Russia, Ukraine sign major trade agreement

Russia and Ukraine have signed an agreement after Kremlin talks between Ukrainian President Viktor Yanukovych and Russian President Vladimir Putin aimed at removing trade obstacles between the two neighbours and boosting economic ties.

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Russian President Vladimir Putin (R) shakes hands with Ukrainian President Viktor Yanukovych in the Grand Kremlin Palace in Moscow, Russia (AAP)

The agreement "on the removal of trade limitations" for 2013 and 2014 was signed by Russian Economy Minister Alexei Ulyukayev and his Ukrainian counterpart Igor Prasulov.

Putin said on Tuesday that the state energy companies of Russia and Ukraine had also signed an amended agreement slashing the price Moscow charges its cash-strapped neighbour for natural gas.

"As you have seen, Gazprom and Naftogaz Ukraine have signed an amendment that allows Gazprom - which it intends to do - to sell gas to Ukraine at a price of $US268.50 for 1,000 cubic metres. As you know, that price now is around $US400," Putin said after talks with Yanukovych.

Putin added that Russia had agreed to throw a lifeline to Ukraine's struggling economy by investing $US15 billion ($A16.82 billion) into the ex-Soviet country's government securities.

"The Russian government made a decision to invest part of the National Welfare fund to the amount of $US15 billion in Ukrainian government securities," Putin told reporters.

But Putin added that he and Yanukovych had not discussed the idea of Kiev joining a Kremlin-led free trade bloc.

"I would like to calm everyone down, today we have not discussed the issue of Ukraine joining the Customs Union at all," he added.


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Source: AFP



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