AUR#673 US-Ukraine Economic Relations; Bright Future On Ski Slope; Book: "To Kill Julia"; Bandits-Criminals To Parliament; Out Of The Darkness

THE ACTION UKRAINE REPORT – AUR
An International Newsletter, The Latest, Up-To-Date
In-Depth Ukrainian News, Analysis and Commentary
Ukrainian History, Culture, Arts, Business, Religion,
Sports, Government, and Politics, in Ukraine and Around the World
BANDITS – CRIMINALS GOING TO PARLIAMENT
Seeking immunity from prosecution

“Ten have criminal records, 37 are under criminal investigation, and 41
await trial. All have been candidates in Ukraine’s March 26 parliamentary
elections.

Critics call the collection of shady characters running in the ballot a
disgrace – and a sign of how little has changed in this ex-Soviet republic
despite the high hopes and lofty promises of the 2004 Orange Revolution,
when hundreds of thousands rallied under the slogan “Criminals in Jail.”

The practice of seeking immunity from prosecution by taking up a
parliamentary seat had become so standard in post-Soviet Ukraine that
most people didn’t pay any attention.

“If you steal a hen or sack of grain from your neighbor, you go to jail,
but if you steal a million you end up in parliament,” lamented Volodymyr
Stretovych, who heads the parliamentary committee against organized

crime.” [Articles 13-14-15]

THE ACTION UKRAINE REPORT – AUR – Number 673
Mr. E. Morgan Williams, Publisher and Editor
Washington, D.C., Kyiv, Ukraine, TUESDAY, MARCH 14, 2006

——–INDEX OF ARTICLES——–
Clicking on the title of any article takes you directly to the article.
Return to the Index by clicking on Return to Index at the end of each article

1. US-UKRAINE ECONOMIC RELATIONS: ON THE ROAD TO THE WTO
OP-ED: By Oleh Shamshur, Ambassador of Ukraine to the USA
Zerkalo Nedeli on the Web, Mirror-Weekly, No. 9 (588)
International Social Political Weekly
Kyiv, Ukraine, Saturday, 11-17, March, 2006

2. U.S. AMBASSADOR JOHN HERBST CELEBRATES PROGRESS ON
U.S.-UKRAINE WTO BILATERAL MARKET ACCESS AGREEMENT
Interfax-Ukraine, Kyiv, Ukraine, Thursday, March 9, 2006

3. UKRAINE PARLIAMENT: CONSIDER FOUR WTO BILLS THIS WEEK
UNIAN news agency, Kiev, in Ukrainian 1241 gmt 13 Mar 06
BBC Monitoring Service, UK, in English, Monday, Mar 13, 2006

4. WESTINGHOUSE DELEGATION TOURS SOUTH – UKRAINIAN
NUCLEAR POWER STATION
By Alla Miroshnichenko, Ukrinform
Kyiv, Ukraine, Sunday, March 12, 2006

5. NEW POLISH AIRLINE: FLY TO GERMANY, DENMARK & UKRAINE
Lodz to Kiev and Lviv, Ukraine and Rzeszow to Lviv, Ukraine
AP Worldstream, Warsaw, Poland, Saturday, Mar 11, 2006

6 . POLISH VISTULA CLOTHING MFG WANTS TO OPEN 100 SHOPS
OVER FOUR YEARS IN COUNTRIES BORDERING POLAND
Three planned for Ukraine in 2006 and more in 2007
Polish News Bulletin, Warsaw, Poland, Thursday, Mar 09, 2006

7. UKRAINE SEES BRIGHT FUTURE ON SKI SLOPE
By Otto Pohl, The New York Times
New York, New York, Monday, March 6, 2006

8. UKRAINIAN COURT CANCELS SCANDALOUS SALE OF LUXURY
CRIMEAN RESIDENCE TO RUSSIAN BANK FOR PRESIDENT PUTIN
One Plus One TV, Kiev, in Ukrainian 1730 gmt 9 Mar 06
BBC Monitoring Service, UK, in English, Friday, Mar 10, 2006

9. LET IT FLY: GOVERNMENT SACRIFICES #1 PRIVATE CARRIER
Conflict around Boryspil airport looks like new re-privatization case
ANALYSIS & COMMENTARY
: By Roman Bryl, Ukraine Analyst
IntelliNews – Ukraine This Week, Kyiv, Ukraine, Monday, March 6, 2006

10. GENERAL MOTORS LOOKS AT BUYING INTO CAR FACTORY IN
POLAND OWNED BY UKRAINIAN COMPANY AVTOZAZ
By James Mackintosh in London and Tom Warner in Kiev
Financial Times, London, United Kingdom, Tue, March 14 2006

11. FORMER HEAVYWEIGHT CHAMP SEEKS NEW LIFE AS
MAYOR OF UKRAINIAN CAPITAL KIEV
By Mara D. Bellaby, AP Worldstream, Kiev, Ukraine, Sun, Mar 12, 2006

12. TYMOSHENKO BEST-SELLER REKINDLES FIRE OF REVOLUTION
“To Kill Julia,” penned by Yuri Rogoz, a Tymoshenko admirer
Andrew Osborn in Moscow, The Independent
London, United Kingdom, Friday, Mar 10, 2006

13. KEEPING DEMOCRACY ALIVE IN UKRAINE
Interview: A key figure in the 2004 revolution, Interior Minister
Yuriy Lutsenko is cleaning up the police force.
By Howard LaFranchi, Staff writer, The Christian Science Monitor
Boston, Massachusetts, Monday, March 13, 2006

14. UKRAINE PARLIAMENTARY ELECTION ATTRACTING MANY
CANDIDATES WITH SHADY PASTS
Natasha Lisova, AP Worldstream, Kiev, Ukraine, Mon, Mar 13, 2006

15. OUR UKRAINE BLOC BROADCAST PORTRAYS PARTY OF REGIONS
PARLIAMENTARY CANDIDATES AS CRIMINALS SEEKING IMMUNITY
UT1, Kiev, in Ukrainian 1700 gmt 10 Mar 06
BBC Monitoring Service, UK, in English, Sat, Mar 11, 2006

16. GRAND COALITION: UKRAINE’S SALVATION
OP-ED: By John B. Conlan, Kyiv Post
Kyiv, Ukraine, Wednesday, Mar 08 2006

17. UKRAINIAN PARLIAMENTARY CAMPAIGN DIGEST: MAR 5-12 06
BBC Monitoring research in English 12 Mar 06
BBC Monitoring Service, United Kingdom;, Sunday, Mar 12, 2006

18. JUDGES, POLITICS AND ELECTIONS IN UKRAINE
Despite legal prohibition some judges are running for Parliament
ANALYSIS & COMMENTARY: by Judge Bohdan A. Futey
Zerkalo Nedeli on the Web, Mirror-Weekly, No. 8 (587)
International Social Political Weekly, Article in Ukrainian
Kyiv, Ukraine, Saturday, 4-10, March, 2006
The Action Ukraine Report (AUR) #673, Article 18, in English
Washington, D.C., Tuesday, March 14, 2006

19. DANUBE — BLACK SEA NAVIGABLE WATERWAY
ANALYSIS & COMMENTARY: Embassy of Ukraine
The Action Ukraine Report (AUR), #673, Article 19
Washington, D.C., Tuesday, March 14, 2006

20. OUT OF THE DARKNESS
ROMANIA TRIES TO SHED ITS TRADITIONAL PAST FOR
ENTRY INTO EUROPEAN UNION
By Kevin Sullivan, Washington Post Foreign Service
The Washington Post, Washington, DC
Sunday, March 12, 2006; Page A12
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1
. US-UKRAINE ECONOMIC RELATIONS: ON THE ROAD TO THE WTO

OP-ED: By Oleh Shamshur, Ambassador of Ukraine to the USA
Zerkalo Nedeli on the Web, Mirror-Weekly, No. 9 (588)
International Social Political Weekly
Kyiv, Ukraine, Saturday, 11-17, March, 2006

US-Ukraine economic relations have been notable for a number of inveterate
problems, which shaped up the system of priorities for Ukrainian diplomats
in the American sector and had a general negative effect on the bilateral
relations of these two states.

I refer to the reestablishment of export privileges for Ukrainian goods in
the USA in accordance with the US Generalized System of Preferences
(GSP), granting by the US of market economy status to Ukraine, signing of
a pact on market access (which, in fact, opens WTO doors to Ukraine), and
lifting of Jackson-Vanik restriction (which, despite its purely political
content, provided for economic sanctions).

At the same time, a relatively brief history of US-Ukraine relations has
proven that not only has the US promoted its own economic and political
interests, but also it has strongly reacted to the actions of the former
Ukrainian government, which in one way or another violated principles of
democracy and civilized market economy. International experience has
proven that these issues are interconnected.

The historic events of 2004 gave sufficient grounds to Washington, American
business circles, and actually all democratic states to regard Ukraine not
only as a dynamically developing democracy, but also as a promising
economic partner, shedding its tight cover of transition economy. This
provided for the active and equitable involvement of Ukraine into the system
of modern international economic relations.

In the past, Ukrainian producers were losing more than USD300 billion a year
due to lack of favorable trade conditions and antidumping investigations.
Ukraine’s loss due to its image of an unreliable economic partner, as a
result of the charges of improper intellectual property rights protections
and non-recognition of its market economy status, should be added to its
general loss. That is why recent achievements in US-Ukrainian relations not
only have economic value, but also have non-material value.

They enable Ukraine to follow its course to a place within the international
system of division of labor and to promote its interests. They testify to
our actual achievements in market-based economic development and
corresponding institutional changes.

In particular, privileges for Ukrainian export to the USA according to the
GSP were reestablished as a result of a special revision of the situation in
Ukraine. Thus, the White House acknowledged the responsibility and
adequacy of the Ukrainian government’s actions in the field of intellectual
property rights protection and adaptation of Ukrainian legislation to
international standards.

As is known, sanctions against Ukraine were introduced in 2001. They
prohibited duty free export of goods for up to USD40 million per annum
according to 120 lines of the American Harmonized tariff system.

In April 2005, the Ukrainian government initiated revision of the Ukrainian
economy’s status. (First, the US Department of Commerce made such
revision in 1997 within the framework of antidumping investigation
concerning Ukrainian import of scrap metal and carbonic and other steel
wire.)

This is a rather complicated procedure that enables all the stakeholders,
including American companies directly competing with Ukrainian producers,
to provide any arguments in support of their position.

It is very important that many major US companies (AES, ADM, Alticor,
Cargill, General Electric, Motorola, PBN, Procter&Gamble, United
Technologies), which have positive experiences working in Ukraine, spoke
in its support.

The decision of the US Department of Commerce to grant Ukraine market
economy status testifies to the recognition by the US government of the
efforts of the new Ukrainian government to make irreversible changes in the
economic sector.

We expect that this decision will become a powerful signal for American
business, which will contribute to the flow of investments into Ukraine and
the development of comprehensive trade and economic cooperation.

On the other hand, Ukrainian entrepreneurs received important means that
enabled them to promote their business interests in the USA much more
effectively and to go to the international markets more energetically.

I would like to use this opportunity and emphasize that our cooperation with
American partners during the revision of our status revealed a new quality
of work of Ukrainian ministries and departments, their improved skills to
work in a modern way and use adequate legal and diplomatic instruments to
clearly justify their position.

Successful completion of the US-Ukrainian negotiations within the framework
of Ukraine’s accession to the WTO and signing protocol on mutual market
access bring the same conclusion.

The length of negotiations with the WTO member states, the USA included,
testifies both to the complexity of the process and sensitivity of the
issues as well as to the persistence of Ukraine in the promotion of its own
economic interests. The agreements were achieved as a result of healthy and
mutually beneficial compromise.

Similar to our American partners, I am sure that the results of these
negotiations will further our bilateral cooperation on economic issues of
the WTO rules.

There is another important aspect related to the signing of a bilateral
protocol. It enabled the US Congress to adopt the decision to lift the
Jackson-Vanik amendment. Kyiv repeatedly raised this issue, which has
both practical significance and symbolic meaning.

However only recently we began to feel that our efforts were given adequate
support by the US government and lawmakers. A public coalition for lifting
Jackson-Vanik restriction co-chaired by former US Ambassadors to Ukraine
Stephen [Steven] Pfifer [Pifer] and William Miller unites more than 100 [the
number is actually 250, AUR Editor] US non-governmental organizations and
businesses and plays a significant role in this process.

Previously the Ukrainian side proved that it met the criteria of lifting
this restriction; now its anachronism has become totally obvious in the
general context of bilateral relations.

In general, my numerous meetings with high-ranking US officials, influential
congressmen and senators, representatives of business, and the general
public testify to the fact that “US-Ukrainian strategic partnership” is
acquiring a practical meaning in almost all spheres of bilateral
cooperation.

There is a great interest in a new democratic Ukraine and general readiness
toward qualitative change in the relations with it in all levels of American
society. Investment issues and joint production in the most dynamic and
high-technology industries of Ukraine’s economy generate special interest in
the USA.

Clearly, radial revival of US and other investments in Ukraine cannot be
expected without the advancement of market reforms, completion of an
efficient investment infrastructure, and creation of other conditions that
would insure the trust of potential investors in Ukraine. WTO membership
would have an exclusive significance in this relation.

In the context of our recent progress in US-Ukrainian relations, I would
like to emphasize that the Ukrainian government did its best to provide a
powerful tool protecting the interests of Ukrainian national producers in
the USA. Further on, their success will depend on their own efforts,
flexibility, and ability to compete in the American market.

I would also like to emphasize that “economization” of Ukrainian diplomats
and their readiness and wish to promote the interests of Ukrainian exporters
cannot settle external economic issues. Now it is the turn of Ukrainian
entrepreneurs: they have every opportunity to benefit from the advantages
produced by Ukrainian diplomats in Washington.

In the end, I would like to underscore that progress in Ukrainian external
economic policy is directly related to success or failure of its internal
policy. It is being negatively affected by certain forces, which try to
impede the general state policy by sabotaging important political and
legislative initiatives. Such forces are reluctant to act in compliance with
the strategic state interests and react adequately to new geopolitical
realities. -30-
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2. U.S. AMBASSADOR JOHN HERBST CELEBRATES PROGRESS ON
U.S.-UKRAINE WTO BILATERAL MARKET ACCESS AGREEMENT

Interfax-Ukraine, Kyiv, Ukraine, Thursday, March 9, 2006

KYIV – U.S. Ambassador to Ukraine John E. Herbst welcomed the signature
in Washington on March 6 by U.S. Trade Representative Rob Portman and
Ukrainian Minister of Economy Arseniy Yatsenyuk of a bilateral agreement on
market access as part of Ukraine’s World Trade Organization (WTO) accession
negotiations, press office of United States Embassy in Ukraine reports.

“This agreement marks significant progress on a number of the top issues on
our bilateral trade agenda, as targeted by President Bush and President
Yushchenko in the New Century Agenda for the Ukrainian-American Strategic
Partnership 2005,” Ambassador Herbst said.

“Ukraine’s trade benefits under the Generalized System of Preferences (GSP)
were restored on January 23. Ukraine achieved market-economy status on
February 1, which U.S. Deputy Commerce Secretary David Sampson
announced February 17 during his visit to Kyiv.

The March 6 bilateral agreement paves the way for Ukraine to complete its
WTO accession negotiations, which will would open up potentially vast
opportunities for local businesses and attract major companies to Ukraine,”
Herbst explained. “U.S. producers and exporters will benefit from more open
access to Ukraine’s industrial, agricultural, and services markets,” Herbst
added.

Ukraine’s WTO accession is a top priority for the U.S. and Ukraine.
Membership in the WTO demonstrates a country’s commitment to conducting
economic relations under a common rules-based system. U.S. investors will
enjoy increased transparency and gain enhanced security in critical service
and other industries.

WTO accession will help expand Ukraine’s markets, and increase investors’
confidence that Ukraine has met international standards of economic openness
and fairness.

As Ukraine takes steps to adopt WTO rules by modernizing and rationalizing
laws and regulatory standards for trade, its economy is benefiting. The
growth of foreign direct investment (FDI) in Ukraine hit a record high of
$7.3 billion in 2005. A reduction of import tariffs in 2005 helped reduce
both prices and the incidence of smuggling for a number of consumer goods.
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3. UKRAINE PARLIAMENT: CONSIDER FOUR WTO BILLS THIS WEEK

UNIAN news agency, Kiev, in Ukrainian 1241 gmt 13 Mar 06
BBC Monitoring Service, UK, in English, Monday, Mar 13, 2006

KIEV – This week parliament will consider four bills that Ukraine needs to
adopt to join the WTO, parliament speaker Volodymyr Lytvyn told a news
conference in Kiev today. He said that Ukrainian Prime Minister Yuriy
Yekhanurov had asked parliament to return to the four bills required for
Ukraine’s accession to the WTO.

Lytvyn said the conciliatory council of group and faction leaders decided
to put the bills, which parliament had previously rejected, on this week’s
agenda for a repeat hearing.

He said that parliament must have its final say, and if it fails to make a
decision, this will postpone Ukraine’s WTO entry, “although I understand
that apart from legal motives, there are political ones”. [Passage omitted:
further details of the agenda] -30-
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4. WESTINGHOUSE DELEGATION TOURS SOUTH – UKRAINIAN
NUCLEAR POWER STATION

By Alla Miroshnichenko, Ukrinform
Kyiv, Ukraine, Sunday, March 12, 2006

MYKOLAYIV – A delegation of the famous American concern
Westinghouse toured the South – Ukrainian nuclear Power Station.

Within the framework of the international nuclear safety aid by the US
Department of Energy and with participation of the Westinghouse a series
of projects are being implemented at the NPP. The projects of qualification
of American fissile fuel and replacement of information- computer systems
are among these.

Having familiarized himself with the NPP, Westinghouse Vice President for
Central and Eastern Europe Robert Bonner unveiled a decision of the United
States to start financing the second stage of the project, which is aimed at
preparing Ukrainian NPPs for using American nuclear fuel. -30-
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5. NEW POLISH AIRLINE: FLY TO GERMANY, DENMARK & UKRAINE
Lodz to Kiev and Lviv, Ukraine and Rzeszow to Lviv, Ukraine

AP Worldstream, Warsaw, Poland, Saturday, Mar 11, 2006

WARSAW – A new small Polish airline plans to begin flights next month with
discount fares to Germany, Denmark and Ukraine, its president said in
remarks published Saturday.

Jan Szczepkowski, who is also co-owner of the Direct Fly private airline,
said tickets would e available from Tuesday to buy on the Internet or by
telephone flights between Berlin and the central and northern Polish cities
of Gdansk, Bydgoszcz and Lodz.

The airline also will fly between Bydgoszcz and Copenhagen, Denmark,
and offer routes from Lodz to Kiev and Lviv, in Ukraine, and from the
southeastern Polish city Rzeszow to Lviv.

The first flights have been planned for April 11, Szczepkowski said,
according to Polish news agency PAP. The airline, which is targeting
business travelers, also planned to fly internal routes in Poland. Ticket
prices are to range between 119 zlotys (US$38/A32) on domestic flights
to 549 zlotys (US$177/A148) on foreign links. -30-

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6. POLISH VISTULA CLOTHING MFG WANTS TO OPEN 100 SHOPS
OVER FOUR YEARS IN COUNTRIES BORDERING POLAND
Three planned for Ukraine in 2006 and more in 2007

Polish News Bulletin, Warsaw, Poland, Thursday, Mar 09, 2006

WARSAW – Vistula clothes manufacturer wants to open 100 shops in the
next four years in countries bordering Poland. Beginning in 2007, the
company wants to open 20 to 30 shops annually. Vistula Managing Director
Witold Bezmienow said that by 2006 the company wants to have five outlets
in the Czech Republic and one or two in Lithuania and Slovakia.

Vistula is also interested in Hungary. “We want to open three shops in
Ukraine by autumn this year and three or four in 2007. Also in 2007, we
want to open outlets in Russia and Germany,” said Bezmienow. Currently,
the company has three shops abroad: in Riga, Prague and Budapest.

“So far, sales abroad account for several percent of the company’s income,
but in a few years time we would like them to equal Polish sales,” added the
managing director. The company owns close to 70 shops but wants 100
before the close of the current year. Apart from retail sales, Vistula is the
wholesaler of the Luigi Vesari brand. -30-
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7. UKRAINE SEES BRIGHT FUTURE ON SKI SLOPE

By Otto Pohl, The New York Times
New York, New York, Monday, March 6, 2006

VOROKHTA, Ukraine – What does a young man fresh out of college in the
poverty-stricken Carpathian Mountains of western Ukraine do with his life?

The ski industry helped the Carpathian Mountains region of Ukraine pull out
of an economic slump caused by the collapse of the Soviet Union.

Selling mushrooms by the roadside, a common career path here, was not
quite what Yuri Dobrovolsky had in mind. It would be better, he thought,
to start a ski area.

So, too, did a number of well-heeled investors. With master plans from
Canada, high-speed lifts from Austria and $125 million in start-up capital,
Mr. Dobrovolsky’s Bukovel resort is the most significant investment in the
region.

No great claim for this distant land of weathered wood houses and
horse-drawn carriages in this Ivano-Frankovsk oblast, or administrative
region. But if investment plans for the next few years are met, Bukovel will
be one of the largest ski resorts in the world, with more guest
accommodations than megaresorts like Whistler, in British Columbia, or
even Vail.

Plans call for a total of $1 billion to be invested by 2010, when the resort
will have 26 lifts and 75 miles of trails, said Mr. Dobrovolsky, now 31. The
airport in nearby Ivano-Frankovsk is slated for expansion to handle
international visitors.

Bukovel, while hundreds of miles from a major international city, lies at
the heart of a vast area of rapidly developing economies and a growing
middle class that thirsts for amenities. In fact, skiing is a good indicator
of a developing middle class, said Don Murray, vice president of Ecosign,
one of the world’s largest mountain resort designers and creator of
Bukovel’s master plan.

“Eastern Europe and China is where the growth currently is,” he said in an
interview in February, adding that Bukovel was probably the largest ski
resort in the world under development.

“We saw the market opportunity not only for tourism, but for building an
entire market,” said Bogdan Lesiuk, the regional director of the Ukrainian
bank Privatbank, who led his company’s negotiations to invest in the resort
in 2002.

Profit will come not only from the ski resort, he said, but from the other
businesses made possible because of the visitor traffic. “Mountain streams
all flow together into a big river,” he said.

That river is still in the future. For now, the enormous base area dwarfs
the scattered restaurants, ski rental shops, hotel complex and sleigh horses
used to bring visitors from nearby hotels and, sometimes, to pull cars out
of snowbanks.

But construction cranes sway and the resort already bustles with visitors in
bright snow outfits, clomping from the parking lots to the lifts in the
latest ski boots. The resort equipment is brand new, from Doppelmayr
high-speed quad lifts to bar code ticket scanners.

With 600,000 visitors expected by the end of this season, Bukovel is already
altering life in this region of 1.4 million inhabitants. Sport utility
vehicles with Thule ski racks zip past people pushing battered milk cans on
wheelbarrows. In local markets, entrepreneurs offer old, scratched Völkl
skis for about $50.

The Soviet collapse in 1991 hit this region hard. The wood mill in Vorokhta,
for example, closed a decade ago, eliminating the only significant employer
in this city of 8,000.

So the influx is welcome to people like Halena Heredijuk and her husband,
Yuri, who rent two rooms in their home to visiting skiers and recently began
building a guesthouse. About a third of villagers offer rooms for overnight
stays, and everyone is discussing the skyrocketing value of real estate .

The Heredijuks plan to sell a 3.7 acre lot they estimate is worth $300,000
and to build a small hotel with the proceeds.

In nearby Kolomyya, Vitaliy Pavliuk runs a small hotel, which he fills with
skiers willing to exchange the 45-minute commute to Bukovel for cheaper
accommodations. He is working with investors on a new ski hotel in the
mountains. “Now that I’ve done this first hotel, I want more,” he said.
“Everything is possible now.”

Others agree. “There are 20 places you could build a ski resort,” said
Arkadiy Mudraninets, who abandoned a classical music career when his
orchestra in nearby Uzhhorod went bankrupt in the wake of the Soviet
Union’s collapse. He has built a new career as a ski instructor.

The closest competitor to Bukovel is Dragobrat, a resort with Soviet- era
roots but now upgraded with used European equipment. Up a 12-mile
dirt-and-snow road passable only with military-grade trucks, Dragobrat
offers Ukraine’s highest skiing – and many say its best.

Yuri Bidniy, 54, one of Dragobrat’s owners, says their $1.5 million
investment attracted plenty of local attention, but that it was not always
desirable. “The local prosecutor, the police, the fire department, they all
came for their bribes.”

Since Ukraine’s Orange Revolution in 2004, however, local officials have not
bothered him, Mr. Bidniy said. These days, his guests are a more likely
source of gray hair.

“Two young kids on snowboards came in after midnight and emptied a fire
extinguisher on a sleepy professor who opened his door,” he said. “I don’t
let snowboarders into the hotel anymore.”

Mr. Bidniy and Mr. Mudraninets know that a vibrant ski industry is just one
step in the right direction for a poor country. “If I had a lot of money,
I’d rebuild the Uzhhorod orchestra,” Mr. Mudraninets said. “It’s the sign of
a good city. Good roads and a good symphony orchestra. When we have
those things, you know Ukraine will have arrived.” -30-
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8 . UKRAINIAN COURT CANCELS SCANDALOUS SALE OF LUXURY
CRIMEAN RESIDENCE TO RUSSIAN BANK FOR PRESIDENT PUTIN
Former Prime Minister Viktor Yanukovych involved in the deal

One Plus One TV, Kiev, in Ukrainian 1730 gmt 9 Mar 06
BBC Monitoring Service, UK, in English, Friday, Mar 10, 2006

KYIV – [Presenter] The Hlitsyniya guesthouse in Yalta won’t become the
residence of Russian President Vladimir Putin. The Kiev business court
today cancelled the scandalous agreement on the sale of Hlitsyniya to
Russia’s Vneshtorgbank [Foreign Trade Bank].

Former Prime Minister Viktor Yanukovych and the former head of the
Directorate for State Affairs, Ihor Bakay, were involved in the deal. Artek
[children’s recreation centre], which was the formal seller at the time,
must return to the state the 36m hryvnyas [7.2m dollars] it received. Mariya
Vasylyeva has the details.

[Oleh Bachun, captioned as head of the board of judges of Kiev economic
court, reading ruling] The court has decided to partially satisfy the
demands of the plaintiff and to find invalid the purchase-sale agreement of
12 November 2004 for the buildings and premises of the Hlitsyniya
guesthouse.

By way of a reciprocal restitution, Vneshtorgbank – located at 16 Kuznetskiy
Most Street, Moscow, Russian Federation – is obliged to return to the
state-owned Artek International Children’s Centre – at the designated
location – the buildings and premises of the Hlitsyniya guesthouse.

[Correspondent] The verdict of the Kiev business court summed up 22
rulings by courts of various levels during the two-year dispute. Lawyers are
constantly amazed at the resourcefulness of some of the officials who
devised a huge number of cunning schemes for transferring ownership of
state property.

Hlitsyniya has been passed from hand to hand since 1997, when the State
Tax Administration took the guesthouse from the Supreme Council
[parliament]. Seven years later, it was temporarily under the jurisdiction of
the legendary presidential Directorate for State Affairs.

Then, for a month it was the property of Artek. At least on paper, it was
the children’s republic that sold the pearl of the Livadiya complex and part
of the park of the Counts Potocki to Russia’s Vneshtorgbank for 78m
hryvnyas, of which the Russians have paid less than half.

It is rumoured that the Russian president has an eye on Hlitsyniya, and his
Ukrainian colleague could not refuse.

[Anatoliy Selivanov, captioned as parliament representative] To receive for
such a minimal sum a building as unique as the Hlitsyniya guesthouse, to
receive 20 hectares of land that is of national significance – this
certainly did not happen without certain aspects such as, let’s say,
agreements that went against state interests.

[Correspondent] There has not been any reaction from Moscow yet. A
representative of Vneshtorgbank refused to comment. But all sides are
preparing for the legal battle to continue in other courts – right up to the
Stockholm International Arbitration Court.

[Vsevolod Loskutov, captioned as adviser to the Russian embassy] We
acquired this building, paid money for it, in accordance with Ukrainian laws.
We saw the logic of the way this situation developed. I don’t think we were
surprised because we saw the direction it was taking, but of course this
causes concern.

[Correspondent] Hlytsyniya has been returned to Ukraine, but only 450
special Ukrainians [MPs] and their families will be able relax in this
heavenly spot. According to the court ruling, Artek should transfer it to
the Nyzhnya Oreanda sanatorium complex, which comes under the
apparatus of the Ukrainian parliament. [Passage omitted: more details]
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[ return to index] [The Action Ukraine Report (AUR) Monitoring Service]
========================================================
9. LET IT FLY: GOVERNMENT SACRIFICES #1 PRIVATE CARRIER
Conflict around Boryspil airport looks like new re-privatization case

ANALYSIS & COMMENTARY: By Roman Bryl, Ukraine Analyst
IntelliNews – Ukraine This Week, Kyiv, Ukraine, Monday, March 6, 2006

The conflict in Boryspil airport appeared in 2004 when Aerosweet airlines
leased and in a short period of time bought 32 hectares of land next to the
main terminal of the international airport. In 2005 the company started to
build its new terminal.

The project costs about USD 100mn. But when Aerosweet had just begun
construction works, the airport administration accused the company of
illegal purchase of the land. One of the reasons of such a reaction was the
airport’s intention to build its own terminal.

Boryspil’s project was financed by Japanese Bank for International
Cooperation. The bank gave the airport a USD 180mn credit for this purpose.
The party began a trial in Kyiv interregional commercial court that on Oct
13, 2005 decided that the land had been purchased legally. The airport
officials appealed to Supreme Commercial Court. On Feb 21 the Court held
hearings on the case but postponed its decision that was expected to be
announced on Mar 9.

Government decides to interfere in dispute, backing Boryspil side —–

The delay can be explained by interference in the dispute of highly ranked
governmental authorities including the president Victor Yuschenko. Starting
Feb 17, airport employees began a series of pickets of the governmental
building under the slogan “State airport should belong to the state”. The
workers passed an open letter to Yuschenko and transport officials to
prevent disposition of the airport’s land to commercial structures ( i.e.
Aerosweet).

In its turn, Aerosweet officials considered such protests as an attempt to
influence government officials. On Feb 20 the transport ministry and the
state service on monitoring aviation safety (Gosaviasluzhba) founded a
special commission to investigate the airport’s activities.

The initial results of the investigation showed that airport officials in
fact have some backing from the government, and Aerosweet had little
chances to win the dispute and return its investments.

Three commissions examine airport’s activity —–

The same day, on Feb 20, secretary of national defense and security council
Anatoliy Kinakh announced that the airport should stay in state property.
Kinakh was unofficially named among the high ranking state officials that
support returning Aerosweet’s land into state ownership. This fact was
indirectly confirmed by another commission for monitoring the airport’s
activity that was formed by MPs.

The parliamentary commission concluded on Feb 24 that the core of the
dispute was the inability of Boryspil authorities to use Japanese credit
funds properly. According to the head of the commission Anatoliy Levin,
airport officials refused to give access to necessary documents and head of
the airport Olexander Shyshkov often threatened Levin. Shyshkov named
Anatoly Kinakh as a backer of Boryspil administration, Levin reported.
Shyshkov is a member of the party that Kinakh heads.

Nevertheless, to avoid speculations that are not confirmed by rock-solid
facts, we should inform that on Feb 27 president Yuschenko set up a
commission to examine Boryspil airport’s activity. Economy minister Arseniy
Yatsenyuk headed the commission. It also includes the transport minister,
internal affairs minister, high ranking representatives of state security
service, and other officials.

The commission plans to examine the airport’s economic activity within two
weeks and develop a concept of its future development. That was already a
third commission created to monitor the airport’s activity. It includes
representatives of the transport ministry and Gosaviasluzhba, the
parliamentary commission and the last one created by the president’s order.

Other side of conflict – Aerosweet – does not exclude leaving airport —–

The first meeting of the commission was scheduled for Mar 3. Before the
meeting, an official from Aerosweet informed that the company examines the
possibility of leaving Boryspil airport and starting building a new separate
terminal in Kyiv region.

Representatives of Aerosweet also informed that they did not want to leave
Boryspil airport because building a new independent terminal will be
1.5-times more expensive. Besides it would take 2-3 years to complete it.

This demarche had its effect. In fact, Boryspil officials did not push the
carrier to leave the airport. Aerosweet brought about UAH 95mn (USD 19mn)
of revenues to Boryspil in 2005. Aerosweet risks losing transit passengers that
make up about 30% of all its passengers. To keep up its transit turnover,
Aerosweet needs to build not an independent terminal, but a whole new
airport and it may cost up to USD 1bn.

EconMin: Kyiv needs two international airports —–

Meanwhile, the state commission supported the idea of building a new
terminal somewhere in Kyiv region. It corresponds to the state’s concept of
creation of two international airports next to Kyiv, economy minister
Arseniy Yatsenyuk said at the commission’s meeting. The ministry can provide
the land for the terminal and propose Aerosweet to take part in a tender to
purchase the land.

Within the project of the second international airport, it could be possible
to realize the idea of building an international cargo airport. That idea is
in line with the presidential task to present a concept of development of
the entire aviation industry, Yatsenyuk said.

Another part of the concept is to give all ineffectively used airports into
concession ownership to foreign and local entities. One of the key
challenges for a potential concessionaire is purchasing domestics planes and
developing domestic routes.

Government orders to complete building new terminal
that is financed by Japan —–

Such long term prospects, on one hand, are the only way to develop the air
transport industry and the Boryspil airport, which are outsiders among
respective industries in Eastern and Central Europe. Not just in terms of
passenger turnover (about 3.9mn passengers passed through Boryspil alone
in 2005), but in terms of service quality and modern infrastructure.

However, attaining these goals needs huge investments. It is doubtful that
Boryspil can manage to attract big investments, taking into consideration
that it failed to use properly USD 180mn Japanese credit. But it still has
time to complete the project. The new terminal financed by the Japanese is
scheduled to be built until 2008. Moreover, the state commission decided to
step up the terminal’s construction.

International airport Boryspil will keep its monopolistic position for the
next several years. As we can see, the commission found its way of resolving
the problem: to hasten spending Japanese money, to leave Aerosweet solve its
problems on its own, and to promise to privatize inefficient airports.

It appears Aerosweet, the largest domestic carrier, became the biggest loser
as result of this decision. The company at present cannot leave Boryspil,
because it has no place to relocate. More obviously, land under its
construction site would be returned to state property.

The company hopes that Supreme Commercial Court will decide on Mar 9
in favor of the carrier. But taking into consideration the government’s
position on the issue, there are little chances Aerosweet will win the case.
We should remember one more thing: Aerosweet is often tied together with
the name of disgraced oligarch Victor Pinchuk.

The state took from him the stake in Kryvorizhstal metallurgical plant. It
also plans to return into state property Nikopol ferroalloy plant that is
also affiliated with Pinchuk. The oligarch recently sold his main financial
asset – Ukrsotsbank to Italian Intesa Banca. And now we’ve got story with
Aerosweet.

Whatever ending the story will have, there is one obvious conclusion.
Boryspil international airport for the next several years will keep its
monopolistic position as the main international gate. That contradicts
government’s intention to boost competition on the air transport market.
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[return to index] [The Action Ukraine Report (AUR) Monitoring Service]
========================================================
10. GENERAL MOTORS LOOKS AT BUYING INTO CAR FACTORY
IN POLAND OWNED BY UKRAINIAN COMPANY AVTOZAZ

By James Mackintosh in London and Tom Warner in Kiev
Financial Times, London, United Kingdom, Tue, March 14 2006

General Motors, the world’s biggest carmaker, is considering taking a
minority stake in a Ukrainian-owned car factory in Poland as part of
negotiations to build Chevrolets at the plant, according to people close to
the talks.

The FSO facility in Warsaw, controlled by Avtozaz of Ukraine since last
year, has the capacity to produce 350,000 cars a year but the plan being
discussed would see it start in the tens of thousands and build up
eventually to about 100,000. The cars would be sold by GM in Europe
through its existing dealer network.

The talks have reached an advanced stage but people close to the two
companies cautioned that Avtozaz was also talking to other carmakers and
the deal had been repeatedly delayed. As well as the option of taking a stake,
GM is considering simply outsourcing production to the FSO factory.

“The Ukrainians have a huge amount of capacity they can’t utilise at the
moment so they are keen to find a partner,” said one person familiar with
the situation. Avtozaz confirmed talks were under way with several carmakers
but refused to give details. GM declined to comment.

GM is understood to be the frontrunner in the bidding, helped by its
contacts with Avtozaz, which assembles Chevrolet models, among others,
at its base in Zaporozhye, Ukraine.

The FSO move would help GM cope with a lack of capacity at the South
Korean factories of its GM Daewoo subsidiary, which has recovered more
quickly than expected since GM took control in October 2002. All the
Chevrolet-badged models sold in Europe are built by GM Daewoo, which
could only increase output at its existing plants by adding night shifts.

GM is also keen to bolster its support for Avtozaz to make up for its
crumbling relationship with Avtovaz, the Russian manufacturer of Ladas.
Avtovaz brought its joint venture factory with GM to a halt last month by
withholding vital components.

While production has restarted, the future of the project remains in doubt.
Chevrolets built by Avtozaz in Ukraine are being shipped to Russia duty
free. It is understood that GM could also re-enter the bidding for a former
Daewoo factory in Romania, which the government is trying to sell.

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[ return to index] [The Action Ukraine Report (AUR) Monitoring Service]
========================================================
11. FORMER HEAVYWEIGHT CHAMP SEEKS NEW LIFE AS
MAYOR OF UKRAINIAN CAPITAL KIEV

By Mara D. Bellaby, AP Worldstream, Kiev, Ukraine, Sun, Mar 12, 2006

KIEV – The former heavyweight boxing champion climbed nimbly onto
the back of a pickup truck as the crowd roared his name. Vitali Klitschko
smiled shyly and took a deep breath. In this fight, Klitschko is the underdog
– a position he’s not used to.

Klitschko is running for mayor of Kiev, the Ukrainian capital, in a contest
that is about housing and garbage collection on the outside, but is also
highly personal, and closely bound up in the Orange Revolution, Ukraine’s
2004 leap into full democracy.

The mayor whose job he wants is a close friend of his, and he is also
running for Parliament in national elections on March 26, the same day as
the mayoral race, heading the candidate list of a new anti-corruption,
pro-Orange Revolution political bloc.

In a field of 41 candidates, most opinion polls give the lead to the
67-year-old incumbent, Oleksandr Omelchenko, a decade in the job and seeking
a third term. Omelchenko leads by 6 percent in most polls, though the latest
reported a dead heat. Most gave a margin of error of two percentage points.

A 34-year-old millionaire, 6 feet 8 inches (2.03 meters) tall and weighing
245 pounds (110.6 kilograms), Klitschko cuts an Arnold Schwarzenegger-like
figure on the campaign trail.

“I’m not here because I need fame or a job,” he told a couple of hundred
Ukrainians – women in head scarves, autograph-hunting boys, black-clad young
men – who turned out to hear him on a cold Saturday morning. “I want to
clear the road for new ideas,” he said, glancing often at prepared notes. “I
want to work for you.”

Most applauded, but some were just there for the autograph of a national
hero. “I don’t know if I’ll vote for him – I just wanted him to sign
something for my son,” said Oleh Mashmanov.

Klitschko “is one of the next generation of politicians,” said analyst
Stanislav Belkovsky at a discussion of those poised to replace the Orange
Revolution leaders whose appeal is already beginning to weaken in this
ex-Soviet republic of 47 million.

“He’s young and by 35 will have learned what Omelchenko won’t be able to
learn by 70,” said Ivan Saliy of the Kiev-based Institute for Ukraine’s
Steady Development. He would be “a mayor with room for growth.”

Klitschko retired unexpectedly from boxing in November after hurting his
knee in training and pulling out of a defense of his WBC heavyweight
champion title. That left his younger brother and fellow boxer, Wladimir,
alone to carry the sporting mantle of “the Klitschko brothers.”

Vitali and Wladimir, sons of a teacher and Air Force officer, rose to fame
not only by pounding their opponents, but also by smashing boxing
stereotypes. Both have Ph.D’s in physical education and sport from Kiev
University, and the elder Klitschko lets it be known that he plays a mean
game of chess and relaxes by reading serious literature.

At the height of the 2004 Orange Revolution mass protests, Vitali Klitschko
wore a small orange sash on his boxing trunks while pummeling British
challenger Danny Williams in Las Vegas, then flew home to take the stage
alongside President-to-be Viktor Yushchenko at the height of the revolution.
Yushchenko made Klitschko an adviser.

In running for mayor of the city of 4 million he is taking on his longtime
friend and former boxing patron. Omelchenko had been quoted as saying the
Klitschko brothers were like sons to him, while Klitschko reportedly
declared that he fought better when Omelchenko was at a match.

That may explain why the race is much more sedate than analysts predicted.

“Klitschko is young and energetic. Ukraine needs people like him,” said
supporter Valentyna Rudenko, 60, waving a small Klitschko campaign flag.
“And he lived in America. I want to live like you do in America. He
understands what that means.”

But that also works against him. At news conferences, he is often asked how
he can run a city that he has spent so little time in recently, having made
his principal home abroad. His preference for speaking Russian rather than
Ukrainian also upsets nationalists eager to shake off a long history of
Russian domination.

Klitschko says he’s learning, and now starts off his speeches in Ukrainian.
He also counters that with his international profile and contact book, he
can promote Kiev’s image abroad and apply solutions that work in other
capitals. -30-
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[return to index] [The Action Ukraine Report (AUR) Monitoring Service]
========================================================
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========================================================
12. TYMOSHENKO BEST-SELLER REKINDLES FIRE OF REVOLUTION
“To Kill Julia,” penned by Yuri Rogoz, a Tymoshenko admirer

Andrew Osborn in Moscow, The Independent
London, United Kingdom, Friday, Mar 10, 2006

She has been named one of the world’s three most powerful women, had
banknotes run off in her honour and inspired a bizarre pornographic film,
but now Julia Tymoshenko, Ukraine’s most glamorous politician, can boast
a new spin-off: a best-selling thriller.

An edgy paperback recounting the events leading up to her dismissal as
primeminister last year and her spectacular fall from grace after Ukraine’s
orange revolution in 2004 mixed with a liberal dash of fiction and
conspiracy theory has become a runaway hit.

Though her advisers are reluctant to admit it, the novel is fuelling what
has already become a powerful cult of personality that can only help her
chances of winning back her job in crunch elections on 26 March.

Ms Tymoshenko, 45, was sacked by her one-time ally President Viktor
Yushchenko last year after he complained that his ministers were spending
more time in-fighting than on delivering the orange revolution’s promises.

Ms Tymoshenko’s critics accused her of spending too much time on
sprucing up her own image and settling personal scores.

Despite attempts at reconciliation, the two revolutionaries have not patched
up their differences and are contesting the parliamentary elections as
rivals.

The book, entitled “To Kill Julia,” makes little effort to conceal its
inspiration, making only minor changes to the surnames of the country’s
leading politicians. Penned by Yuri Rogoz, a Tymoshenko admirer and a
member of her party, it tells the story of a failed attempt to assassinate the
woman who came to be known during the revolution as the orange princess.

Although in real life there was no such attempt, she and her supporters
believe that a clutch of corrupt advisers surrounding Mr Yushchenko
engineered what amounted to her political assassination.

The book was published last month and has been flying off the shelves since,
with Kiev bookshops reporting it to be outselling other titles by a ratio of
20 to one. Its publisher, Folio, has printed 1.7 million copies, the biggest
print run in its history, and has priced the book competitively – at just
$1.

Ms Tymoshenko’s rivals denounced the book as “black PR”, but it has not
harmed her popularity ratings. A poll this month put her support at 29 per
cent, more than Mr Yushchenko, and second only to Viktor Yanukovych,
the presidential contender ousted by the orange revolution.
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========================================================
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========================================================
13. KEEPING DEMOCRACY ALIVE IN UKRAINE
Interview: A key figure in the 2004 revolution, Interior Minister
Yuriy Lutsenko is cleaning up the police force.

By Howard LaFranchi, Staff writer, The Christian Science Monitor
Boston, Massachusetts, Monday, March 13, 2006

WASHINGTON – He was one of the leaders of Ukraine’s 2004 Orange
Revolution, and – by his own account – the first to “pitch a tent” in Kiev’s
central square in 2000 in opposition to the Soviet-era government.

But now as a system insider, Ukraine Interior Minister Yuriy Lutsenko is
discovering firsthand the hard work of building a new democracy. In
Washington recently to advance US-Ukraine cooperation on justice and
international crime, the youthful Mr. Lutsenko says he’s learned that
creating a clean and fair national police force is one of the most important
determinants in a young democracy’s success.

And stepping back to view the press for glasnost in the Middle East, the
appointee of Ukraine President Viktor Yuschenko has some sobering
words for the Bush administration’s democratization enthusiasts.

“I would not like to be the adviser to the US foreign policy on the Middle
East,” he says, “for one thing because I have enough to be preoccupied with
in Ukraine.” But he says any country must have the “spark” inside if
freedom’s fire is to catch and not burn out.

“The support from outside is important – we learned that in the cold days in
the Maidan [Kiev’s central square] in the revolution,” Lutsenko says. “But
to get nine people [out of 10] to join in democracy’s success, you must
first have the one of their own so they know they are not alone.”

Ukraine’s democratization, which became the focus of much of the world in
late 2004 with the eventually successful election of the pro-democracy (and
West-favored) Mr. Yuschenko, will command international attention again
with its March 26 parliamentary elections.

Observers say the polls, which will pit Yuschenko’s pro-reform, pro-Western
forces against the establishment and Moscow-favoring forces of former prime
minister Viktor Yanukovych, will help determine whether Ukraine remains on
its pro-West path.

The year following Yuschenko’s successful campaign – in which he was
poisoned nearly to death, allegedly by pro-old-line forces – has been a
rocky one for Ukraine and its democratization. In September the prime
minister and key figure in the Orange Revolution, Yuliya Tymoshenko, was
dismissed. Winter saw the battle with Russia over natural gas prices, and
early this year the parliament gave the new prime minister a vote of no
confidence, essentially sacking the government and prompting the March
elections.

In a new report, Freedom House says the rough year has left Ukrainians
ambiguous about democratization and disappointed in their new leadership.
And although the pro-democracy organization now lists Ukraine as “free” in
its annual survey of world freedom – it previously listed the former Soviet
satellite as “partly free” – it also sounds alarms over the public’s drift
over the past year.

A recent survey of Ukrainians commissioned by Freedom House finds a high
degree of pessimism about the country’s politicians, with 2 of 3 saying the
country is headed in the wrong direction, and little interest in or
knowledge of new laws that will govern the March elections.

“Recent events in Ukraine confirm that the transition to a more democratic
society is extremely difficult and that the campaign for the parliamentary
elections will be highly charged and competitive,” said Freedom House
executive director Jennifer Windsor in a commentary on the survey. The
poll’s findings, she added, “underscore the importance of further engaging
citizens and ensuring they understand and remain committed to the ongoing
democratization process.”

The sunny Lutsenko, who earned a reputation as an optimistic jokester during
the frigid 2004 pro-democracy vigil, says he understands if there is fatigue
with political tumult. “To be frank, we are tired of passing new exams every
year,” he says, referring to repeated elections.

But he agrees that the public must be engaged, and says the best way he
can help to encourage that as interior minister is by reforming the national
police. “People are feeling more like they are safe at home and on the
street, but they also feel they can… come to us and report problems or
suggest things, so that means there is more trust.”

Ukraine’s first civilian interior minister, Lutsenko rattles off statistics
to demonstrate how crime is down over the last year – and to underscore
his drive to rid the national police of corruption. He has fired 2,500
police, while 1,200 ministry officials are facing criminal charges – ranging
from bribery to fraud and kidnapping. The state has been losing billions of
dollars a year to corruption, he says.

“I think we are succeeding in building a new image for the national police,”
he says. Yet a concern for image does not prompt him to shy away when
asked about human trafficking, an issue that rates high with US officials
and rights groups dealing with Ukraine. “We know there have been and are
a great number of Ukrainian women and even children sold into sexual
slavery,” Lutsenko says.

But recent revelations of a case where police officers joined with criminal
organizations to sell children from small border towns is prompting
Ukrainians to act on the issue, as is a new ministry office focused on human
trafficking, created last year at the US ambassador’s recommendation.

Lutsenko says one key to addressing that problem will be getting tighter
control of Ukraine’s borders, something that requires cooperation from
neighbors. To that end, he’s hoping for a “trilateral” meeting in May of
Ukraine, Russia, and the US.

By then, the March elections will have delivered a fresh reading of
Ukraine’s political mood, and Lutsenko could find himself in different
circumstances – even a different post (though presumably not pitching a
protest tent again in Maidan. Surveys regularly show him to be among the
five most popular political leaders, though Ukrainian bloggers say he
appears to have retreated from the limelight).

But come what may, tilt East or West, Lutsenko says he is confident
democratization will continue. “Ukraine” he says, “has passed the point
of no return from which it could ever fall back.” -30-
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LINK: http://www.csmonitor.com/2006/0314/p04s01-woeu.html
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[ return to index] [The Action Ukraine Report (AUR) Monitoring Service]
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14. UKRAINE PARLIAMENTARY ELECTION ATTRACTING MANY
CANDIDATES WITH SHADY PASTS

Natasha Lisova, AP Worldstream, Kiev, Ukraine, Mon, Mar 13, 2006

KIEV – Ten have criminal records, 37 are under criminal investigation, and
41 await trial. All have been candidates in Ukraine’s March 26 parliamentary
elections.

Critics call the collection of shady characters running in the ballot a
disgrace – and a sign of how little has changed in this ex-Soviet republic
despite the high hopes and lofty promises of the 2004 Orange Revolution,
when hundreds of thousands rallied under the slogan “Criminals in Jail.”

“If you steal a hen or sack of grain from your neighbor, you go to jail, but
if you steal a million you end up in parliament,” lamented Volodymyr
Stretovych, who heads the parliamentary committee against organized crime.

Others counter that the very fact voters are now hearing about a candidate’s
unsavory past is a breakthrough compared to the lengths the government went
in 2004 to hide and then deny the criminal record, which was later wiped
clean, of then-presidential candidate Viktor Yanukovych.

The practice of seeking immunity from prosecution by taking up a
parliamentary seat had become so standard in post-Soviet Ukraine that most
people didn’t pay any attention.

But that changed after the Orange Revolution and President Viktor
Yushchenko’s promise to clean up dirty politics.

Ukrainian Interior Minister Yuriy Lutsenko, whose office is responsible for
checking candidate lists to find those with criminal records, went public
with the findings last month.

He said his office has no questions about the candidates of only 11 out of
the 45 parties taking part in the election. Among the parties with some
questionable candidates are Yushchenko’s party and the one led by former
Orange Revolution heroine Yulia Tymoshenko.

But Lutsenko’s decision to single out opposition parties for stronger
criticism has drawn charges of politicking, particularly after he declared
that 25 percent of the Yanukovych party list are “my clients” – a
tongue-in-cheek reference to people of interest to the police. He did not
back up his allegations.

“Lutsenko is just making many groundless accusations as he himself
campaigns,” said Yanukovych’s ally, Taras Chornovil.
Natalia Vytrenko, leader of the People’s Opposition party, sued the interior
minister after he said that two candidates on her party list were wanted by
Interpol.

She won. A Kiev court barred the minister from discussing personal and
political issues regarding her party candidates, though the court didn’t
dismiss the actual allegation. Lutsenko has appealed the decision, insisting
that he has a right to inform society about who is running.

Some politicians say they have been unfairly snared in the movement to
expose alleged criminal candidates. Andriy Shkil, an ally of Tymoshenko,
acknowledged his name is on the list _ but it’s for a public disorder case
he calls politically charged since it was opened in 2001 during a mass
protest against then-President Leonid Kuchma.

Ukraine’s Central Election Commission said that according to Ukrainian law,
anyone with a criminal record can’t run for parliament. Those with cases
pending are not affected.

Yaroslav Davydovych said eight of the 10 candidates with criminal records
identified by the Interior Ministry have been struck off the ballot. The
other two are in the process of being removed.

Most of the 37 criminal investigations allegedly concern corruption and
economics crimes, but exact details haven’t been made public. Many
Ukrainians believe that the revelations in 2004 about Yanukovych’s earlier
convictions helped swing support to Yushchenko – and gave political parties
the impetus to pursue their rivals’ buried pasts.

Yanukovych was sentenced to three years in prison for robbery and assault in
1967, at age 17, but was released because he was a juvenile. The conviction
was annulled when the alleged victim withdrew his statement. In 1970,
Yanukovych was sentenced to two years in prison for an assault and battery,
but again the alleged victim withdrew testimony and the case was killed.

Yevhen Poberezhniy, a member of the Ukraine’s Voters advocacy group,
defended the drive to release as much information as possible, saying
Ukrainians have a right to know all they can about people for whom they are
voting. “Parties bear responsibility before voters for the criminal past of
people in their lists,” he said. -30-
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15. OUR UKRAINE BLOC BROADCAST PORTRAYS PARTY OF REGIONS
PARLIAMENTARY CANDIDATES AS CRIMINALS SEEKING IMMUNITY

UT1, Kiev, in Ukrainian 1700 gmt 10 Mar 06
BBC Monitoring Service, UK, in English, Sat, Mar 11, 2006

An election broadcast by the propresidential Our Ukraine Bloc has accused
the opposition Party of Regions, which is leading in opinion polls, of
intimidating residents of Donetsk, the party’s stronghold, and using force
against Our Ukraine Bloc campaigners in eastern Ukraine ahead of the 26
March parliamentary election.

The 30-minute broadcast, which was aired on 10 March under the quota
allocated to all election runners, portrayed Party of Regions candidates as
criminals seeking MP and local councillors’ immunity.

The broadcast indirectly linked the party’s influential tycoon Rinat
Akhmetov to a “wave of criminal infighting” in Donetsk Region aimed to
redistribute the spheres of influence in the early 1990s.

The following is an excerpt from the Our Ukraine Bloc’s election broadcast
shown on the Ukrainian state-owned television UT1 on 10 March; subheadings
have been inserted editorially:

[Voice-over, music playing, video shows a crowd of people on a square
throwing orange flags and leaflets on the ground and setting them on fire]
These clips have been filmed not during the 2004 [presidential] election
campaign. These events took place not under the former administration, which
tried to eliminate the then opposition Our Ukraine bloc. These clips were
filmed in February 2006.

A crowd of supporters of [opposition Party of Regions leader] Viktor
Yanukovych destroyed [Our Ukraine’s] orange tents and campaign materials
before his arrival. The situation repeated itself in Kherson. [Passage
omitted: Our Ukraine’s tent destroyed, a campaigner attacked in Kherson]

Pictures of this kind can be seen in many regions where Yanukovych and the
Party of Regions still enjoy support. Donetsk Region is a stronghold of this
political force. The most dramatic events are happening here, much like
during the presidential election in 2004.

[Passage omitted: Our Ukraine activist Anton Klymenko from Donetsk says
that Our Ukraine supporters were beaten up in 2004, and that the local
authorities are almost the same in Donetsk.]

[Voice-over] The [current] open and democratic parliamentary election
campaign is not to the liking of the criminal structures which have
dominated Donetsk Region for decades. Attacks on Our Ukraine
campaigners are common here.

[Anton Klymenko, Our Ukraine Bloc, Donetsk] Every day, we have from
three to seven instances when thugs simply drive up to campaign tents,
brutally tear them up like beasts, and beat up all the people inside.
OUT UKRAINE BLOC ACTIVISTS REPORTEDLY ATTACKED
[Voice-over] During the week from 12 to 20 February, 14 brutal attacks on
campaigners were made, excluding petty provocation acts. On Donetsk’s
central Lenin Square on 19 February, a woman was brutally beaten up and her
mouth was torn up just because she took Our Ukraine’s campaign leaflet in an
orange tent. The woman was too afraid to speak about this. Fear has come
back to Donetsk Region.

[Serhiy Osyka, captioned as lawyer, Donetsk, in Russian] There was a thaw,
that is, people stopped being afraid. People hoped for changes. But now the
Party of Regions wants to take revenge and to remain in its stronghold – in
Donetsk. People who still had hopes have now began fearing that the Party of
Regions will come and will revenge itself on those who did not support them
at the election.

[Passage omitted: An uncaptioned woman describes an attack on an orange tent
and on two girls campaigning for the Our Ukraine Bloc in the town of
Vuhledar in Donetsk Region.]

[Voice-over] The division into us and them has remained in Donetsk Region
since the 2004 election. The Party of Regions, many members of which running
for parliament are registered in Donetsk Region, is dividing Ukraine by its
deeds and not by words.

[Rinat Akhmetov, captioned as number seven on the Party of Regions election
list, in Russian] I am often asked what I can wish to western Ukraine. The
answer is simple. [I can wish] The same thing as to eastern Ukraine.

[Voice-over] This is a Donetsk suburb and this
is a district in Makiyivka, whose former mayor Vasyl Dzharty is running for
parliament as No22 on the Party of Regions election list. His reputation of
a certain type made him famous in the town long before he had become mayor.
When he was mayor, he became known for eliminating a trolleybus route for
people to use private [and more expensive] vans.

This is a region of contrasts. On the one hand, there are billionaires and
multimillionaires united by joint business and political interests.

[Video shows Donetsk Mayor Oleksandr Lukyanchenko and Donetsk regional
council head Borys Kolesnykov, who is No 10 on the Party of Regions election
list, sitting in a hall packed with people, and Akhmetov’s face.]

On the other hand, there are residents of depressed towns who lost their
means of existence after mines and a number of plants were shut down.

On the one hand, huge industrial potential, which can bring and is bringing
superprofits to its owners, is concentrated here. On the other, lossmaking
mines, for which dozens of millions of hryvnyas in subsidies are earmarked
from the state budget, are operating here.

Poverty has always been here, and it continues to exist even though the
richest man in Donetsk and Ukraine and a businessman running for parliament
on the Party of Regions election list, Rinat Akhmetov, is well aware what ds
poverty is like.

[Passage omitted: excerpt from Akhmetov’s speech at a meeting with voters in
Donetsk on 19 February; Akhmetov is shown saying he is of a humble origin.]
AKHMETOV AND “CRIMINAL INFIGHTING” IN THE EARLY 1990s
[Voice-over] How the Party of Regions’ richest man has fought poverty is a
separate story. In the early 1990s, a real war for profitable metallurgical
plants, mines and spheres of influence in other sectors was launched in
Donetsk Region. Criminal groups emerged one by one. They were often
engaged in fighting in town centres using assault rifles. A wave of criminal
infighting swept Donetsk in the early and mid-1990s. [Video shows a
collection of knives, handcuffs, pistols and rifles on the floor.]

[Mykhaylo Klyuyev, captioned as head of the Interior Ministry directorate in
Donetsk Region, in Russian] During the period of 1990-2002, members of a
criminal gang committed a series of audacious high-profile ordered killings
and used firearms while dividing the criminal spheres of influence in
Donetsk Region and in other Ukrainian regions, and also in the CIS
countries.

[Voice-over] On 15 October 1995, a horrible explosion shook the Shahtar
stadium [in Donetsk]. [Then president of the Shakhtar football club, Akhat]
Brahin was killed. [Video shows a stadium and people’s bodies scattered
around.]

Akhmetov took his place and became the richest man or, as they say in
Donetsk Region, the master of [eastern Ukrainian coal mining region]
Donbass. Simultaneously, a criminal group led by Givi Nemsadze was being
formed. It existed until recently.

[Klyuyev] The criminal group of Nemsadze was completely formed in 1995.
Roles and duties were assigned to the gangsters. The gang was divided into
two. One was involved in crimes of a general criminal nature, the other
controlled financial and economic activities of various commercial
structures, including those created by the gang itself. The gangsters own
over 200 companies in the city of Donetsk and in other Ukrainian regions.

[Voice-over] The gang began acting actively. Shadow business turned out to
be too narrow for it. The former government began cooperating with it.

[Klyuyev] The above criminal gang created criminal ties with public servants
at different levels, with MPs and with various law-enforcement agencies.

[Voice-over] Criminals have been ruling in the region since the beginning of
the new century. Nothing is happening here without permission from the
criminal structures. The disobedient are simply killed – mercilessly.

The year of 2005 – you can see excavations of a mass grave on these
pictures. The investigators managed to find the materials thanks to which
they seized the Nemsadze gangsters, who showed them the place where they
buried the corpses of the people who, until recently, were believed to be
missing.

[Video shows a long wooden staircase leading into a deep hole in the ground,
and remnants of human bodies lying around.]

[Klyuyev] There are documents confirming that 57 people were killed by this
gang. These include 25 businessmen, 19 rival gangsters, and eight gangsters
from this same criminal group who were killed for betrayal. Five people were
killed to intimidate the public.

[Video shows a skull and bones on the ground, a man taking out a black bag
out of a hole in the ground, and weapons lying on the ground.]

[Voice-over] This is a terrible trace left by criminals and by a government
which was controlled by the criminals, the government that we managed to
topple in 2004. After that the fight against criminals, which the Party of
Regions described as persecution for political reasons, has been launched.

These people now want to come back and rule Ukraine again.
PARTY OF REGIONS CANDIDATES SAID TO SEEK PM IMMUNITY
This is the Party of Regions election list. [Video shows a list of names.]
It includes 22 individuals against whom criminal cases were opened or who
were convicted. Here are the brightest representatives.

Oleksandr Darda, No 89, was sentenced for robbery and illegal carrying of
weapons to three years and six months in prison by the Makiyivka town court
in 1977.

Serhiy Malyarenko, No 230, was sentenced for robbery to two years in prison
in 1982.

Anatoliy Savchuk, No 316, was sentenced for extortion to three years and six
months in prison with confiscation of property by the Zhytomyr regional
court in 1997.

Serhiy Horbach, No 261, was sentenced for fraud to five years in prison in
2003.

Volodymyr Vinnychenko, No 290, was sentenced for tax evasion to three years
in prison in 1997.

Oleh Kuts, No 333, was sentenced for corruption to two years of a restraint
of liberty in 2001.

Lyubov Bila, No 351, was sentenced for forgery and abuse of office to two
years in prison with confiscation of property by the Dnipropetrovsk regional
court in 2001.

Finally, Viktor Yanukovych, number one, was convicted twice, in 1967 and
1970, for robbery and deliberate infliction of bodily injury of medium
gravity respectively, to five years in prison in total.

Number 96 on the Party of Regions election list is former Ukrainian
Prosecutor-General Svyatoslav Piskun. He was prosecutor-general in 2002,
2003 and 2005. Isn’t it because of this that his neighbours on the party’s
election list feel impunity? That’s a bright list.

When Yanukovych was asked about the criminals on the election list, he
declined to comment.

[Yanukovych, in Russian] That is not what people want. People want no PR
campaigns. People need real deeds. We need to deal with the economy. We need
to think about how to live in our country, how to build it and how to secure
the future for our children.

[Voice-over] So are these the people who will think about how the country
should live and what kind of country should be built? What kind of future
can the criminals offer to children? And what kind of country will they
build? Ukraine once refused to have a future of this kind in 2004, when
Yanukovych wanted to become president.

[Video shows a young man destroying an Our Ukraine hoarding under cheerful
cries of a crowd of young girls.]
PARTY CANDIDATES SEEK LOCAL COUNCILLORS’ IMMUNITY
The Party of Regions has criminals not only on its parliamentary election
list. Individuals with the [criminal] past are also running for local
government bodies.

Vadym Volkanov, who was first deputy mayor of Kirovohrad until recently, is
now running for the [Kirovohrad] regional council as one of the first ten on
the Party of Regions election list.

These pictures were made in 1997 when Volkanov was detained for racket. He
was detained for racket more than once. In April 1997, Volkanov and his gang
were caught red-handed following a statement by a businessman who received
threats from the criminal gang.

During the search, policemen seized from Volkanov a false identity card of a
member of the association of former officers of the Interior Ministry and
the SBU [Security Service of Ukraine], stating that all law-enforcement
bodies should help the owner of the identity card. But Volkanov was released
time and again, because he had high-ranking patrons at the time.

[Video shows masked special-task policemen pointing their guns at men lying
on the ground, a man being escorted by two masked policemen, and masked
policemen searching a man in front of a car.]

Soon afterwards, Volkanov became deputy mayor of Kirovohrad. It was under
his management that massive vote rigging took place at the No 100
constituency in Kirovohrad during the presidential election, which became
known all over Ukraine in 2004. Now he is running for the regional council
on the Party of Regions list.

The list of those running for Crimean parliament under the name of Viktor
Yanukovych includes a Melnyk, a convict who spent a year and a half in
prison.

[Interior Minister Yuriy Lutsenko, in Russian] He is a member of an
organized criminal group, Seylem. [Shows a picture of four men sitting at a
table and drinking] Here are the [photos] of him having a party with comrade
Voronok, who is a well-known leader of the Seylem group. I think there is no
special need to tell you, the Crimeans, what sort of person Melnyk is.

[Voice-over] Here is Melnyk with the criminal authority Voronok. The Crimean
criminal groups Seylem and Bashmaki are really well-known all over Crimea.
They are responsible for numerous murders, racketeering, blackmailing and so
on. This has been the case throughout Ukraine.

The Party of Regions is not shy of having people who want to get deputy
immunity among its ranks. It was not for nothing that this political force
was so active in 2005 in defending introduction of deputy immunity for local
councillors [in addition to MP immunity].

They badly need to conceal criminals from punishment that they deserve, to
bring these people to power and take revenge, which may turn out to be too
severe for Ukraine.

[Video shows a killed man sitting in a car, holes in a car window, blood on
the ground behind a car, ammunition, and a diver coming out of water with a
rifle in his hands.]

[Passage omitted: The same woman activist complains of the lack of freedom
in Donetsk Region; Osyka says local residents are afraid of attending Our
Ukraine rallies; Klymenko says it is untrue that the whole of Donetsk Region
supports the Party of Regions.]
PARLIMENTARY ELECTION IS A “SECOND TEST” FOR UKRAINE
[Voice-over] What will Ukraine be like if individuals with overt criminal
past, who are telling people overt lies that they alone can improve their
lives now, come to power [reference to a Party of Regions campaign slogan]?

In the past years, they have only managed to build business empires with
blood, tears and fear; to intimidate the region they came from; to reduce
people to poverty and slavery; and to leave them without any alternative or
opportunity to make a choice. They are preparing vote rigging in the region
under their control by intimidating members of election commissions.

Activists of the Our Ukraine Bloc, much like during the presidential
election campaign, are resisting crude force. They are not alone. Ukraine is
awakening again, in the same way as during the Orange Revolution. It opens
its eyes again.

For once, Ukrainians seriously repulsed criminals and their henchmen, who
were thrown out of the government. But they kept quiet, and are once again
rising their heads, calling themselves the opposition.

The time has come for Ukraine to stand a second test, which is no less
serious than in autumn 2004, when people said no to criminals. If this
choice is not confirmed, Ukraine may again immerse in the years of darkness,
fear and bloodshed.

[Archive video shows clips from the 2004 presidential election campaign, a
collection of knives, blood behind a car on the ground, shabby apartment
blocks, Yanukovych getting out of a bus and falling to the ground when hit
by an egg during the 2004 election campaign, and footage of the Orange
Revolution; the video is accompanied by a song people sang on Kiev’s
Independence Square during the Orange Revolution.]
——————————————————————————————-
[ return to index] [The Action Ukraine Report (AUR) Monitoring Service]
========================================================
16. GRAND COALITION: UKRAINE’S SALVATION

OP-ED: By John B. Conlan, Kyiv Post
Kyiv, Ukraine, Wednesday, Mar 08 2006

If Ukraine is to get out of its political and economic mess, the three major
political leaders in the country – President Viktor Yushchenko, former Prime
Minister Yulia Tymoshenko and Donetsk-based business leader Renat
Akhmetov, need to think “outside the boxes” of their selfish associates and
form the new Parliament and Cabinet via a Grand Coalition.

The Orange Coalition parties will not have enough votes to form a majority
in Parliament and elect a Cabinet without taking in Oleksandr Moroz’
Socialists and Speaker Volodymyr Lytvyn’s list.

If they take in these political camps, the majority will not be stable and
homogeneous in strategic policies. Their presence in a coalition will
prevent economic and governmental reforms needed in agriculture, health,
education, taxes, etc.

The Socialists would block speedy privatization of most state enterprises
that desperately need foreign capital and know-how required to create jobs
and survive in this new era of global competition, and would muddle foreign
and national security policies.

A dual alliance between the Akhmetov-controlled Regions of Ukraine and
Yushchenko’s Our Ukraine or Tymoshenko’s party would be fatal for either
of the Orange parties. Orange voters would be aghast and outraged if either
party joined Regions alone and left the other Orange branch outside.
Moreover, support for Ukraine from the United States and Europe would
rapidly cool.

While Regions members operate closely with Our Ukraine’s financial clan
members, Our Ukraine’s democratic reform plurality would rebel before the
end of 2006 if they were trapped in a coalition of majority Regions members.
Such an uprising would collapse Parliament’s majority and Cabinet.

Moreover, leaving the talented Yulia Tymoshenko in opposition would be
suicide.

An embittered, rejected woman with brains and clever one-liners would chop
them all to pieces. A consideration of these and other factors leads to
several conclusions:

A. Ukraine needs Parliament and Cabinet stability for 4-5 years in order to
rapidly grow its economy, create millions of new jobs, raise living
standards, and secure the independence of Ukraine from preying neighbors.
Ukraine can not survive if it has further turnover in Cabinets and continued
mismanagement, inefficiency, and large-scale corruption in leading
government circles.

B. Akhmetov needs Euro-Atlantic capital, markets, and respectability if he
wishes to emerge as an admired and elected national leader. He is using
Euro-U.S. business experts to create models of efficiency and transparency.

He is clearly interested in separating his businesses and himself from a
controversial past, hoping to take Systems Capital Management, his primary
business holding, and other companies, public on the London and New York
Stock Exchanges.

C. Yushchenko needs a stable Parliament and Cabinet that will sustain and
protect him for the rest of his term, lest the Presidency become quite
ineffective or impeached.

D. Tymoshenko, the best communicator in national politics, needs a position
where she has a chance to prove herself fairly, free of back-stabbing
allies. A woman in a “safe marriage” can be most cooperative, stable and
very helpful.

Critics justly say the Regions Party includes some unsavory persons, but Our
Ukraine and Tymoshenko’s Byut bloc lists don’t have many virgins either.

Akhmetov would become the new “Renaissance Man” to lead Ukraine out
of chaos and into a progressive future by forming a center-right “Grand
Patriotic Coalition” of some 330 members from Regions, Our Ukraine,
Tymoshenko’s Fatherland party, and Pora/Reforms & Order, assuming the
latter passes the three percent barrier.

Such a teaming would, of course, include policy and personnel concessions,
including an end to any further East-West tensions, separatism and language
issues. A gentlemen’s agreement forgiving financial transgressions and
improper privatizations would be necessary.

This de-facto amnesty would not serve true justice as Tymoshenko has
called for, but it would serve peaceful reconciliation, if accompanied by
the following: Repealing the October 2005 law granting immunity from
criminal prosecution to some 200,000 local officials; and repealing the two
Constitutional sections which give criminal immunity to all Parliament
members and Judges.

Putting the past behind us, but making every citizen obey the laws and pay
their full taxes from hereon forward, would gain public and international
admiration and unite a stable super-majority in Parliament that can
implement needed reforms. Reforming the corruption-ridden Judiciary, by
implementing testing for judges and replacing incompetent judges must be
included in the package.

Such an agreement should also include ending the moratorium on sale and
purchase of agricultural lands, and selling off almost all state businesses
and factories. The cash raised needs to be used to build infrastructure,
communal utilities and housing throughout Ukraine, creating tens of
thousands of new jobs. Privatization would not only weed out corruption
in state-owned enterprises, it would also bring in billions to revamp these
businesses and boost tax revenues.

The coalition agreement would have to state that while Ukraine will always
have significant trade and cultural relations with countries to the east,
the country’s future lies in revamping its systems to Euro-Atlantic
standards. The agreement would obviate a referendum on Constitutional change
implemented in December 2004, while advancing other needed constitutional
amendments and laws.

If Akhmetov can get the Regions of Ukraine bloc to back such a package deal,
Yushchenko and Tymoshenko would have to agree and all their reputations
would soar. A Grand National Coalition would then look like this:

President: Yushchenko, supported by stable Parliament and Cabinet for 4
more years.

Premier: Tymoshenko or a Regions of Ukraine choice, with either surrounded
by coalition Ministers.

Parliament Speaker: a Regions of Ukraine choice or Tymoshenko, with
Our Ukraine leader Mykola Katerynchuk as her 1st deputy.

Bingo! Ukraine’s economy would take off with a regionally and politically
balanced Cabinet of professionals operating stably for several years to the
next elections. The public will be pleased, business and international
investors enthralled, and Russia and Euro-Americans and world media will
be willing to work with a stable country. -30-
————————————————————————————————
Hon. Dr. John B. Conlan, is former U.S. Congressman, a long-time
investment advisor living in Kyiv, and well-versed in Ukraine politics.
————————————————————————————————-
LINK: http://www.kyivpost.com/opinion/oped/23992/
——————————————————————————————-
[return to index] [The Action Ukraine Report (AUR) Monitoring Service]
========================================================
17. UKRAINIAN PARLIAMENTARY CAMPAIGN DIGEST: MAR 5-12

BBC Monitoring research in English 12 Mar 06
BBC Monitoring Service, United Kingdom;, Sunday, Mar 12, 2006

The propresidential Our Ukraine bloc ran a hard-hitting election broadcast
attacking the opposition Party of Regions on state TV. Donetsk-businessman
Rinat Akhmetov, who is running for parliament on the Party of Regions list,
was called as a witness in a high-profile murder case. The Party of Regions
accused the authorities of planning steep price rises after the election.

A number of representatives of the authorities alleged that they were
victims of wiretapping by the Security Service of Ukraine when it was headed
by Oleksandr Turchynov, now the campaign manager of the Yuliya Tymoshenko
Bloc. Pollsters presented their final results before a ban on publication of
poll data came into force after 10 March.

The following is a digest of Ukrainian parliamentary election campaign
developments in the week of 5-12 March 2006:
OUR UKRAINE-PARTY OF REGIONS FEUD
An election broadcast by the propresidential Our Ukraine Bloc accused the
opposition Party of Regions of intimidating the residents of its Donbass
stronghold and using force against Our Ukraine campaigners in eastern
Ukraine.

The 30-minute broadcast suggested that a number of Party of Regions
candidates have “an overt criminal past” and are seeking immunity from
prosecution in parliament or on local councils.

The broadcast described the party’s most influential figure, tycoon Rinat
Akhmetov, as the “master” of Donbass. It described a “wave of criminal
warfare” in the region in the early 1990s which was aimed at gaining control
over “profitable metallurgical plants, mines and spheres of influence in
other sectors”.

The broadcast included graphic footage of the remains of victims of a
criminal gang said to be linked to the former authorities being recovered
from an abandoned mine in 2005. (UT1, Kiev, in Ukrainian 1700 gmt 10
Mar 06)

The Donetsk court of appeals ruled that about 20 witnesses, including Rinat
Akhmetov, should be brought to court by police to give evidence in the trial
of a former police officer accused of causing the explosion at the Shakhtar
stadium in Donetsk in October 1995, which killed Akhmetov’s predecessor as
president of the Shakhtar football club, Akhat Brahin. (One Plus One TV,
Kiev, in Ukrainian 1730 gmt 6 Mar 06)

An election advertisement of the opposition Party of Regions warned that
the authorities are planning huge price increases after the election and that
“heating will be too expensive for ordinary Ukrainians”. (One Plus One TV,
Kiev, in Ukrainian 1630 gmt 8 Mar 06)

Speaking at a news conference in Lutsk, Prime Minister Yuriy Yekhanurov
described election advertising about imminent price rises as “scare
stories”. Yekhanurov asked journalists to reassure the public and refrain
from fuelling an artificial panic over rising prices for sugar, potatoes and
vegetables. (UNIAN news agency, Kiev, in Ukrainian 1548 gmt 10 Mar 06)
EAVESDROPPING SCANDAL
Interior Minister Yuriy Lutsenko said in an interview with an analytical
weekly that the Prosecutor-General’s Office had opened a criminal case over
wiretapping of his conversations as well as those of the presidents of
Ukraine, Russia and Turkmenistan by the Security Service of Ukraine (SBU),
when it was headed by Oleksandr Turchynov, who is now the campaign chief of
former Prime Minister Yuliya Tymoshenko’s bloc. (Zerkalo Nedeli, Kiev, in
Russian 4 Mar 06)

Turchynov described Lutsenko’s statements as “nonsense” and “blatant lies”
and said he is planning to sue Lutsenko for libel. He insisted that, under
his leadership, the SBU worked within the bounds of the law and the
constitution, and did not engage in illegal surveillance of politicians,
state officials or interstate conversations. “All this is simple lies and
pre-election provocation,” Turchynov said. (Interfax-Ukraine news agency,
Kiev, in Russian 1755 gmt 5 Mar 06)

Former Deputy Prime Minister Roman Bezsmertnyy, the campaign manager of
the pro-presidential Our Ukraine bloc, said in a TV interview that he had seen
transcripts of conversations that allegedly took place in the offices of
former National Security and Defence Council Secretary Petro Poroshenko,
former Justice Minister Roman Zvarych, and some ambassadors.

Bezsmertnyy said that the transcripts “had long been making rounds from
office to office”, but that he was unable to prove this. He said that after
Turchynov’s dismissal in September 2005 “a great deal of computer material
was destroyed, but some fragments did remain”. (NTN, Kiev, in Ukrainian 1730
gmt 5 Mar 06)

Zvarych, who is Our Ukraine’s deputy campaign manager, said during a chat
show on One Plus One TV that he had been summoned to the
Prosecutor-General’s Office on 9 March in connection with the wiretapping
case and was given the status of victim.

“I state that I was bugged when I was justice minister, and I also state
that this was done by the SBU under Oleksandr Turchynov,” he said.
Turchynov, who was also a guest on the show, denied this. (Ukrayinska
Pravda website, Kiev, in Ukrainian 10 Mar 06)

The head of the presidential secretariat, Oleh Rybachuk, said that
Turchynov’s successor, Ihor Drizhchanyy, had confirmed that there had been
several cases of wiretapping by the SBU “after the orange team came to power
and the new government had been working for several months”. (TV 5 Kanal,
Kiev, in Ukrainian 1400 gmt 11 Mar 06)
COALITIONS
Our Ukraine campaign manager Roman Bezsmertnyy said that the new parliament
may be dissolved if a propresidential coalition is not created after the
election. Bezsmertnyy said that former Prime Minister Yuliya Tymoshenko “has
no other option but to sign an agreement in the framework of an Orange
coalition. And if she does not, the only remaining option is to dissolve
parliament”.

Bezsmertnyy dismissed suggestions that Our Ukraine is engaged in secret
negotiations with the Party of Regions. (NTN, Kiev, in Ukrainian 1730 gmt 5
Mar 06)

President Viktor Yushchenko said during a TV interview that he favours Prime
Minister Yuriy Yekhanurov continuing in the post after the election.
Yushchenko praised Yekhanurov as a “rational prime minister” who was able to
reverse negative economic trends observed under his predecessor, Yuliya
Tymoshenko.

Yushchenko rejected Tymoshenko’s campaign slogan calling for Ukrainians to
go to the polls to vote for the new prime minister. Yushchenko said that the
coming election “is not the election of a chancellor or prime minister”.
(UT1, Kiev, in Ukrainian 1920 gmt 6 Mar 06)

Tymoshenko agreed to a secret deal to join an Orange coalition in the future
parliament after Yushchenko agreed to her demand to drop the Swiss-based gas
intermediary Rosukrenergo as supplier of Russian and Central Asian gas to
Ukraine, a business daily reported quoting a source in the presidential
secretariat. (Kommersant-Ukraina, Kiev, in Russian 7 Mar 06)

Tymoshenko said during a TV interview that she will do her best to prevent
the pro-presidential Our Ukraine bloc and opposition Party of Regions
forming a coalition.

Tymoshenko insisted that she is not competing with President Viktor
Yushchenko in the parliamentary election, but she reiterated her opposition
to a number of his close allies running on the Our Ukraine list, including
Bezsmertnyy, former National Security and Defence Council Secretary Petro
Poroshenko, former Emergencies Minister Davyd Zhvaniya, Zaporizhzhya
governor and former Transport Minister Yevhen Chervonenko, Our Ukraine
parliament faction leader Mykola Martynenko, and former first presidential
aide Oleksandr Tretyakov. (Inter TV, Kiev, in Ukrainian 1900 gmt 9 Mar 06)

After meeting Lithuanian President Valdas Adamkus in Kiev, Yushchenko said
that forces representing the comeback of the old authorities will poll a
maximum of 30-35 per cent. He said the most important thing is to find a
formula for the consolidation of democratic forces. (UT1, Kiev, in Ukrainian
1900 gmt 11 Mar 06)

Yekhanurov, who is number one on the Our Ukraine bloc list, said that he
does not believe that a coalition with the Yuliya Tymoshenko Bloc will be
created. Yekhanurov attributed the Party of Regions’ lead in opinion polls
to the authorities’ mistakes in personnel policy and their failure to
complete the process of bringing representatives of the former authorities
to account. (Inter TV, Kiev, in Ukrainian 1800 gmt 11 Mar 06)
ELECTION PREPARATIONS
Central Electoral Commission head Yaroslav Davydovych warned that the
election process may be disrupted in some areas since district election
commissions were short of over 10,000 members just 20 days before the
parliamentary election.

Davydovych urged parliament to amend election legislation to allow executive
bodies to appoint members of polling station commissions. Currently, this is
up to political forces only. (ICTV television, Kiev, in Ukrainian 1645 gmt 6
Mar 06)

During a meeting with President Viktor Yushchenko, the head of the OSCE
mission for the observation of parliamentary elections in Ukraine, Lubomir
Kopaj, expressed concern over the formation of district electoral
commissions and hoped that the issue would be settled soon.

Kopaj said that the election campaign is proceeding in a calm manner, while
the OSCE’s monitoring shows that TV and radio audiences receive a broad
range of information about election participants from mass media.

He said that election participants have access to mass media, while the
Central Electoral Commission acts in a “professional and open” manner.
(Interfax-Ukraine news agency, Kiev, in Russian 1335 gmt 7 Mar 06)

Deputy Foreign Minister Mykola Maymeskul has said that Moldova cannot
guarantee that voting in the Ukrainian parliamentary election in the
breakaway Dniester region will not be disrupted. The Moldovan Foreign
Ministry has said that it is very difficult to ensure a smooth vote in a
country where a state of emergency is in effect. (NTN, Kiev, in Ukrainian
1500 gmt 9 Mar 06)
LAW AND ORDER
The public reception office of MP and Lviv mayoral candidate Petro Pysarchuk
(Party of Regions) was set alight on 7 March. The fire destroyed all office
equipment and documents, and seriously damaged the building. Lviv police
also reported that an activist working for Pysarchuk was attacked and beaten
up in Lviv on 4 March. (UNIAN news agency, Kiev, in Ukrainian 0655 gmt 7
Mar 06)

The Communist Party’s Lviv Region election HQ was pelted with stones on the
night of 4-5 March. The secretary of the Lviv Region Communist Party
committee, Taras Sapuha, said that windows were smashed, and the walls and
furniture were damaged. ( UNIAN news agency, Kiev, in Ukrainian 1117 gmt 6
Mar 06)
POLLS
A number of pollsters announced their latest results on 10 March, the last
day when poll results can be made public. The Democratic Initiatives
Foundation polled 2,009 respondents on 26 February-6 March.

The following figures are percentage of those who are going to vote on 26
March: Regions of Ukraine, 30.4 per cent; Our Ukraine, 17.1 per cent; Yuliya
Tymoshenko Bloc, 16.9 per cent; Socialist Party, 5.4 per cent; Communist
Party, 3.7 per cent; People’s Bloc of Lytvyn 3.4 per cent; Pora-Reforms and
Order, 2.3 per cent; People’s Opposition Bloc of Vitrenko 1.8 per cent;
Viche 1.7 per cent; against all, 2.1 per cent; undecided, 8.1 per cent.

The sample error did not exceed 2.2 per cent, the agency said. (UNIAN news
agency, Kiev, in Ukrainian 1241 gmt 10 Mar 06)

The Kiev International Institute of Sociology polled 2,011 respondents on 25
February-5 March. The report did not specify whether the following figures
represent the percentage of eligible voters or only of those who are going
to vote: Party of Regions, 36.2 per cent; Our Ukraine, 20.9 per cent; Yuliya
Tymoshenko Bloc, 14.3 per cent; Socialist Party, 6.4 per cent; Communist
Party, 3.9 per cent; People’s Bloc of Lytvyn, 2.5 per cent; Pora-Reforms and
Order, 2.2 per cent; People’s Opposition Bloc of Nataliya Vitrenko, 1.3 per
cent.

The sample error did not exceed 2.3 per cent. (Interfax-Ukraine news agency,
Kiev, in Ukrainian 1352 gmt 10 Mar 06) -30-
————————————————————————————————-
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18 . JUDGES, POLITICS AND ELECTIONS IN UKRAINE
Despite legal prohibition some judges are running for Parliament

ANALYSIS & COMMENTARY: by Judge Bohdan A. Futey
Zerkalo Nedeli on the Web, Mirror-Weekly, No. 8 (587)
International Social Political Weekly, Article in Ukrainian
Kyiv, Ukraine, Saturday, 4-10, March, 2006
The Action Ukraine Report (AUR) #673, Article 18, in English
Washington, D.C., Tuesday, March 14, 2006

Over the past several months, there have been numerous newspaper
accounts of the upcoming elections and the crisis of the Constitutional
Court of Ukraine. Despite the Constitutional and legal prohibition on
political activity by judges[1], some judges are nonetheless running for
Parliament on party lists in the upcoming election.

In addition, it appears unlikely that a quorum will exist in the
Constitutional Court before the parliamentary election on March 26.
Although these issues have been addressed before,[2] there are some
matters worth repeating because Parliament has not acted to remedy the
situation.

Under the Constitution and the law, in order to avoid potential conflicts of
interest, judges are prohibited from being members of political parties or
trade unions.[3] This has often been ignored, however, by both judges and
political parties alike.

Of particular concern is the inclusion of a number of judges on party lists
for the upcoming March parliamentary elections, including the Chief Judge of
the Supreme Court and the Chief Judge of the Higher Commercial Court.

It is bewildering that none of the Verkhovna Rada deputies nor other judges
have raised objections to this obvious disobedience to the Law on the Status
of Judges and Constitution.[4]

The Constitution prohibits political activity by judges because the bedrock
principle of democracy and the Ukrainian Constitution is the separation of
powers on the three branches of government. At the very least, a judge’s
inclusion on a party list gives the appearance of impropriety, at the worst,
political activism will effect a judge’s impartiality and decision making
ability.

Therefore, judges who seek public office on political party lists or voting
blocs should first resign from the bench. This is not what is happening for
the upcoming elections. Instead, party leadership approved the inclusion of
many judges’ names on the party lists for the upcoming elections. Even the
Lytvyn People’s Bloc, the party of the Speaker of the Verkhovna Rada, has
included judges on its list.[5] This should not go on.

It is the Rada deputies’ responsibility to uphold and promote adherence to
the law.[6] Deputies and, in particular, the Parliament leaders should
publicly object to the inclusion of judges on the party lists and have them
removed unless they have first resigned from the bench.

It is often worth repeating that no one will respect judges, or Parliament
for that matter, until the judges and elected public officials respect
themselves. Although high hopes followed the Supreme Court’s decision
in Yushchenko v. CEC on December 3, 2004, inclusion of judges on party
lists does not live up to those standards.

In addition, judges and deputies have shown a total disregard for the
Constitutional Court’s decision in In re Dual Mandates which specifically
declared members of Parliament holding two public offices unconstitutional.

Unfortunately, even at this date there are still some Rada deputies who hold
two positions. What Ukrainian would believe he or she is living in a
democracy when elected representatives so blatantly flout the law?

Since mid-October 2005, the Constitutional Court has been unable to form
a quorum. By way of background, there are eighteen judges on the
Constitutional Court. The President, Council of Judges, and the Verkhovna
Rada each appoint or elect six members to the court.

Eleven judges constitute a quorum at a meeting for purposes of opening or
rejecting a case (at least six judges must vote to open a case), twelve
judges must participate in a plenary meeting, and ten judges must vote in
support of a decision or conclusion on the merits during a plenary meeting.

A crucial problem that has existed for some months is Parliament’s avoidance
of electing its share of judges to the Constitutional Court and the election
of the Verkhovna Rada’s share of judges to the Constitutional Court has been
postponed from one week to another. On February 21, Ukrayinska Pravda
reported that a vote is not scheduled until March 15, less than two weeks
before the parliamentary elections. As of right now, there are only five
judges on the court.

Pursuant to a questionable provision in the Law on the Constitutional Court,
each candidate, regardless of whether he or she was appointed by the
President, or elected by the Verkhovna Rada or the Council of Judges, must
take an oath of office before the Parliament.[7] Although the Constitution
provides for the oath of office of the President and Rada deputies, the
Constitution does not have such requirements for judges of the
Constitutional Court.

The swearing-in requirement, in my view, therefore, is likely
unconstitutional itself because it allows the vitality of the Constitutional
Court to rest in the hands of the Verkhovna Rada B a clear violation of the
separation of powers. The Law on the Constitutional Court can not give
Parliament any oversight authority that the Constitution does not already
provide[8] and Article 153[9] of the Constitution can not be interpreted as
providing authority to require an oath.

Naturally, such a law could be applicable only to judges elected by the
Rada, but not by the President or the Council of Judges. Since October,
however, there has been no Constitutional Court to consider the
constitutionality of the swearing in because the Verkhovna Rada did not
schedule a session to swear-in candidates appointed by the President or
the Council of Judges upon the expiration of certain judges’ terms.

Therefore, the Verkhovna Rada has effectively prevented the operation of
the Constitutional Court by not filling vacancies and not allowing the
appointees assume their seats on the court. It is difficult to believe that
after the Orange Revolution and its ideals, the Parliament is so negligent
in its duties to have an acting Constitutional Court that is so vital and
crucial to the rule of law in a country.

As predicted in August 2005,[10] the battling factions currently within
Parliament had difficulty cooperating with each other and the lack of
consensus prevented the placing of a swearing-in ceremony on the
Parliament’s schedule and precluded the attainment of the 226 votes
necessary to schedule a swearing-in ceremony in the event a consensus
was not reached.[11] To date, no swearing in ceremony has been
scheduled (which, as previously stated, is likely unconstitutional anyway)
and the fighting over appointees continues.

Since Ukraine’s independence, many of us served as advisors to a number
of institutions and committees on issues concerning the rule of law and
democracy in Ukraine. Most importantly, we assisted the working group
on the drafting and passage of the Constitution.

Over the years, therefore, we have become acquainted with many of the
people about whom this article has expressed critical views. It is not easy
to make such public statements, but a commitment to democracy, the rule
of law, the Constitution, and, most of all, Ukraine requires it. -30-
————————————————————————————————
Bohdan A. Futey is a Judge on the U.S. Court of Federal Claims in
Washington, DC, appointed by President Ronald Reagan in May 1987.
Judge Futey has been active in various Rule of Law and Democratization
Programs in Ukraine since 1991. He served as an advisor to the Working
Group on Ukraine’s Constitution, adopted June 28, 1996.
————————————————————————————————
FOOTNOTES:
[1] Ukr. Const., art. 127; Law on the Status of the Judges, art. 5.
[2] See, e.g., Bohdan A. Futey, A Crisis in the Constitutional Court
of Ukraine: A Court Without Judges?, August 18, 2005.
[3] Ukr. Const., art. 127; Law on the Status of the Judges, art. 5.
In the United States, a federal judge is prohibited from engaging in any
political activity and must resign from the bench if he or she becomes a
candidate for political office. Code of Conduct for U.S. Judges Canon 7
(1997). State and local judgeships, however, are often elected position
and, therefore, candidates run for election and re-election as members of
a political party, just like any other public official.
[4] Id.
[5] In addition, the Regions of Ukraine Party, Bloc of Natalia Vitrenko,
Bloc of Oliynyk and Syrota, Third Force, and the nonpartisan bloc
The Sun all have judges on their party lists for the upcoming elections.
[6] Although the Rada may have legitimate concerns regarding the
performance of President Yushchenko’s government, the January 10
no-confidence vote raised uncertainty and confusion as well as questions
of whether the vote was in compliance with the Constitution. Of course,
there is no Constitutional Court to evaluate the validity of the vote.
[7] Law on the Constitutional Court, art. 17.
[8] Ukr. Const., art. 6
[9] The procedure for the organization and operation of the
Constitutional Court of Ukraine, and the procedure for its review of
cases, are determined by law. Ukr. Const., art. 153.
[10] Bohdan A. Futey, A Crisis in the Constitutional Court of
Ukraine: A Court Without Judges? August 18, 2005.
[11] Ukr. Const., art. 91 (A The Verkhovna Rada of Ukraine adopts
laws, resolutions, and other acts by the majority of its constitutional
composition . . . .).

——————————————————————————————-
[ return to index] [The Action Ukraine Report (AUR) Monitoring Service]
========================================================
19. DANUBE — BLACK SEA NAVIGABLE WATERWAY

ANALYSIS & COMMENTARY: Embassy of Ukraine
The Action Ukraine Report (AUR), #673, Article 19
Washington, D.C., Tuesday, March 14, 2006

The Ukrainian project of the reopening of the Danube – Black Sea deep-
water navigable waterway is aimed to resolve the social and economic
problems of the most depressive region in Ukraine and not only breathe
in life into local transportation system, but also help facilitate shipping
cargoes from the Black Sea to Europe and vice versa.

Ukraine has been persistently trying to contribute to sustainable
development of all Danube countries and realize the common objective in
its activity, i.e. to achieve the balance between economic growth, social
development and environmental preservation in the region.

In this context the Ukrainian project of the reopening of the Danube – Black
Sea deep-water navigable waterway is directly related to our aspirations to
be integrated into European and Euro-Atlantic structures and meet all our
obligations in accordance with the national and international legislation.

Moreover, according to the Action Plan between Ukraine and the EU for
2005-2007, Ukraine commits to develop the Danube transportation system
as the main part of the Pan-European waterway.

When taking the decision to reopen the waterway, Ukraine was trying to
harmonize the project with requirements of the EU environmental policy
and principles of sustainable development.

After several years of discussions at the expert and decision-makers levels,
thorough studies by 18 Ukrainian scientific research institutions and R&D
bureaus, public hearings, events involving international experts, Ukraine
have chosen the only viable option that had lesser environmental impact
than the other ones.

Ukraine is taking into account that the Danube Delta is under the regulation
of the Ukrainian national and international legislation. In this context
Ukraine has applied all the possible efforts for the purpose to fulfill our
commitments according to bilateral and multilateral agreements and to
correct our project activities following the recommendations of the
international ecological conventions.

Now all the works in the Ukrainian part of the Danube delta are in the
framework of the Phase 1.

Under the Feasibility Study of the project, the 1st phase of the reopening
of the navigable waterway consists of the implementation of dredging
activity in the sandbar section of the Bystroe Arm, the clearance of sand
reefs in the river section between Izmailsky Chatal and Vilkove, and the
construction of the protection dam.

The implementation of this activity is currently near to be completed. The
total amount of actualized works of the first phase is 90 percent for the
river section activity and 60 percent for protection dam construction.

However the total capacity of Bystroe navigable waterway reaches now more
than 800 passages of vessels of 5.85 m draught during the period after its
inauguration.

Further development of our project involves the final adjustment of its
elements and parameters in the line with existing international standards,
and the provision of protective hydraulic facilities designed to ensure its
stable operation. The scope of works for the Phase 2 will be clarified and
refined on the basis of the design review and environmental monitoring data.

The Environment Impact Assessment (EIA) for Phase 2 has been already
completed and forwarded to the Environmental Ministry of Ukraine for State
Environmental Expertise. Several rounds of public hearings of the EIA took
place in Ukraine with the involvement of all interested parts. Besides, the
EIA is available also in the web-side of the Ministry of Transport of
Ukraine.

Following our commitments and recommendations of international community,
Ukraine will organize an international workshop on the results of the EIA
and makes them available as soon as the EIA is approved at the national
level.

The most urgent issue during the implementation of our project is the
environmental monitoring system. The Program of Comprehensive
Environmental Monitoring of the Territory of the Ukrainian Part of the
Danube Delta has been worked out and launched by the Scientific Research
Institute of Ecological Problems under the Ministry of the Environment
Protection with involvement of numerous institutions that work mainly under
the auspices of the National Academy of Sciences of Ukraine.

The main results of the monitoring programme were presented during the
International Scientific – Practical Seminar which took place in Odessa in
April 27-28, 2005.

Following the conclusions of this event the Ukrainian and the Romanian sides
decided to develop and to implement the international program of monitoring
of all Danube Delta under the aegis of international environmental
protection organizations.

At present we have the updated results of the Integrated Environmental
Monitoring Programme which indicates that the impact of river-bound
dredging operations on changes in water quality was insignificant.

The preliminary data indicate that the spawning process for the majority of
the commercial fish species was successful, enhanced by higher water levels
in the Danube River.

According to the recommendations of the Danube Biosphere Reserve
management, the prohibited area for small-size vessels was established along
the spit, marked with 2 special buoys. Moreover, in 2005 the reserve
management set a strict limitation on inspection visits to the spit for various
commissions in order to minimize the potential for disturbance during the
nesting period.

These measures have been approved in terms of minimizing the disturbance
caused by navigation activity in the area of the Ptichia Spit, which is
particularly important for the nesting bird colonies.

The preliminary data indicate that the population of key colonial species
(sandwich tern (Sterna sandvicensis) and common tern currently nesting on
the Ptichia Spit is similar to the 2004 nesting population. Likewise, the
populations of other accompanying nesting species are likely to remain
stable.

The recent years demonstrated the necessity to maintain and strengthen the
transboundary activity in the Danube region. The further development of
industry, increasing number of accidents and disasters in the riverside
states, such as floods and spills of pollutants, force to aware of the
existence of radical changes and challenges which can not be resolved
without bilateral/multilateral cooperation.

Ukraine has satisfied with the main achievements reached between Ukraine and
Romania. After the official visit of Ukrainian President to Romania, the
meetings between Ministers of Environment Protection of two countries and
the visits of Ministers for Foreign Affairs of Ukraine and Romania the new
phase of the Ukrainian – Romanian cooperation has been started.

It was acknowledged that the Governments of Ukraine and Romania have to
pay attention to the necessity of taking common measures with a purpose of
preventing the degradation of the Danube Delta.

Moreover, it was decided that the problems of sustainable development and
environmental preservation between our countries must be settled on the
level of experts without shifting the discussion into the political
dimension.

In this context, all existing ecological problems of the region were
discussed during the international conference “Conservation and sustainable
development of the Danube Delta” (27 February – 1 March 2006, Odessa)
under the auspices of the International Commission for the Protection of the
Danube River (ICPDR) and the UNESCO.

This international conference brought together experts of the Republic of
Moldova, Romania and Ukraine, governmental and non-governmental
representatives, and international governmental and non-governmental
organizations.

The Conference participants have agreed to establish an expert group under
the leadership of the ICPDR to prepare and implement a river basin
management plan for the Danube Delta as well as to monitor of water quality,
availability, distribution, and the impact of human activities thereon.

The Conference underlined the need for human activities to be based on the
Ecosystem Approach as adopted by the UN Convention on Biological Diversity.
Trilateral activities in the Danube Delta should be based on the Ecosystems
Approach, which indicates how and where policy and management interventions
and decision-making can be made to ensure long term maintenance of
biodiversity as well as secure human wellbeing and alleviating poverty.

—————————————————————————————————–
[return to index] [The Action Ukraine Report (AUR) Monitoring Service]
========================================================
20. OUT OF THE DARKNESS
Romania Tries to Shed Its Traditional Past for Entry Into E.U.

By Kevin Sullivan, Washington Post Foreign Service
The Washington Post, Washington, DC
Sunday, March 12, 2006; Page A12

GOLAIESTI, Romania — Inside the local bar in this frozen village in
Romania’s bleak northeast, Oana Gatu poured mugs of hot wine for a
couple of farmers and talked about how the European Union is going
to change Christmas.

In villages like this one, she said, families slaughter a pig for the
holiday using the traditional method: Two or three men hold the animal down
while someone drives a long knife through its neck and into its heart. The
spouting blood is captured for sausage, and the pig can take several minutes
to die.

Gatu said everyone here knows that cherished tradition will become illegal
as soon as Romania joins the E.U., as early as Jan. 1. Membership in the
affluent, exclusive club of nations will mean abiding by strict Europe-wide
standards for everything from pig slaughtering to beach cleanliness, and
it’s a price most Romanians are eager to pay.

“We’re too poor,” Gatu said. “We have to get to the next level.”

As the hoped-for entry draws near, Romania’s experience illustrates how
expansion of the European Union is changing not just the union but the
states that join. Like eight other East European nations that entered in
2004, Romania is busy erasing the legacy of half a century of communism
and trying to build institutions that bear the stamp of approval of E.U.
headquarters in Brussels.

It is struggling to embrace Western-style market economics and multiparty
politics and trying to control corruption. But some aspects of life here,
such as discrimination against the country’s large Roma, or Gypsy,
population, remain stubbornly resistant to the E.U.’s pressure for change.

Much of Western Europe is feeling fatigue with the half-century-old project
to stitch together a superstate on the European continent. But in this
country of 22 million, enthusiasm for it is practically a national
obsession. Polls consistently show that about 70 percent favor E.U. entry
and regard it both as a final break with the Soviet era and a return to
Romania’s European roots.

Store names across the country capture the spirit: Eurovet sells cat food,
Eurofarma fills prescriptions. Blue E.U. flags flutter alongside the
Romanian flag on government buildings and utility poles in even the most
remote corners of the nation.

“All of Romanians consider the E.U. accession like being a key moment, the
moment when Romania will be back in Europe,” President Traian Basescu, a
former oil tanker captain, said in an interview. “We are very determined to
fulfill all our obligations.”

A digital clock in a main square in the capital, Bucharest, counts down the
days to New Year’s Day. E.U. officials have been publicly optimistic about a
January entry for Romania, along with neighbor Bulgaria, which would expand
the roll of members to 27 and extend the bloc east to the Black Sea.

But membership — along with billions of dollars in desperately needed
development aid and investment — could be delayed a year if E.U. leaders
decide at a meeting in June that the two candidates haven’t made enough
progress toward honest, open and modern government.

To some Romanians, that would be fine. Under the E.U. flag, “life will
change in the countryside for the worse,” said Emil Imre Szabo, a dairy
farmer in Transylvania. “There are too many requirements, and we won’t be
able to meet them.”

But 200 miles south of here in Bucharest, hundreds of bureaucrats in
Basescu’s government are working late into the night to harmonize laws with
those of Europe — upgrading border security regulations, modernizing
environmental law, and changing hiring and promotion guidelines for civil
servants to attack cronyism and graft.

A popular Sunday television show educates Romanians on the changes.
Set in a country pub, characters poke fun at the E.U.’s stilted bureaucratic
jargon and explain issues that come with joining Europe, such as farm
credits and regulations about genetically modified soybeans.

“The Romanian people look at this integration on the 1st of January as a
salvation,” said Stelian Tanase, a political analyst. “But Romanians have
started to understand the real price: We have to change our way of life.”
CONTROLLING CORRUPTION
First and foremost, according to everyone from President Basescu to rural
goatherds, that means attacking corruption. Bribery and kickbacks have long
greased life in Romania, whether it’s paying big money to win a government
contract or slipping a train conductor a little cash for a cut-rate ticket.

“The low standard of living in Romania is caused by the high levels of
corruption,” said Marcel Daniel Ghemes, 37, a night watchman in the
Transylvanian town of Targu Mures in the country’s central region. He said
rampant corruption has allowed officials to get rich while he and other
hardworking people live in drab apartment blocks.

Ghemes, his wife and their two children survive on the $130 a month he earns
and the $130 a month his wife earns at a glove factory. The children sleep
in the apartment’s bedroom while the parents bed down in the living room.

Ghemes predicted that E.U. membership will make life better for him by
bringing more investment, jobs and prosperity, and tougher for corrupt
politicians because of new laws scrutinizing their behavior. It’s already
happening, he said, citing the woman Romanians know as Aunt Tamara.

Officials from the National Anti-Corruption Department, created last year
under pressure from the E.U., announced in January that they were
investigating the wealth of Adrian Nastase, a prominent legislator who was
prime minister from 2000 to 2004. At issue is how Nastase obtained three
apartments, jewelry and cash, together worth more than $1 million.

He has said they were an inheritance from his wife’s aunt Tamara, who died
last year. That assertion became an instant punch line on Romanian
television as local media reported that the deceased woman had no obvious
signs of such wealth.

The property would likely never have come to light were it not for a
financial disclosure form, introduced as part of the E.U.-mandated revamp,
that Nastase filed on Dec. 30.

In February, prosecutors charged him with corruption violations connected to
his purchase of an upscale Bucharest home in 1998, allegedly bought from a
lawmaker’s relative for a price 25 times lower than its market value.

Nastase has denied wrongdoing, and his supporters argue that he has been
targeted in a political campaign to show the E.U. that big fish can be
caught. But other people call the case a genuine breakthrough.

“A couple of years ago, nobody thought that they would start to investigate
one of the big politicians,” said Integration Minister Anca Boagiu, who
presides over a ministry created to help Romania join the E.U. “I think that
this is a good sign that the system’s started to work.”

Anti-corruption prosecutors have also charged a former transport minister
with accepting a bribe and announced that they are investigating Deputy
Prime Minister George Copos on suspicion of tax evasion.

According to Justice Minister Monica Luisa Macovei, the court system has
been sufficiently reworked to handle politically explosive cases. In an
interview, she said that trials are now randomly assigned to judges by a
computer and that millions of dollars have been invested in computerized
databases for police and courts. Hiring and promotion of judges and
prosecutors, she said, will now be decided by open competition rather than
cronyism.

One of Basescu’s first acts upon taking office in 2004 was to demand a
review of several major contracts, including a $2.5 billion deal signed in
2003 with U.S. construction giant Bechtel Corp. to build a 250-mile highway
through Transylvania. The contract was awarded without public bidding, which
brought complaints from critics in Romania and, perhaps more significantly,
the European Union. Bechtel was not accused of wrongdoing.

In the interview, Basescu blamed “very bad” procurement laws, which he said
are being replaced with new ones that require competitive public bids. The
new laws, he said, are “very European.”
BATTLING DISCRIMINATION
One recent day in Targu Frumos, a small town in northeastern Romania,
Ionel Pandele’s eyes flashed with anger. Under E.U. pressure, the Romanian
government has promised to end discrimination against the Roma, but
Pandele, 22, said he and his family have seen little change. “I have no
rights in this country,” Pandele said. “Everyone says they will do things
for the Roma, but I don’t see anything happening.”

Pandele was showing a reporter a videotape made on Aug. 19, 2003, when
police officers wearing black uniforms and hoods forcibly evicted his family
from the fruit and vegetable stall they had run for more than a decade. A
half-dozen officers are seen swinging nightsticks over and over as they beat
Pandele’s brother, Cristinel, then drag both brothers into a police van.

“They beat us like it was a civil war,” Ionel Pandele said. The family said
the eviction, the beatings and the failure of any officer to be punished in
the 2 1/2 years since the incident were racism pure and simple.

Town officials said that the stall was closed as part of an effort to
renovate the market and that the Pandeles had violated the terms of their
lease. The Targu Frumos mayor, Gheorghe Tataru, said in an interview that
authorities had acted properly. He blamed the situation on the Pandeles,
and on the Roma in general. If the Roma say life is difficult, he said,
“it’s above all because they don’t want to make it better for themselves.”

Europe has about 7 million to 9 million Roma, with the largest
concentration, 1 million to 2 million, in Romania, according to the World
Bank. Discrimination — and often violence — against this minority is a
centuries-old reality in Romania.

Macovei, the justice minister, said she used to handle discrimination cases
for Roma clients when she worked as a human rights lawyer.
Anti-discrimination laws have vastly improved recently, she said, but
anti-Roma attitudes persist. “In the real life, the majority, the Romanians,
do still treat the Roma people as different and not their equals,” Macovei
said.

The government has passed new hate crime laws and created a National
Council for Combating Discrimination, which recently ruled that the
Pandeles’ eviction was due in part to ethnicity. Town officials are
appealing that finding.

Timo Summa, a European Commission official who oversees E.U. enlargement
issues, said that despite advances in anti-discrimination laws, “the theory
and the practice don’t meet every time” in Romania. Discrimination against
the Roma is decreasing, he said, but remains a concern: “What is needed is a
change of culture, a change of mind-set. There is no way to do it
overnight.”

Pierre Moscovici, the European Parliament’s special observer for Romania,
said European officials were encouraged by the country’s overall progress
and want evidence that the country’s course toward modernization is
irreversible.

“Poland was not perfect, Lithuania was not perfect,” he said, naming two
of the 2004 entrants. “Romania won’t be perfect. In the end, we will have to
take a political decision, which will be, ‘Are they good enough?’ “
————————————————————————————————–
Washingtonpost.com ‘s Travis Fox in Golaiesti and special correspondent
Alexandra Topping in London contributed to this report.
————————————————————————————————–
http://www.washingtonpost.com/wp-dyn/content/article/2006/03/11/AR2006031100170.html
——————————————————————————————-
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monthly basis, any or all of the Macroeconomic Situation Reports (Romania,
Bulgaria, Ukraine) by sending an e-mail to mwilliams@SigmaBleyzer.com.
“UKRAINE – A COUNTRY OF NEW OPPORTUNITIES”
========================================================
UKRAINE INFORMATION WEBSITE: http://www.ArtUkraine.com
========================================================

“THE ACTION UKRAINE REPORT- AUR” – SPONSORS
“Working to Secure & Enhance Ukraine’s Democratic Future”
AUR sponsors will be listed again later this week.
========================================================
TO BE ON OR OFF THE FREE AUR DISTRIBUTION LIST
If you would like to read THE ACTION UKRAINE REPORT- AUR,
around five times a week, please send your name, country of residence,

and e-mail contact information to morganw@patriot.net. Information about
your occupation and your interest in Ukraine is also appreciated. If you do
not wish to read THE ACTION UKRAINE REPORT please contact us
immediately by e-mail to morganw@patriot.net. If you are receiving more
than one copy please let us know so this can be corrected.
========================================================
PUBLISHER AND EDITOR – AUR
Mr. E. Morgan Williams, Director, Government Affairs
Washington Office, SigmaBleyzer
Emerging Markets Private Equity Investment Group
P.O. Box 2607, Washington, D.C. 20013, Tel: 202 437 4707
Mobile in Kyiv: 8 050 689 2874
mwilliams@SigmaBleyzer.com; www.SigmaBleyzer.com
========================================================
Power Corrupts and Absolute Power Corrupts Absolutely.
========================================================
return to index [The Action Ukraine Report (AUR) Monitoring Service]
========================================================

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