Putin touts Moscow-led customs union in Ukraine

AP News
|
Posted: Apr 12, 2011 2:38 PM
Putin touts Moscow-led customs union in Ukraine

Prime Minister Vladimir Putin expressed nostalgia for Soviet times on Tuesday in urging Ukraine to join Russia's new customs union with Kazakhstan and Belarus.

Ukraine has resisted pressure to join the Moscow-led union, preferring instead to pursue a free-trade agreement with the European Union.

During a meeting with his Ukrainian counterpart, Putin said the customs union would stimulate growth in whole sectors of the Ukrainian economy as he touted the benefits of the economic integration formed when the countries were all part of the Soviet Union.

"The technological links from the Soviet period are still functioning, and one partner cannot be efficient without another," Putin said. "That is what we must think about and give a second wind to the capabilities formed during the previous decades."

Ukraine's Prime Minister Mykola Azarov said little in response, only expressing the wish that if Ukraine did not sign up that the union between the three countries would not hurt Ukrainian-Russian trade.

Putin warned Azarov that if Ukraine shunned the customs union, Russia could take protectionist measures to prevent Ukrainian goods from flooding the Russian market.

The Russian leader also met Tuesday with President Viktor Yanukovych, who while restoring friendly relations with Moscow has made clear his preference for pursuing closer economic integration with Europe.

Ukraine, however, depends on Russia for natural gas supplies, and Azarov argued that the price should be cut.

Political analyst Vadym Karasov said Putin was using economic pressure to restore Russian domination over Ukraine.

"Ukrainian goods are not competitive with European ones, while Russia is a big market for Ukrainian goods," Karasov said. "Putin understands perfectly that Ukraine cannot play in two economic spaces at the same time in his desire to take it back under Russian influence."