Russia Bails Out Ukraine In Rebuke to U.S., Europe

   < < Go Back
from The Wall Street Journal,

Ukrainian President Viktor Yanukovych, left, winks at Russia's Vladimir Putin as they agree to a bailout deal. Sergei Karpukhin/Reuters

Russia lavished Ukraine with a bailout package worth at least $20 billion Tuesday, trumping the West in a Cold War-tinged struggle that keeps the former Soviet republic in Moscow’s orbit.

The pact, one of the richest ever offered by Russia to another country, came just weeks after Kiev turned its back on a trade deal with the EU that Moscow had strongly opposed.

Announced after talks in the Kremlin between Russian President Vladimir Putin and his Ukrainian counterpart Viktor Yanukovych on Tuesday, the deal gives Ukraine loans and cheaper natural-gas supplies.

It appears to be substantially larger and the terms less restrictive than the aid the West had been offering to entice Ukraine to sign the EU’s trade-and-political accord. Russian officials said the first $3 billion in credits could be released within days.

“Ukraine’s trade with Russia makes it impossible for us to act in any other way,” Mr. Yanukovych said, referring to the deep economic links between the two countries. “There is no alternative to this.”

Mr. Putin, in turn, told Mr. Yanukovych, “Ukraine, without doubt, is our strategic partner and ally.”

More From The Wall Street Journal (subscription required):