Ukraine U-turns on European Union trade deal

Supporters of Yulia Tymoshenko protest in the Kiev parliament. Picture: Reuters
Supporters of Yulia Tymoshenko protest in the Kiev parliament. Picture: Reuters
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UKRAINE has suspended preparations for signing a landmark trade treaty with the European Union and said it would renew dialogue with Russia to aid its economy instead.

The diplomatic turnaround came yesterday just eight days before President Viktor Yanukovich was due to sign a deal on trade and co-operation with the EU which would mark a pivotal shift west for the former Soviet republic’s 46 million people, away from its old ally, Russia.

Prime minister Mykola Azarov said Ukraine was suspending preparations for concluding the EU deal “with the aim of adopting measures to ensure national security”. Ukraine has been concerned a punitive Russian reaction to any deal could hurt its economy.

The order added that Ukraine would “renew active dialogue” with Russia, other members of a Moscow-led customs union and the Commonwealth of Independent States, former republics of the Soviet Union.

Germany’s foreign minister Guido Westerwelle reacted by saying the EU was still interested in a deal with Ukraine.

A spokesman for President Vladimir Putin said Russia welcomed Ukraine’s desire to rebuild links. Earlier, Ukraine’s parliament rejected draft laws that would let jailed opposition leader Yulia Tymoshenko go to Germany for treatment – something EU leaders had pressed Mr Yanukovich to permit before they would sign the pact.

Ukrainians have been divided on the merits of an EU deal, notably since Mr Putin made clear that Moscow might retaliate a by cutting vital gas flows as it has done in previous “gas wars”. Russia supplies 25 per cent of EU gas; 80 per cent of it is piped through Ukraine.

Opposition leader Arseny Yatsenyuk, an ally of Tymoshenko, responded to the government order by saying that a failure by Mr Yanukovich to sign the EU deal would be tantamount to “treason” and provide grounds for his impeachment.

The government announcement followed months of wrangling between the EU and Ukraine with the 28-member bloc insisting Ukraine carry out democratic reforms including ending “selective justice” and reforming the judiciary and the electoral system.

The EU’s insistence that Mr Yanukovich act to release Tymoshenko had particularly irked the president, who sees her as a danger to his bid for re-election in 2015. He had been due to sign the EU deal at a summit in the Lithuanian capital, Vilnius, on 29 November.

Mr Yanukovich took a harder line this week in talks with the EU, threatening not to sign.

EU envoys had been trying to find a compromise under which Tymoshenko, who was jailed for seven years for abuse of office over Russian gas contracts after a trial western governments say was political, could be released to Germany for medical treatment for back trouble.

But, at an angry session yesterday, the Kiev parliament, which is dominated by Mr Yanukovich’s allies, rejected all six bills put forward by the opposition that would allow her release.

German foreign minister Mr Westerwelle spoke of wishing that Ukraine would choose a “European path of development” but made clear that was up to Kiev. “Our interest in good relations with Ukraine is unbroken and our offer of a real partnership still stands,” he said. “The ball is in Kiev’s court. It is their sovereign right to decide on their path freely.”