Ukrainian leader seeks cash from Putin amid protests

Ukraine's embattled President Viktor Yanukovych left behind furious anti-government rallies on Tuesday to negotiate a multibillion lifeline with Russia's Vladimir Putin that protesters fear will ruin their EU integration dreams.

The nation of 46 million has been at the heart of a furious diplomatic tug of war since Yanukovych's decision last month to ditch a landmark EU partnership agreement and seek closer ties with Russia.

Tuesday's high-stakes meeting at the Kremlin came two days after frustrated EU officials suspended months of negotiations they had hoped would pull Ukraine out of Russia's orbit for the first time.

"Ukraine is in a very difficult situation - between the European Union and Russia. On one hand, Ukraine relies on energy resources from Russia to boost its domestic economy. On the other hand, in the country, many people want to engage with the EU," said Ding Chun, director of the Center for European Studies of Fudan University in Shanghai.

Diplomats in Brussels cited Yanukovych's continued courtship of Russia for their decision and demanded a firmer commitment to EU standards on political freedoms and economic reforms.

"Ministers confirmed again today the European Union's readiness to sign the (agreement) as soon as Ukraine is ready and the relevant conditions are met," EU foreign policy chief Catherine Ashton said on Monday after a ministerial meeting in Brussels.

"We believe that the agreement provides the best way to address Ukraine's short-term economic challenges," Ashton said.

But Yanukovych will instead be hoping to win an urgently needed cash advance from Russia - estimated by local media at anywhere between $5 billion and $12 billion - that his critics view as Putin's reward for Kiev's U-turn on the EU pact.

"A Russian loan can help Yanukovych keep power," said Ukrainian political analyst Volodymyr Fesenko.

"And the Kremlin is ready to help him because this meets Putin's strategic interests," the analyst said.

Since the location of Ukraine is important strategically for Russia and economic cooperation between the two countries is also very tight, Moscow will not let Ukraine join the EU easily, said Ding, the expert from Fudan University.

"This situation may last for a while," he added.

Yanukovych's reversal sparked the largest anti-government rallies since the 2004 pro-democracy Orange Revolution that first nudged Ukraine on a westward path.

The Ukrainian government has organized counter-rallies by bussing thousands of people into Kiev from eastern regions where Yanukovych enjoys broader support.

The latest mass rally attracted nearly 300,000 people to central Kiev on Sunday and the opposition plans to hold another monster rally on Independence Square on Tuesday evening aimed at putting still more pressure on Yanukovych during his Kremlin talks.

Cheaper gas and loans

Yanukovych hoped to sign a series of deals with Putin that besides the loan include an agreement for cheaper Russian natural gas shipments that could provide some relief to Ukraine's wobbly economy.

But demonstrators feared that Yanukovych will be putting the country on a path toward future membership in a Russian-led Customs Union that the Kremlin hopes to build into a rival to the 28-nation EU bloc.

The Ukrainian government flatly denied that a Customs Union deal will be signed on Tuesday. But this has failed to allay the protest movement's worst fears.

Nationalist opposition leader Oleg Tyagnybok said his Svoboda (Freedom) party had learned that Putin planned to reward Yanukovych for delaying the EU deal's signature with a $5 billion loan.

He said Russia would also lower the gas price it charges the Ukrainian state energy company to $200-$300 per thousand cubic meters from the more than $400 that it pays now.

"That is the baggage Yanukovych is taking with him to Moscow," Tyagnibok told reporters.

AFP-China Daily

(China Daily 12/18/2013 page11)