Ukraine's Parliament Approves 2015 Budget
KYIV, Dec 29 (Reuters) -- Ukraine's parliament backed a budget for 2015 on Monday that it had been under pressure to approve to secure the next tranche of financial aid under a $17 billion International Monetary Fund loan package, the Interfax news agency reported.
Before the budget vote in the early hours of the morning, deputies approved a series of austerity laws, including an amendment to impose additional duties on imports, that Prime Minister Arseny Yatsenyuk warned could prove unpopular with Ukraine's foreign trade partners.
Foreign currency reserves have more than halved since the beginning of the year to a 10-year low, due to gas debt repayments to Russia and efforts to support its struggling currency, the hryvnia.
Yatsenyuk said the budget could still be amended following talks with Ukraine's Western backers.
"A series of articles will change depending on what we agree with international lenders," Interfax quoted him as telling parliament. He said these discussions would start on Jan. 7.
Voting was delayed as deputies debated the merits of the law amendments required for the budget, with some arguing they unfairly increase prices for Ukrainians, many of whom are already struggling to make ends meet as the economy teeters on the edge of bankruptcy.
Ukraine's remaining foreign currency reserves stand at just under $10 billion, barely sufficient to cover two months of imports.
One new law will add 10 percent duty to taxes on food imports and an extra 5 percent on other imports excluding strategic imports such as gas.
"Problems could arise with our trade partners," Yatsenyuk told parliament, advising that the law should only come into effect once the government had consulted on it with international partners.
He said one of the main focuses of the new budget was defence and security spending, which will amount to 90 billion hryvnia.
A year of revolution and war with pro-Russian separatists has pushed the hryvnia to record lows and crippled the economy, which is forecast to shrink 4.3 percent next year.
This month, Kyiv said it needed the IMF to expand its bailout programme due to the worsened economic outlook, but the Fund and Ukraine's other Western backers have made it clear any further financial assistance will hinge on Kyiv's ability to implement the long-promised reforms.
This ends our live-blogging for December 28. Be sure to check back tomorrow for more of our continuing coverge.
Germany says Russia must influence separatists in Ukraine to end crisis, Reuters reports:
German Chancellor Angela Merkel appealed to the Russian government on Sunday to use its influence on separatists in eastern Ukraine to implement a ceasefire plan agreed in Minsk in September aimed at ending the conflict.
Planned talks involving Russia, Ukraine and the Organisation for Security and Cooperation in Europe to further the ceasefire arrangements have not yet taken place.
"(Merkel said) A stabilisation of the situation can only come if the agreed contact lines are finally implemented," said a spokeswoman in a statement.
"She appealed to the Russian government to use its influence on the separatists to this end," said the spokeswoman.
In a phone call with Ukrainian President Petro Poroshenko late on Saturday, Merkel expressed regret that the contact group talks had not happened. Last week, Poroshenko had said the talks would take place on Dec. 24 and 26.
Merkel, who has been closely involved in diplomatic efforts to resolve the crisis, also welcomed the exchange of prisoners between the Ukrainian government and separatists.
Here is today's map of the military situation in eastern Ukraine, according to the National Security and Defense Council:
Kyiv says three of its soldiers wounded in latest clashes: