Kharkiv (Ukraine) (AFP) – Russian President Vladmir Putin on Monday levelled conditions on ending Moscow’s offensive against Ukraine as Russian forces shelled the country’s second city in the face of sweeping Western sanctions.

The Russian attacks on Kharkiv killed at least 11 people, Ukrainian officials said. Kyiv says more than 350 civilians, including 14 children, have been killed since the invasion began on Thursday. The United Nations said more than half a million people have fled the country. 

Russian and Ukrainian negotiators on Monday met for the first time since Moscow launched its full-scale invasion with Ukraine demanding a ceasefire and the withdrawal of Russian troops. The talks ended with both sides agreeing to continue a second-round of negotiations “soon”.

In a lengthy telephone call, Putin told French President Emmanuel Macron that “the demilitarisation and denazification” of Ukraine and Western recognition of Russian sovereignty over the Crimean peninsula were prerequisites to ending fighting in Ukraine, the Kremlin said.

“The Russian enemy is bombing residential areas of Kharkiv, where there is no critical infrastructure, where there are no positions of the armed forces,” said Oleg Sinegubov, the governor of the region that includes Kharkiv.

An AFP photographer in the city inspected damage caused by fighting on Sunday, finding a destroyed school, as well as several burned out Russian infantry vehicles. 

Russian corpses in army fatigues could also be seen in the streets.

British Prime Minister Boris Johnson condemned what he called “the barbaric air strikes being carried out by Russia against innocent civilians, including children”.

Earlier on Monday, the Russian army urged Ukrainians to leave Kyiv “freely” on one highway out ahead of what is an expected Russian offensive to capture the capital.

Financial pain

Long queues for groceries snaked through the streets of Kyiv on Monday after a strict 36-hour military curfew was lifted and volunteer militias learned how to make home-made explosives. 

“We will greet them with Molotov cocktails and bullets to the head,” bank employee Viktor Rudnichenko told AFP. “The only flowers they might get from us will be for their grave.”

The Russian ruble crashed to a record low as sanctions imposed by the West over the weekend had an immediate impact in Moscow, forcing the central bank to more than double its key interest rate to 20 percent.

“Ninety percent of Russians are going to rush to withdraw their rubles and change them into dollars, property or even gold,” predicted 51-year-old retired soldier Edward Sysoyev, who was in line to take out cash from a Moscow bank. “It’ll be ordinary people who pay for this military bun-fight.”

As Russia becomes increasingly isolated on the world stage, it faced a crucial test of support Monday as the 193 members of the UN General Assembly held an extraordinary debate on a resolution condemning Moscow’s “unprovoked armed aggression” in Ukraine.

During the rare emergency special session — just the 11th the Assembly has held in the United Nations’ 77-year history — Russia defended its decision to invade as member state after member state made a plea for peace.

“The fighting in Ukraine must stop,” warned UN Secretary-General Antonio Guterres, after the session began with a minute of silence for the victims.

“Enough is enough. Soldiers need to move back to their barracks. Leaders need to move to peace. Civilians must be protected.” 

Separately the United States said it had banned all US transactions with Russia’s central bank, while traditionally neutral Switzerland said it would adopt the same measures as the EU.

The economic pain is intended to change Putin’s calculations, but the roughly 100,000 Russian troops thought to be inside Ukraine continue to move forward from positions in the north, east and south on Monday.

“The Western sanctions on Russia are hard, but our country has the necessary potential to compensate the damage,” insisted Kremlin spokesman Dmitry Peskov. 

Putin, who put his nuclear forces on alert on Sunday, banned foreign currency transfers outside of Russia and ordered exporters to exchange their foreign reserves for the ruble in moves to support the currency.

There were more signs of rare dissent on Monday among the usually ultra-loyal oligarchs who surround the Russian leader — in addition to anti-war demonstrations that saw an estimated 2,100 people arrested on Sunday.

Russian advances

“It is necessary to change the economic policy, it is necessary to end all this state capitalism,” tycoon Oleg Deripaska wrote on Telegram while criticising “fantasists” in charge.

Western defence officials and the Kyiv government say Ukrainian troops have so far kept the country’s major cities out of Russian hands despite incursions in the capital and Kharkiv over the weekend. 

The small southern city of Berdyansk has been occupied, however, Ukrainian officials said.

Moscow claimed it had “gained air superiority over the entire territory of Ukraine”, while accusing Ukrainian troops of using civilians as human shields.

“You don’t conquer a country in two days,” said Olivier Kempf, a security analyst at the Foundation for Strategic Research think tank, warning against Western optimism about Russia’s slower-than-expected progress so far. 

“There have been difficulties, yes, that’s war. They perhaps have logistical problems, but no matter what anyone says, they are still advancing,” he told AFP. 

The talks on the Belarus-Ukraine border were led by Ukraine’s defence minister and Russian presidential adviser Vladimir Medinsky.

Kyiv had been initially reluctant to send a delegation to Belarus, given the country’s role in facilitating Russia’s attack on Ukraine by hosting troops and weaponry used for the invasion.

“We agreed to keep the negotiations going,” Medinsky said at the end of the talks.

Financial hit

The weekend featured a momentous series of announcements from Europe, with Germany unveiling a historic change to its defence policies, and the EU saying it would buy and supply arms to Ukraine, the first such move in its history.

Fresh sanctions announced over the weekend on Russia’s economy are intended to cut it off from the global financial system in the way that Iran, Venezuela or North Korea have been frozen out of international trade. 

The Moscow Stock Market was closed Monday to prevent an expected mass sell-off. 

Many Russian banks have been excluded from the SWIFT bank system, which is used to settle international trade, and the Russian central bank has seen its foreign assets held in Western countries frozen.

The response from the world of sports has also been gathering steam, as Russia was expelled from the World Cup and the country’s clubs and national teams suspended from all international football competitions “until further notice”, FIFA and UEFA said.

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