Feb. 25 (Bloomberg) -- The European Union set a three-month deadline for Ukraine to carry out changes to its justice and electoral systems in order to qualify for a free-trade agreement.
The 27-nation EU renewed its commitment to provide Ukraine with 610 million euros ($805 million) of aid, contingent on the former Soviet republic reaching an assistance agreement with the International Monetary Fund, according to a statement issued in Brussels today after an EU-Ukraine summit.
Ukraine, which resumes talks with the IMF next month on a third bailout since 2008, faces a shrinking economy and $10 billion of debt payments scheduled this year. The economy is in a recession after contracting 0.9 percent in the fourth quarter.
The EU “is very much committed to Ukraine’s economic growth and modernization, and we are aware of the economic challenges facing the country,” European Commission President Jose Barroso said after talks with President Viktor Yanukovych. The promised EU aid is the largest such package ever “and represents a clear demonstration of our support to Ukraine’s prosperity,” Barroso said.
The EU postponed a so-called association agreement, including a free-trade area, with Ukraine after former Prime Minister Yulia Tymoshenko was jailed in a case many in the bloc see as politically motivated. Yanukovych has pledged to resolve the issue, though prosecutors threatened last month to imprison her for life for alleged murder.
“We raised our continued concern over the cases of selective justice,” EU President Herman Van Rompuy said after talks with Yanukovych. “Systemic reform of the judicial system is also crucial to ensure that there will be no recurrence of selective justice.”
The EU seeks “concrete progress” from Ukraine by early May on selective justice as well as electoral and political changes, according to a joint statement issued after the summit.
“Some steps have been taken, but we still need to see more and concrete progress,” Van Rompuy said. “I have underlined the European Union’s call for determined action and tangible progress in these areas at the latest by May. Progress in these areas is realistic and feasible but the time is very short.”
Yanukovych said Ukraine will “do its best” to satisfy the EU’s requirements.
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