Ukraine's Prime Minister Mykola Azarov has come back to the Europe Union and said that they will sign the trade and cooperation agreement in exchange for €20 billion ($27.6 billion) in aid.
Last month Ukrainian officials refused to sign the agreement, that would have helped them finally move out from under the shadow of Russia, and instead actually began rebuilding ties with Moscow, much to the annoyance of its people. Thousands of protestors, wanting to join the EU and leave Russia behind, took to the streets, demanding the resignation of President Viktor Yanukovich and the signing of the new trade deal.
Prime Minister Azarov has now said that they want the EU to understand their position. As described in a recent article on Oilprice.com, Russia has placed Ukraine under a lot of economic pressure, making it very difficult for them to choose the EU over Russia in a new deal; however at the same time they have also refused to join a Moscow-led customs union.
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"We suggest that the European Union invest in mutually profitable projects such as the modernisation and development of European transport corridors, and the creation of a new corridor to the Caucasus.
Now European officials look at the protests in Maidan (in central Kiev) and are not rushing to consider such projects and questions about the size of aid. And who will benefit from these protests: European officials or the Ukrainian people, who urgently need economic and financial help?"
Ukraine is on the verge of bankruptcy, and during the first three months of 2014 will have to pay just under €2.9 billion ($4 billion) in debt repayments and gas bills. The proposed €20 billion will help strengthen the country's economy as it adapts to a closer integration with the European Union, and offer a form of compensation for the potential loss of the huge Russian market, which may shun Ukraine for favouring the EU.
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The EU claims it has managed to set aside €610 million for macro-financial assistance once the Ukraine has signed an agreement with the International Monetary Fund, but President Yanukovich has stated that this sum is "humiliating".
He explained that "we are not waiting and not asking that they give us a present or compensate us, we are not talking about the European Union giving us the necessary technical support to bring our industry in line with European standards.
We are talking about the involvement in big mutually profitable projects, which have created new jobs in our enterprises over recent years."
By. Charles Kennedy of Oilprice.com
Charles is a writer for Oilprice.com More