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Six Ukrainian troops have been killed in an ambush in the eastern Donetsk region, the defense ministry has said.
A unit was attacked near the town of Kramatorsk by about 30 insurgents with heavy weapons, it said. Eight more servicemen were wounded.
Donetsk region is one of two in eastern Ukraine that declared themselves separate from Ukraine after referendums deemed illegal by Kiev, the US and EU.
Six Ukrainian troops have been killed in an ambush in the eastern Donetsk region
In Luhansk, separatists said an attempt was made on the life of a rebel leader.
Self-declared governor Valery Bolotov was shot and had lost a lot of blood, but his life was not in danger, the press office of the “Luhansk People’s Republic” said.
Earlier the Kiev-appointed governor of Donetsk region said Ukraine was planning a national referendum on devolving power to regions.
Speaking at a news conference in Donetsk, Serhiy Taruta called on parliament to pass legislation which would authorize a vote to help regions get more power while remaining within Ukraine.
Serhiy Taruta also described Sunday’s separatist referendums in Donetsk and Luhansk as “an opinion poll”.
He said the self-declared “People’s Republic of Donetsk” did not exist legally or politically, and that the Donetsk region could not survive economically as an independent territory.
People in the east “should hear answers to the questions that they are concerned about”, he said.
Separatists in Donetsk and Luhansk say 89% and 96% respectively voted in favor of “self-rule” in the referendums.
Armed rebels remain in control of many official buildings across eastern Ukraine.
The EU is imposing further sanctions over Russia’s actions in Ukraine after self-rule referendums in Donetsk and Luhansk.
Separatists in Donetsk and Luhansk regions say 89% and 96% respectively voted in favor of “self-rule”.
Earlier the head of the rebel Donetsk election commission, Roman Lyagin, said joining Russia “would probably be an appropriate step”.
The EU is imposing further sanctions over Russia’s actions in Ukraine after self-rule referendums in Donetsk and Luhansk
Two Crimean companies and 13 individuals have been added to the sanctions list – the names are likely to be announced officially within the next 24 hours.
The sanctions impose travel bans and asset freezes. EU ministers are also discussing what might trigger a broader package of sanctions against the Russian economy.
In a brief statement, the Kremlin described the referendums as “the will of the people” and noted the “high turnout”.
The Kremlin denounced what it claimed had been “attempts to disrupt the votes, with the use of force, including the use of heavy weapons, against civilians”.
The Russian authorities said they expected the results of the vote to be implemented in a civilized manner, without any repetition of violence and called for dialogue between Kiev, Donetsk and Luhansk.
Later Russia’s Foreign Minister, Sergei Lavrov, said there were no plans to hold fresh international talks on the crisis – he accused the West of an “information blockade” over events in Ukraine and of “shameless lies”.
German Foreign Minister Frank-Walter Steinmeier is to travel to Kiev on Tuesday to promote “dialogue” between the different parties.
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Ukrainian separatist leader Denis Pushilin is calling on Russia to “absorb” the eastern region of Donetsk after Sunday’s unofficial vote on its status.
The leader of the self-declared Donetsk People’s Republic said Moscow should listen to the “will of the people”.
Ukrainian separatist leader Denis Pushilin has called on Russia to absorb the eastern region of Donetsk
Russia has called for dialogue and “implementing” the result, but Ukraine and the EU declared the poll illegal.
The EU is imposing further sanctions over Russia’s actions in Ukraine.
Separatists in Donetsk and Luhansk regions say 89% and 96% respectively voted in favor of “self-rule”.
Earlier the head of the rebel Donetsk election commission, Roman Lyagin, said joining Russia “would probably be an appropriate step”.
Russia has called for dialogue between the militants and Kiev with the participation of the Organization for Security and Co-operation in Europe (OSCE).
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Pro-Russian militants in eastern Ukraine are holding “self-rule” referendums – a move condemned by the Ukrainian government and the West.
Self-proclaimed leaders in the Donetsk and Luhansk regions are going ahead with the vote despite Russian President Vladimir Putin’s call to postpone it.
Self-proclaimed leaders in the Donetsk and Luhansk regions are going ahead with the vote despite Russian President Vladimir Putin’s call to postpone it
Ukraine says the vote could result in the “self-destruction” of the regions.
Pro-Russian gunmen occupying offices in a number of towns have been involved in heavy clashes with Ukrainian troops.
Reports say there was a fierce fighting overnight on the outskirts of the rebel-held city of Sloviansk, which remains sealed by government troops conducting what the government in Kiev describes as an “anti-terror” operation.
At least seven people were killed in clashes in the port of Mariupol on Friday, officials said.
Referendum organizers said earlier this week that most of the polling stations were controlled by pro-Russian activists and would be ready for voting.
Millions of ballot papers have been prepared.
They contain only one question in both Ukrainian and Russian: “Do you support the act of state self-rule of the Donetsk People’s Republic/Luhansk People’s Republic?”
The organizers have suggested they intend to hold a second round of voting later this month, on joining Russia. They also say they will boycott Ukraine’s presidential elections on May 25.
There are no independent or international observers involved in Sunday’s vote.
On Saturday, Ukraine’s interim President Oleksandr Turchynov admitted many in eastern Ukraine supported the pro-Russian militants, but warned that the referendums were “a step towards the abyss”.
The EU and US have also condemned the referendums, amid fears that Ukraine could be sliding to civil war.
A survey by the Pew Research Centre suggested a majority even in eastern Ukraine – 70% – wanted to remain in a united country, despite concerns about governance.
President Vladimir Putin earlier called for a postponement of the vote to create the conditions necessary for dialogue.
Last month, Russia annexed Ukraine’s southern autonomous republic of Crimea, after a referendum.
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Vladimir Putin is making his first visit to Crimea since Russia annexed it from Ukraine.
The Russian president told crowds marking the 1945 Soviet victory over the Nazis that Crimea had shown loyalty to a “historical truth” in choosing to be part of Russia.
The Kiev government protested at the visit, calling it a “gross violation of Ukraine’s sovereignty”.
Kiev also reported that more than 20 people had died in a security operation against separatists in Mariupol.
Ukrainian Interior Minister Arsen Avakov said that about 20 pro-Russian protesters and one Ukrainian security officer had been killed in the southern port.
Ukrainian forces and pro-Russian separatists had clashed at the police headquarters, which was set on fire.
Vladimir Putin is making his first visit to Crimea since Russia annexed it from Ukraine
In the Crimean port of Sevastopol, Vladimir Putin thanked the armed forces for their role in World War Two and hailed the incorporation of the peninsula into the Russian Federation.
He watched a fly-by of Russian aircraft and addressed seamen on naval vessels, as crowds gathered on cliffs overlooking the harbor.
Vladimir Putin said: “I am sure that 2014 will go into the annals of our whole country as the year when the nations living here firmly decided to be together with Russia, affirming fidelity to the historical truth and the memory of our ancestors.”
He earlier addressed thousands during a huge, hour-long military parade in Moscow’s Red Square, vowing to defend the “motherland”.
Vladimir Putin told the crowd that May 9, known as Victory Day in Russia, was a “day of grief and eternal memory” and stressed how the “iron will of the Soviet people” had saved Europe from slavery.
“It is a holiday when an overwhelming force of patriotism triumphs, when all of us feel particularly acutely what it means to be loyal to the motherland and how important it is to defend its interests,” he said.
NATO’s Secretary General Anders Fogh Rasmussen said Vladimir Putin’s visit to Crimea was “inappropriate”, adding: “We consider the Russian annexation of Crimea to be illegal, illegitimate and we don’t recognize it.”
US National Security Council spokesperson Laura Magnuson said: “We do not accept Russia’s illegal annexation of Crimea. Such a visit will only serve to fuel tensions.”
Ukraine’s interim authorities held subdued memorials to mark the Soviet victory.
A brief veterans’ ceremony was held in Kiev’s main park, in front of PM Arseniy Yatsenyuk and several former presidents.
The authorities feared pro-Russian activists would try to stoke violence if there were any higher profile celebrations.
Nazi Germany invaded the USSR – which included Ukraine – in June 1941 and advanced almost as far as Moscow before being driven back to Berlin.
Crimea was put under Ukrainian administration in 1954.
After the collapse of the USSR, Russia maintained a large military presence on the peninsula, and more than half of the region’s population identified themselves as ethnic Russian.
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Pro-Russian separatists in eastern Ukraine have decided to go ahead with an independence referendum on Sunday, despite a call from Russian President Vladimir Putin to postpone it.
The move was announced by separatist leaders after consulting supporters.
On Wednesday, Vladimir Putin called for a postponement to create the conditions necessary for dialogue.
Pro-Russian separatists in eastern Ukraine have decided to go ahead with an independence referendum on Sunday (photo Reuters)
Ukrainian authorities say they will disregard the results and that “anti-terror” operations will continue.
Millions of ballot papers have been prepared for the referendum.
The question put to voters is: “Do you support the act of proclamation of independent sovereignty for the Donetsk People’s Republic?”
The decision to press ahead with the vote was announced by separatist leaders in the regions of Donetsk and Luhansk.
The leader in Donetsk, Denis Pushilin, said the decision had been unanimous.
“We just voice what the people want and demonstrate through their actions,” he said.
A spokesman for the Kremlin said there was “little information” and that it needed to analyze the situation further.
Moscow has vowed to protect the rights of Ukraine’s Russian-speaking population against what it calls an undemocratic government in Kiev.
Ukrainian authorities have rejected activist demands for greater autonomy and troops have been battling to regain official buildings occupied by rebels in the east.
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Ukraine troops have retaken Mariupol city hall from pro-Russia separatists, reports say.
The rebels, who had seized the building last week, reportedly left early on Wednesday. The reason is not clear.
Pro-Russia separatists have captured official buildings in dozens of towns in eastern Ukraine in recent weeks.
Ukraine troops have retaken Mariupol city hall from pro-Russia separatists
The government has accused Russia of helping the rebels and sent troops to restore Kiev’s authority.
Russia’s Interfax news agency quoted a pro-Moscow militiaman in Mariupol as saying government forces had taken over the city hall.
“No shots were heard,” he said.
“All the militia members were removed from the building.”
He added that government forces had started to clear the barricade on the central square with a bulldozer.
There were also reports of clashes between Ukrainian troops and pro-Russia militants in Sloviansk, a rebel stronghold, early on Wednesday.
The Ukrainian government has rejected the pro-Russian activists’ demands for greater autonomy for eastern regions, fearing they could lead to the break-up of the country or more regions being annexed.
Kiev has called a presidential election on May 25, and said it was ready to back new international talks in Geneva, as long as Moscow supported the poll.
On Tuesday, Russian Foreign Minister Sergei Lavrov ruled out holding another round of international talks unless pro-Russian opposition groups were involved.
The separatists in Donetsk have proclaimed a “People’s Republic” and are preparing to hold an independence referendum on Sunday.
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Pro-Russian militants near the eastern city of Sloviansk have killed four Ukrainian soldiers and shot down an army helicopter, Kiev says.
Kiev says the gunmen used heavy weapons against Ukraine’s units involved in the “anti-terror” operation. Casualties were also reported among the rebels.
The militants are reported to have retreated towards the city centre which is now quiet.
The rebel stronghold remains sealed off by Ukrainian troops.
Pro-Russian militants have seized government buildings in a dozen or more Ukrainian cities in the east.
Four Ukrainian soldiers have been killed and an army helicopter shot down by pro-Russian militants near the eastern city of Sloviansk (photo AFP)
Kiev accuses Moscow of supporting and arming the gunmen – a claim denied by the Kremlin.
Speaking to reporters near Sloviansk, Ukrainian Interior Minister Arsen Avakov accused the militants of trying to ambush government forces on the outskirts of Sloviansk on Monday morning.
He blamed the rebels for using heavy weapons, including mortars.
The Ukrainian military later said that four soldiers had been killed and about 30 injured.
In a statement, the defense ministry confirmed that a helicopter has been shot down near Sloviansk.
The crew of the aircraft survived, largely because the helicopter crashed into a river, the ministry added. It was the third Ukrainian military helicopter to be downed over the city in recent days.
On Sunday, Ukraine’s PM Arseniy Yatsenyuk accused Russia of executing a plan “to destroy Ukraine and its statehood”.
He was speaking two days after dozens were killed in violence in the southern Ukrainian port city of Odessa.
“Russia’s aim was to repeat in Odessa what is happening in the east of the country,” he said, insisting Kiev had not lost control of the region.
The clashes on Friday left more than 40 dead, mostly pro-Russian separatists killed in a building fire.
Russia warned on Monday that failure to halt the escalating unrest would threaten peace across Europe.
Despite the latest violence, Ukraine plans to hold a presidential election on May 25.
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Pro-Russian separatists have attacked Ukraine’s police headquarters in Odessa, forcing the release of several people held over deadly violence two days ago.
Friday’s clashes led to more than 40 deaths. Most victims were pro-Russian activists killed when the building they were in caught fire.
Ukraine’s interim PM Arseniy Yatsenyuk has accused police of failing to prevent the violence.
He was speaking as Ukrainian troops encircled Sloviansk in the east.
The army operation is trying to wrest control from separatists who have taken over a government buildings in a number of towns.
Pro-Russian separatists have attacked Ukraine’s police headquarters in Odessa, forcing the release of several people held over deadly violence two days ago (photo AFP)
Hundreds of people descended on the police headquarters on Sunday afternoon in an initially peaceful protest calling for the released of those detained.
The gathering turned violent as protesters – some wearing masks and carrying improvised weapons – broke windows and forced the gates.
There were chants of “Russia, Russia” and “Russians won’t abandon their own”.
A number of detainees were then released by the police, apparently in an attempt to pacify the crowds. Reuters, quoting police sources, put the number freed at 30. The interior ministry, in a statement quoted by the Associated Press, said 67 people were released.
Odessa had been observing a day of mourning for those killed on Friday, when running street battles involving petrol bombs led to a fire breaking out on the third floor of a trade union building.
Dozens of pro-Russian activists had barricaded themselves inside. While some were rescued, 38 people either burned, suffocated or jumped to their deaths.
Moscow and Kiev have blamed each other’s supporters for the fire.
On Sunday, many visited the burned out trade union building, which now has a large Russian flag draped on one wall, to pay tribute.
Arseniy Yatsenyuk, who has travelled to Odessa, has ordered a full investigation into what happened, saying the authorities did “nothing to stop this crackdown”, and were “inefficient and they violated the law”.
He told a news conference that all the senior police in the city had been fired and would be replaced.
But he said the unrest was “part of a plan fomented by Russia to destroy Ukraine”.
Arseniy Yatsenyuk insisted Kiev had not lost control entirely, saying much would depend on whether local populations “support peace and stability or whether they support those who are sponsored by Russian”.
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The remaining seven international military observers taken captive in eastern Ukraine a week ago have been released.
Five Ukrainian officers captured with the observers, who are linked to the Organization for Security and Co-operation in Europe (OSCE), were also freed.
Pro-Russian separatists in the town of Sloviansk say they released the OSCE observers “without conditions”.
Kiev has resumed military action against the separatists, with fighting reported in some areas.
Russia, accused by the West of being behind the unrest, says it “no longer has any influence” over the separatists.
Pro-Russian separatists in Sloviansk say they released the OSCE observers without conditions (photo Reuters)
Moscow also accused Kiev and the West of responsibility for Friday’s violence in the south-western city of Odessa, which left at least 36 people dead.
Both the OSCE and Vyacheslav Ponomaryov, a leader of the insurgency in the east, confirmed the releases.
“As I promised them, we celebrated my birthday yesterday and they left. As I said, they were my guests,” Vyacheslav Ponomaryov said.
Russia had sent an envoy to negotiate the releases. Vladimir Lukin said he hoped the “voluntary act” by the separatists would be reciprocated by Kiev, adding: “I would very much like military actions to end.”
President Vladimir Putin’s spokesman in Moscow, Dmitry Peskov, said: “From now on Russia essentially has lost its influence over these people because it will be impossible to convince them to lay down arms when there’s a direct threat to their lives.”
One of the observers, German Colonel Axel Schneider, said the team had been treated “as good as possible” in what was a “miserable situation”.
Western leaders had condemned the abductions.
On Friday, President Barack Obama again called for the observers to be released, saying their abduction was “inexcusable” and “disgraceful”.
The observers – four Germans, a Dane, a Pole and a Czech – are not part of the main OSCE monitoring mission, which was agreed after long negotiations by Russia, Ukraine and the US.
Ukraine’s government meanwhile confirmed a second day of military operations in the east.
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According to Ukraine’s interior ministry, at least 31 people have been killed in a fire in Odessa Trade Unions building amid violence in the Black Sea city.
The deaths came as pro-Russian protesters clashed with Ukrainian government supporters in the city.
Officials said some people were overwhelmed by smoke and others died after they jumped from the building.
Earlier President Oleksandr Turchynov said many separatists had been killed in a government offensive in Sloviansk.
At least 31 people have been killed in Odessa Trade Unions building fire amid violence in the Black Sea city
Activists have seized scores of government buildings and detained observers in eastern Ukraine.
The fire broke out in Odessa’s Trade Unions House, the regional office of Ukraine’s interior ministry said. It did not give details of how the blaze started.
The exact sequence of events is still unclear, but reports suggest the separatists had barricaded themselves inside the building and both sides were throwing petrol bombs.
The interior ministry gave a toll of at least 31 dead, revising down an earlier tally of 38 killed.
Ukrainian Deputy Foreign Minister Danylo Lubkivsky said he regretted the loss of life but insisted Russia was behind the violence.
“The situation remains under control. But the security situation is threatened by Russian special agents,” he said.
“That’s why we are requesting and demanding Russian authorities to stop their efforts that can undermine regional security and stability.”
Meanwhile, Russia’s foreign ministry said Moscow was “outraged” by events in Odessa and denounced Kiev’s “irresponsibility”, AFP news agency reports.
Earlier, four people were killed in clashes between the pro-Russian and pro-Kiev protesters in the city – the first such eruption of violence in the south after weeks of mounting unrest in Ukraine’s east.
The death toll in Odessa is the highest since violence broke out between pro-EU protesters and police in the capital in February.
Meanwhile the latest reports from rebel-controlled Sloviansk in the east say intense gunfire has broken out in the centre of the city.
During the day government forces took over pro-Russian checkpoints outside the city.
Separatists shot down two Ukrainian army helicopters, killing a pilot and another serviceman.
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Sloviansk separatists have shot down two of Ukraine’s army helicopters during an “anti-terror” operation in the eastern city, Kiev says.
Ukraine’s military said a pilot and serviceman were killed and nine rebel checkpoints seized.
Russia says Kiev’s actions “killed the last hope” for a deal agreed last month in Geneva aimed at defusing the crisis.
President Vladimir Putin’s spokesman Dmitry Peskov also described Ukraine’s operation as “punitive”.
Dmitry Peskov said that contact had been lost with Russian envoy Vladimir Lukin sent to the south-eastern Ukraine.
Russia’s foreign ministry earlier warned that any assaults by Ukraine’s troops in the region would have “catastrophic consequences”, triggering fears of an invasion by Moscow.
Separately, reports are coming that several foreign journalists have been detained in Sloviansk.
Sloviansk separatists have shot down two of Ukraine’s army helicopters during an anti-terror operation (photo Reuters)
Sloviansk is a stronghold for pro-Russian separatists who are exerting increasing control in the region.
In a statement on Friday, Ukrainian Interior Minister Arsen Avakov said the “active phase” of the operation began at 04:30 local time.
He said interior troops and the National Guard were involved in the operation in the Sloviansk-Kramatorsk region.
“The terrorists opened fire with heavy weapons against Ukrainian special units.
“A real battle with professional mercenaries is going on,” Arsen Avakov said, adding that the separatists were using the tactics of hiding behind civilians in residential buildings.
Russia’s state-run Rossiya 24 TV channel said the city was being “stormed”.
It quoted Sloviansk’s rebel leader Igor Strelkov as saying that the city was completely sealed off.
The fighting appears to be concentrating on the periphery of the city.
However, there were no reports of Ukrainian government troops entering the city itself.
Local residents were later quoted as saying that the situation in the city calmed down but remained tense.
Earlier, Ukraine’s acting President Oleksandr Turchynov reinstated military conscription.
Eastern Ukraine has a large Russian-speaking population and was a stronghold for President Viktor Yanukovych before he was overthrown by pro-Western protesters in February.
The crisis has plunged East-West relations to their lowest point since the Cold War ended in the early 1990s.
On Thursday, German Chancellor Angela Merkel asked Russia in a phone call to President Vladimir Putin to help free foreign military monitors seized by rebels in Slovianks last week.
For his part, Vladimir Putin reiterated his call for Kiev to withdraw troops from the south-east to open the way for a national dialogue.
Angela Merkel is due to meet President Barack Obama in Washington on Friday to discuss the crisis in Ukraine.
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Ukraine has reinstated military conscription to deal with deteriorating security in the east of the country, acting President Oleksandr Turchynov.
The move, announced in a decree, came as pro-Russia militants seized the regional prosecutor’s office in the eastern city of Donetsk.
Ukraine blames Russia for organizing the seizures of a number of offices in the east, a claim Moscow denies.
Some 40,000 Russian troops are stationed near the Ukrainian border.
Oleksandr Turchynov admitted on Wednesday that his forces were “helpless” to quell the unrest in some parts of the east, saying the goal was now to prevent it from spreading.
He also said Ukraine was on “full combat alert”, amid fears that Russian troops could invade.
Ukraine has reinstated military conscription to deal with deteriorating security in the east of the country (photo EPA)
On Thursday, his office said in a statement that conscription was being introduced “given the deteriorating situation in the east and the south… the rising force of armed pro-Russian units and the taking of public administration buildings… which threaten territorial integrity”.
Kiev’s decision is, in the short-term at least, a symbolic step as the Ukrainian military has been starved of cash for years and is no match for what Russia has on its borders.
The real battle for control of Ukrainian territory is already under way and Kiev is losing ground.
Analysts say Ukraine has 130,000 personnel in its armed forces that could be boosted to about one million with reservists.
Kiev scrapped compulsory military service for young men in late 2013 under a law introduced by then President Viktor Yanukovych.
At the time, Viktor Yanukovych said Ukraine would introduce military reforms to create “a professional army”.
In Donetsk on Thursday, pro-Russian militants attacked the prosecutor’s office, accusing those inside of siding with the government in Kiev.
The crowd later forced its way into the building, stripping weapons and shields from police officers and raising the flag of the self-proclaimed Donetsk People’s Republic.
Donetsk, an industrial hub of more than one million people, has seen a number of government offices seized in recent weeks.
Eastern Ukraine has a large Russian-speaking population and was a stronghold for Viktor Yanukovych before he was overthrown by protesters in February.
Russia then annexed the Crimean peninsula – part of Ukraine but with a Russian-speaking majority – in a move that provoked international outrage.
The crisis has plunged East-West relations to their lowest point since the Cold War.
On Thursday, German Chancellor Angela Merkel asked Russia in a phone call to President Vladimir Putin to help free foreign monitors held in eastern Ukraine.
The military observers were seized by pro-Russia separatists at a checkpoint in the flashpoint town of Sloviansk last Friday.
For his part, Vladimir Putin reiterated his call for Kiev to withdraw troops from the south-east to open the way for a national dialogue.
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The IMF has approved a $17.1 billion bailout for Ukraine to help the country’s beleaguered economy.
The loan comes amid heightened military and political tension between Ukraine and neighboring Russia.
The loan is dependent on strict economic reforms, including raising taxes and energy prices.
The money will be released over two years, with the first installment of $3.2 billion available immediately.
The head of the International Monetary Fund, Christine Lagarde, said the fund would check regularly to ensure the Ukrainian government followed through on its commitments.
The IMF has approved a $17.1 billion bailout for Ukraine to help the country’s beleaguered economy
In March Ukraine put up gas prices by 50% in an effort to secure the bailout.
The government has also agreed to freeze the minimum wage.
The bailout had to be approved by the IMF’s 24-member board, which includes a Russian representative.
The IMF loan will also unlock further funds worth $15 billionn from other donors, including the World Bank, EU, Canada and Japan.
In December last year, Ukraine agreed a $15 billion bailout from Russia, but this was cancelled after protests forced out pro-Russian President Viktor Yanukovych.
On Wednesday, the IMF warned that Russia was “experiencing recession” because of damage caused by the Ukraine crisis.
The fund said $100 billion would leave Russia this year, partly caused by the US and EU sanctions.
The sanctions were imposed after Russia annexed the Crimea region from Ukraine last month.
The IMF bailout will also make available $1 billion in loan guarantees from the US, which was recently approved by Congress.
Earlier on Wednesday, an international conference in London ended with a commitment to help Ukraine recover tens of billions of dollars worth of assets which were allegedly stolen by the ousted President Viktor Yanukovych and his allies.
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Ukraine has threatened to take Russia’s Gazprom to court over what it says are inflated gas prices if the company refuses a new payment deal.
Ukraine’s PM Arseniy Yatseniuk, said Kiev was ready to pay $268 per 1,000 cubic metres of gas and settle its $2.2 billion debt with Gazprom if it agreed to the price.
Gazprom has so far declined to comment.
Russia almost doubled Ukraine’s gas price after the toppling of President Viktor Yanukovich in February.
Ukraine has threatened to take Russia’s Gazprom to court over inflated gas prices (photo AFP)
PM Arseniy Yatseniuk has said his country is not willing to pay at those levels.
“We insist that the price set for Ukraine at the beginning of 2014 [$268 dollars per 1,000 cubic metres] is a market one,” he added.
“We insist on the continuation of this price.”
Ukraine’s state gas company, Naftogaz, has started the process of taking Gazprom to an arbitration tribunal in Stockholm if the Russian state-controlled firm does not agree to the offer within 30 days, Arseniy Yatseniuk said.
Meanwhile, Ukraine’s interim prime minister announced another gas deal that allows supplies from Central Europe to reach the country via Slovakia.
Under the agreement, signed on Monday, Slovakia will reinstate a disused pipeline capable of supplying three billion cubic metres of gas a year to Ukraine.
Ukraine’s energy minister, Yuri Prodan, said the country would soon start gas import talks with Hungary, as it tries to reduce its reliance on Russia, which accounts for about half of its total supply.
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One of a team of eight European monitors seized in eastern Ukrainian city of Sloviansk has been released by pro-Russian separatists.
The officer, a Swede, was freed on medical grounds, it has been confirmed.
The monitors were shown to the media on Sunday – a move described as “revolting” by Germany, the native country of four of the team.
The remaining seven are still being held and diplomacy continues to try to secure their freedom.
There is no word about a number of Ukrainian military officers who were seized along with the group.
In eastern Ukraine, gunmen continue to occupy official buildings in a dozen cities, defying the government in Kiev.
Meanwhile, the US and EU are preparing to unveil new sanctions against Russia, accusing it of destabilizing Ukraine.
Pro-Russian separatists in eastern Ukraine have released one of a team of eight European monitors seized in the flashpoint city of Sloviansk (photo Reuters)
The foreign observers – operating under the auspices of the Organization for Security and Co-operation in Europe (OSCE) are from Germany, Poland, Sweden, Denmark and the Czech Republic.
They were shown to the media on Sunday, led into Sloviansk town hall by masked gunmen.
German monitor Colonel Axel Schneider, who spoke for the group, stressed they were not NATO officers – contrary to claims made by the separatists – nor armed fighters, but diplomats in uniforms.
“We are not prisoners of war. We are the guests of [self-declared Sloviansk] Mayor [Vyacheslav)] Ponomaryov, and being treated as such.”
Reporters later saw one of the group – accompanied by two men – get into an OSCE vehicle which then drove away.
A spokeswoman for Vyacheslav Ponomaryov told Reuters the Swedish national who was freed “has a mild form of diabetes and so we decided to let him go”.
Germany strongly criticized the group’s appearance before the media.
“The public parading of the OSCE observers and Ukrainian security forces as prisoners is revolting and blatantly hurts the dignity of the victims,” said a statement (in German) from Foreign Minister Frank-Walter Steinmeier.
Frank-Walter Steinmeier added that Russia had a duty to “influence” the separatists” so that the other members of the mission can be freed as soon as possible
The monitors who were captured are not part of the main OSCE mission in Ukraine, which Moscow agreed to.
They are from individual OSCE countries, invited to Ukraine by the Kiev government.
Earlier, Vyacheslav Ponomaryov said there was the possibility of exchanging the monitors for militia members held by the Kiev government.
Russia, an OSCE member, has pledged to “take all possible steps” to secure the observers’ release.
Kiev has accused the militia of using the Europeans as a “human shield”.
The West has blamed Moscow for fomenting a secessionist revolt in eastern Ukraine after it annexed Crimea last month. Moscow denies the claim.
Russian Foreign Minister Sergei Lavrov said Ukraine must end military operations in the east of the country as part of urgent measures to defuse the crisis.
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The G7 powers have agreed to impose fresh sanctions on Russia over its actions in Ukraine.
A G7 statement gave no detail of the sanctions, but US officials said they could announce measures by Monday.
The West accuses Russia of leading a secession rebellion in Ukraine’s east, months after it annexed Crimea. Moscow denies the allegations.
Meanwhile, negotiators are trying to secure the release of international observers seized by pro-Russia gunmen.
Forces in the city of Sloviansk are still holding the eight European military observers and several Ukrainian army personnel who they seized on Friday and accuse of espionage.
The observers were taking part in a mission linked to the Organization for Security and Co-operation in Europe (OSCE).
Forces in Sloviansk are holding eight European military observers and several Ukrainian army personnel (photo AFP)
Rebel militia continue to occupy official buildings in a dozen eastern cities, defying the government in Kiev.
Russia has tens of thousands of troops deployed along its side of the border with Ukraine and has said it would act if its interests were threatened.
The US accused Russian jets of violating Ukraine’s airspace on Friday in a further sign of escalation.
Pentagon spokesman Col. Steven Warren said Russian aircraft had entered Ukrainian airspace several times in the past 24 hours.
Meanwhile, the G7 praised Ukraine for acting with restraint in dealing with the “armed bands” that had occupied government buildings.
But the group, which includes the US, UK, Germany, Japan, France, Canada and Italy, condemned Russia’s “increasingly concerning rhetoric and ongoing threatening military maneuvers”.
“Given the urgency of securing the opportunity for a successful and peaceful democratic vote next month in Ukraine’s presidential elections, we have committed to act urgently to intensify targeted sanctions and measures to increase the costs of Russia’s actions,” said the statement.
The US and EU already has assets freezes and travel bans in place target a number of Russian individuals and firms accused of playing a part in the annexation of Crimea.
On Friday, Ukraine’s interior ministry said armed separatists had seized OSCE representatives, who were believed to be military observers from Germany, Denmark, Poland, Sweden and the Czech Republic.
Pro-Russian leaders in Sloviansk confirmed the bus had been stopped near the town of Sloviansk and said they were checking the identities of those on board.
The self-proclaimed mayor of Sloviansk, Vyacheslav Ponomaryov, said at least one passenger had been carrying maps showing separatist checkpoints in the area, which suggested “their involvement in espionage”.
Last weekend, Vyacheslav Ponomaryov broadcast an appeal to President Vladimir Putin asking for Russian troops to protect the city from “fascists” after three of his men died in a gunfight.
Russia’s OSCE envoy Andrei Kelin promised to take “all possible steps” to free the representatives, according to Russian media reports.
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Russia and the US have accused each other of failing to ease tensions in Ukraine after Kiev launched raids on pro-Moscow separatists.
Russia said the US should make Kiev stop the attacks in the east, saying “nothing has been done to resolve this urgent crisis so far”.
The US said Moscow had “actively stoked tensions in eastern Ukraine”.
Russia ordered new military exercises on its border following the raids, drawing condemnation from Ukraine.
Pro-Russian separatists are occupying key buildings in a dozen eastern Ukrainian towns, defying the central government.
The Russian foreign ministry issued a statement urging the US to “use all its influence with the interim government in Kiev to bring it to reason and convince it to refrain from rash steps that will plunge Ukraine even deeper into the depths of crisis”.
It urged Washington to “understand the full measure of its responsibility for what is going on”.
Russia and the US have accused each other of failing to ease tensions in Ukraine after Kiev launched raids on pro-Moscow separatists (photo AP)
Both the US and Russia cited the April 17 Geneva agreement under which illegal armed groups, including those who have seized public buildings, must return home.
The Russian foreign ministry said: “We hope the USA will at last take urgent measures in the interests of de-escalating the situation in accordance with the provisions of the Geneva statement.”
But US state department spokeswoman Jennifer Psaki said Russia had “failed not only to provide public support for the de-escalation of tensions, but has actively stoked tensions in eastern Ukraine by engaging in inflammatory rhetoric”.
Jennifer Psaki said Secretary of State John Kerry had spoken to Russian Foreign Minister Sergei Lavrov “six times since Geneva, and he has never once taken responsibility for the implementation of Russia’s Geneva commitments”.
She added: “There will be additional sanctions if Russia does not make good on this priority.”
Pentagon spokesman Steve Warren told reporters: “The Russian announcement of additional exercises on the Ukrainian border is exactly opposite of what we have been calling on the Russians to do, which is to de-escalate the situation.”
The morning raids by Ukrainian commandos on pro-Russian checkpoints around the town of Sloviansk had left at least two separatists dead.
The raids were brief, with Sloviansk itself reported calm and pro-Russian militants still manning barricades in many areas.
Russian Defense Minister Sergei Shoigu said Moscow had been “forced to react” to the raids by ordering new military exercises.
Sergei Shoigu was quoted by Interfax news agency as saying: “If this military machine is not stopped, it will lead to greater numbers of dead and wounded.”
Moscow has tens of thousands of troops along its side of the border.
Russian television quoted the ambassador to the UN, Vitaly Churkin, as saying that Moscow would have “international-legal grounds” to deploy “peacekeepers” to Ukraine, as it had during the Russia-Georgia conflict of 2008.
Ukraine’s acting President, Oleksandr Turchynov, called on Russia to pull back its troops from the border and end what he called its “blackmail”, adding that Kiev would not yield to “Russian-backed terrorists”.
Foreign Minister Andriy Deshchytisa told the Associated Press that Ukrainian forces would fight the Russians if they had to.
“The Ukrainian people and Ukrainian army are ready to do this. Ukraine will confront Russia. We will defend our land.”
UN Secretary General Ban Ki-moon earlier said he was “seriously concerned that the situation could quickly spin out of control with consequences we cannot predict”.
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Ukraine’s government announces it has regained control of the city hall in the eastern port of Mariupol from pro-Russian separatists.
Several people are said to have been hurt during the overnight operation in the city, where three pro-Russian protesters were recently shot dead.
Administrative buildings have been taken over by separatists in at least a dozen towns in eastern Ukraine.
Talks are reportedly taking place in Mariupol between the two sides.
In another development, the funeral is taking place of a pro-Ukrainian politician, Volodymyr Rybak, who was abducted and killed in the Donetsk region.
Meanwhile, President Barack Obama has accused Russia of flouting a deal on Ukraine reached in Geneva last week, under which illegal armed groups, including those who have seized public buildings, would return home.
Barack Obama told a news conference in Japan that Moscow had failed to halt actions by militants in the region and warned that the US had further sanctions against Russia “teed up”.
Ukraine’s government announces it has regained control of the city hall in the eastern port of Mariupol from pro-Russian separatists
A contingent of US troops has begun landing in Poland for military exercises amid concerns among NATO’s eastern members about Russian intentions.
Moscow has said it will respond to any attack on its interests in Ukraine.
Unrest began in Ukraine last November over whether the country should look towards Moscow or the West.
Ukrainian Interior Minister Arsen Avakov announced on Thursday that the city hall in Mariupol, a port on the Sea of Azov in the Donetsk region, had been “liberated” overnight without any casualties.
“Civic activists” played a major part in the operation, he said.
According to the local news website 0629, a group of about 30 unidentified men in their twenties armed with baseball bats stormed the mayor’s office between 03:00 and 04:00 on Thursday.
The protesters called the police who reportedly came out and calmed down the opposing sides.
Negotiations are under way at the scene between the separatists, the local pro-Ukrainian authorities and the police, the site says.
While the interior minister said nobody had been hurt in the operation, 0629 reported that five men were injured, though not seriously.
Arsen Avakov also said that Ukrainian troops in Artemivsk, another town in the Donetsk region, had fended off an attempt by dozens of pro-Russian militants to seize weapons from a military unit. One soldier was wounded, he said.
Unverified footage of military helicopters, said to be flying over Artemivsk, was posted by a blogger on YouTube.
A local journalist, Anna Bokovaya, told Russian TV that about 50 people had taken part in the attack on the military unit, which lasted 45 minutes.
The militants began the attack after the soldiers inside rejected a demand to surrender, she said. The town was calm again on Thursday morning, she added.
Three pro-Russian protesters were killed when Ukrainian security forces fought off a raid on a base in Mariupol on April 17.
Russia has accused the Kiev authorities of breaking last week’s Geneva accord on resolving the Ukraine crisis.
Russian Foreign Minister Sergei Lavrov said the Kiev government – not recognized by Moscow – had not moved to disarm illegal groups, especially the ultra-nationalist Right Sector.
“Extremists are calling the tune,” he alleged, condemning a fatal shooting near Sloviansk, in eastern Ukraine.
Sergei Lavrov also condemned the continuing Maidan street protests in Kiev.
He said it was “absolutely unacceptable” that the Ukrainian authorities had failed to end what he called the illegal protests in the capital.
However, Ukrainian Foreign Minister Andriy Deshchytsya said he was “surprised” Sergei Lavrov did “not know what is being done in Ukraine regarding the Geneva agreements”, Kiev-based news agency Unian reported.
Sergei Lavrov has accused the Kiev authorities of breaking last week’s Geneva accord on resolving the Ukraine crisis
The government had been having regular consultations with the parties to the agreement in an attempt to find “ways of de-escalating the situation in the east of Ukraine”, Andriy Deshchytsya was reported to have said.
Early on Sunday at least three people were killed in a shooting at a checkpoint manned by pro-Russian separatists near Sloviansk.
The circumstances remain unclear. The local separatists said the attack was carried out by Right Sector militants. Kiev called it a “provocation” staged by Russian special forces.
Sergei Lavrov said the incident proved Kiev did not want to control “extremists”.
He said that the most important demand of the Geneva deal was to “prevent any violence”, and it was not being implemented.
“Steps are being taken – above all by those who seized power in Kiev – which crudely violate the accords reached in Geneva,” Sergei Lavrov told a news conference in Moscow.
The April 17 accord was agreed at talks between Russia, Ukraine, the EU and US. It demanded an immediate end to violence in eastern Ukraine and called on illegal armed groups to surrender their weapons and leave official buildings.
Pro-Russian militants are still holding official buildings in at least nine towns and cities in the Donetsk region of eastern Ukraine.
The interim authorities in Kiev said they had suspended operations against pro-Russian militants over Easter, and appealed for national unity.
They promised to meet some of the demands of pro-Russian protesters, which include the decentralization of power and guarantees for the status of the Russian language.
The Organization for Security and Cooperation in Europe (OSCE) has deployed around 100 monitors across 10 cities in Ukraine to explain the details of the Geneva accord to each side.
Spokesman Michael Bociurkiw said they were having a “mixed experience dealing with checkpoints and so forth and there is a varying reaction to teams”.
He said they were facing a “hardened attitude” in places such as Donetsk and Slaviansk, but other, smaller, areas are “more accommodating”.
Meanwhile, US has warned the next few days will be pivotal and has threatened more sanctions against Russia if it fails to abide by the Geneva accord.
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Orthodox Church patriarchs in Kiev and Moscow have highlighted during their Easter messages the deep division in Ukraine, where a tense stand-off is continuing in the east.
The head of Ukraine’s Orthodox Church Patriarch Filaret accused Russia of “aggression” and “evil”.
Russian Church Patriarch Kirill asked God to end the designs of those who wanted to rip apart Russia and Ukraine.
Pro-Russian activists in the east continue to occupy government offices.
Meanwhile Russia media are reporting several deaths in a gun battle near the eastern town of Sloviansk.
Reports of fatalities in the region have appeared before but have not been independently confirmed.
A mediator from the Organization for Security and Co-operation in Europe (OSCE) is scheduled to hold talks with them on Sunday.
Russian Church Patriarch Kirill asked God to end the designs of those who wanted to rip apart Russia and Ukraine
Ertogrul Apakan, who heads the special OSCE mission in Kiev, said his deputy would be in Donetsk to try to get them to comply with an agreement reached on Thursday to ease the crisis.
In his Easter message, Patriarch Filaret said: “Against our peace-loving nation, which voluntarily gave up nuclear weapons, there has been aggression, there has been injustice.
“A country which guaranteed the integrity and inviolability of our territory has committed aggression. God cannot be on the side of evil, so the enemy of the Ukrainian people is condemned to defeat.
“Lord, help us resurrect Ukraine.”
In Moscow, Patriarch Kirill appealed for peace, saying it “should reign in the hearts and minds of our brothers and sisters by blood and by faith”.
But he also said Ukraine was “spiritually and historically” at one with Russia, and he prayed for it to have authorities that were “legitimately elected”.
“We are a single people before God,” he said.
Ukraine’s acting President, Oleksandr Turchynov, said in his Easter message: “We are living in a fateful time when the Ukrainian people have decisively affirmed their striving for freedom and justice.”
In an interview to be aired in full later on Sunday on NBC’s Meet the Press, Ukraine’s interim PM Arseniy Yatsenyuk accuses Russian President Vladimir Putin of trying to “restore the Soviet Union”.
If Vladimir Putin succeeded, Arseniy Yatsenyuk says, it would be “the biggest disaster of this century”.
Ukraine has been in crisis since President Viktor Yanukovych was toppled in February.
Russia then annexed the Crimean peninsula – part of Ukraine but with a Russian-speaking majority – in a move that provoked international outrage.
The annexation followed a referendum in Crimea that backed a move to join the Russian Federation.
Pro-Russian activists then occupied buildings in several eastern Ukrainian cities, many calling on Moscow to support them.
Russia, Ukraine, the EU and US agreed during talks in Geneva on Thursday that illegal military groups in Ukraine must be dissolved, and that those occupying government premises must be disarmed and leave.
But the separatists’ spokesman in the city of Donetsk said that the Kiev government was “illegal”, and vowed they would not go until it stepped down.
Kiev’s operations against pro-Russian militants in eastern Ukraine have been suspended over Easter, Foreign Minister Andriy Deshchytsia has announced.
However, Andriy Deshchytsia said, Ukraine’s security services would resume military action if the separatists continued to occupy government offices.
They are refusing to leave buildings in several cities, defying an agreement reached on Thursday to ease the crisis.
The US has threatened more sanctions if Russia fails to abide by the agreement.
The Kremlin responded by accusing the White House of treating Moscow like a “guilty schoolboy”.
Kiev’s operations against pro-Russian militants in eastern Ukraine have been suspended over Easter (photo AFP)
In a separate development, Russian President Vladimir Putin said he would award medals to Russians who took part in the seizure of Crimea from Ukraine last month.
The Ukrainian foreign minister added that the Organization for Security and Cooperation in Europe (OSCE) was willing to start a negotiation process with the separatists.
In response to separatist calls for pro-European protesters in Kiev to also vacate sites they were occupying, he said that those camped in the capital’s Maidan Square had “asked permission from the city council” and their camp was therefore not an “illegal occupation”.
Russia, Ukraine, the EU and US had agreed during talks in Geneva that illegal military groups in Ukraine must be dissolved, and that those occupying government premises must be disarmed and leave.
The sides also decided there would be an amnesty for all anti-government protesters.
But the separatists’ spokesman in the city of Donetsk said that the Kiev government was “illegal”, and vowed they would not go until it stepped down.
After cautiously welcoming the deal struck on Thursday, the White House stepped up pressure on Russia to use its influence over separatists occupying the buildings in nine cities and towns in eastern Ukraine.
On Friday, US National Security Adviser Susan Rice warned that if Moscow failed to uphold the deal a new round of sanctions would focus on what she called “very significant sectors of the Russian economy”.
Susan Rice added that the US had identified close associates of the Russian leadership as potential targets for new sanctions.
Russia responded by saying it was disappointed with the US assessment of the Geneva deal.
“You can’t treat Russia like a guilty schoolboy who has to… show he has done his homework,” President Vladimir Putin’s spokesman, Dmitry Peskov, said.
“That kind of language is unacceptable.”
Russia’s President Vladimir Putin has said he has “a right” to send troops into Ukraine but hopes he will “not have to exercise that right”.
Vladimir Putin was speaking live on Russian TV after a clash in Mariupol, eastern Ukraine, in which three pro-Russian protesters were reportedly killed.
He said he hoped the crisis would be resolved through dialogue.
Talks have opened in Geneva between Russia, Ukraine, the EU and US – the first since unrest erupted in Crimea.
In his annual live television phone-in, Vladimir Putin warned the Ukrainian authorities of “the abyss they’re heading into” and urged dialogue.
Vladimir Putin also admitted for the first time that Russian forces had been active in Crimea, which was annexed by Moscow last month. Previously he had insisted that the camouflaged, masked gunmen who took over Crimea were a local “self-defense” force.
In his annual live television phone-in, Vladimir Putin warned the Ukrainian authorities of “the abyss they’re heading into” and urged dialogue (photo RT)
The West says Russia is aiding the pro-Russian activists now occupying dozens of official buildings in Ukraine’s eastern Donetsk region.
Vladimir Putin dismissed as “rubbish” allegations that Russian special forces were operating there.
Russian-speakers are a majority in Crimea and Donetsk, where ties to Russia are strong. Vladimir Putin reminded viewers that Tsarist Russia used to call eastern Ukraine “New Russia”.
“The Federation Council [upper house of parliament] granted the president the right to use military force in Ukraine. I really hope that I do not have to exercise that right and that we are able to solve all today’s pressing issues via political and diplomatic means,” Vladimir Putin said.
He said the Kiev government, which had “seized power”, had only spoken to its own appointees in the region, but “not to the people whom locals trust”.
Meanwhile, Ukraine’s State Border Service has been quoted by the Interfax-Ukraine news agency as saying that it is “significantly” restricting entry into the country by adult men from Russia because of the risk of “acts of terror”.
Overnight about 300 pro-Russian separatists attacked a military unit in Mariupol near the Azov Sea, throwing petrol bombs. Troops had opened fire, killing three, Ukraine’s Interior Minister Arsen Avakov said in a post on his Facebook page.
Ukraine has now sent in reinforcements including helicopters. There was no independent confirmation of Arsen Avakov’s statement.
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Six Ukrainian armored vehicles have been seized by pro-Russian militants in eastern town of Kramatorsk, the defense ministry in Kiev says.
Reports say the occupants were disarmed after the vehicles were blockaded by locals in the city of Kramatorsk.
The incident comes a day after the military began an operation to remove pro-Russian protesters from public buildings across eastern Ukraine.
Meanwhile, NATO is increasing activity in member states bordering Russia.
After Ukrainian forces recaptured an airfield outside Kramatorsk on Tuesday, armored vehicles appeared in the centre of the town early on Wednesday.
“A column was blocked by a crowd of local people in Kramatorsk with members of a Russian diversionary-terrorist group among them,” the defense ministry said its statement.
The military vehicles were then taken to Sloviansk where they are being held by “people in uniforms who have no relation to Ukraine’s armed forces,” the ministry said.
The Ukrainian troops appear to have been disarmed before being fed by pro-Russian militants at a cafe in Sloviansk and then put on a bus back to their home city of Dnipropetrovsk.
Six Ukrainian armored vehicles have been seized by pro-Russian militants in eastern town of Kramatorsk
In another incident, several hundred residents of Pchyolkino, south of Sloviansk, surrounded another column of 14 Ukrainian military vehicles.
After the crowd was reinforced by pro-Russian gunmen, negotiations ensued and the troops were allowed to drive their vehicles away, but only after agreeing to surrender the magazines from their assault rifles.
The episodes come amid increasing tension across eastern Ukraine, blamed by the Kiev government and the West on covert Russian intervention in the region – an allegation denied by Moscow.
The crisis escalated this month after pro-Russian rebels occupied buildings in about 10 towns and cities, demanding greater autonomy or referendums on secession.
Tens of thousands of Russian soldiers are believed to have massed on Ukraine’s borders since Russia took control of the Ukrainian region of Crimea last month, following a controversial referendum on self-determination.
As tensions rose, Ukraine’s acting Defense Minister Mykhailo Koval headed for the east of the country to monitor the progress of the “anti-terrorist operation” announced by acting President Oleksandr Turchynov on Tuesday.
In the city of Donetsk, where activists have been occupying the regional government building since April 6, pro-Russian gunmen have taken control of the mayor’s office.
They told an AFP correspondent their only demand was for the region to stage a referendum on turning Ukraine into a federation with broader local rights.
Meanwhile NATO announced it was beefing up its eastern members’ defenses.
In Brussels, NATO Secretary General Anders Fogh Rasmussen promised “more planes in the air, mores ships on the water, more readiness on the land”.
Anders Fogh Rasmussen called on Russia to make clear it did not “support the violent actions of well-armed militias or pro-Russian separatists in eastern Ukraine”.
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President Barack Obama has called President Vladimir Putin urging him to use his influence to make separatists in eastern Ukraine stand down.
The phone call between Barack Obama and Vladimir Putin came as pro-Russian activists continued to occupy buildings in eastern towns.
For his part, Vladimir Putin rejected accusations of Russian interference, calling the reports “unreliable”.
Meanwhile, Ukraine’s acting President, Oleksandr Turchynov, has announced the start of an “anti-terrorist operation”.
He told parliament it had begun in the “north of Donetsk Region” on Tuesday morning and was being conducted “stage by stage, in a responsible and weighed manner”.
The extent of the operation was unclear but unconfirmed reports on Russian media, quoting separatists, speak of Ukrainian armor being on the move near the flashpoint towns of Sloviansk and Kramatorsk.
President Barack Obama has called President Vladimir Putin urging him to use his influence to make separatists in eastern Ukraine stand down
Tanks and armored personnel carriers could be seen parked 44 miles from Sloviansk on Monday.
EU foreign ministers say they will expand a list of names targeted by sanctions.
Tension has been steadily rising since Russia annexed the Crimean peninsula, formerly part of Ukraine, last month.
The move, condemned as illegal by Kiev and the West, followed the ousting of Ukraine’s pro-Moscow President Viktor Yanukovych in February.
The White House said the “frank and direct” conversation between the two presidents was made at Russia’s request.
“The president expressed grave concern about Russian government support for the actions of armed, pro-Russian separatists who threaten to undermine and destabilize the government of Ukraine,” a White House statement said.
“The president emphasized that all irregular forces in the country need to lay down their arms, and he urged President Putin to use his influence with these armed, pro-Russian groups to convince them to depart the buildings they have seized.”
The statement also threatened Moscow with wider sanctions, saying “the costs Russia already has incurred will increase if those actions persist”.
The Kremlin said in a statement that recent unrest in Ukraine’s south-east was “the result of the unwillingness and inability of the leadership in Kiev to take into account the interests of Russia and the Russian-speaking population”.
The statement said Vladimir Putin had urged Barack Obama to “use the resources at the disposal of the American side” to help prevent any bloodshed.
It dismissed claims that Russia was interfering in Ukraine, saying the accusations were based on “questionable information”.
Thousands of Russian troops are reported to be deployed along the border between Ukraine and Russia. Kiev fears any crackdown on pro-Russian groups could trigger an invasion.
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