Ukraine might have recently decided to strengthen its financial and economic ties with Russia, but the European Union (EU) should not abandon the country, the country's opposition leader told CNBC.
"What's very important for my country and the only we can move on is to sign an association agreement [with the EU], to implement real reforms and to attract investors [as well as] to reform the judiciary and tackle rampant corruption and to be a part a part of the European world," Arseniy Yatsenyuk, Leader of the "All Ukrainian Union Fatherland" party, said.
Yatsenyuk's comments follow the Ukrainian president's surprise decision in December to not sign an association agreement with the EU – an deal that would have strengthened political, trade and economic ties between the 28-nation union and Ukraine – in favor for closer ties (plus financial aid and energy price cuts) with Russia.
The move prompted thousands of pro-EU Ukrainians (including many from the All Ukrainian Union Fatherland party) to descend on public areas in the capital Kiev to protest the decision. And although an estimated 100,000 gathered in the capital's central square on New Year's Eve to call for President Yanukovich to resign, the numbers have since dwindled.
To Russia, with Love
Yatsenyuk said the majority of Ukrainians wanted the government to sign the association agreement with the EU but conceded that it was hard for the Ukraine to be between two unions -- the EU and Russia, which he called its "big neighbour which sometimes acted like a Russian bear."
Ukraine finds itself in a difficult position economically which has caused it to look both east and west for help to save it from bankruptcy.
In 2011, the country's $15 billion loan program with the International Monetary Fund (IMF) was suspended after Ukraine failed to raise domestic gas prices as the organisation had required in return for the aid.
In October 2013, the World Bank cut the country's 2013 growth forecast to zero from a previously forecast 1 percent and lowered its forecast for 2014 from 3 to 2 percent. In the same month, third quarter gross domestic product (GDP) data confirmed the country had sunk into its third recession since 2008.
In a bid to reverse its economic misfortunes, the former Soviet republic appeared ready to sign a landmark trade and cooperation deal with the EU last year but instead Ukrainian President Viktor Yanukovych chose to turn to Russia.
In return for turning its back on the EU, Russia agreed to buy $15 billion of government bonds and to cut the price of Ukraine's gas supply.
(Read more: Russia takes a page out of the US playbook)
Yatsenyuk, who heads the opposition party previously led by former Prime Minister Yulia Tymoshenko who was imprisoned more than two years ago on charges of abuse of power, said that corruption and the "stupid" government were key obstacles on the road to investment in the Ukraine.
"This is a key problem and this is why we need to sign an association agreement [with the EU]. This is the best recipe to make real reforms in my country."
Yatsenyuk said the impetus behind Russia's deal was geo-political. "Russia is a solid and quite influential player…and this is more of a geo-political [move] rather than an economic one. It provided Ukraine with a temporary loan which is temporary relief, rather than financial support for real reforms."
- By CNBC's Holly Ellyatt, follow her on Twitter @HollyEllyatt
