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Russia, EU hint at financial aid in exchange for Ukraine's partnership

Published time: December 16, 2013 17:42
Edited time: December 17, 2013 10:12
A protester holds Ukrainian and European Union flags during a rally to support euro integration in central Kiev  (Reuters/Gleb Garanich)

A protester holds Ukrainian and European Union flags during a rally to support euro integration in central Kiev (Reuters/Gleb Garanich)

Aiming to keep Ukraine in orbit, both Russia and the EU have teased the country with promises to help fund its $17 billion finance gap.

As Kiev remains split between advocates of Ukraine’s alliance with Russia and those who want the country to move closer to the EU, Moscow and Brussels both said on Monday that they would grant loans to Ukraine should it agree to join their own particular alliance.

Ukraine will “simply fail to maintain economic stability,” Interfax quoted Russian presidential aide Andrey Belousov as saying. “I do not rule out that, if there is a request, a credit could be provided,” he said.

EU foreign policy chief Catherine Ashton also stressed that the EU could help Ukraine secure an IMF loan. At an EU Council meeting, Ashton said she had talked with the Ukrainian president about the short-term issues that prevented him from signing the agreement with the EU. She said such issues could be resolved through the support of the EU and international financial institutions, as well as through commercial loans.

Ukraine is seeking help to cover an external funding gap of $17 billion next year, which is almost the level of the central bank's depleted currency reserves, according to Reuters.

On Tuesday Ukrainian President Viktor Yanukovich is visiting Moscow. He will be meeting Vladimir Putin to discuss economic cooperation. “A solid package of bilateral agreements is expected to be signed following the meeting”, says the Kremlin website.

When asked whether the loan would be put forward at Tuesday's meeting between Yanukovich and Putin, Belousov said that he has not ruled out any possibilities.

Comments (10)


Count Cash 17.12.2013 13:29

The Ukrainian government have certainly outflanked the Euro mayhem camp who was going to sign a deal with the EU for free, also knowing it would bankrupt Ukraine. Instead the Ukrainian government are showing they are the ones delivering on funding, on preserving Ukraine in terms of economics and sovereignty. It’s doubtful that the Euro mayhem protesters can survive this delivery of real value for Ukraine by the Ukrainian government – the Government look like professionals, the Euro mayhem camp like clueless amateurs. Ukraine has a huge chance to get what it wants as long as it ignores the naive pro EU protesters.


Erich 16.12.2013 22:32

Hard choice, money from a country that has a history of forgiving debt, or money from countries that have used loans and interest rates to enslave people.


Count Cash 16.12.2013 22:10

There is also timing to all this, Ukraine cannot wait forever for cash, it has immediate needs The EU needs pack this cash very quickly and get it to Ukraine - tomorrow; otherwise the Russian card will be played. If the EU gets the cash arranged, then Ukraine will move onto visa free travel or they are out and so on and so on….. Get with the program EU, Ukraine is in the driving seat!

View all comments (10)
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