UPDATE: Putin pledges no sanctions vs Ukraine, sees relations souring

(Adds details in last paragraph)

MOSCOW, Dec 17 (PRIME) -- Russia will introduce no sanctions against Ukraine but the economic relations will deteriorate anyway because Ukraine will have no trade preferences from January 1, President Vladimir Putin told reporters at an annual press conference Thursday.

“We are not going to introduce sanctions of any kind for Ukraine. I want this to be heard…Ukraine cannot be put into a worse position than for any other foreign partner, but sure Ukraine will have no incentives and no preferences in trade with Russia from January 1, 2016,” Putin said.

Putin signed on Wednesday a decree to suspend a CIS free-trade zone deal with Ukraine from January 1, 2016, when Kiev enters the framework of the E.U. trade association.

Russia can start producing agricultural goods meeting E.U. requirements to ease the conflict arising from Ukraine’s association with Europe, but the transition will take significant investment and time, Putin said.

End