Ukrainian President Viktor Yanukovych pledged to tackle the country’s political crisis and return his focus to the economy as anti-government protests continued in the capital, Kiev.
Catherine Ashton, the European Union’s foreign policy chief arrived today for a two-day visit to meet Yanukovych and opposition leaders to mediate in a political stalemate as thousands of people braved freezing temperatures to protest for a 20th day. The demonstrations erupted after Ukraine pulled out of a deal to deepen trade ties with the EU in favor of closer links with Russia.
As demonstrators face off against riot police in the city center, Ukraine’s leaders are seeking $10 billion to keep the economy afloat. Talks with Russia and the EU have yielded no progress so far and Yanukovych returned from China last week without loans. The president today said he’d restart talks with the International Monetary Fund and pledged to sign an EU trade agreement in March.
“Everyone should concentrate on the economy,” Yanukovych said in a televised round-table discussion with three former presidents of Ukraine. “These political problems we have now, I will resolve in the coming days.”
The yield on Ukraine’s dollar-denominated bonds due 2023 retreated to 10.65 percent at 5:32 p.m. Kiev from yesterday’s record-high 10.883 percent, according to data compiled by Bloomberg.
The likelihood of an agreement with the IMF isn’t high before elections, because Yanukovych’s administration has repeatedly rejected its demands for budget consolidation, said Tim Ash, chief economist for emerging markets at Standard Bank Group Ltd in London.
“The IMF will inevitably ask for fiscal consolidation, which the government will simply be unable/unwilling to stomach this side of elections and given the regime’s low level of popularity,” Ash said. “I cannot see an IMF deal being done with the Yanukovych administration this side of elections.”
Emotions flared after hundreds of officers pushed activists away from their make-shift blockades in Kiev and stormed the offices of jailed former Prime Minister Yulia Tymoshenko’s party yesterday and early this morning.
“I follow with concern the reports that police forces forcibly entered the office of the biggest opposition party,” Ashton said in a statement last night. “I call on the Ukrainian authorities to exercise utmost restraint and refrain from any further use of force, in order to give space for a negotiated solution out of the current political stalemate.”
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