Russia's President Vladimir Putin on Tuesday approved a draft bill for the annexation of Crimea.
The decree signed by Putin and posted on the official government website Tuesday morning is one of the steps which would formalize the annexation of Crimea. Russia, however, still has a room to back off. The treaty to annex Crimea has to be signed by leaders of Russia and Crimea, approved by the Constitutional Court and then be ratified by the parliament.
Later on Tuesday, Putin is scheduled to address both houses of the parliament in a nationally televised speech which he is widely expected to use to stake Russia's claim on Crimea.
Putin signed a decree recognizing Crimea as a sovereign and independent state, Russian media reported on Monday, shortly after the peninsula declared independence after voters on Sunday overwhelmingly chose to secede from Ukraine.
The United States, the European Union and Ukraine's new government refused to recognize the Crimean referendum and discussed sanctions against Moscow. They say the vote violates Ukrainian and international norms. Moscow, however, considers the referendum legitimate. Putin was set to address both houses of parliament Tuesday on the issue.
The Crimean parliament declared that all Ukrainian state property in the region will be nationalized and become the property of the Crimean Republic. Lawmakers also asked the United Nations to recognize it, and they began work on setting up a central bank with money from Russia.
Crimean lawmakers said they were flying to Moscow later Monday to discuss annexation by Russia. The pro-Russia region is home to a strategic port where Moscow already houses its Black Sea naval fleet. There are tens of thousands of troops reported to be Russian but bearing no insignia stationed in Crimea, while more Russian troops began lining the border with Crimea last week.
Oleksander Turchinov, Ukraine’s acting president, said the country is ready for negotiations with Russia on Crimea but would never accept an annexation. He added that actions inciting mass disorder would be punished as abetting the "military aggressor" and as a crime against the state.
Ukraine's Foreign Ministry earlier rejected a Russian proposal to create a contact group to mediate in the crisis and suggest changes to Ukraine's constitution. Responding to the rising tensions, the Ukrainian parliament approved the president's order for an armed forces mobilization of up to 20,000 troops.
U.S. President Barack Obama on Monday imposed sanctions on 11 Russians and Ukrainians — including two top Putin aides — blamed for Russia's military incursion and separatist actions in Crimea. The European Council also sanctioned 21 individuals involved in the referendum by freezing their assets and imposing a travel ban.
"The referendum in Crimea was a clear violation" and will not be recognized by the international community, Obama said Monday.
Obama said the U.S. will continue to hold close consultations with Europe to resolve the crisis. Vice President Joe Biden travels to Europe on Monday and is expected to meet with the leaders of NATO allies Poland, Estonia, Latvia and Lithuania on Tuesday.
"Our message will be clear," said Obama. "As NATO allies, we have a solemn commitment to our collective defense, and we will uphold this commitment."
Despite Crimean aspirations of joining the Russian Federation, it is still far from clear what Putin's next move will be. Annexing Crimea could evoke more international outrage than Moscow has an appetite for, and retaining de facto control of Crimea while the division weakens Ukraine's central government could result in an equally appealing situation for Moscow. Putin, however, has never been known for his predictability, and at this stage his response to the Crimean vote is unknown.
Kimberly Marten, a Russia and Eurasia expert at Columbia University, told Al Jazeera in February that an isolated war over Crimea would have implications reaching far beyond the peninsula.
"If you have Ukraine break into pieces, then other countries that have held together will have a strong incentive to look at their own arrangements. It could be the flare that leads to massive violence and conflict not only in Ukraine but elsewhere in the post-Soviet space," she said.
Moscow urged Ukraine on Monday to adopt a federal system, giving parts of the country more autonomy, as a way of resolving the polarization between Ukraine's western regions — which favor closer ties with the 28-nation EU — and its eastern areas, which have long-standing cultural and economic ties to Russia.
Russia's Foreign Ministry encouraged Ukraine's parliament to call a constitutional assembly that could draft a new constitution to make the government federal. It also said the country should adopt a "neutral political and military status," a demand reflecting Moscow's concern about the prospect of Ukraine's joining NATO.
Moscow is also pushing for Russian to become Ukraine's state language.
In Brussels, Polish Foreign Minister Radoslaw Sikorski said the West must take stronger action to counter Russia’s moves.
"We need to show solidarity with Ukraine, and therefore Russia leaves us no choice," he told reporters. "The [annexation] of Crimea cannot rest without a response from the international community."
Al Jazeera and wire services