Ukraine seals deal with European Union

Brussels: The European Union signed an historic free-trade pact with Ukraine on Friday and warned it could impose more sanctions on Moscow unless pro-Russian rebels act to wind down the crisis in the east of the country by Monday.

Ukrainian President Petro Poroshenko came to Brussels to sign a far-reaching trade and political co-operation agreement with the EU that has been at the heart of months of deadly violence and upheaval in his country, drawing an immediate threat of “grave consequences” from Russia.

Georgia and Moldova signed similar deals, holding out the prospect of deep economic integration and unfettered access to the EU’s 500 million citizens, but alarming Moscow which is concerned about losing influence over former Soviet republics.

EU leaders meeting in Brussels demanded that, by Monday, Ukrainian rebels agree to ceasefire verification arrangements, return border checkpoints to Kiev authorities, free hostages and launch serious talks on implementing Poroshenko’s peace plan.

“We expect progress in the next hours,” German Chancellor Angela Merkel said. “If we don’t see any steps forward on any of the points, then we are also prepared to take drastic measures.”

EU leaders said they were ready to meet again at any time to adopt significant sanctions on Russia. Diplomats said they could target new people and companies with asset freezes as early as next week. More than 60 names are already on the list.

Although it has drawn up a list of hard-hitting economic sanctions against Russia, the EU is still hesitating over deploying them because of fears among some member states of antagonising their major energy supplier.

“We are talking about possible sanctions against Russia but we do not have to introduce sanctions for the sake of sanctions,” Poroshenko said.