WRAPUP 7-Ukraine peace deal falters as rebels show no sign of surrender


* Pro-Russia separatists reinforce barricades

* Kerry tells Lavrov to call for end to occupations

* Lavrov tells Kerry to restrain Kyiv “hotheads”

* U.S. to decide “in days” on additional sanctions

(Adds U.S. comments on possible timing of new sanctions)

By Richard Balmforth and Aleksandar Vasovic

KYIV/SLAVIANSK, Ukraine, April 21 (Reuters) – An
international agreement to avert wider conflict in Ukraine was
faltering on Monday, with pro-Moscow separatist gunmen showing
no sign of surrendering government buildings they have seized.

U.S. and European officials say they will hold Moscow
responsible and impose new economic sanctions if the separatists
do not clear out of government buildings they have occupied
across swathes of eastern Ukraine over the past two weeks.

Washington, which signed last week’s accord in Geneva along
with Moscow, Kyiv and the European Union, said it would decide
“in days” on additional sanctions if Russia does not take steps
to implement the agreement.

U.S. Secretary of State John Kerry urged his Russian
counterpart, Sergei Lavrov, on Monday to help carry out the
deal, including by “publicly calling on separatists to vacate
illegal buildings and checkpoints”, spokeswoman Jen Psaki said.

“If they don’t take steps in the coming days, there’ll be
consequences,” she told a news briefing on Monday. “Obviously,
we would have to make a decision in the matter of – in a matter
of days – if there are going to be consequences for inaction.”

The United States and the European Union have imposed visa
bans and asset freezes on some Russians over Moscow’s annexation
of Crimea from Ukraine last month. Those limited measures,
designed not to have wider economic impact and to avoid
deepening the crisis, have been mocked as pointless by Moscow.

Building a consensus on tougher measures is tricky in Europe
where many countries rely on Russian energy exports.

In its account of their telephone conversation, the Russian
Foreign Ministry said Lavrov had called on Kerry to “influence
Kyiv, not let hotheads there provoke a bloody conflict” and to
encourage it “to fulfil its obligations unflaggingly.”

U.S. Vice President Joe Biden arrived in Kyiv, where he is
expected to announce a package of technical assistance. The
visit is likely to be more important as a symbol of support than
for any specific promises Biden makes in public.

MUTUAL ACCUSATIONS

The Geneva accord aimed to lower tension in the worst
confrontation between Russia and the West since the Cold War. It
calls for occupied buildings to be vacated under the auspices of
the Organization for Security and Cooperation in Europe, or
OSCE.

But no sooner had the accord been signed than both sides
accused the other of breaking it, while the pro-Moscow rebels
disavowed the pledge to withdraw from occupied buildings.

An OSCE mediator, Mark Etherington, held his first meeting
with the leader of separatists in Slaviansk, a town that rebels
have turned into a heavily fortified redoubt.

He said he had asked the pro-Russian self-proclaimed
“people’s mayor” of the town, Vyacheslav Ponomaryov, whether he
would comply with the Geneva agreement, but gave no hint about
the response.

Ponomaryov later told a news conference: “We did not
negotiate, we talked. We told them our position, what happened
here, and they told us about their plans.”

In other signs the Geneva accord was far from being
implemented, activists in Slaviansk brought up trucks laden with
sand and were filling sandbags to reinforce their barricades.

In nearby Kramatorsk, local media showed masked gunmen
taking over the office of the SBU security service and leading
away a civilian identified as the local police chief.

Separatists said they would not disarm until Right Sector, a
Ukrainian nationalist group in western Ukraine, did so first.

“Who should surrender weapons first? Let us see Right Sector
disarm first. Let them make the first step and we will follow,”
Yevgeny Gordik, a member of a separatist militia, told Reuters.
“We need dialogue. This is not dialogue. It is monologue.”

Russia says Right Sector members have threatened Russian
speakers. Kyiv and Western countries say the threat is largely
invented by Russian state-run media to justify Moscow’s
intervention and cause alarm in Russian speaking areas.

Moscow blames Right Sector for a shooting on Easter Sunday
morning, when at least three people were killed at a checkpoint
manned by armed separatists. Right Sector denies involvement,
while Kyiv said Russia provoked the violence.

One European diplomat said the Geneva deal was a way for
Russian President Vladimir Putin to buy time and undermine
momentum towards tougher sanctions: “Talks and compromises are
just part of his tactics,” said the diplomat. “He wants to have
Ukraine.”

PROTECTING RUSSIAN SPEAKERS

Putin announced last month that Moscow had the right to
intervene in its neighbours to protect Russian speakers. He then
annexed the Crimean peninsula.

Moscow has since massed tens of thousands of troops on the
Ukrainian border, and Kyiv and its Western allies say Russian
agents are directing the uprising in the east, including the
“green men” – heavily armed, masked gunmen in unmarked uniforms.

In his latest move, likely to be seen by the West as a
further threat to the post-Cold War order, Putin signed a law on
Monday making it easier for Russian speakers across the former
Soviet Union to obtain Russian citizenship.

Eastern Ukraine is largely Russian-speaking and many
residents are suspicious of the pro-European government that
took power in Kyiv in February, when Moscow-backed President
Viktor Yanukovich fled the country after mass protests.

Separatists have declared an independent “People’s Republic
of Donetsk” in the east’s biggest province and have named
themselves to official posts in towns and cities, setting up
checkpoints and flying Russian flags over government buildings.

There is also some support for Ukrainian unity in the
region, but pro-Kyiv activists have had a lower profile since
the separatists took up arms.

One activist who helped organise a unity rally in Rubizhne,
a town in the eastern Luhansk region, told Ukraine’s Channel 5
television that separatists attacked it, forcing the rally to
disperse. Local police said a policeman was hurt when
unidentified people tried to disrupt the rally.

In the regional capital, Luhansk, Interfax-Ukraine news
agency said a meeting of about 3,000 people in the local SBU
headquarters had elected a “people’s governor” and voted to hold
a two-stage referendum next month on union with Russia.

Ukraine announced an operation to retake rebel-held
territory earlier this month, but that modest effort largely
collapsed in disarray.

Kyiv has declared an “Easter truce”, although it is far from
clear it could muster any real force if it tried. The army is
ill-equipped, untested and untrained for domestic operations,
while the government in Kyiv doubts the loyalty of the police.

The OSCE, a European security body that includes both NATO
members and Russia, has so far deployed around 100 monitors and
mediators in Ukraine and expects their number to rise.

An OSCE spokesman said the mediators were visiting
separatist-occupied buildings with copies of last week’s Geneva
accord to explain it to the people inside.

“It’s a mixed experience dealing with checkpoints and so
forth and there is a varying reaction to teams. There is a
hardened attitude in Donetsk or Slaviansk but some other areas
are more accommodating,” spokesman Michael Bociurkiw said. “When
teams go to smaller centres people are more willing to talk.”

(Additional reporting by Natalia Zinets, Alastair Macdonald and
Jeff Mason in Kyiv, Dmitry Madorsky in Slaviansk, Alissa de
Carbonnel in Donetsk, Doina Chiacu and Patricia Zengerle in
Washington, Steve Gutterman and Vladimir Soldatkin in Moscow;
Writing by Peter Graff, Philippa Fletcher and David Stamp;
Editing by Tom Heneghan, Peter Cooney and Lisa Shumaker)