Malaysia Says Accord Reached to Hand Over Bodies of MH17

July 21 (Bloomberg) -- Malaysian Prime Minister Najib Razak said rebels in eastern Ukraine agreed to hand over bodies of crash victims and grant access to the site where a passenger jetliner was brought down last week near the Russian border. Ryan Chilcote reports on “Bottom Line.” (Source: Bloomberg)

Pro-Russian rebels released bodies from the crash site of the Malaysian jet that was shot down over eastern Ukraine last week as U.S. and European leaders hammered home their message that President Vladimir Putin is isolating himself on the world stage.

The corpses stored in trains left for the city of Kharkiv after a rescue effort that was hampered by local insurgents and sparked a global controversy. As European foreign ministers head to Brussels for a summit tomorrow to discuss further sanctions, President Barack Obama urged Putin to rein in the rebels, who he said were “Russia-backed.”

Russia is locked in its worst diplomatic crisis with the U.S. and its allies since the end of the Cold War. Already sanctioned for his decision to annex Crimea in March, Putin is now facing the prospect of further penalties after the U.S. indicated that it believes the Russian military supplied the missile that downed MH17. Putin counters that his opponents are using the incident for “selfish political gains.”

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“The MH17 tragedy increases potential for further measures against Russia, and deepens the rift between Russia and the West,” Tatiana Orlova, senior economist at Royal Bank of Scotland Group Plc in London, said by e-mail. “The public outcry in the EU countries affected by the tragedy increases the domestic pressure on EU leaders to follow the U.S. and impose ‘third-round’ sanctions against Russia, which the EU has so far has eschewed.”

Photographer: Brendan Hoffman/Getty Images

Alexander Hug, right, Deputy Chief Monitor of the Organisation for Security and Cooperation in Europe (OSCE) Special Monitoring Mission to Ukraine, visits a train containing the bodies of victims of the Malaysia Airlines flight MH17 crash on July 21, 2014 in Torez, Ukraine. Together with Dutch inspectors, the storage conditions were declared acceptable, though it is still unclear where or when the train will be moved. Close

Alexander Hug, right, Deputy Chief Monitor of the Organisation for Security and... Read More

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Photographer: Brendan Hoffman/Getty Images

Alexander Hug, right, Deputy Chief Monitor of the Organisation for Security and Cooperation in Europe (OSCE) Special Monitoring Mission to Ukraine, visits a train containing the bodies of victims of the Malaysia Airlines flight MH17 crash on July 21, 2014 in Torez, Ukraine. Together with Dutch inspectors, the storage conditions were declared acceptable, though it is still unclear where or when the train will be moved.

Handover, Access

Malaysian Prime Minister Najib Razak said the separatists agreed to hand over bodies of victims and grant access to the crash site. The accord to transfer the remains of 282 people to the Netherlands was reached with Alexander Borodai, prime minister of the self-proclaimed Donetsk People’s Republic, Najib said today at his official residence in the administrative capital of Putrajaya. The two black boxes will be handed over to a Malaysian team in Donetsk tonight, he said.

Malaysia lost 43 citizens when the Boeing Co. 777 on Flight 17 from Amsterdam to Kuala Lumpur crashed July 17. It was the second-worst hit nation after the Netherlands with 193 passengers, while Australia had 27, according to a statement from Malaysian Airline System Bhd. (MAS)

Kharkiv, Amsterdam

Refrigerated train cars carrying corpses and body parts of crash victims will be moved to the Ukrainian city of Kharkiv, where Dutch representatives will take control, according to Najib. The remains will then be flown to Amsterdam before the bodies of Malaysian nationals are sent home after any necessary forensic analysis, he said.

Photographer: Bulent Kilic/AFP via Getty Images

Monitors from the Organization for Security and Cooperation in Europe (OSCE) and members of a forensic team inspect a refrigerator wagon containing the remains of victims from the downed Malaysia Airlines Flight MH17, at a railway station in the eastern Ukrainian town of Torez on July 21, 2014. Close

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Photographer: Bulent Kilic/AFP via Getty Images

Monitors from the Organization for Security and Cooperation in Europe (OSCE) and members of a forensic team inspect a refrigerator wagon containing the remains of victims from the downed Malaysia Airlines Flight MH17, at a railway station in the eastern Ukrainian town of Torez on July 21, 2014.

The site of the crash at Grabovo, less than 60 miles from Russia, has become a focus of international outrage as armed rebels hover over the investigation, making reclamation of wreckage and corpses more difficult. Speaking at the White House today, U.S. President Barack Obama said Putin has “direct responsibility” to compel separatists to stop hampering a probe.

“There seems to be some progress, but it is going step by step,” Dutch Prime Minister Mark Rutte said during a news conference in The Hague today. “It can take as much as 10 to 12 hours for the train to reach Kharkiv. From there, the bodies will be flown to the Netherlands for identification. This is good news.”

As leaders from London to Washington signaled Putin risks becoming a pariah, the Russian leader suggested they were playing politics. He blamed the downing of the plane on the Ukraine conflict and said that international investigators should have full access.

More Sanctions?

As Putin confronted worldwide scorn over the crash, Germany and the U.K. sought to limit expectations that EU foreign ministers will agree on punishing Russia for its alleged role in downing the plane.

German Foreign Minister Frank-Walter Steinmeier said the EU’s 28 member states have to “increase pressure” on Russia, though “it’ll be no easy meeting” tomorrow in Brussels. A U.K. official, speaking on condition of anonymity because the discussions were private, said the Dutch government had requested the EU delay actions that might provoke Russia until the bodies of passengers and crew on flight MH17 are recovered.

The conflict in east Ukraine is raging on, even as the eyes of the world focus on the crash. Government troops seized rebel-held towns in the Donbas region and took over part of Donetsk, according to a Defense Ministry statement today.

Russian Counterclaims

A Russian military official said today that the country’s military didn’t transfer a Buk missile to insurgents, directly contradicting U.S. accusations that the weapon was supplied by Russia. Top Russian commanders displayed a series of satellite and other images they said backed up their contention that the U.S. and Ukrainian conclusions that the plane was downed by a rebel-fired missile don’t reflect the facts.

Borodai, the separatist leader, today repeated that rebels didn’t shoot down the plane.

Separatists had at least three Russian-made surface-to-air missile systems, known by their NATO designation SA-11 Gadfly, Ukraine state security official Vitaliy Nayda said on July 19. Three of the systems were transported back to Russia just hours after the plane was shot down, he said. Nayda displayed photos that he said showed them on the road to the Russian border.

The images were “manipulated,” Russia’s military said.

The Gadfly, known locally as the Buk-M, is a radar-guided weapon that can locate a target at a range of 140 miles and reach altitudes as high as about 72,000 feet, according to the army-technology.com website.

Ukrainian Prime Minister Arseniy Yatsenyuk told reporters today that Ukraine’s armed forces haven’t fired surface-to-air missiles, that the rocket used to down the plane came from Russia and that those who fired it had received training in Russia. He said the Netherlands and Ukraine’s international partners should lead the investigation into the crash.

To contact the reporters on this story: Shamim Adam in Kuala Lumpur at sadam2@bloomberg.net; Manirajan Ramasamy in Kuala Lumpur at rmanirajan@bloomberg.net; Aliaksandr Kudrytski in Minsk, Belarus at akudrytski@bloomberg.net

To contact the editors responsible for this story: Balazs Penz at bpenz@bloomberg.net Paul Abelsky, Andrew Langley

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