* EU set to agree new sanctions but delay implementation
* Leaders could give Putin a week, some sources say
* EU wants to see if ceasefire can be agreed and respected
By Tom Körkemeier and Paul Taylor
BRUSSELS/NEWPORT, Wales, Sept 5 The European
Union is set to agree new economic sanctions against Russia on
Friday but will wait before implementing them to give Moscow
time to show if it is respecting a proposed ceasefire in
Ukraine, diplomats said.
How long it would hold off has yet to be decided, and if a
peace holds then the package might not be implemented at all.
Two diplomats said EU leaders could give President Vladimir
Putin a week to demonstrate he was resolving the conflict,
another spoke of 72 hours. Envoys from member states meet in
Brussels on Friday afternoon and the diplomats said the details
of the sanctions package should be settled then.
"They want to give the ceasefire a chance," one said of
hopes of a deal between Russia and Ukraine in Minsk on Friday.
Another said: "If the ceasefire holds, then there is a
possibility of not implementing sanctions at all."
Ukraine's President Petro Poroshenko and the main
pro-Russian rebel leader both announced on Thursday they would
call a ceasefire on Friday if a peace deal is signed in Minsk,
which would be the first such breakthrough in the five-month
The European Union and United States imposed sanctions
against Russia after Moscow annexed Ukraine's Crimea peninsula
in March, and tightened them since then, accusing Russia of
supporting pro-Russian separatists in Ukraine's east.
The latest wave of sanctions was announced after Western
countries said they believed Russia had send ground troops into
Ukraine, helping the rebels launch a major advance last week.
Once EU ambassadors agree the next wave of sanctions, it
would take a decision by the 28 national leaders to put the
measures into effect.
British Foreign Secretary Phillip Hammond told the BBC he
favoured going ahead with the immediate implementation of
sanctions and then lifting them if the ceasefire held.
But other EU states favour postponing implementation as long
as a ceasefire is on the table.
French President Francois Hollande said on Thursday shortly
after Poroshenko's ceasefire announcement that sanctions would
be activated "if there is no progress (on Ukraine), but
everything will depend on the coming hours."
EU leaders agreed at a summit last Saturday to prepare the
new, third, set of sanctions within the week and diplomats said
the 28 ambassadors should be able to iron out outstanding
differences on a text of measures later on Friday.
Governments are wrangling over details, partly in the hope
of limiting the effects of sanctions on their own economies and
businesses operating in their own markets. Several smaller EU
countries, notably the Czech Republic and Slovakia, have
expressed scepticism about sanctions.
Among the most contentious areas is a proposed tightening of
an export ban on goods that can have both a military as well as
a civilian purpose.
There are also differences over the wording of measures to
ban Russian state-owned companies from borrowing through
syndicated loans in the EU, sources said, as well as over a list
of Russians to be subject to a ban on entry to the bloc.
One key element of the new sanctions will be expanding a ban
on raising money in the EU capital market to all Russian
state-owned firms. An existing ban applies only to banks.
Expanding the ban could affect major oil Russian oil companies,
Other measures include: banning syndicated EU loans to
Russian government-owned banks and institutions, and banning the
sale of Russian derivative instruments in the bloc. A ban on
selling debt instruments with a maturity of longer than 90 days
would be extended to debt for longer than 30 days.
Outside the financial sector, the proposals include an
expansion of an export ban on goods that could have military
uses to all potential Russian importers, not just companies in
the defence sector.
And a ban on selling advanced technologies in the energy
sector to Russia could be extended to include servicing
agreements, affecting EU companies working in Russia.
Some member states have suggested barring Russian Defence
Minister Sergei Shoigu from entering the EU, diplomats said.
And some have floated an EU cultural and sports boycott of
Russia - though that is not expected to be agreed on soon.
(Additional reporting by Jan Strupczewski and Robin Emmott in
Brussels; Writing by Alastair Macdonald; Editing by Peter Graff)