EU and US to Provide ‘Significant’ Financial Aid to Ukraine in Transition

Written by | Tuesday, February 4th, 2014

The European Union and the United States are preparing a plan for significant short-term financial assistance for Ukraine aimed at helping the troubled country get through a transitional period, EU foreign policy chief, Catherine Ashton, said in an interview with The Wall Street Journal on Monday (2 February). The transitional period will enable a broad-based interim government approve political and economic reforms and prepare for presidential elections that are due in 2015. According to Ashton, the EU and the US are “developing a plan – a Ukrainian Plan, I have suggested they call it – that looks at what do we need to do in different parts of the economy right now to make things better.”
Ukraine has been mired in a deep political crisis since November 2013, when President Viktor Yanukovich’s government decided not to sign a free trade agreement with the EU, prompting mass pro-EU integration protests. The demonstrations remained more or less peaceful until January, when the Ukrainian parliament adopted a number of bills giving the government greater powers to restrict mass demonstrations. Then, radical opposition activists responded to the new legislation with violent attacks on riot police, leading to several days of bloody clashes, in which hundreds of police officers and protesters were injured.
The Ukrainian authorities have since made a number of concessions to the opposition, including the repeal of the controversial anti-protests laws, but the tense ceasefire remains generally shaky. The $15 billion (€11 billion) bailout pledge that Ukraine won from Russia to help its ailing economy has now been put on hold by Moscow after Ukraine’s Prime Minister Mykola Azarov quit last week, bowing to protesters’ demands – Russian President Vladimir Putin asserted that Moscow would wait until a new government was formed before fully implementing the agreement.
The amount of the proposed EU-US aid package, which might not only consist of money but also contain “guarantees” or help on investment or shoring up the currency, had not yet been decided but Ashton said “the figures won’t be small”. Importantly, in contrast to past EU aid promises, this latest package would reportedly not depend on Ukraine reaching an agreement with the International Monetary Fund. Ashton who visited Kiev last week to try to promote dialogue between the government and opposition is expected to return to Ukraine again shortly. US Assistant Secretary of State Victoria Nuland will also visit Ukraine again in the next few days. Meanwhile, some opposition leaders in the Ukraine have urged the EU to impose sanctions to hurt the business and financial interests of the president and his leading supporters, though very few Western governments see that as sensible step at present.

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