Russia moved to increase its influence over Ukraine sharply yesterday by pledging to invest $15bn in the country’s bonds and slashing the price it charges Kiev for gas, dealing a blow to those hoping the country will integrate more closely with the EU.
The series of agreements signed by Russian president Vladimir Putin and his Ukrainian counterpart Viktor Yanukovich appeared to give Moscow the upper hand in a geopolitical struggle with Europe. But the perception of Mr Yanukovich “selling” the country to Russia could fuel the popular protest movement that has gripped Kiev since Mr Yanukovich aborted an integration agreement with the EU last month.
Russia said it would invest $15bn of reserves in its national welfare fund into Ukrainian securities. It also said it would temporarily cut prices it charges Ukraine for natural gas – among the highest in Europe – from more than $400 per thousand cubic metres to $268.50. The presidents also signed deals aimed at ending Russian bans on Ukrainian imports, which have contributed to a sharp fall in trade between the countries.