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Vladimir Putin recognizes Crimea republic

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(CNN) -- Western powers slapped sanctions on more than two dozen Russian officials and their allies in Ukraine's Crimea region Monday, while Ukrainian officials vowed they would never accept the territory's annexation by Russia.

In a televised address Monday night, interim Ukrainian President Oleksandr Turchynov said his government would do "everything possible" to solve the crisis diplomatically, and he praised his citizens for refusing to respond to Russian provocations with violence.

"The Kremlin is afraid of the democratic future which we are building, and this is the reason for their aggression," Turchynov said. "But this will not be an obstacle to the building of a democratic country."

But he announced a partial mobilization of his country's armed forces and said Ukrainians "have to unite in one big family, which is ready to protect its home." And Prime Minister Arseniy Yatsenyuk told CNN that there was "a strong possibility" of a Russian invasion of Ukraine.

"I still believe that there is only one solution of this crisis, a peaceful one," Yatsenyuk said. "But we offer peace, and Russia offers war."

The Russian-backed breakaway government in Crimea applied to join with Moscow on Monday after a weekend referendum that Ukraine, the United States and the European Union called illegal. U.S. and EU officials announced sanctions on more than two dozen Russian officials and their allies in the region, which Russian-backed forces seized three weeks ago.

In Moscow, Russian President Vladimir Putin signed a decree that recognizes the independence and sovereignty of the Republic of Crimea, says a statement on Russia's Kremlin website. The Russian parliament is expected to vote on whether to annex the breakaway territory in the coming days.

Turchynov said Ukraine was willing to hold talks with Russia, "but we will never accept the annexing of our territory."

The EU sanctions include the top pro-Russian Crimean secessionist leaders, 10 leading Russian lawmakers who have endorsed the annexation of Crimea and three top Russian military commanders. The U.S. sanctions list also includes two top advisers to Russian President Vladimir Putin and ex-Ukrainian President Yanukovych, whose February ouster in the face of widespread anti-government protests sparked the current crisis.

In Washington, President Barack Obama warned Moscow: "Further provocations will achieve nothing except to further isolate Russia and diminish its place in the world."

"The international community will continue to stand together to oppose any violations of Ukrainian sovereignty and territorial integrity, and continued Russia military intervention in Ukraine will only deepen Russia's diplomatic isolation and exact a greater toll on the Russia economy," he said.

Russian official: Proud to be sanctioned

Washington said its sanctions targeted Russian officials and lawmakers, as well as Crimea-based separatist leaders, with financial sanctions for undermining "democratic processes and institutions in Ukraine." Obama's order freezes any assets in the United States and bans travel for the 11 people named. Among those sanctioned were ousted Ukrainian President Viktor Yanukovych and aides to Putin.

But one of the Putin aides named in the U.S. sanctions called it "a great honor" to be singled out for American punishment.

"I consider the decision of the Washington Administration as a recognition of my service to Russia," Vladislav Surkov told Russian news outlet MK.

Diplomatically, Sunday's referendum has put the United States and Russia on the kind of collision course not seen since the Cold War. Economically, it's unclear how much such a coupling will cost Russia. And politically, it's divided Crimeans, some of whom think it will bring better pay and some who see this as a Kremlin land grab.

In Brussels, Belgium, European Union international policy chief Catherine Ashton announced sanctions against 21 people "responsible for actions which undermine or threaten the territorial integrity, sovereignty and independence of Ukraine." She called the weekend vote "illegal" and "a clear breach of the Ukrainian Constitution," and she urged Russia not to follow up by annexing the territory.

"We want to underline very clearly that there is still time to avoid a negative spiral and to reverse current developments," she said.

The union's 28 foreign ministers agreed on sanctions earlier Monday, Lithuanian Foreign Affairs Minister Linas Linkevicius wrote in a message on Twitter. More measures would follow in a few days, when EU leaders meet for a summit in Brussels, he said.

Crimea is home to 2 million people, most of them ethnic Russian. Moscow strongly backed Sunday's referendum, which the region's leaders declared won with an overwhelming 96.7% vote in favor of leaving Ukraine.

Russian lawmakers have said they will welcome Crimea with open arms. But members of the ethnic Ukrainian and Muslim Tatar minorities had said they would boycott the vote.

Uncertainties stemming from a possible break from Ukraine have fueled rumors about a looming legal vacuum in the crisis-hit region, causing panic and confusion. And in the meantime, Yatsenyuk said Moscow appeared ready to attempt a similar play in other Russian-speaking areas of Ukraine, starting with demonstrations by what he called "political tourists" with foreign passports.

"Look the last rallies that happened in Donetsk and in Kharkiv and in Lugansk," he said. "They gathered from 500 people up to 4,000 people. But they expected to have 50,000 people. So we talked to the people. We tried to address this issue in the right manner, trying to convince Ukrainians that the biggest asset we have is our country."

What comes next

• On Monday, Russia proposed creating an international support group to mediate in the Ukraine crisis. Its Foreign Ministry said in a statement that this group would urge Ukraine to implement portions of a February 21 peace deal and formulate a new constitution that would include Russian as an official language alongside Ukrainian, as well as set out broad powers for the country's regions.

• Putin will address a joint session of Russia's parliament on Crimea on Tuesday.

• Russian lawmakers say they will discuss the future of Crimea on Friday. "All the necessary legislative decisions on the results of the referendum will be taken as soon as possible," said Sergey Neverov, the deputy speaker of the lower house of parliament, the Duma. "The referendum shows that the people of Crimea see their future as a part of Russia."

• Crimean lawmakers have approved legislation to make the Russian ruble the official currency in Crimea alongside the Ukrainian hryvnia, according to a statement posted on the Crimean Parliament's website. The hryvnia remains an official currency until January 1, 2016. The statement did not provide a date for when the ruble would be circulated in the region.

• The lawmakers also adopted a resolution stating that on March 30, Crimea will move to Moscow Standard Time.

• A secession would mean transferring banks, public utilities and public transport from Ukraine to Russia in what would undoubtedly be a costly operation. Crimea is entirely integrated into Ukraine's mainland economy and infrastructure: Ninety percent of its water, 80% of its electricity and roughly 65% of its gas comes from the rest of country. It also depends heavily on the Ukrainian mainland to balance its books. About 70% of Crimea's $1.2 billion budget comes directly from Kiev.

• A special tax system may be introduced for Crimea, Russia's state-run ITAR-Tass news agency reported Monday, citing Russian Finance Minister Sergei Shatalov.

A bad day for relations

Many Crimeans hope the union with Russia will bring better pay and make them citizens of a country capable of asserting itself on the world stage. Others saw the referendum as a land grab by the Kremlin from Ukraine, whose new rulers want to move the country toward the European Union and away from Moscow's sway.

Tension is also running high in parts of the Russian-speaking industrialized east of Ukraine near the border with Russia, with clashes between rival demonstrators.

Thousands of pro-Russian demonstrators rallied beneath a towering statue of Soviet revolutionary Vladimir Lenin in Donetsk's main square, with chants of "Donetsk is a Russian city" ringing out as the protesters gathered in a show of support for the Crimean referendum and to demand their own.

Christopher Hill, a former U.S. ambassador to South Korea, Iraq and Poland, described Sunday as a bad day for East-West relations.

"Putin has left our president with no choice. He needs to impose sanctions. I know Putin will come back and impose his own," he said. "I think the end of this is going to be to cast Russia out into the cold. And the problem is, I don't think Putin really cares. I think this is where he wants to take Russia."

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