Ukraine defends rejection of EU trade deal

Ukraine’s prime minister has defended his government’s decision to scrap signing of a trade deal with the European Union (EU), saying it was based on the bad state of the economy and reform demands by the International Monetary Fund.

Nikolai Azarov said on Friday in a parliamentary session that the decision had been the only alternative considering the country’s difficult economic conditions.

“The decision was hard, but the only possible one in the economic situation,” said Azarov.

The prime minister also blamed the IMF for the decision to scrap the deal, saying the Fund’s demands had been “the last straw.”

The IMF has demanded the cash-strapped country to reduce spending and to radically increase gas prices in order for Ukraine to quality for more credit.

The prime minister’s remarks came after opposition leader Vitaly Klitschko asked President Viktor Yanukovych to explain the decision before parliament.

Meanwhile, Russia’s President Vladimir Putin denied earlier in the day allegations from the West that Ukraine has bowed to Russian pressure.

The European Union has expressed disappointment over the decision, saying the agreement would have attracted foreign investments to the country.

On November 21, Ukraine announced that it would suspend signing an imminent trade agreement with the EU and that it would revive talks on a deal with Russia.

According to a decree issued by the prime minister’s office, the decision was made to “ensure the national security of Ukraine” after considering effects of trade with Russia. It also spoke of the need to “restore lost trade volumes with the Russian Federation.”