Russia Says Ukraine Must Be ‘Neutral’ as It Accuses U.S., NATO

Maidan Square in Kiev, Ukraine

(Bloomberg – bloomberg.com – Henry Meyer, Daryna Krasnolutska, Volodymyr Verbyany – April 22, 2015)

Russia said it wants a “neutral” and unified Ukraine as it accused the North Atlantic Treaty Organization of seeking to turn its neighbor into a hostile state.

The U.S. wields enormous influence over Ukraine, while Russia wants the people of its “near neighbor” to have a good life, Russian Foreign Minister Sergei Lavrov said in an interview with three Moscow radio stations on Wednesday.

“It’s in our interests not to divide Ukraine, it’s in our interests to keep it neutral in military terms,” Lavrov said. “We want Ukraine to be peaceful and quiet. To achieve that, it’s necessary to keep Ukraine unified and not allow it to be torn into pieces.”

The U.S., NATO and the European Union accuse Russia of sending troops and weapons to support separatists fighting government forces in eastern Ukraine in a yearlong conflict that has cost more than 6,100 lives, a charge Russia rejects. The U.S. and the EU imposed sanctions after Russian President Vladimir Putin annexed Ukraine’s Crimea in March last year, while Ukraine and the pro-Russian rebels repeatedly blame each other for breaches of a fragile truce negotiated in Minsk, Belarus, in February.

Implementing the Minsk peace agreement is the way to maintain Ukraine’s unity, Lavrov said. A split in the country will mean that “from the European side, the NATO side, there’ll be attempts to make Ukraine anti-Russian,” he said.

‘Constructive Approach’

With the insurgency devastating the Ukrainian economy, the government is seeking to agree with its creditors on reducing its debt payments to accompany a $17.5 billion bailout from the International Monetary Fund. Government debt due in July 2014 was up 2.3 cents to 47.10 cents on the dollar. The hryvnia, which has lost 30 percent against the greenback this year, the world’s worst performer, weakened 0.6 percent to 22.61 per dollar at 2:08 p.m. in Kiev.

Ukraine expects to reach a deal in talks with creditors by the time an IMF mission visits Kiev at the end of May, Finance Minister Natalie Jaresko said at a government meeting on Wednesday. “We are waiting for a constructive approach, that creditors will cooperate with us,” Jaresko said.

The hryvnia is becoming less volatile and “we see signs of stability and support every day,” she said. The first tranche of IMF bailout funds doubled Ukraine’s reserves, helping to stabilize its monetary and financial systems.

Ukraine’s governing coalition must stay united and approve draft laws needed to secure the release of the second tranche of IMF money, Prime Minister Arseniy Yatsenyuk told the cabinet.

No government troops were killed or wounded in rebel attacks in the past 24 hours, Ukrainian military spokesman Andriy Lysenko told reporters in Kiev on Wednesday. Ukrainian forces broke the cease-fire 32 times in the same period, the separatist-run DAN news service reported, citing the Defense Ministry of the self-declared Donetsk People’s Republic.

Article ©2015 Bloomberg L.P. All Rights Reserved. Article also appeared at bloomberg.com/news/articles/2015-04-21/ukraine-pushes-for-un-peacekeepers-as-rockets-disrupt-cease-fire