EU vows unwavering support to Ukraine but problems with deal mount

By Gabriela Baczynska

BRUSSELS (Reuters) - European Union leaders reaffirmed support for carrying out a 2014 pact on closer ties with Ukraine but cited "limitations" amid divisions over how far to go with a country mired in intractable corruption and conflict.

Some in Ukraine feel the EU has not shown enough support in its confrontation with Russia and worry that promises by U.S. President-elect Donald Trump to mend Washington's relations with Moscow could be come at their expense.

On top of that, a provision to lift EU visas for Ukrainians is snagged and the Netherlands is struggling to work around a national referendum that rejected the EU's agreement on freeing up trade and building closer political ties with Kiev.

Three years after a pro-EU uprising overthrew the Moscow-allied leadership in Kiev, the mood was publicly upbeat at Thursday's Brussels gathering at which European Council President Donald Tusk spoke Ukrainian and exchanged jokes with Ukrainian President Petro Poroshenko at a joint news conference.

"You have many friends here, and I can promise you that you will not be left behind," Tusk said. "We also have our limitations, but we will continue in our efforts to fulfil your justified expectations.

"Ukraine's success will be the success of all of Europe."

But behind the official optimism, problems with the deal are mounting as many in the EU are unhappy with the pace of reform in Ukraine, especially in purging rampant graft, and some want to rehabilitate trade ties with major energy supplier Russia.

For Ukraine, a former Soviet republic of 45 million people, the drive toward Western integration has come at a high cost.

Scores were killed during clashes between protesters and Ukrainian security forces 2013-14 and soon afterwards Russia annexed the Crimea region and went on to back an insurgency by Russian speakers in eastern Ukraine.

The EU slapped sanctions on Russia over the bloodshed in the industrial east but the conflict - which killed nearly 10,000 people to date - remains unresolved.

Tusk said the bloc's economic sanctions against Russia would be extended - likely for six months - before an EU summit on Dec. 15-16. But the future beyond that has turned murky as EU divisions over the wisdom of penalizing Moscow have deepened.

Trump's rise to power may only weaken the bloc's resolve.

CORRUPTION, ENERGY, TRADE AND VISAS

Corruption remains rife in Ukraine. Public declarations revealed recently vast wealth held by officials, upsetting both the EU and Poroshenko's constituency at home.

EU leaders told Poroshenko he must do more in rooting out graft, improving rule of law and liberalizing the economy.

Still, Tusk said he hoped Ukrainians would be granted visa-free travel to the EU - coveted by Kiev - by year-end.

But that is not certain as Germany and France have stalled the process, fearing an influx of Ukrainians could pressure the job market and stoke anti-foreigner feeling that has already hurt mainstream parties facing elections next year.

At Thursday's summit, Brussels and Kiev signed a "strategic energy partnership" agreement, a message to Russia which has strived for years to bypass Ukraine in selling more of its gas to Europe, including by the Nord Stream pipeline.

But that is unlikely to assuage Ukrainian concerns after Brussels lifted a cap on Gazprom's Opal pipeline, opening the way for Russia to expand Nord Stream capacity.

And the future of the entire association accord, which EU leaders said had boosted Ukrainian exports to the bloc by 5 percent this year, is now uncertain in the wake of the Dutch vote to reject it.

While the pact is being provisionally applied, The Hague is negotiating for a legally-binding EU summit decision that would allow the Dutch parliament to override the referendum result.

The document would spell out that the agreement does not prejudge Ukraine's eventual membership in the EU, does not oblige the bloc to provide military or financial support to Kiev and does not give Ukrainians access to European jobs.

(Editing by Mark Heinrich)

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