Ukraine leaders praise $15B backing from Russia

Ukraine's political leaders praise a Russia-financed bailout as a guarantee of financial stability, while opposition activists say the deal is likely to worsen economic troubles as the country's dependence on Moscow increases.

Deal doesn't please round-the-clock protesters, who have demanded a snap election

Ukrainian President Viktor Yanukovich, left, gives a wink to his Russian counterpart Vladimir Putin during a signing ceremony after a meeting of the Russian-Ukrainian Interstate Commission at the Kremlin in Moscow on Tuesday. Russia is planning to buy $15 billion worth of Ukraine's upcoming eurobonds using money from a sovereign wealth fund this year and next. (Sergei Karpukhin/Reuters)

Ukraine's political leaders praised a Russia-financed bailout Wednesday as a guarantee of financial stability, while opposition activists said the deal is likely to worsen economic troubles as the country's dependence on Moscow increases.

Russian President Vladimir Putin on Tuesday pledged to buy $15 billion worth of Ukrainian bonds and cut the price of natural gas sharply in an effort to relieve political pressure on Ukraine's embattled president, ViktorYanukovych.

The Ukrainian economy risks a default next year, and over the past months Yanukovych has actively lobbied both Russia and the European Union for a financial life jacket.

His decision last month to opt for a deal with Russia triggered a wave of demonstrations that have crystallized into a large, round-the-clock protest camp in Independence Square in Kyiv, the country's capital.

British Prime Minister David Cameron said Wednesday that the U.K. should stand with the people of Ukraine who want closer ties with the European Union.

"We should pay tribute to those in Ukraine who want to have a future linked to Europe and want the peace, the prosperity and stability that that relationship would bring,'' he told the House of commons Wednesday.

In Kyiv, Prime Minister Mykola Azarov told a cabinet meeting that the deal with Russia ensures "people's confidence in a stable life," while an association agreement with Europe would have given Ukraine a "New Year's present" of "bankruptcy and social collapse," according to the Interfax news agency.

The deal with Moscow, which apparently includes access to Russia's market and large orders for Ukraine's manufacturing industry, did little to appease the protesters, who have demanded that Yanukovych and Azarov resign and snap election be held in 2014.

It is unclear what Putin asked in return for his financial support, but reports suggest that Moscow wants Ukraine to purchase more natural gas and import Russian coal.

Putin said Tuesday that the two sides did not discuss Ukraine's joining the Moscow-led Customs Union, which includes Belarus and Kazakhstan and many Ukrainians feel is an attempt to resurrect the Soviet Union. Opposition critics fear that in bailing out Ukraine, Putin might have asked Yanukovych for a commitment to join the union in the future.

With files from Reuters