KYIV, March 11 - Ukraine will take aerospace company Motor Sich back into state ownership in the near future because of its strategic importance to national security, Reuters reported on Thursday citing top security official Oleksiy Danilov.

Motor Sich was privatized two decades ago and the United States and China have tussled over its fate, posing a dilemma for Ukraine which relies on Washington as its biggest military aid donor but is seeking to forge deeper commercial ties with Beijing.

“? decision has been made according to which the Motor Sich enterprise will be returned to the Ukrainian people, will be returned to the ownership of the Ukrainian state in a legal, constitutional way,” said Danilov, secretary of Ukraine’s Security and Defense Council.

President Volodymyr Zelenskiy signed a decree in January imposing sanctions on Chinese aviation firm Skyrizon, which has sought to acquire control of Motor Sich by buying stakes from its Ukrainian owners.

China warned Ukraine in early February against imposing sanctions on Chinese companies and asked to resolve a dispute over an acquisition of Motor Sich within boundaries of international law and bilateral agreements.

"China opposes unilateral sanctions on Chinese enterprises by foreign governments,” Wang Wenbin, spokesman for the China’s Ministry of Foreign Affairs, said.

A group of Chinese investors said on February 17 that it will seek $3.6 billion in damages after the authorities have blocked the takeover of Motor Sich.

Meanwhile, Washington opposed Chinese investors acquiring Motor Sich and in the final days of the administration of President Donald Trump, Washington added Skyrizon to a Military End-User (MEU) List, restricting its access to U.S. exports.

Zelenskiy’s Servant of the People Party said last week it would submit to parliament a bill on nationalizing the aerospace company.

Chinese investors initiated international arbitration threatening Ukraine with several billion-dollar penalties over investments made into the company.

Danilov said that the state would compensate where private owners had invested any capital in Motor Sich. (rt/ez)