KIEV (Reuters) - Ukrainian President Petro Poroshenko signaled on Wednesday he aimed to put a pro-Western and business-friendly stamp on his leadership and set out peace proposals for the rebellious east involving a unilateral ceasefire by government forces.
Poroshenko, installed as president 11 days ago, nominated Pavlo Klimkin, a pro-European diplomat now serving as ambassador to Germany, for foreign minister. He asked parliament also to approve Valeria Hontareva, an experienced banker who is widely respected in business circles, as new central bank chief.
Both nominations, which require parliament's approval, confirmed Poroshenko's determination to shift the ex-Soviet republic westwards towards the European Union and attract foreign investment for the cash-starved economy. He may present his nominees to parliament tomorrow.
But earlier, he looked to the crisis-torn east where government forces are battling a separatist insurgency that has already cost scores of lives on both sides.
After a late-night telephone call with Russian President Vladimir Putin, Poroshenko outlined a 14-step plan, including an amnesty for separatist fighters who lay down their arms, and tighter controls over Ukraine's border with Russia.
"The plan will start with my order for a unilateral ceasefire," Poroshenko said after speaking to students at a military institute in Kiev. "Immediately after this, we need very quickly to get support for the peace plan...from all participants."
Acting Defence Minister Mykhailo Koval told journalists in Kiev the ceasefire "will happen in the next few days".
Fighting continued overnight, however.
A spokesman for government forces, Vladyslav Seleznyov, said in the course of fierce exchanges of fire near the small town of Schastye in Luhansk region more than 30 separatist fighters had been "killed and wounded". Three soldiers had been killed on the government side and 9 wounded, he said.
The figures for separatist casualties could not be independently confirmed. But a Reuters journalist in Luhansk saw rebels loading empty pine coffins onto a lorry which then joined a convoy heading to Schastye.
The violence in the east has cost the lives of 147 Ukrainian soldiers with 267 wounded up to now, the defense ministry said on Wednesday. This figure did not include other law enforcement bodies such as the national guard.
Ukraine accuses Russia of backing the rebels in the industrial Russian-speaking east who rose up after mass protests in Kiev toppled Viktor Yanukovich, a president sympathetic to Moscow. Kiev says the rebels have been bringing in weapons across the long border with Russia.
TENSIONS HIGH
Poroshenko said on Monday that a ceasefire could start only if the border was secure, and that he had ordered troops to regain control of it to pave the way for a truce and peace talks.
The Kremlin said Putin's conversation with Poroshenko late on Tuesday night had "touched on the theme of a possible ceasefire in the area of military action in southeastern Ukraine".
Moscow has urged a swift end to what it calls a "punitive operation" against pro-Russian separatists in the east.
Relations between the two neighbors are in tatters, three months after Russia labeled the uprising against Yanukovich a Western-backed coup, then annexed the Crimea from Ukraine.
Moscow has grudgingly acknowledged Poroshenko as Ukraine’s new elected leader; but tensions are still high, exacerbated by Russia’s decision to cut off gas supplies to Ukraine after the two sides failed to agree a regime for pricing and the settlement of Ukraine’s debts.
On Wednesday, the Ukrainian government said an explosion on a section of pipeline carrying Russian gas through Ukraine to European had been caused by a bomb and that it saw "foreign interference" behind the attack.
Prime Minister Arseny Yatseniuk ordered security reinforced at gas pipeline installations to avoid further acts of sabotage.
Russian investigators accused Ukrainian Interior Minister Arsen Avakov and Ihor Kolomoisky, governor of the Dnipropetrovsk region in the east, of criminal acts in the government's military push against the separatists.
A spokesman for the federal Investigative Committee said they were under investigation on charges including murder, kidnapping and using illegal methods of warfare - although it was not immediately clear under what jurisdiction.
The Kremlin also said Putin had expressed his concern to Poroshenko over the deaths of two journalists for Russian state television, who were killed in shelling as Ukrainian forces fought pro-Russian separatists near the eastern city of Luhansk.
Klimkin, nominated for foreign minister, is a 47-year-old Moscow-educated physicist who entered the foreign service more than 20 years ago, becoming Ukraine's envoy to Germany in 2012.
Seen as ardently committed to European integration, he played a key role in negotiating the association and free trade agreements with the EU, which Yanukovich spurned finally provoking the uprising that brought him down.
Hontareva, Poroshenko's nominee for the central bank's top job, has worked for leading Ukrainian and international financial institutions in Ukraine for 18 years.
She held the post of first deputy chairman of the board and financial markets chief at ING Bank Ukraine from January 2001 to December 2007. Prior to that she served as a member of the board of Societe General Ukraine, where she was responsible for capital market operations.
If approved as head of the central bank, she will figure prominently in future negotiations with the International Monetary Fund which last May signed off on a $17 billion bailout for Ukraine with tough conditions including steep hikes in gas tariffs and floating the national hryvnia currency.
Poroshenko also nominated Vitaly Yarema, currently first deputy prime minister, to be prosecutor general - a key law-enforcement post in which he will be expected to play a role in reforming the country's corruption-ridden judiciary.
"We are seeing Poroshenko appoint very credible, pro-western, market and business-friendly people," said Timothy Ash of Standard Bank plc in a commentary.
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