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Ukraine leader to go to EU summit, but not ready to sign pact

REFILE - ADDING TRANSLATION OF SIGN Students take part in a rally to support EU integration in western Ukrainian city of Lviv November 26, 2
REFILE - ADDING TRANSLATION OF SIGN Students take part in a rally to support EU integration in western Ukrainian city of Lviv November 26, 2

By Natalia Zinets and Richard Balmforth

KIEV (Reuters) - Ukrainian President Viktor Yanukovich said on Tuesday he would attend an EU summit this week, but, criticizing the bloc for a 'humiliating' financial aid offer, declared he would sign a free trade pact only when it suited Ukraine's interests.

Shifting Ukraine's economy onto European standards would require not less than $20 billion per year, he said in a television interview.

Yanukovich's government announced last week it had shelved plans to sign a landmark pact with the European Union at the summit in Lithuania's capital, stunning EU leaders and igniting pro-Europe rallies in the former Soviet republic.

Ukraine's decision to renew instead closer economic cooperation with Moscow revived Western fears of a swing back into Russia's sphere of influence.

Yanukovich on Tuesday confirmed he would go to Vilnius all the same. Then, a short while later, in a television interview, he sharply attacked the EU, accusing it of offering just 610 million euros ($827.19 million) and making this conditional on agreeing a new loan deal with the International Monetary Fund.

"For three years in succession they have shown this candy in pretty wrapping to us ... We don't have to be humiliated like this. We are a serious country, a European one," he said.

"When it corresponds to our interests, when we have agreed (with the EU) on normal conditions, (only) then can we consider signing. "When will we sign? Soon or not soon? I would like the time to be as soon as possible ... but the question is one of principle for us," Yanukovich said.

The presidential website quoted him separately as saying that bringing Ukraine's economy up to European standards would cost $20 billion a year.

The Vilnius agreement would have marked a definitive turn towards the West for Kiev and away from Moscow, which sees Ukraine as a sphere of its economic and political influence.

His strong words after Ukraine's U-turn following years of negotiations with the EU set the scene for a possibly testy encounter - in all likelihood at a dinner in Vilnius on Thursday night - between Yanukovich and the club of 28 EU leaders.

Earlier, his prime minister, Mykola Azarov, repeated that last Thursday's decision to suspend the signing and revive economic dialogue with Russia had been taken out of economic necessity.

He said Ukraine would begin talks with Moscow from next month to work out a "roadmap" for closer cooperation. Yanukovich, Azarov said, would seek three-way talks on Ukraine's economic future, including also Russia, in Vilnius.

Ukraine is heavily indebted and strongly reliant on Russian gas, for which it says it is paying unreasonably high prices.

Referring to the East-West tug-of-war which Ukraine often finds itself in the center of, Azarov said: "We absolutely do not want to be a battleground between the EU and Russia, a field of confrontation. We want to have good relations with both the EU and Russia."

OPPOSITION ACCUSATIONS

The opposition accuses the government of cynically using months of negotiations with the EU as a bargaining chip in dealings with Russia to reach a deal for cheaper gas and loans from Moscow. Putin would like to draw Ukraine into a Russian-backed customs union with eastern, former Soviet neighbors.

Several thousand pro-Europe demonstrators gathered again in central parts of the capital Kiev on Tuesday night after opposition leaders urged people to turn out after work.

"We are different, but we are united because we are have only one aim - President Yanukovich must sign the Association Agreement at the Vilnius summit," a statement by the three main opposition leaders said.

The three opposition leaders - boxer-turned-politician Vitaly Klitschko, former economy minister Arseny Yatsenyuk and far-right nationalist Oleh Tyahniboh - say they also intend to go to Vilnius.

Student bodies have also called for a strike on Wednesday in educational institutions.

TYMOSHENKO'S FATE

The demonstrations in Kiev have evoked memories of the 2004-5 Orange Revolution protests against sleaze and electoral fraud which brought hundreds of thousands out on to the streets and doomed Yanukovich's first bid for the presidency.

These were co-led then by the now jailed opposition leader Yulia Tymoshenko, a fierce opponent of Yanukovich whose release the EU was trying to agree as part of the run-up to Vilnius.

Tymoshenko, who turns 53 on Wednesday, served twice as prime minister under her former 'orange' ally Viktor Yushchenko and was only narrowly beaten by Yanukovich for the presidency in early 2010 after he made a comeback.

She was jailed the following year for seven years for abuse of office after a trial Western governments say was political.

Yanukovich might face rough questioning about Tymoshenko's fate from leaders such as German Chancellor Angela Merkel.

Germany was to have accepted Tymoshenko for treatment for chronic back trouble under a compromise deal envisaged by the EU but which has now died along with the planned signing.

($1 = 0.7374 euros)

(Additional reporting by Pavel Polityuk and Thomas Grove; Editing by Andrew Heavens)

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