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EU, Ukraine sign aid deals worth $1.78 billion

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Photo - Ukrainian Prime Minister Arseniy Yatsenyuk addresses the media at the European Commission headquarters in Brussels, Tuesday, May 13, 2014. The European Commission says it is determined to help Ukraine, and to make sure that Ukraine has all the support it needs, to undertake the political and economic reforms that are necessary for the country. (AP Photo/Yves Logghe)
Ukrainian Prime Minister Arseniy Yatsenyuk addresses the media at the European Commission headquarters in Brussels, Tuesday, May 13, 2014. The European Commission says it is determined to help Ukraine, and to make sure that Ukraine has all the support it needs, to undertake the political and economic reforms that are necessary for the country. (AP Photo/Yves Logghe)
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BRUSSELS (AP) — Ukraine's prime minister and European Union officials on Tuesday closed deals for a total of 1.3 billion euros ($1.78 billion) in EU assistance that Kiev could use to pay its energy bills, combat corruption and reform its institutions.

"Ukraine can count on the European Union now and in the future," said European Commission President Jose Manuel Barroso.

The agreements were signed during the visit of Ukrainian Prime Minister Arseniy Yatsenyuk and his government to EU headquarters.

Yatsenyuk thanked the EU, saying "Russia will fail to make Ukraine a failed state."

The government in Kiev is facing a pro-Moscow mutiny in eastern Ukraine, where armed separatists declared independence on Monday following a disputed referendum the day before. Both the European Union and the Obama administration have rejected the referendum as illegal.

On Tuesday, the talks EU officials held with Yatsenyuk and his ministers in Brussels identified ways to "support the political, economic and financial stability of Ukraine," Barroso told a joint news conference.

In March, leaders of the 28-nation EU agreed on 11 billion euros in short-, medium- and long-term assistance for Ukraine. The memorandum signed Tuesday is for 1 billion euros in loans for macrofinancial assistance. Barroso said the first installment of 600 million euros would be disbursed soon, following ratification of the arrangement by Ukraine's parliament.

EU officials told reporters the funds could be used to help pay Russia for natural gas purchases — a matter of dispute between the two countries. The EU loans were made contingent on the Ukrainian government committing itself to fiscal and economic reforms.

A separate "state-building contract program," evaluated by the EU as worth 365 million euros, is intended to help Ukraine implement reforms, fight corruption, promote social and economic development and expand government capacity, Barroso said.

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