Putin Says `No Closed Issues` in Talks with Ukraine

"There are no closed issues. We have signed an agreement on the free trade zone. Concerning Ukraine's membership in the Customs Union, Ukrainian experts think GDP will grow 1.5 percent to 6.5 percent if Ukraine joins the Customs Union. This will depend on the depth of integration," Putin said.

Putin and his Ukrainian counterpart Viktor Yanukovych are meeting at the Russian president's personal residence Zavidovo outside Moscow on Monday. The leaders are to discuss energy cooperation but do not plan to sign any documents, Putin’s spokesman Dmitry Peskov said earlier.

Putin said starting from 2015 the movement of workforce will be limited into the Customs Union. "Free flows of workforce will be only within the Customs Union, and we must do everything to discuss this problem,” Putin said.

For his part, Yanukovych said,” We should assess the format of Ukraine’s participation in the Customs Union and have talks,” adding that Ukraine’s immediate joining is not an issue.

Last week, Yanukovych said Ukraine is interested in finding a route toward integration with the Customs Union of Belarus, Kazakhstan and Russia, and is negotiating with Russia on possible models of cooperation with the trade bloc.

Belarus, Kazakhstan and Russia have been in the Customs Union since January 1, 2012. The bloc allows unrestricted movement of capital, goods and services across the three states’ national borders. Moscow has repeatedly proposed membership to Ukraine, promising cheaper gas supplies in return.

Kiev is reluctant to become a full member, because such a deal would rule out signing a free trade agreement with the European Union. Kiev has proposed cooperating with the union under a "three plus one" format, which would not, however, imply full membership.

Ukraine, which has proclaimed a strategic course of Euro-integration, plans to sign an Association Agreement with the EU in late 2013. Ukraine and the EU reaffirmed their commitment to signing the agreement during the 16th EU-Ukraine summit in Brussels.