STRALSUND, Germany—German Chancellor Angela Merkel and French President François Hollande on Saturday urged the Kiev government to make concessions to the pro-Russian population in Ukraine even as they declared a looming independence referendum in the country’s east illegal and warned of further sanctions against Russia.

The two leaders said after a two-day meeting in Merkel’s parliamentary district in northeast Germany that the 57-nation Organization for Security and Cooperation in Europe, or OSCE, should collect illegal weapons in Ukraine and observe the scheduled May 25 presidential election.

They urged the Ukrainian government to move ahead within days a Ukrainian constitutional reform plan that Russia has been demanding. But they also warned Russian President Vladimir Putin that they were prepared to broaden sanctions against his country if Russia prevents the May 25 election from being held.

“We are prepared to go farther on the sanctions path,” Merkel said. “But that is not an end in itself for us.”

The comments from Merkel and Hollande show how the West continues to scramble to find a way to find a diplomatic resolution to the Ukraine crisis. While Putin made public statements in recent days indicating he was prepared to support the presidential vote, and urged separatists to call off their referendum, violence in eastern Ukraine has continued to flare.

Merkel and Hollande said they viewed as illegal the referendum for independence from Kiev scheduled to be held Sunday in separatist-controlled parts of eastern Ukraine.

But a five-point declaration the two adopted called on the pro-Western government in Kiev to be open to the demands of pro-Russian groups, including a constitutional reform plan that would ensure minority rights and open the door to decentralizing the government.

The Kiev government should make public their plans for constitutional reform “in the coming days,” the declaration said.

The most important goal, they said, was to ensure the presidential election scheduled for May 25 would be held to add legitimacy to the government in Kiev.

An expanded version of this report appears at WSJ.com



