Russia will 'wait' on Ukraine loan until new government decided

29th January 2014, Comments 0 comments

President Vladimir Putin on Wednesday said Russia would wait until a new government was formed in Ukraine before it considered releasing a crucial $15 billion bailout package for Kiev in full.

The Russian president's comments indicated that Moscow may renege on its promise to bail out the crisis-hit Ukraine if the new government turns out to be staunchly anti-Russian.

"Let's wait until a new government is formed in Ukraine," Putin said in televised remarks to his cabinet.

"But I ask you not to lose contact with your colleagues even in the current situation."

Ukrainian Prime Minister Mykola Azarov and his entire government resigned Tuesday after weeks of protests that began when President Viktor Yanukovych pulled out of a key EU deal in favour of closer ties with Moscow.

Putin's announcement came after senior members of his cabinet urged him to wait to see the make-up of the new government before honouring the agreement in full.

"Understanding the necessity of fulfilling all the agreements, we have to do it in a reasonable manner," said Prime Minister Dmitry Medvedev.

"And it will be possible to do it in a reasonable manner only when we understand what the government will look like, who will work there and what rules they will stick to," he said at the meeting with Putin.

On Tuesday, Putin had promised after talks with top EU officials that Russia "will not" review the loan agreement, regardless of whether Ukraine's opposition comes to power.

In a bid to prop up Ukraine's embattled President Yanukovych, Russia in December agreed to buy $15 billion of its debt and slash its gas bill by a third.

The bailout came out after Yanukovych unexpectedly refused to sign a key pact with the European Union and was seen as a move to reward the ex-Soviet country.

Russia has already invested $3 billion in Ukraine's eurobonds.

© 2014 AFP

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