* Signing follows months of violence in Ukraine
* Georgia, Moldova also sign trade accords with EU
* EU makes no promise of membership the countries seek
* Ukraine extends ceasefire by 72 hours until Monday
(Updates with Ukraine extending ceasefire by 72 hours,
paragraphs 2, 5-6, 13-14)
By Robin Emmott and Justyna Pawlak
BRUSSELS, June 27 The European Union signed an
historic free-trade pact with Ukraine on Friday and warned it
could impose more sanctions on Moscow unless pro-Russian rebels
act to wind down the crisis in the east of the country by
Shortly after returning to Kiev from Brussels where he
signed the pact, Poroshenko announced on his website that
Ukraine had extended a ceasefire by government forces against
pro-Russian separatist rebels by 72 hours until 10 p.m. on
Ukrainian President Petro Poroshenko came to Brussels to
sign a far-reaching trade and political cooperation agreement
with the EU that has been at the heart of months of deadly
violence and upheaval in his country, drawing an immediate
threat of "grave consequences" from Russia.
Georgia and Moldova signed similar deals, holding out the
prospect of deep economic integration and unfettered access to
the EU's 500 million citizens, but alarming Moscow, which is
concerned about losing influence over former Soviet republics.
The week-long ceasefire had been due to expire on Friday.
The extension was made, Poroshenko's website said, in line
with a Monday deadline set by EU leaders for the rebels to agree
to ceasefire verification arrangements, return border
checkpoints to Kiev authorities and free hostages including
detained monitors of the OSCE rights and security watchdog.
"We expect progress in the next hours," German Chancellor
Angela Merkel said. "If we don't see any steps forward on any of
the points, then we are also prepared to take drastic measures."
EU leaders said they were ready to meet again at any time to
adopt significant sanctions on Russia. Diplomats said they could
target new people and companies with asset freezes as early as
next week. More than 60 names are already on the list.
Although it has drawn up a list of hard-hitting economic
sanctions against Russia, the EU is still hesitating over
deploying them because of fears among some member states of
antagonizing their major energy supplier.
"We are talking about possible sanctions against Russia but
we do not have to introduce sanctions for the sake of sanctions.
We do have a need for a dialogue. I hope this dialogue will take
place and we will have a real ceasefire," Poroshenko told a news
conference in Brussels.
Poroshenko has drawn up a 15-point peace plan to defuse the
crisis in eastern Ukraine, where hundreds of people have been
killed in clashes between security forces and pro-Russian
Ukraine, Georgia and Moldova have made clear that their
ultimate goal is EU entry, but Brussels, under pressure from
voters weary of further expansion, has made no promise it will
allow them in.
Poroshenko and national security chiefs said that during the
next 72 hours recruitment centres for Russian fighters across
the border in Russia should be closed.
Ukrainian government forces would have the right to end the
ceasefire ahead of time in any areas where ceasefire conditions
were not being implemented, Poroshenko's announcement said.
Ukraine's former pro-Moscow President Viktor Yanukovich
turned his back on signing the EU agreement last November in
favour of closer ties with Moscow, prompting months of street
protests that eventually led to his fleeing the country.
Soon afterwards, Russia annexed Ukraine's Crimea region,
drawing outrage and sanctions from the United States and EU, and
pro-Russian separatists began an uprising in eastern Ukraine.
"Over the last months, Ukraine paid the highest possible
price to make her European dreams come true," Poroshenko said,
calling Friday's accord the most important day for his country
since independence from the crumbling Soviet Union in 1991.
Symbolically, he signed the agreement with the same pen that
had been prepared for Yanukovich to sign the document last year.
Russia's Deputy Foreign Minister Grigory Karasin immediately
said the signing would have "grave consequences" for Ukraine,
Interfax news agency reported.
Poroshenko urged the EU to reward Ukraine for its sacrifices
by promising the country would be eligible for membership of the
EU once it was ready. The pledge would "cost the EU nothing but
would mean the world to my country", he said.
European Council President Herman Van Rompuy said Friday's
deals were "not the final stage of our cooperation", but this
fell short of the prospect of ultimate EU membership.
Moldovan Prime Minister Iurie Leanca has also set his sights
on EU membership, saying on Thursday that he hoped his country
would apply to join in the second half of 2015.
Russia, which fought a war with Georgia in 2008, has met
previous attempts by its neighbours to move closer to the EU
with trade reprisals. EU officials fear it could happen again.
EU officials say that, in diplomatic talks, Russia has
threatened to withdraw the duty-free treatment that Ukraine
currently benefits from as a member of the Commonwealth of
Independent States (CIS) free trade pact.
If Russia imposed customs duties, it would put at risk some
of Ukraine's exports, which mainly consist of base metals,
grains, machinery, equipment and processed food. Ukraine sends
24 percent of its exports to Russia, worth $15 billion a year.
Moscow fears Ukraine may re-export EU products to Russia,
avoiding duties that Russia imposes to protect its own output.
Russian energy giant Gazprom cut off gas supplies to Kiev
last week after Ukraine failed to pay its gas debts.
(Writing by Adrian Croft and Will Dunham; Additional reporting
by Gabriela Baczynska in Moscow; Editing by David Stamp,
Philippa Fletcher and Ken Wills)