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Russia could push Ukraine toward default

Staff writer |
Russian presidential adviser Sergei Glazyev warned Ukraine against signing a trade and cooperation agreement with the European Union, saying Moscow would retaliate with trade restrictions that could push Ukraine toward default.

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Speaking at a conference in the Black Sea city of Yalta, Mr. Glazyev dismissed the benefits of a planned free-trade deal between the EU and Ukraine as "mythology." He warned that tariffs and trade checks that Russia would impose after the deal could cost Ukraine billions of dollars and result in a default.

"Who will pay for Ukraine's default, which will become inevitable?. One has to be ready to pay for that," said Mr.Glazyev.

Russia is opposing Kiev's plans to sign a free-trade and political association agreement with the 28-member bloc in November, calling Kiev into a Moscow-led economic union. It upped the pressure on Ukraine over the summer by banning the products of a major confectionary maker in Russia and by temporarily halting some Ukrainian imports at its border, dealing a painful blow to Ukrainian business.

EU officials have urged Kiev to implement key reforms and sign the EU deal in November, saying Ukraine belongs with the West.

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