically entrenched Russian business interests are within Ukrainian politics and commerce, as these systemic flaws pose the greatest threat to the development of a democratic system.

JLT Head of Credit & Political Risk Advisory

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How “cli-fi” novels humanise the science of climate change

The paradox is that the harder climate-fiction novels try, the less effective they are.

When the Paris UN Climate Change Conference begins at the end of November, the world’s leaders will review the climate framework agreed in Rio in 1992. For well over 20 years, the world has not just been thinking and talking about climate change, it has also been writing and reading about it, in blogs, newspapers, magazines – and in novels.

Climate change fiction is now a recognisable literary phenomenon replete with its own nickname: “cli-fi”. The term was coined in 2007 by Taiwan-based blogger Dan Bloom. Since then, its use has spread: it was even tweeted by Margaret Atwood in 2013:

It is not a genre in the accepted scholarly sense, since it lacks the plot formulas or stylistic conventions that tend to define genres (such as science fiction or the western). However, it does name a remarkable recent literary and publishing trend.

A 21st-century phenomenon?

Putting a number to this phenomenon depends, partly, on how one defines cli-fi. How much of a novel has to be devoted to climate change before it is considered cli-fi? Should we restrict the term to novels about man-made global warming? (If we don’t, we should remember that narratives about global climatic change are as old as The Epic of Gilgamesh and the Biblical story of the flood.) If we define cli-fi as fictional treatments of climate change caused by human activity in terms of setting, theme or plot – and accept there will be grey areas in the extent of this treatment – a conservative estimate would put the all-time number of cli-fi novels at 150 and growing. This is the figure put forward by Adam Trexler, who has worked with me to survey the development of cli-fi.

This definition also gives us a start date for cli-fi’s history. While planetary climatic change occurs in much 20th-century science fiction, it is only after growing scientific awareness of specifically man-made, carbon-induced climate change in the 1960s and 1970s that novels on this subject emerged. The first is Arthur Herzog’s Heat in 1976, followed by George Turner’s The Sun and the Summer (published in the US as Drowning Towers) in 1987.

At the turn of this century, Maggie Gee and TC Boyle were among the first mainstream authors to publish climate change novels. In this century, we can count Atwood, Michael Crichton, Barbara Kingsolver, Ian McEwan, Kim Stanley Robinson, Ilija Trojanow and Jeanette Winterson as major authors who have written about climate change. The past five years have given us notable examples of cli-fi by emerging authors, such as Steven Amsterdam, Edan Lepucki, Jane Rawson, Nathaniel Rich and Antti Tuomainen.

Creative challenges

Cli-fi is all the more noteworthy considering the creative challenge posed by climate change. First, there is the problem of scale – spatial and temporal. Climate change affects the entire planet and all its species – and concerns the end of this planet as we know it. Novels, by contrast, conventionally concern the actions of individual protagonists and/or, sometimes, small communities.

Added to this is the networked nature of climate change: in physical terms, the climate is a large, complex system whose effects are difficult to model. In socio-cultural terms, solutions require intergovernmental agreement – just what COP21 intends – and various top-down and bottom-up transformations. Finally, there exists the difficulty of translating scientific information, with all its predictive uncertainty, into something both accurate and interesting to the average reader.

Still, cli-fi writers have adopted a range of strategies to engage their readers. Many cli-fi novels could be classified as dystopian, post-apocalyptic or, indeed, both – depicting nightmarish societies triggered by sometimes catastrophic climate events. A future world is one effective way of narrating the planetary condition of climate change.

Some novelists are also careful to underpin their scenarios with rigorous climatic predictions and, in this way, translate science fact into a fictional setting. Kingsolver, who trained as an ecologist, is the best example of this – and Atwood and Robinson are also known for their attempts at making their speculations scientifically plausible. Also, cli-fi novels, particularly those set in the present day or very near future rather than in a dystopian future, tend to show the political or psychological dimensions of living with climate change. Readers can identify with protagonists. To some extent, the global community is represented in fictional everymen or everywomen. Or, often, it is through such characters that science is humanised and its role in combating climate change better understood.

Can cli-fi lead to change?

Could cli-fi affect how we think and act on climate change? The paradox is that the harder cli-fi tries, the less effective it is. Many writers want to inspire change, not insist on it: the line between literature and propaganda is one that most novelists respect. Literature invites us to inhabit other worlds and live other lives. Cli-fi at its best lets us travel to climate-changed worlds, to strive there alongside others and then to return armed with that experience.

In Paris, the UN will seek a global agreement on climate action for the first time in more than 20 years. There is plenty of climate change fiction out there to help provide the mental and psychological space to consider that action.

The Conversation

Adeline Johns-Putra, Reader in English Literature, University of Surrey

This article was originally published on The Conversation. Read the original article.