"On December 17, after a session of the Russian-Ukrainian intergovernmental commission President Vladimir Putin announced that Russia would place part of reserves from its National Welfare Fund in the amount of $15 billion in Ukrainian government securities.
In addition, Gazprom and Naftogaz Ukraine signed a supplement to the January 19, 2009 contract on natural gas deliveries. Putin said that the document permits Gazprom delivering gas to Ukraine at $268.5 per 1,000 cubic meters down from $400 now." [Source ]
Russian law does not currently permit the country's 'rainy day' pension fund to invest in other nation's bonds, especially those having a low rating such as Ukraine's. It is by no means certain that such transactions will take place, and if they do, on what terms.
As for the gas deal, Ukraine will have to purchase much larger quantities that it currently does, and the price may be re-evaluated every three months.
Conclusion: The deals struck by the presidents of Russia and Ukraine are mere window-dressing...neither side will stick to their side of the bargain and fresh circumstances will necessitate their reassessment.
As for the gas deal struck two days ago, this is the second occasion that Yanukovych has 'tacked on' supplementary arrangements onto the so-called ruinous 2009 Tymoshenko agreement in which she allegedly 'exceeded her powers' resulting in her imprisonment for seven years. Previously the 2010 Russian/Ukrainian Naval Base for Gas treaty, the 'Kharkiv Accord', was also also based on the 2009 deal.
According to Putin: "The gas contract signed with the Ukrainian government led by Prime Minister Yulia Tymoshenko was economically feasible, and the deal's price setting formula was the same as the one applied to all of the consumers in Europe, Russian President Vladimir Putin said at a press conference on Thursday.
"We actively worked with the Ukrainian government headed by Tymoshenko as well. We worked very vigorously in all the areas. By the way, it was her government that signed the gas contract then. And I have always thought that this contract is absolutely economically feasible," he said.
This contract fully complied with "our practice of work with other foreign partners," Putin said.
"Its price setting formula is the same as the one that is valid for all of our consumers in Europe. One should not imagine anything else there," he said.
This contract was "not designed to strangle anyone," the president said. [From link above]
Yet Tymoshenko has been in detention over two years....a victim of political persecution instigated by Yanukovych.
Mikhail Khodorkovsky, Russia's most prominent political prisoner, having been imprisoned for over 10 years, may be pardoned soon by Putin. Yanukovych should take note of this and release Yulia Tymoshenko too.
I watched president Yanukovych's televised press conference this afternoon. The last time I saw such a flat delivery and such boring drudgery was in latter decades of the last century in Communist Poland. . If I were a young, ambitious enthusiastic, entrepreneurial Ukrainian I would have been deeply depressed by it all.
Yanukovych hardly spoke about creating an environment for encouraging economic growth, aid for small business start-ups, tax breaks or easy credit for high tech companies, attracting foreign investment, simplifying labyrinthine regulations which currently allow state officials to rake in kick-backs, tackling corruption in the higher echelons of government etc.
Instead he just stuck to describing major infrastructure projects - exactly the kind where his Party of Regions' oligarch pals can fix tenders and skim off vast sums before stashing them in exotic off-shore banks.
Curiously, he dodged a question whether he would be standing for re-election as president after his first term, hinting that one term might be enough for him.
“If my rating is, figuratively speaking, low and I have no prospects, I will not be disturbing the country’s development and move forward,” he said
In contrast, most western leaders would have replied: "I need a second term to complete my vision for the country - to complete the job I was elected to do - We are making good progress in difficult circumstances...I am confident that the electorate will support me, my policies are already bearing fruit..." and so on.
The reply he gave will surely reduce confidence and trust in him amongst his own ranks even further..
He struck me as being rather bored and tired of having to explain everything and of having to answer banal 'dolly drop' questions. [In my part of the world a soft ball gently thrown to a small child is called a 'dolly drop']
After meeting Yanukovych recently, British Prime Minister David Cameron [allegedly] said: "He's from a different civilization. He's not a partner for Europe at all."
Having watched Yanukovych's performance I have to agree..