Brussels, 27/08/2015 (Agence Europe) - On Thursday 27 August, European Commission President Jean-Claude Juncker called for the Minsk agreements to be applied by both parties - “in particular, Russia”.
“The Russian party seems not to be applying the imperatives belonging to it”, he said at a press conference with Ukraine's President Petro Poroshenko, adding that peace had to come via implementation of the agreements. “Russia is fulfilling nothing on the Minsk agreements”, Poroshenko stated. Over the last 24 hours, seven Ukrainian soldiers have been killed, he said. Since the start of the war in East Ukraine, over 6,800 people have been killed.
During a press conference with European Council President Donald Tusk, Poroshenko gave assurances, however, of the “enormous efforts made by Ukraine to fulfil the Minsk agreements”. He spoke of the cooperation with the Organization for Security and Cooperation in Europe (OSCE), the withdrawal of weapons, and work on the political process. Poroshenko stated that the review of the constitutional process would be debated in the Ukrainian Parliament on 31 August. If it is adopted, “then we will have accomplished all the political aspects of the Minsk agreement”, he said, expressing his opposition to any new negotiation (Minsk 3).
Tusk had a positive opinion of the trilateral contact group's 26 August agreement for a ceasefire starting on 1 September. However, in Poroshenko's opinion, the ceasefire must be immediate. He also called again for a United Nations or EU mission to guarantee security. “Ukraine will constantly return to the idea of introducing UN peacekeepers, not as an alternative to Minsk but as an aid, or the introduction of an EU mission in the CSDP format”, he said. During his meeting with Tusk, Poroshenko said that the EU's political and security committee (PSC) would visit Ukraine in mid-September in order to see how the Minsk agreements were going and to look at possible further action for the EU on the ground in the Luhansk and Donetsk regions.
In addition, Poroshenko said he hoped the EU would have “the opportunity to extend its sanctions against a number of Russian people” including in connection with the annexation of Crimea.
Enormous progress made on visa question. Juncker and Poroshenko also addressed the issue of visa liberalisation. While Juncker spoke of “the enormous progress achieved”, he called for further efforts, especially as regards the fight against corruption. On 17 August, Ukraine sent its position on a list of points raised by the Commission. The Commission is currently studying this and is expected to give its opinion by the end of 2015. “We will do everything for the European Commission's position to be as positive as possible”, Juncker said, so that the member states might give their agreement to this visa liberalisation.
Juncker, like Poroshenko, stressed that the entry into force of the free trade area between Ukraine and the EU should take place on 1 January 2016. “Any move aiming to put [this entry into force] back until later has no effect on the EU's position”, he said. Two European countries - Cyprus and Greece - have still not yet ratified the association agreement.
Agreement welcomed on restructuring public debt. Juncker said he was “very satisfied” with the agreement, sealed the same day, on restructuring the Ukrainian debt, which “will reduce [Ukraine's] gross needs in financing” and “enable [it] to continue the process of reforms”.
Setting aside the threat of a payment default, this agreement provides for the write-off of 20% of the nominal amount of the Ukrainian debt, or around $3.6 billion, a slight rise in the interest rate (7.75% compared with the current average of 7.2%) and a four-year extension to the repayment period. The level of repayment will also depend on the level of growth, according to information published by the Ukrainian authorities. In all, the agreement enables Kiev to save $11.1 billion over this period.
“No country that has declared itself in default has obtained such conditions”, Ukraine's Prime Minister Arseniy Yatsenyuk was pleased to announce, as quoted by French news agency AFP. “Russia will never obtain better conditions than the other creditors”, he added. Moscow will not take part in the restructuring of the Ukrainian debt and is calling for the repayment of $3 billion by 20 December.
The Franklin Templeton fund and three other US financial institutions hold two thirds of the Ukrainian public debt - in other words, $8.9 billion. The agreement was sealed by Ukraine's Minister of Finance Natalie Jaresko, an American who is a naturalised Ukrainian.
At the end of July, the Commission made a loan of €600 million to Kiev - a sum corresponding to a third of the third macro-financial aid plan approved by the EU for Ukraine (see EUROPE 11364). In all, the EU has already paid over €1.6 billion as part of the two previous macro-financial aid plans. (Camille-Cerise Gessant and Mathieu Bion)