AUR#746 Viktory In Ukraine; Don’t Give Up On Ukraine; President Of All Ukraine; Political Instability Doesn’t Scare Business; Man With Mission

ACTION UKRAINE REPORT – AUR
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ACTION UKRAINE REPORT – AUR – NUMBER 746

Mr. E. Morgan Williams, Publisher and Editor
PUBLISHED IN WASHINGTON, D.C., FRIDAY, AUGUST 4, 2006

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——- 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. VIKTORY IN UKRAINE
Orange Revolution Betrayed? More Like Vindicated
REVIEW & OUTLOOK: OPINION EUROPE
The Wall Street Journal, New York, NY, Friday, August 4, 2006

2. FOR WEST, UKRAINE POLITICIAN’S REBIRTH
SHOWS DOWNSIDE OF DEMOCRACY
By Alan Cullison, The Wall Street Journal
New York, New York, Friday, August 4, 2006

3. DON’T GIVE UP ON UKRAINE
COMMENTARY: By Carlos Pascual, International Herald Tribune
Paris, France, Thursday, August 3, 2006

4. ON UKRAINE’S COALITION OF NATIONAL UNITY
ANALYSIS & COMMENTARY: By Anders Aslund
Senior Fellow, Institute for International Economics, Washington
Action Ukraine Report (AUR) #746, Article 4
Washington, D.C., Friday, August 4, 2006

5. YUSHCHENKO CHOOSES THE LESS EVIL
Viktor Yanukovich is back in power
ANALYSIS & COMMENTARY:
Vladimir Solovyev and Mikhail Zygar
Kommersant, Moscow, Russia, Friday, August 4, 2006

6. UKRAINE’S ORANGE REVOLUTION UNDONE?
The president made a deal to share power with the pro-Russian
leader ousted in 2004’s people-power revolt.
By Fred Weir, The Christian Science Monitor
Boston, Massachusetts, Friday, August 4, 2006

7. HOW THE ORANGE REVOLUTION LOST ITS JUICE
Ukrainians might well wonder why they bothered
EUROPE: Foreign Editor’s Briefing by Bronwen Maddox
Times Online, London, United Kingdom, Friday, August 4, 2006

8. WHAT REMAINS OF UKRAINE’S “ORANGE REVOLUTION”?
By Christian Lowe, Reuters, Kiev, Ukraine, Friday, August 4, 2006

9. YUSHCHENKO HAS CHANCE TO TURN FROM THE PRESIDENT
OF THE “ORANGE CAMP” INTO THE PRESIDENT OF ALL UKRAINE
REGNUM, Moscow, Russia, Thursday, August 3, 2006

10. NOW IS A GOOD TIME FOR RUSSIA TO CHANGE
RULES OF GAME WITH UKRAINE
COMMENTARY: Argumenty i Fakty, Moscow, in Russian 3 Aug 06
BBC Monitoring Service, United Kingdom, Thursday, Aug 03, 2006

11. UKRAINIAN ECONOMY UNSHACKLED
Political instability doesn’t scare business
Kommersant, Moscow, Russia, Thursday, July 27, 2006

12. THE SHOW MUST GO ON
The Tale of the Ukrainian Coalition will stir up memory for a long time.
OPINION: By Vitaly Portnikov, Columnist
Kommersant, Moscow, Russia, Friday, August 4, 2006

13. LVOV ANALYST SAYS: THERE WILL BE NO ‘OUR UKRAINE’
AT NEXT ELECTIONS
Regnum, Moscow, Russia, Thursday, August 3, 2006

14. UKRAINE’S 1993
COMMENTARY: By Mikhail Zygar
Kommersant, Moscow, Russia, Thu, August 3, 2006

15. EU HOPES NEW UKRAINE GOVERNMENT WILL CONTINUE
STRENGTHENING TIES WITH EUROPE
By: CONSTANT BRAND, AP Worldstream
Brussels, Belgium, Thursday, Aug 03, 2006

16. STATEMENT REGARDING CURRENT EVENTS IN UKRAINE
STATEMENT: Michael Koziupa, President, ODFFU
Organization for the Defense of Four Freedoms for Ukraine, Inc.
New York, New York, Tuesday, August 1, 2006

17. UKRAINE’S GRAND COALITION TO FORM GOVERNMENT

AP Worldstream, Washington, D.C., Thursday, Aug 03, 2006

19. UKRAINE LEADER AGREES TO NATO MEMBERSHIP
ONLY WITH NATIONAL REFERENDUM

AFX Europe (Focus), Kiev, Ukraine, Thursday, Aug 03, 2006
20. ROW OVER ARMENIAN GENOCIDE PUTS SENATE APPROVAL
FOR NEW US AMBASSADOR TO ARMENIA ON HOLD
Former US Ambassador resigned after accurately
describing the Armenian genocide as genocide.
Agence France-Presse, Washington, D.C., Thu, August 3, 2006

21. SEARCHING FOR MYTHICAL TREASURES ON THE
BOTTOM OF THE BLACK SEA
By Anastasiya Ringis, Kyiv Weekly, Kyiv, Ukraine, Wed, Aug 2, 2006

22. SECULAR STATE OR DON’T PUT HAND BETWEEN BARK & TREE
ANALYSIS & COMMENTARY: By Serhky Odarych
In Ukrainian translated into English by Maria Tsukanova
Ukrayinska Pravda, Kyiv, Ukraine, Friday, July 28, 2006


23. MAN WITH A MISSION:

NIGERIAN MINISTER SETS OUT TO SAVE KIEV
Adelaja Promotes God And Democracy in a Land Suspicious of Evangelism
By Alan Cullison, The Wall Street Journal
New York, New York, Friday, July 21, 2006; Page A1
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1
. VIKTORY IN UKRAINE
Orange Revolution Betrayed? More Like Vindicated

REVIEW & OUTLOOK: OPINION EUROPE
The Wall Street Journal, New York, NY, Friday, August 4, 2006

A Western ambassador to Kiev once told us that Viktor Yushchenko may
be disorganized and indecisive, but eventually does the right thing.

This insight comes to mind after, in the wee hours of yesterday morning, the
Ukrainian President ended four months of political paralysis and nominated
his rival, Viktor Yanukovych, to be Prime Minister.

For the iconic leader of the country’s 2004 Orange Revolution, this was no
easy decision, and for millions of Ukrainians it will be hard to swallow.

Only 18 months ago, Mr. Yanukovych served the old, corrupt regime whose
transparent attempts to steal presidential elections on his behalf sparked
nationwide protests and forced a rerun of the vote in which Mr. Yushchenko
triumphed.

Betrayal, screamed many Orange supporters yesterday, while enemies of
democracy in the former Soviet Union and parts of the West have looked on
at Ukraine’s so-called crisis with glee. Washington and Brussels could
barely disguise their anxiety.

Pardon us, but what’s the big deal exactly? Mr. Yanukovych’s party won 32%
of the vote — the most of any party — in March’s parliamentary elections.
Thanks to the 2004 democratic turnover, that vote was the liveliest, freest
and fairest in Ukraine’s history.

The original Orange coalition won enough seats to form a government but
bickered for months. A small party eventually split away to give Mr.
Yanukovych’s coalition enough votes in the Rada (Parliament) to lead the
cabinet. Denying him this right, won fair and square, would have been the
real betrayal of the Orange Revolution.

Mr. Yanukovych and his friends were lucky to avoid criminal prosecution
for their role in the 2004 election fraud. A convicted petty criminal, later
a regional political baron, Mr. Yanukovych ran an effective campaign in
March — complete with American political consultants — in his electoral
home base of eastern Ukraine.

His support for closer ties with Moscow, and to make Russian a state
language, played well with his voters. But eastern Ukrainian politicians
tend to turn patriotic and pragmatic once in the capital Kiev, and the odds
are that Mr. Yanukovych, who already served as Prime Minister, will be no
different. The only litmus test that matters is whether he accepts the rules
of the political game in a free society.

With 47 million people in a country the size of France split along
linguistic and cultural lines, Ukraine is not easy to govern. In yesterday’s
agreement with the President, Mr. Yanukovych pledged to modernize the
economy and push ahead with efforts to join the EU and the World Trade
Organization.

He’ll be hard pressed to do worse than the outgoing Orange government. Its
poor record won Mr. Yushchenko’s party its embarrassing third-place finish
in the parliamentary poll.

The hand-wringing over Mr. Yanukovych’s appointment misinterprets the
meaning of 2004. Millions braved the cold to fight for a free vote not out
of any great love for Mr. Yushchenko, or his since estranged sidekick Yulia
Tymoshenko.

After a decade of kleptocratic rule, a rising middle class said, to borrow
from the name of a student protest group, Pora! — It’s Time! — for a
normal democracy. With this messy outcome yesterday, that’s what they got.

A still strong President will share power with a Prime Minister from a
competing party, who will lead a broad coalition. A loud opposition, led by
Ms. Tymoshenko who denounced yesterday’s agreement, will make life

difficult for them both in the Rada, which has established itself in the past
15 years as an independent institution. A lively media and active NGOs
will keep close watch.

And, at the next poll, voters will again pass judgment. On all these counts,
Ukraine is everything that Vladimir Putin’s Russia is not.

Ukraine’s misfortune is to be a proxy in the wider war over democracy.

An eclectic mix of Bush bashers, Putin apologists and retro-Soviet
nostalgics outside Ukraine is eager to declare the Orange Revolution dead to
score ideological points. But this free, young country continues to make the
obituary writers look foolish. -30-
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2. FOR WEST, UKRAINE POLITICIAN’S REBIRTH
SHOWS DOWNSIDE OF DEMOCRACY

By Alan Cullison, The Wall Street Journal
New York, New York, Friday, August 4, 2006

MOSCOW — The Bush administration had hoped Ukraine’s 2004 Orange
Revolution could be a springboard for Western-style democratic movements
throughout the former Soviet Union — and even in Russia itself, where an
increasingly autocratic Vladimir Putin is tightening his grip.

But Western-leaning democrats in Kiev and elsewhere in the region soon ran
into stiff head winds, and yesterday may have hit their greatest blast of
turbulence yet when Ukrainian President Viktor Yushchenko nominated as prime
minister Viktor Yanukovych, his Moscow-backed rival who sparked a popular
upheaval by attempting to take the presidency in 2004 with vote fraud.

The move is expected to effectively squelch hopes for Ukraine’s quick
integration with the European Union and the West.

Mr. Yanukovych’s resurgence serves as yet another reminder to the West that
free elections in troubled lands don’t guarantee a pro-Western result. From
the Palestinian territories, Lebanon and Iraq to Ukraine and Kyrgyzstan,
democracy has empowered politicians and movements whose interests — and
actions — often counter those of the U.S. and its allies.

Nor has Russia been sitting on its hands amid the political upheaval on its
borders. The Kremlin, fearful a revolution could topple its own
establishment, backed rigged presidential elections in Belarus that
installed the authoritarian president, Alexander Lukashenko, for another
term.

Moscow also has been putting pressure on the pro-Western government of
Georgian President Mikhail Saakashvili, who has been trying to regain
control of breakaway enclaves within his country that are supported by
Moscow.

Russia’s ambassador to Ukraine, Viktor Chernomyrdin, called Mr.
Yushchenko’s acceptance of the nomination “a good decision by the
Ukrainian president. Viktor Yanukovych will guarantee stability and
integrity of Ukraine.”

The U.S. State Department said it is prepared to work with Mr. Yanukovych
despite his history of strong support for Russia. “Mr. Yanukovych has come
to the prime ministership in the old-fashioned, democratic way: He worked
hard for votes, he campaigned, he politicked,” spokesman Sean McCormack
said.

Leaders of Ukraine’s Orange Revolution found themselves riven by personal
rivalries and at odds with a populace in the country’s east that rejected
many proposed Westward-leaning moves and voted heavily against Mr.
Yushchenko in presidential elections.

The prospect of Ukraine joining the North Atlantic Treaty Organization, for
example, was a major rallying point for Yushchenko opponents.

Within hours of Mr. Yushchenko’s decision, it appeared his party was heading
for disintegration. Some members were refusing his plea to join a grand
coalition, while erstwhile ally Yulia Tymoshenko called the appointment a
betrayal.

Mr. Yanukovych’s ascent is a by-product of March parliamentary elections in
which no single party gained a clear majority. In an early morning
television address yesterday, Mr. Yushchenko appealed to supporters to
understand his reasons for nominating his former rival as prime minister,
saying it was the only way to unite a badly split nation.

“I understand the complexity of this decision in the east, as well as in the
west of Ukraine,” said Mr. Yushchenko, who in recent days had considered
disbanding Parliament to call new elections.

He said, however, that “Ukraine has two polarities regardless of whether
there would be new elections or not. We’d come out with the same results as
we received in March.”

Mr. Yushchenko said he made his decision after Mr. Yanukovych agreed to
sign a memorandum on national unity that preserved tenets of a Western-
oriented agenda, such as membership in NATO and enactment of steps that
would provide a balance of power among branches of government and speed
Ukraine’s entrance into the World Trade Organization.

His rivals say a genuine about-face would seem unlikely for Mr. Yanukovych,
a former petty criminal who campaigned for closer ties with Moscow, and who
enjoyed the Kremlin’s backing in the rigged vote in 2004. That tally was
later overturned by street protests and Ukraine’s Supreme Court.

Ms. Tymoshenko announced she would be taking her political party into the
parliamentary opposition. Mr. Yushchenko invited her and other political
leaders to a round-table yesterday to discuss the new government, and there
she declared on national television Mr. Yushchenko’s document on national
unity, not legally binding, a farce.

“Ninety percent of it is declarations passed from politician to politician
for years and never realized,” she said. “We have to call things as they
really are.”

Mr. Yushchenko replied that she had never done anything to promote the
values of the document herself, and accused her of demagoguery.

Mr. Yushchenko’s combative relationship with Ms. Tymoshenko was one of
the cracks in the foundation of the Orange coalition. Mr. Yushchenko’s critics
said his tenure as president reads like a study in lost political
opportunity. He often left the governing to subordinates who fought bitterly
among themselves and became embroiled in corruption scandals.

He appointed Ms. Tymoshenko as his prime minister last winter, and left the
economy in her charge while he made a succession of trips overseas, often to
receive awards for valor during the Orange Revolution.

When Ms. Tymoshenko and cabinet members began trading accusations of
corruption last summer, Mr. Yushchenko suddenly dismissed them and
nominated a little-known technocrat, Yuri Yekhanurov, to replace her.

But Parliament rejected the Yekhanurov nomination. Mr. Yushchenko then
concluded an agreement with Mr. Yanukovych that cost him dearly in his
popularity: In return for his support, the president promised an amnesty for
those involved in election-law violations.

Mr. Yushchenko’s standing was further sapped in January, when he signed a
natural-gas deal with Russia using a go-between company that was later
learned to be under investigation by the U.S. Justice Department’s
organized-crime division.

In March parliamentary elections, his party, Our Ukraine, finished a distant
third in the poll behind Ms. Tymoshenko and Mr. Yanukovych, whose party
came in first.

Katya Malofeyeva, an analyst at Renaissance Capital, a brokerage firm in
Moscow, said it was clear Mr. Yushchenko didn’t want to form a new coalition
with Ms. Tymoshenko. The group would have had a thin majority in Parliament,
and its members, which included Socialists, industrialists and populists,
were too disparate to work together, she said.

Some Western diplomats, however, point to a bright side: After a year and a
half of political feuding, Ukraine at least has a government with a firm
majority in Parliament that will be able to pass laws.

Others suggest Mr. Yanukovych has learned some lessons since his tainted
2004 campaign; for the parliamentary contest, he hired Western campaign
advisers and worked crowds in a get-out-the-vote drive.

One Western official said he believes the portrayal of Mr. Yanukovych’s
Party of the Regions as a stooge of Russia has always been exaggerated.

“The Party of the Regions represents East Ukrainians who have a strong
business interest in cooperating with Russia and the CIS [Commonwealth
of Independent States] — but they are also competitors with Russian
businesses,” the European diplomat said.

“Now, of course, the question is to what extent they are ready to really
transform society and Ukraine’s economy in terms of the rule of law, the
judiciary, corruption and so on.” -30-
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Marc Champion in Brussels contributed to this article. Write to Alan
Cullison at alan.cullison@wsj.com
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3. DON’T GIVE UP ON UKRAINE

COMMENTARY: By Carlos Pascual, International Herald Tribune
Paris, France, Thursday, August 3, 2006

WASHINGTON: After the Orange Revolution

The collapse of Ukraine’s Orange Coalition has deflated democratic forces
around the world. It has also heartened those in Russia, President Vladimir
Putin included, who hate and fear the “color” revolutions.

Yet there is some good news in the country’s current political mess.
Multiparty politics is alive. It can be bare-knuckled, ugly and corrupt, but
it also involves real debate over how to advance Ukraine’s development as a
state with ties to the Euro- Atlantic community and with decent relations
with Russia.

For these goals to be achieved, however, Ukraine’s politicians must give
more weight to national interests and less to the politics of personal
power. Such leadership may have emerged with the coalition forged in the
early hours of Thursday.

On the surface, the past two years appear to be a story of failure. During
autumn 2004, the Orange Revolution brought millions to Kiev’s Independence
Square to fight against electoral fraud, lifting Viktor Yushchenko to the
presidency in January 2005.

Only nine months later, allegations of corruption between Yushchenko and
populist Prime Minister Yulia Tymoshenko brought down the “Orange
government.”

When parliamentary elections were held in March 2006, public frustration
with Yushchenko produced a first place finish for the party of Viktor
Yanukovich, the loser in the 2004 presidential race. As of early this week,
Ukraine’s political parties were still bickering about forming a government,
bringing the country to the brink of a constitutional crisis.

But less visible throughout the political bustle has been the welcome demise
of what in Russia is called “managed democracy”: No longer can elections be
won by the party in power dictating the results.

Voters have learned that the right to hold power should come out of the
ballot box, not from the office of the sitting president. In championing the
right of the people to challenge leaders through an opposition movement, the
Orange Revolution secured a future for political opposition.

The results of the parliamentary elections still produced paralysis. On
Wednesday, Yushchenko let his constitutional authority to dissolve
Parliament lapse without commenting. His silence added to the sense of
disarray. No wonder many who flocked to the orange cause have a sour
taste in their mouths. This is not the democracy they hoped for.

Yushchenko and Yanukovich now have an opportunity to stop the political
slide. The agreement reached on Thursday gives Yushchenko the chance to
champion a solid policy agenda – his ticket to restore his political
relevance. Yanukovich will get another shot as prime minister – and a chance
to turn his tainted legacy into one of effective governance.

Coalitions inevitably mean imperfect compromise, but it is hard to see how
any other alternative would be good for Ukraine. Any excuse to dissolve
Parliament after August 2 and vote again would have violated the
Constitution and surrendered the last remnant of the Orange Revolution’s
claim to a moral high ground.

New elections also would have extended the crisis through 2006: Two months
until voting, another month to seat Parliament, and then a rehash of the
fight over the government and prime minister. If the polls are to believed,
voters would have punished Yushchenko with yet a smaller share of the vote,
making the negotiations even harder.

The Orange team could have tried to reunite in opposition and block
Yanukovich. That carried the risk that the “politics of no” would have
thwarted progress and left Yushchenko looking yet more ineffectual.

As policy makers now move toward governance, they should keep in mind that
they have lost public trust. Politics has become perceived as an extension
of business interests. Any new gas deals with Russia should be subjected to
public scrutiny. Leaders must counter perceptions that the quest for power
is a contest for the right to steal from the gas sector.

The international community should remember that Ukraine’s democracy is
underpinned by a determined people who want a unified state and good
governance. Why else would they have come out in the millions in November
2004? They deserve hope and support.

Progress may take time. Ukraine’s friends should make clear that the door to
NATO is open and that the European Union will still contemplate expanding.
There should be a clear plan for accession to World Trade Organization. Such
prospects shape incentives for cooperation among political parties.

In this fragile environment, there is no need to give momentum to those in
Russia who would trumpet any perceived Western slight of Ukraine’s
Euro-Atlantic integration.

And Russia should not be an issue in this domestic drama. Ukraine should
have good relations with all its neighbors – and its neighbors should
recognize that a sovereign, democratic and prosperous Ukraine is an asset,
not a threat.

Even amid crisis, Ukraine’s economy surged ahead in May at an annual rate
of 8.5 percent. Ukraine’s 47 million people, Russia and Europe would all be
better off with the political accountability that could sustain such
performance. -30-
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NOTE: Carlos Pascual is vice president of the Brookings Institution
and a former U.S. ambassador to Ukraine.
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LINK: http://www.iht.com/articles/2006/08/03/opinion/edpascual.php
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4. ON UKRAINE’S COALITION OF NATIONAL UNITY

ANALYSIS & COMMENTARY: By Anders Aslund
Senior Fellow, Institute for International Economics, Washington
Action Ukraine Report (AUR) #746, Article 4
Washington, D.C., Friday, August 4, 2006

Tomorrow on August 4, Viktor Yanukovych will finally be approved as Prime
Minister of Ukraine by the Supreme Rada more than four months after the
parliamentary elections. This process could have been faster, but given the
election outcome, the government is about as good as anybody could have
hoped for.

This coalition represents a strategic realignment in four ways.

[1] First, it signifies that the orange revolution is really over, and
its eventual success has been the democratization of the Regions,
which honestly become the biggest party in the elections.
[2] Second, it marks a departure from the regionally divisive politics.
[3] Third, the new coalition is based on a common economic policy, and
[4] finally the new government has adopted a unifying foreign policy.

Three alternative coalitions were possible, an orange, an eastern and an
ideological coalition between the Regions and Our Ukraine. The Orange
Coalition was tried but it alienated the East and fell apart. An Eastern
coalition was tried which naturally alienated the West.

The natural way out was a government based on the liberal-conservative
economic policy common to Our Ukraine and the Regions. Even so, the
socialists are happily joining this coalition, while the communists hesitate
but are likely to stay out. A proper coalition memorandum has already been
signed between Our Ukraine and the Regions, and the socialists have joined
as well.

The new government is to be based on the principle of checks and balances.

The Regions will get most of the economic bloc, while President Yushchenko
will get the power bloc, with the Ministry of Defense, the Ministry for
Foreign Affairs, the Ministry of Interior, the Chairman of the State
Security Service, and the Prosecutor General, plus the First Deputy Prime
Minister and some minor ministers. Each minister is supposed to be checked
by a committee chairman in parliament from another party.

Yulia Tymoshenko has declared that she will go into opposition, and she
welcomes everybody to her faction. Undoubtedly, she will provide an
effective critique of the government, which should be good for democracy and
the quality of its decisions.

The worry that she would insist on new elections on flimsy constitutional
grounds has fortunately subsided. Such elections would have been very
divisive between Ukraine’s East and West, and they could have undermined
Ukraine’s newborn democracy.

Yushchenko has devoted great effort to elaborate a “Declaration of National
Unity,” which is a program of the new coalition. The text is relatively
brief, consisting of six pages with 27 points of substance.

Four issues were particularly difficult and required hard negotiation,
federalism, the status of the Russian language, private sales of
agricultural trade, and Ukraine’s foreign policy orientation. On all points,
compromises have been made, but Yushchenko appears to have prevailed.

The first paragraph spells out that Ukraine is a unitary state, while
another paragraph advocates decentralization without any mentioning of
federalism.

The language paragraph has been carefully edited. Ukrainian remains the
official state language, but “every Ukrainian citizen is guaranteed the
right to use Russian or any other native language in all walks of life.”

Private sales of agricultural land will be introduced not later than January
1, 2008, which the socialists have opposed.

Four paragraphs deal with foreign policy issues. Ukraine is to “take all
necessary legislative steps join the WTO” before the end of 2006,” which is
a clear victory of Our Ukraine over both the Regions and the socialists.

Ukraine is to maintain its course of European integration with the eventual
aim to join the European Union, and it is to start negotiations on a free
trade zone between Ukraine and the EU. Again, Our Ukraine has prevailed.

The Regions insisted on adding a paragraph on the Russian-supported Single
Economic Space, but only as a free trade area and with reservations added by
Yushchenko, which will probably irritate the Kremlin to make it kill the
Single Economic Space.

Our Ukraine has got a paragraph on NATO in the declaration, calling for
“mutually-beneficial cooperation with NATO.” The Regions have added that a
referendum on Ukraine’s accession to NATO must be held, but Our Ukraine has
attached a phrase that the referendum should be undertaken “after Ukraine
has carried out all necessary procedures” which somewhat diffusely refers to
NATO accession.

On the whole, Our Ukraine appears to have got foreign policy and the power
bloc in the government, while the Regions gets the economic bloc in the
government, and both parties agree on the principles of economic policy.
Meanwhile national tensions have been resolved.

This is quite an impressive outcome of the negotiations, and there is good
hope that this alliance will hold, so perhaps we should not be very upset
that they have taken four months to complete. -30-
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AUR NOTE: Contact Anders Aslund, aaslund@iie.com; www.iie.com
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5. YUSHCHENKO CHOOSES THE LESS EVIL
Viktor Yanukovich is back in power

ANALYSIS & COMMENTARY: Vladimir Solovyev & Mikhail Zygar
Kommersant, Moscow, Russia, Friday, August 4, 2006

Ukraine’s Supreme Rada is to endorse Viktor Yanukovich as prime minister
on Friday. President Viktor Yushchenko has given in, agreeing to nominate
his long-standing rival for prime minister.

Yanukovich’s comeback in office means not only the defeat of the Orange.
Ukraine is also in for a new redistribution of property that the White and
Blue will certainly launch.
CAPITULATION
Viktor Yushchenko was hesitant Wednesday night, thinking what to do to
solve the tangled political dead-lock. Night callers visited him every hour.

The office greeted Yulia Timoshenko, leader of the bloc of the same name,
Party of Region’s leader Viktor Yanukovich, the parliament’s speaker
Alexander Moroz and Communists leader Pyotr Simonenko.

Comments of Yushchenko’s associates were changing drastically, depending
on the last person the president had spoken to. After Yulia Timoshenko’s
visit, for example, president’s legal advisers started speculating the dissolution
of the Rada.

After Yanukovich left Yushchenko, the president’s legal aide, Nikolay
Poludenny cited reasons why the head of state is free to nominate the
Region’s leader to the parliament.

The president made his choice only late at night. He went out to the press
at two o’clock in the morning and announced that he would not dissolve the
Rada.

“I decided to nominate Viktor Fyodorovich Yanukovich as prime minister. I
am aware of complications that appear both in the East and the West over any
candidate, but I would like to ask the nation to try to comprehend my
decision. We have a unique chance to do the thing that we were dreaming of
in the Maidan -bring the two banks of the Dniepr together,” the president
said.
SURPRISE FOR INFLUENTIAL OUR UKRAINE MEMBERS
The news came as a surprise for the most influential members of the
president’s Our Ukraine. The bloc started mentioning a split after the news
that Yushchenko let his old rival to rise to power again appeared.

Parliamentary deputy Nikolay Katerinchuk pledged he would not support
Yanukovich’s nomination. He also promised to create an inter-faction group
to go into opposition in case Our Ukraine sets up a coalition with the Party
of Regions.

“I cannot find reasons for this action of the president. It’s the surprise
for us that is hard to give a comment on,” Katerinchuk told Kommersant. He
announced Thursday that ten allies of his were walking out from Our Ukraine.
YUSHCHENKO AGREED TO PARTY OF REGIONS TERMS
Viktor Yushchenko suffered new defeats in the morning. The Party of Regions
made him sign the national unity agreement with their terms. Points
suggested by the presidents were revised and re-written by Yanukovich’s
associates.

For instance, the mention of the course to join NATO got an addition saying
that the accession to the organization is possible only after the national
referendum.

The leader of the Regions insisted that the universal agreement also have an
article on Ukraine’s meeting engagements of the Common Economic Space and
its members, Russia, Belarus and Kazakhstan. This is how the document was
signed at a round-table session that had all political forces represented.
YUSHCHENKO HAD TO FIND EXCUSES FOR U.S. AMBASSADOR
Later, Viktor Yushchenko had to find excuses speaking with U.S. Ambassador
to Ukraine William Taylor, trying to convince him that the document focuses
on the idea that Ukraine will keep to its present foreign policy.

Yulia Timoshenko was the only one to decline to sign the agreement, calling
the document a deed of capitulation of the Orange. “Treachery is becoming a
common practice in Ukrainian politics, and it is growing into an infectious
disease which passes on by an unknown method but does not contaminate women.
It will not affect our political party. We will not let shadow lobbyists
work,” she said.

Viktor Yushchenko interrupted her speech abruptly. “Breast-beating, speaking
about patriotism and love but doing nothing about the situation is all empty
politicizing,” he retorted.

The Yulia Timoshenko Block said they were going into intransigent
opposition. Yulia Timoshenko labeled the national unity agreement “just a
screen to hide insider dealings of dividing posts and distributing
businesses.”
AKHMETOV MAIN INSTIGATOR OF ORANGE COALITION SPLIT
Ukrainian experts believe that economic issues rather than ideological ones
were the thorniest in the talks to create a coalition. But it was not Viktor
Yanukovich who took decision on the Party of Region’s behalf but Rinat
Akhmetov, Ukraine’s richest man and number seven in the party’s election
list.

Akhmetov is reputed to be the main instigator of the split in the Orange
coalition. He is the most interested in Yulia Timoshenko staying away from
the premier’s seat. Ms. Timoshenko made it clear during her tenure of the
post that she was not going to consider vested interests of the eastern
Ukrainian tycoon.

Having risen to the premiership in 2005, she mounted an all-out offensive on
business in Donetsk. Yulia Timoshenko promised to return 3,000 enterprises
to the state. Rinat Akhetov’s business empire was to become the main prey of
the strike. First, Krivorozhstal, owned by him and Viktor Pinchuk,
ex-President Leonid Kuchma’s son-in law, was seized.

Later, Ms. Timoshenko began eyeing Akhmetov’s ore mining enterprises. At the
same time, criminal cases were open against the businessman on charges of
tax evasion and fights that happened ten years ago. Rinat Akhmetov had to
leave the country for some time to stay at large.

Chances of Yulia Timoshenko regaining the prime minister’s seat increased
after the parliamentary elections when the Yulia Timoshenko, Our Ukraine and
the Socialist Party formed the Orange coalition. This development could
bring with a new round of reprivatization, which Rinat Akhmetov could not
possibly let happen.

The Party of Regions launched a mighty counter-attack on the coalition. A
wave of protests rocked Ukraine; regional authorities in the country’s east
and south adopted bills on the national status of the Russian language;
plans about NATO military exercises were foiled.
MOROZ PROVED TO BE THE WEAKEST LINK
At the same time, the Party of Regions made a try to drive a wedge into the
coalition. Alexander Moroz proved to be the weakest link in this chain. The
leader of the Socialists rushed to the anti-crisis coalition of Viktor
Yanukovich and Communists at the decisive moment when Yulia Timoshenko
was close as ever to bargain out premiership for herself.

For this, Moroz not only received the post of the Rada’s speaker, but got a
promise to have Socialists-controlled business in peace, according to
unofficial sources in Kiev.

Election rolls of the Socialists do not contain names of tycoons but the
party is well fed by Red Directors of quite a number of enterprises. That is
why the Socialist Party vehemently opposes privatization of plants.

After the Rada confirms Yanukovich as prime minister on Friday, Rinat
Akhmetov and other major businessmen of the Party of Regions will get a
strong protection.

In contrast, the Yulia Timoshenko Bloc and Our Ukraine will lose from it. The
Regions will surely remind Yulia Timoshenko of last year’s re-privatization
and the Krivorozhstal story.

It is of note that less ideologically-minded deputies have already gone away
from the Timoshenko Bloc as they had run to be in the parliament to defend
their business interests.

Our Ukraine will be at the losing end as well. The Party of Regions is sure
to send Our Ukraine’s leaders away from senior posts in lucrative state
monopolies such as Naftogaz Ukrainy. Giving in to Viktor Yanukovich,
Yushchenko, however, has chosen the less evil.

Had Yulia Timoshenko been appointed prime minister, the president’s people
would have been driven from their seats more quickly and tougher, while Our
Ukraine can still come to terms with the Regions.
OUTCOME
Members of the new government are likely to be named on Friday. Viktor
Yanukovich will head the government but he will merely act a formal premier,
Ukrainian experts note. Rinat Akhmetov will be as a real one. Our Ukraine
will probably get one set of a deputy prime minister.

Anatoly Kinakh, known for his ability to work under any rule, is the
likeliest candidate for the position. The Party of Regions will apparently
get the whole economic bloc. However, they said it was possible that acting
Economic Development Minister Arseny Yatsenyuk be asked to work in their
government.

Nikolay Onishchuk, member of Our Ukraine, said Thursday that his party
hopes to obtain posts of justice and interior ministers at the new cabinet.

Portfolios of justice and interior ministers, head of the Ukrainian Security
Service and Defense Minister are declared to be free of politics and are
under the president’s jurisdiction, according to the national unity
agreement. Therefore, Boris Tarasyuk, Anatoly Gritsenko and Igor
Drizhchany are likely to retain the former three posts.

Acting Interior Minister Lutsenko will probably lose his position.

[1] Firstly, he was personally involved in persecution of Boris Kolesnikov,
a leader of the Party of Regions, and repeatedly stated that lifting
previous convictions from Yanukovich was against the law.
[2] Secondly, the Socialists already released a list of their demands
Thursday. They would like to appoint transportation and education
ministers as well as the head of the State Property Fund.

The latter position is a key one, given a possible re-distribution of
property. It is the State Property Fund that is in charge of privatization,
so Rinat Akhmetov evidently prefers to see a compliant person at the post.
The incumbent head of the agency, Valentina Semenyuk from the Socialist
Party dropped a hint to Akhmetov on Thursday that she is what he needs.

Semenyuk mentioned that Krivorozhstal, seized from Rinat Akhmetov and his
business partner, Viktor Pinchuk, might be given back. Should an inspection
find that Mittal Steel, the new owner of the plant, does not meet any
obligation the contract – say, on workers’ wages – Krivorozhstal may be
returned to the state at any moment, Ms. Semenyuk warned.

We can also suppose that the new government will rigorously protect
interests of Donetsk-based businessmen who are mostly interested is in low
prices on Russian gas. Therefore Viktor Yanukovich will evidently raise the
issue of reducing gas prices for the friendly government during Moscow
visit. Gazprom, however, is unlikely to respond to Kiev’s request. It has
not recently met anybody half-way.

All the more, Ukraine’s new government is not going to be Russia-friendly.
The claim of making Russian the second national language – a motto that the
Party of Regions has used in the campaign – has already gone to the
background and will probably be forgotten soon.

Leonid Kuchma, by the way, acted in the same way. His promises for
Russian-speaking eastern Ukraine were discarded right after the election
victory.
YANUKOVYCH & AKMETOV HAVE TO TRY TO PLEASE THE WEST
Furthermore, Viktor Yanukovich and Rinat Akmetov will have to make efforts
to please the West. American partners have repeatedly hinted to Viktor
Yushchenko lately that Washington considers Yanukovich a totally
unacceptable prime minister. The Party of Region’s leader will have to try
hard to change this viewpoint.

Rinat Akmetov has already begun restoring relations with the United States.
As Ukrainian press report, he went to have talks with the U.S.
administration this week.

In an effort to get the West’s approval and create favorable conditions for
their business Donetsk people may soon grow to be even more pro-West
politicians than the Orange. It is particularly probable as they have three
years till the next election for this. -30-
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LINK: http://www.kommersant.com/page.asp?id=695033
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6. UKRAINE’S ORANGE REVOLUTION UNDONE?
The president made a deal to share power with the pro-Russian
leader ousted in 2004’s people-power revolt.

By Fred Weir, The Christian Science Monitor
Boston, Massachusetts, Friday, August 4, 2006

MOSCOW – President Viktor Yushchenko reached across the Orange
Revolution’s barricades Thursday and nominated his arch rival to lead
Ukraine’s government out of nearly five months of political paralysis.

The deal, reached as a constitutional deadline that expired Wednesday night,
creates a “grand coalition” between the pro-Western Mr. Yushchenko’s Our
Ukraine movement and Viktor Yanukovych’s Party of Regions, which favors
closer ties with Russia. Ukraine’s parliament, the Supreme Rada, is expected
to elect Mr. Yanukovych as prime minister on Friday.

Critics suggest the accord has betrayed the Orange Revolution and played
into Moscow’s hands. Some, including Yushchenko’s former ally Yulia
Tymoshenko, who heads the second largest party in parliament, say they will
boycott the Rada and call their supporters into the streets to protest.

“We are putting up our tents in the streets again, and we are going to take
this to the people,” says Yevgeny Zolotaryov, reached by phone. He’s the
leader of Pora, a small party allied with Ms. Tymoshenko. “This is farewell
to Yushchenko, who failed to be a leader to the nation and, frankly,
betrayed his voters. It is the end of the Orange Revolution.”
NATIONAL UNITY OVER IDEOLOGY
But some experts say the bargain may be the best way for deeply divided
Ukraine to muddle through without an open political split between its
nationalistic, Ukrainian-speaking west and the industrialized, heavily
Russified east.

“This was not a victory of one side over the other, but a set of workable
compromises,” says Oleksander Shushko, an expert with the independent
Institute for Euro-Atlantic Integration in Kiev. “Some in Ukraine don’t want
to see any cooperation with Yanukovych at all, but that would deepen the
divisions in the country.”

Speaking on television Thursday, Yushchenko said national unity was his key
concern. “We have a good chance to escape political war and pass to
political competition,” he argued. “We have another chance to unite Ukraine
today.”

March parliamentary elections left the 450-seat Rada almost evenly divided
between Yushchenko and Tymoshenko’s Orange parties and Yanukovych’s Party
of Regions. Tymoshenko, a fiery populist who was fired as prime minister by
Yushchenko a year ago, demanded she be given her old job back as the price
of supporting an Orange coalition.

Amid the bickering last month, the small Socialist Party, which holds the
balance of power, crossed the floor and joined Yanukovych, wrecking Orange
hopes and precipitating the current crisis.

“Yushchenko is in a very difficult situation, but he is thinking of the
country,” says Vira Nanivska, president of the Academy of State Management
in Kiev. “His vision is that we cannot be divided, we must compromise – but
not with our basic values – and we must learn to work together. He has not
yielded on any issue of substance.”

The outlines of the bargain, made public Thursday, suggest that Yushchenko’s
key foreign policy concern – Ukraine’s drive for NATO membership – will go
ahead unimpeded. The Western military alliance could issue an invitation to
Ukraine to begin the process of induction at its Riga Summit this November.

But Yanukovych won a pledge that joining the organization would have to be
approved by Ukrainians in a referendum. “The prospect of NATO membership
for Ukraine is very fragile,” says Masha Lipman, an expert with the Carnegie
Center in Moscow. “Polls show the majority of Ukrainians do not support the
idea at this time.”
RUSSIAN POWER PLAY?
Yanukovych also toned down his demand that more power be handed to
Ukrainian regions, and for the Russian language – which is spoken by over
half of Ukrainians – to be granted official status.

“Russian will be treated under Ukrainian law as a minority language, not as
a second official language, and that’s a big step back from Yanukovych’s
campaign promises,” says Mr. Shushko.

While the return of Yanukovych may be greeted with pleasure in Moscow, it
probably does not signal any serious geopolitical shift.

“Of course people in the Kremlin are probably gloating, and happy to see
Yushchenko so much weaker than he was before,” says Ms. Lipman. “But
Ukrainian politicians, including Yanukovych, have every reason to seek a
balance between Russia and the West, not to go one way or the other.”

But some Ukrainians worry that Russia could be fanning separatist sentiment
in eastern Ukraine, where economic links and pro-Moscow sympathies are
strong. Earlier this summer, a wave of anti-NATO demonstrations rocked the
largely Russian-populated Crimean Peninsula – home to the Russian Navy’s
Black Sea Fleet – which many Russian nationalists believe should not be part
of Ukraine.

“The current political crisis is the last resort for Russia,” says Ms.
Nanivska. “They will try to take advantage of this opportunity to split
Ukraine.”

Yushchenko’s only alternative to trying to find common ground with
Yanukovych had been to wield his constitutional power to dissolve parliament
and call new elections.

But a poll conducted in mid-July by the independent Kiev International
Institute of Sociology found that if fresh elections were held, voter
turnout among exhausted Ukrainians would be a low 56 percent, and
Yanukovych’s Party of Regions would win an outright majority of 50.3 percent
of the votes. And Yushchenko’s fiery Orange rival Tymoshenko would take 22
percent and Yushchenko’s own Our Ukraine movement would receive less
than 10 percent.

“Tymoshenko is trying to get people into the streets, to oppose any
agreement and force new elections,” says Nanivska. “It’s hard to say what
will happen. It’s going to be a tense couple of weeks coming up.” -30-
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LINK: http://www.csmonitor.com/2006/0804/p06s01-woeu.html
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7. HOW THE ORANGE REVOLUTION LOST ITS JUICE
Ukrainians might well wonder why they bothered

EUROPE: Foreign Editor’s Briefing by Bronwen Maddox
Times Online, London, United Kingdom, Friday, August 4, 2006

UKRAINIANS might well wonder why they bothered. The bright 2004
Orange Revolution has turned a muddy, burnt orange shade now that
President Yushchenko has been forced to take his arch-foe into the heart
of his Government.

Viktor Yushchenko, the hero of the Orange Revolution and passionate
advocate of closer links with the West, has finally picked the pro-Russian
Viktor Yanukovych as his next Prime Minister.

Today Ukraine’s parliament will vote on the nomination. But the outcome
is all but a formality – and for Yushchenko it is a catastrophe.

For Ukraine it is a fraction better than the outright paralysis that has
gripped the Government for four months, since parliamentary elections were
inconclusive and the Orange parties began to feud fatally with each other.

But it is probably a recipe for future paralysis, given that the instincts
of the “two Viktors” pull in opposite directions. The heart of the problem
is that Ukraine remains a divided country, torn between visions of belonging
to Europe and to Russia, with neither compelling enough to win over the
other camp.

HARD TO OVERSTATE THE SHOCK OF THIS REVERSAL
It is hard to overstate the shock of this reversal. Two years ago Yushchenko
ousted Yanukovych, a fervent pro-Russian and a symbol of the overbearing
excesses of the old regime of Leonid Kuchma.

Crowds of hundreds of thousands stood in the freezing snow through the
night to protest against corrupt election results, and Yushchenko became the
overnight darling of the West, his pockmarked face, the result of suspected
poisoning, the symbol of former Soviet citizens’ desire to overthrow their
old masters.

For Tony Blair and President Bush, more than a year into the frustrations of
building a new Iraq, it was a gift: an apparent sign of the unquenchable
desire for democracy everywhere.

This sudden shift isn’t exactly a blow to democracy. Yanukovych’s Party of
Regions certainly has electoral legitimacy; it won 186 seats in the 450-seat
legislature in March, the largest single party.

Behind him came the party of Yuliya Tymoshenko, originally part of the
Orange bloc, and Yushchenko’s Prime Minister for a few heady months
after the revolution.

But in the end Yushchenko, with the role of king-maker, found it easier to
strike a deal with his former foe than with his former ally.

His rows with Tymoshenko had paralysed the Orange bloc. Her impassive
pale face, crowned with a thick, pale rope of plaited hair (a style meant to
indicate her sympathy with peasant traditions), belied the vigour of her
opposition.

This latest twist does not prove that democracy in Ukraine is fragile;
perhaps even the reverse. But it does show that Ukraine’s European impulses
are more fragile than it had suited the West to think.

UKRAINE REMAINS A COUNTRY DEEPLY DIVIDED BY HISTORY
That is no surprise. Ukraine remains a country deeply divided by history,
culture and economy: the west leans towards Europe; the Russian-speaking,
industrial east towards Russia. Yushchenko represents the west, Yanukovych
the east.

The question now is in which direction the new “grand alliance” will lean.
Yesterday the two Viktors issued a joint declaration that they say will
direct their coalition.

They vow to seek European Union membership, co-operate with Nato and
also to work towards World Trade Organisation membership. These show
Yushchenko’s attempt to keep hold of the “rewards” from the West that his
victory secured.

The United States said yesterday that it could do business with this team.

But Yanukovych’s influence is clear in the pledge to look at joining a
Russian-backed trade zone including Belarus. Nor does the text say that
Ukrainian is the “only” state language, in deference to Yanukovych’s
Russian-speaking voters.

This isn’t a defeat for democracy, but it is a setback for the West’s
attempt to bring Ukraine within its circle of sympathy.

The mistake was to assume that the two were the same.
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LINK: http://www.timesonline.co.uk/article/0,,13509-2298438,00.html
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[return to index] [Action Ukraine Report (AUR) Monitoring Service]
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NOTE: Send in a letter-to-the-editor today. Let us hear from you.
========================================================
8. WHAT REMAINS OF UKRAINE’S “ORANGE REVOLUTION”?

By Christian Lowe, Reuters, Kiev, Ukraine, Friday, August 4, 2006

KIEV – The thousands of people who took to the streets of Ukraine’s capital
two years ago to bring about the “Orange Revolution” could be forgiven for
asking: “Why did we bother?”

Ukrainian President Viktor Yushchenko, faced down by an opposition majority
in parliament, on Thursday proposed the man he defeated in the 2004
revolution Viktor Yanukovich as prime minister.

Yanukovich is a pro-Moscow politician with close ties to big business and he
shares few of the Western-leaning and reforming ideals of the revolution.
In particular, he does not share Yushchenko’s enthusiasm for taking Ukraine
into NATO and the European Union.

Yushchenko said he had extracted written guarantees from his rival that as
prime minister he would not try to derail market reforms or integration with
Europe, though he gave no specifics. Much will depend on whether the
president manages to install his allies in key posts in a Yanukovich
government.

“It is so disappointing,” said Valentina, a hotel receptionist in Kiev. She
fought back tears after hearing Yanukovich was to be prime minister. “With
our own hands … we have handed power to the very man we fought against.”

The “Orange Revolution” quickly lost its lustre once its architects were in
power.

Bitter infighting broke out between Yushchenko and his first prime minister,
Yulia Tymoshenko. Economic growth faltered, and people who hoped for
quick improvements in living standards grew disillusioned.

Months of indecision and bickering in the “Orange” camp after an
inconclusive March parliamentary election further discredited them in the
eyes of many voters.
INDELIBLE MARK
But many observers say the revolution has left an indelible mark on Ukraine.

The media is vibrant and unafraid to criticise politicians. That is a marked
change from before 2004 when aides to former President Leonid Kuchma
would try to dictate to journalists how to report events.

Even Yanukovich has changed. A gruff politician who had little time for the
media, he has undergone coaching from Western consultants to make him
more telegenic.

And since the revolution Ukraine has conducted two national elections that
were bitterly fought, but largely clean. Previous voters were marred by
allegations of ballot-rigging.

“Voters have learnt that power and accountability come out of the ballot
box,” wrote Carlos Pascual, a former U.S. ambassador to Ukraine now
with the Brookings Institution think tank.

“In championing the ability of the people to challenge leaders through an
opposition movement, the Orange Revolution secured a future for political
opposition,” he said.

Underlining how far Ukraine had come, Yanukovich said on Wednesday the
events of 2004 “were of benefit to everyone.” He added: “People came out
onto the streets with a huge desire to change their lives for the better.”
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Additional reporting by Olena Horodetska
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9. YUSHCHENKO HAS CHANCE TO TURN FROM THE PRESIDENT
OF THE “ORANGE CAMP” INTO THE PRESIDENT OF ALL UKRAINE

REGNUM, Moscow, Russia, Thursday, August 3, 2006

KIEV – “Ukrainian President Viktor Yushchenko has acted wisely and has
decided not to break the Constitution, to no longer be led by his former
political comrades-in-arms.

This decision may turn him from the President of the ‘orange’ part of
Ukraine into the President of the whole country,” says Ukrainian political
expert Kost Bondarenko, while commenting to REGNUM on Yushchenko’s
decision to nominate Viktor Yanukovich for Prime Minister. “I can only
applaud Yushchenko for this decision,” says Bondarenko.

Asked about the prospect of the President-Prime Minister relations,
Bondarenko says: “I think they will show no cordiality or mutual
understanding, their relations will be exclusively businesslike.” -30-
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Permanent news address: www.regnum.ru/english/683423
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10. NOW IS A GOOD TIME FOR RUSSIA TO CHANGE
RULES OF GAME WITH UKRAINE

COMMENTARY: Argumenty i Fakty, Moscow, in Russian 3 Aug 06
BBC Monitoring Service, United Kingdom, Thursday, Aug 03, 2006

Text of report by Russian weekly Argumenty i Fakty on 3 August;
subheadings are as published:

Last week Ukrainian President Viktor Yushchenko had an opportunity to
dissolve the Supreme Council. But talks on a government of parliamentary
majority continued. What has to be done if the new Ukrainian authorities
will again offer their “friendship” to Russia?

A mere month ago it was impossible to imagine that there will be politicians
in the government of Ukraine who promised their electorate during the
parliamentary elections not to join NATO, grant the status of the state
language to Russian and, as a return favour, to haggle for lower gas prices
from Moscow.

Let us recall that it is not Gazprom that has been dealing since January
2006 with the delivery of gas to Ukraine, but a mediatory company,
Rosukrenergo. The Russian gas cost over 230 dollars per 1,000 cu.m. in the
first six months of the year. But the mediators assets list this gas as only
a third of the whole volume.

Most of Rosukrenergo’s gas comes from Turkmenistan at the price of 65
dollars per 1,000 cu m. The gas “cocktail” for Ukraine contains Uzbek and
Kazakh fuels as well. As a result the selling price of the cocktail on the
border of Russia and Ukraine stands at 95 dollars per 1,000 cu.m. Ukrainian
industrial enterprises receive gas at 115 dollars.

Many experts were tempted to believe at the beginning of the year that this
price is not affordable for Ukraine’s economy. About 80 per cent of
Ukraine’s exports consist of energy-consuming metallurgy and chemical
products.

But this spring the world markets “gave a present”, higher prices for
metals, to Ukraine which was on the verge of an energy abyss. The country’s
economy was on the increase again. Meanwhile it is clear to everyone that
this is most likely to be a temporary break.
EITHER NATO, OR GAS
A source in Rosukrenergo has told AiF that accords on delivering gas to
Ukraine envisage possible changes in prices in connection with the “changes
in the market situation”. The contract on delivering the Turkmen gas expires
in September. [Turkmen President] Saparmyrat Nyyazow insists on increasing
prices. As of 2007, the Kazakh gas prices will go up as well.

Will Russia be able to resist the charms of the new Ukrainian government if
its ministers again begin to pledge their eternal love to the “brotherly
Russian people” and ask for economic concessions? Will Putin be able to call
back the “market formula of pricing”?

In the opinion of some experts this is not necessary. “If Russia manages to
tactfully remind Ukraine of the idea of buying out the Ukrainian transit
pipeline, it will be difficult for Kiev to refuse. The Ukrainians then will
be able to pay some of the gas price with their property,” economist M.
Delyagin thinks.

“The continuation of mutually beneficial collaboration of the enterprises of
the military and industrial complex may become an impetus for a refusal to
join NATO. The Yanukovych-Moroz-Symonenko coalition will insist on the
refusal anyway. There is other leverage, too.”

“Let us assume that State Duma MPs will demand that the Russian government
should again change the rules regarding the payment of VAT on energy
resources supplied to Ukraine. This would make it possible to return 1bn
dollars from the Ukrainian budget to the Russian budget a year.

This is the time when the Russian government could “generously” offer
concessions to the Ukrainian government by refusing to revisit the decision
on VAT,” M. Delyagin said.
MONEY AND CHAIRS
“Russia has a good chance to finally change ‘ rules of friendship’ with
neighbours,” our American expert Professor S. Lopatnikov believes. “This
does not mean they will have to be left to their own devices. Having
established general tough trading rules for everyone, some of them can be
granted the most favourable partner status.

Discounted fuel prices, free access of their goods to Russian markets, soft
loans and other ways of ‘encouragement’ can become return steps for
observing Russia’s political and economic interests. For instance with
regard to Ukraine’s accession to the Common Economic Space or to the
Eurasian Economic Community. This is a standard practice in the world.”

“Money in the morning, chairs in the evening,” [a catchphrase from Ilf and
Petrov satirical novel “The twelve chairs” about the life in the USSR in the
1920s-1930s. The phrase means advance payments for favours] the expert
recalls the simple formula which has been on Russian officials’ minds in
their dealings with the former Soviet republics. -30-
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11. UKRAINIAN ECONOMY UNSHACKLED
Political instability doesn’t scare business

Kommersant, Moscow, Russia, Thursday, July 27, 2006

An active and decisive prime minister, Yulia Timoshenko, for instance, is
bad for the Ukrainian economy. But political instability, an unformed
cabinet, elections are not.

The Ukrainian economy prefers that the government leave it alone and it
does not react to parliamentary squabbling. This is seen in the indicators
and from surveys.

Growth of the Ukrainian GDP was at the record low rate of 2.6 percent in
2005. That was due to a large extent to an 8-percent drop in wholesale and
retail turnover, according to the data of Ukrstat, the state statistics
agency. That information looks strange, however, since observers note a
consumer boom in the country.

Troika Dialog analyst Irina Piontkovskaya suggested that the discrepancy
was caused by tax accounting when exemption in free economic zones were
abolished.

ING economist Yulia Tseplyaeva suggested that it was simply as matter of
poor data collection in the services and trade sectors. “That is a general
shortcoming in all transitional economies,” she noted.

ING places the real growth of the Ukrainian GDP at 5-6 percent. It is
clearly higher now, since Ukrstat has calculated 5 percent growth for the
first half of the year (9.3 percent in June) without changing its
methodology.

While last year’s growth was almost exclusively due to trade, industry is
now growing. In the first half of the year, heavy industry gained 12.2
percent.

Ukrainian industrialists are becoming more optimistic. According to a poll
taken by the Institute for Economic Research in Kiev, industrialists’
confidence index grew by 11 point in comparison with January.

The number of industrialists who expect changes for the better exceeded the
number of those with the opposite expectation for the first time in many
months, with 22.1 percent in an optimistic mood as opposed to 19 percent
pessimists.

A survey taken by the PRT agency showed that 74 percent of businessmen
expect good conditions for conducting business in the second half of this
year or next year.

The Ukrainian economy’s strides and positive expectations come in the midst
of high political instability. Only 6 percent of Ukrainian business heads
say they are worried about the elections.

The economic policy of the government worries considerably more of them
(23%). Fifty-nine percent say that the growing openness of the society has a
positive influence on their businesses. -30-
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LINK: http://www.kommersant.com/page.asp?idr=1&id=693086
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12. THE SHOW MUST GO ON
The Tale of the Ukrainian Coalition will stir up memory for a long time.

OPINION: By Vitaly Portnikov, Columnist
Kommersant, Moscow, Russia, Friday, August 4, 2006

The Tale of the Ukrainian Coalition, which unfolded in recent months,
will stir up a memory for a long time.

We will not forget how oddly certain voters and politicians were in their
belief that the Orange coalition, split up in the first months of Viktor
Yushchenko’s rule, would reunite after parliamentary elections. We will keep
the memory of attempts to bring the coalition back together, and how they
were mixed with mutual accusations and squabbles.

We will keep in mind how politicians from the Orange camp, once boasting of
their chastity, negotiated with the Party of Regions. We will remember how
the Orange coalition collapsed at the session of the Ukrainian parliament
the day it was formed.

We will remember a revelation that the Rada’s speaker Alexander Moroz is
not the nation’s ethical role model but a low traitor as well as the one who
ordered to murder journalist Georgy Gongadze, the crime that Moroz (an
ethical role model then) blamed President Kuchma on.

People went out to the Maidan – together with Moroz – to put an end to
crimes of the Kuchma regime and not to let his successor to assume power.

There is a conviction that Viktor Yushchenko will not let the gangster that
he stopped at the Maidan. We will have a memory of Yushchenko’s talks
with the Gangster.

The negotiations were televised all day long. A night of talks followed but
it was far from journalists’ eyes. The negotiations broke down, and
Yushchenko nominated the Gangster as prime minister.

It sounds like a soup opera, isn’t? Not like a Mexican one. The first
successful Russian soup opera was made in Ukraine, after all, at the 1+1
channel by Alexander Rodnyansky. It was called The Bourgeois’ Birthday.

Rodnyansky works in Moscow now, and Ukrainian political soup operas have
other producers, not as much talented but the characters are quite similar.

The plot is the same, too. The only difference is that the producer of that
soup had a chance to accept a tempting offer and move to work to the
neighboring country.

Our heroes from Ukraine, in contrast, have nowhere to go. They may get
tempting offers only there; other countries don’t need them as presidents
and prime ministers. So, the battle is not over yet.

The Ukrainian soup opera will go on, much to the satisfaction of politicians
and businessmen and to the equal disappointment of voters who have almost
given up a hope to get sincere elite, willing to make a change in the
country.

However, when cameras are turned on and there is a need for important
words, everyone sits down to the round table and gets engaged in endless
conversations. They do not even want to announce a commercial break.

But once cameras are turned off and journalists get asked to leave, all
actors of the soup opera dive under the same table, hiding from bugs,
planted in the times of Alexande Moroz’s ethic chastity and start dividing
seats in the government and principles.

When the main crew goes to bed, the Saint and the Gagster still stay under
the table. They go on to divide what is left with the hands that have never
stolen anything and the hands that have already stolen everything.

They don’t even notice the break of dawn and re-appearing journalists. “So,
it’s all made up, isn’t? Friends again?” they say a bit distracted. “We seem
to have reached national agreement.” -30-
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LINK: http://www.kommersant.com/page.asp?idr=520&id=695050
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13. LVOV ANALYST SAYS: THERE WILL BE NO
‘OUR UKRAINE’ AT NEXT ELECTIONS

Regnum, Moscow, Russia, Thursday, August 3, 2006

LVOV – “The fact that Our Ukraine has entered the newly established
coalition means that there will be no such party at next elections,” Vice
Rector of the Ukrainian Catholic University, political analyst Myroslav
Marynovich has commented to a REGNUM correspondent in Lvov on
signing the Memorandum on Establishing the National Unity Coalition by
Our Ukraine with the Regions Party.

“The party will practically disappear, be dissolved,” he believes. “But its
responsibility will remain. I would like our society to ask Bessmertny and
Yushchenko, who gave them such carte blanche.

I would like Our Ukraine creators, particularly, Bessmertny, gave their
arguments why people’s aspiration to establish a morally clean and put
there people who can change their colors just to make profit.”

As it was reported before, on August 3, one of the bloc leaders Roman
Zvarych said to the press that Our Ukraine and the Regions Party signed a
memorandum on establishing a coalition, which will receive another name –
The National Unity Coalition. -30-
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LINK: http://www.regnum.ru/english/683612.html
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14. UKRAINE’S 1993

COMMENTARY: By Mikhail Zygar
Kommersant, Moscow, Russia, Thu, August 3, 2006

Ukraine is now having its own 1993. Russia needed 25 months to make the
transition from Boris Yeltsin on a tank to a tank shooting at Russian White
House. Things went a little faster in Ukraine.

Only 20 months separate the present day from Maidan and the euphoria of
“orange” democracy. It ended with a head-on collision between the president
and the parliament.

What comes next? Massacre on the streets of Kiev? Alexander Moroz blessing
militia men to storm the Fifth Channel? “White-blue” supporters fighting
their way to the president’s front office on Bankovaya street? Tanks
surrounding the building of the Rada on Grushevskogo street?

Apparently, no. Such details are unimportant for “Ukraine’s 1993”. Present
Kiev politicians are not so belligerent as their Russian colleagues 13 years
ago. Back then, in Moscow, both sides were ready to resort to weapons-and
they did it. Kiev will probably be spared.

Would current deputies really want to sit under fire? Can one imagine Viktor
Yanukovich in besieged Rada? Or Rinat Akhmetov leading a detachment of
volunteers?

Viktor Yushchenko too will not be able to treat the Supreme Rada like Boris
Yeltsin treated the Supreme Council. Yushchenko does not have loyal security
officials behind him. For instance, acting Minister of Internal Affairs Yuri
Lutsenko is a Socialist. The president does not have the support of the
people. According to recent polls, his popularity rating is fluctuating
around 10 percent.

At last, Russian 1993 is different from that of Ukraine now, because there
were 2 political forces opposing each other in Moscow back then. There
are 3 of them in present-day Kiev. It means there will be no decisive battle.
Ukrainian politicians will play cat and mouse, at most.

“Ukraine’s 1993” may pass without bloodshed. It is not guaranteed, but there
is a chance. Yet, even lack of blood will not change its essence. October
1993 changed Russia.

It destroyed all symbols and illusions of romantically-minded voters. It
turned over the political soil. At last, it gave a new constitution to
Russia-with supernormal presidential power and a parliament unable to
influence major state issues.

August 2006 will make something similar with Ukraine. It does not matter who
wins. Any winner will be able to persuade voters that democracy is the
opposite of order. No matter who remains atop the waves when the “orange”
and the “blue” ebb away, he will have no difficulty with tightening the
screws, and at voters’ requests at that.

Recent polls show that one candidate became extremely popular in Ukraine
during the summer. It is not Viktor Yanukovich or Yulia Timoshenko. It is
the candidate “Against everyone”. Only 1 percent voted for that candidate in
March, while already 10 percent voted for him now. Ukrainian voters start
getting tired of democracy.

Russian authorities were horrified and enraged at the events in Kiev 20
months ago. To many it seemed Russia was losing Ukraine, and that Ukraine
was departing to the West for good.

All those who felt bitter over it back then, should be glad now. Ukraine
hasn’t departed anywhere. It keeps going the same old way which will bring
its own 2000 and 2008. -30-
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LINK: http://www.kommersant.com/page.asp?idr=520&id=694771

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15. EU HOPES NEW UKRAINE GOVERNMENT WILL CONTINUE
STRENGTHENING TIES WITH EUROPE

By: CONSTANT BRAND, AP Worldstream
Brussels, Belgium, Thursday, Aug 03, 2006

The European Union on Thursday welcomed the political compromise reached
between Ukrainian political leaders to form a new government, which it hopes
will continue to foster closer ties with the rest of Europe, but also with
Russia.

European Commission spokesman Pietro Petrucci told reporters that the deal
reached, which would allow Viktor Yanukovych to become Ukraine’s new
prime minister, was not expected to shift Kiev’s ambitions in its bid to join the
EU, despite Yanukovych’s long-standing close ties with Moscow.

“We don’t see any major differences between this coalition and the previous
government,” Petrucci said, adding however, that much depended on the new
government’s plan which is to be outlined once it takes office.

“We welcome the breakthrough that has been reached and it is important for
Ukraine … to see a stable, reform minded government in place and fully
operational soon,” said Petrucci. “The Union attaches great importance to
the new government continuing the process of political and economic reform.”

Ukraine President Viktor Yushchenko nominated his political rival Yanukovych
after he agreed to sign a national unity agreement that preserves the
president’s pro-Western and reformist policies. Yushchenko won the divisive
2004 presidential elections against Yanukovych vowing to bring his former
Soviet republic closer to the West, a move that angered Russia.

Yanukovych was accused of rigging the election after Ukraine’s Supreme Court
threw out his fraud-marred presidential win in 2004 and Yushchenko won the
court-ordered revote.

Petrucci said the EU’s verdict on whether Yanukovych – who has in the past
been staunchly against a pro-Western policy for Ukraine, including
membership in the EU or the NATO alliance – had changed would depend
on how the new government handles its relations with the 25-nation bloc.

The European Commission said it is considering drafting proposals for new
ties with Ukraine, but fall short of accepting repeated requests from
Yushchenko to offer his country a roadmap to eventual membership within the
club.

The EU has warned Ukraine that Kiev must first concentrate on internal
reforms before it can even begin discussing membership. -30-
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16. STATEMENT REGARDING CURRENT EVENTS IN UKRAINE
Organization for the Defense of Four Freedoms for Ukraine, Inc. (ODFFU)

Michael Koziupa, President, ODFFU
Organization for the Defense of Four Freedoms for Ukraine, Inc.
New York, New York, Tuesday, August 1, 2006

NEW YORK – The Organization for the Defense of Four Freedoms for
Ukraine has issued the following statement regarding current events in
Ukraine:

“The political crisis in Ukraine is the result of Russia’s continued
efforts to interfere in Ukraine’s domestic and international development
as a free and independent nation-state.

Earlier this year, the world witnessed how authoritarian interests in the
Kremlin were willing to halt gas supplies in order to subdue Ukraine. These
same interests are eager, and more than able to purchase politicians in
Ukraine’s parliament.

Clearly, leaders of certain political parties, having been guided by their
own narrow political self-interests, have demonstrated their willingness to
trade Ukraine’s sovereignty and independence for a seat in a future
neo-colonial government.

We believe there should be consequences for those politicians who have
demonstrated their utter disregard for Ukraine’s national interest and have
sacrificed the aspirations of Ukrainians from East and West to their own
personal financial gain.

Those political parties and politicians who continue to destabilize Ukraine
through municipal government and wantonly ignore the rule of law should
not be allowed a seat at the table of government. We reject the efforts of
those who would turn Ukraine into a vassal state of a new Russian Empire.

We recognize that opinions differ from east to west just like ideas differ
between brothers and sisters in one family. However, we firmly believe that
all Ukrainians are united in their support and willingness to defend their
freedom and independence.

We reiterate our solidarity with the people of Ukraine who stood their
ground in defense of their liberties in 2004. We implore the Ukrainian
leadership to listen to the voices of the Maidan that still echo today.

We also reiterate our support for and willingness to safeguard Ukraine’s
expressed domestic and foreign policy objectives that include Euro-Atlantic
integration; NATO membership; a free market economy; openness and
transparency in government; combating cronyism and corruption; legal and
judicial reform; and the continued development of democratic institutions.

The Organization for the Defense of Four Freedoms for Ukraine expresses its
solidarity with Ukrainians during these troubling times. We also express our
firm belief in a bright and prosperous future for generations of Ukrainians
born today and tomorrow who will live their lives freely and independently.

May God grant Viktor Yushchenko, President of Ukraine, the wisdom and
strength to lead Ukraine into the 21st century.”

On behalf of the ODFFU Executive, the Board of Directors and members,

Michael Koziupa, President
August 1, 2006, New York
————————————————————————————————-
The Organization for the Defense of Four Freedoms for Ukraine was founded
over 60 years ago by a conference of Ukrainian American organizations to
help Ukraine in its struggle for freedom and independence from two of the
world’s worst brown and red totalitarian regimes, Nazi Germany and the
Soviet Union. The four freedoms are: Freedom of speech – Freedom of
conscience – Freedom from fear – Freedom from want.
————————————————————————————————-
ODFFU, P.O. Box 304, Cooper Station, New York, New York. 10276
National Office: Tel: (212) 982-1170, www.fourfreedoms.net.
Office of the President – Michael Koziupa • Tel/Fax (973) 984-9132 •
e-mail: mkoziupa@optonline.net; Marko Suprun” marko@silvercow.net
———————————————————————————————–
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17. UKRAINE’S GRAND COALITION TO FORM GOVERNMENT
QUICKLY SAYS PARTY OF REGIONS OFFICIAL

RIA Novosti, Moscow, Russia, Thursday, August 3, 2006

KIEV – A grand coalition in Ukraine’s parliament to be finalized Friday will
form the government quickly, a member of the leading party said Thursday.

The head of the pro-Russian Party of Regions, which leads a majority
coalition in the Supreme Rada, received the president’s backing Thursday for
his nomination as prime minister, after four months of political wrangling.

The leaders of the Party of Regions (which holds 186 seats) and
pro-presidential Our Ukraine (81 seats) initialed Thursday a memorandum on
forming a parliamentary alliance in another step toward a “grand coalition”
in the 450-seat legislature.

Other parties in the coalition are the Socialists (33 seats) and the
Communists (21 seats). The bloc led by Yulia Tymoshenko (129 seats),
an outspoken former prime minister, has gone into opposition.

Rodion Myroshnyk, spokesman for Party of Regions leader and prime
minister-designate Viktor Yanukovych, said: “After the grand coalition is
formed finally on Friday and Viktor Yanukovych is voted in as prime
minister, the coalition will be quick in appointing a new Cabinet.”

Myroshnyk said the Party of Regions, which won the largest share of votes in
the March 26 elections, had in reserve a large number of professionals with
vast experience at top posts who were ready to head ministries and agencies,
particularly of the economic bloc.

“I am sure that our partners in the coalition also have several strong
candidates to ministerial posts,” Myroshnyk said.

Speaker Oleksandr Moroz said previously that the Rada could form a
government within one or two days following the vote on appointing
the prime minister.

Under the Constitution, a new Cabinet must be appointed within 60 days
after the current government, led by Yuriy Yekhanurov of the pro-
presidential Our Ukraine party, resigns. -30-
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LINK: http://en.rian.ru/world/20060803/52245621.html
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18. U.S. PREPARED TO WORK WITH YANUKOVYCH GOVERNMENT

AP Worldstream, Washington, D.C., Thursday, Aug 03, 2006

WASHINGTON – The State Department said Thursday it is prepared to work
Ukraine’s prospective new prime minister, Viktor Yanukovych, despite his
history of strong support for Russia.

Spokesman Sean McCormack credited Yanukovych with working within the
democratic system to achieve his political comeback.
“Mr. Yanukovych has come to the prime ministership in the old-fashioned,
democratic way: He worked hard for votes, he campaigned, he politicked,”
McCormack said.

He said the United States will work with the Yanukovych’s government as it
would with any other democratically elected government. “We want to have a
good relationship with the Ukrainian government,” McCormack said.
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19. UKRAINE LEADER AGREES TO NATO MEMBERSHIP
ONLY WITH NATIONAL REFERENDUM


AFX Europe (Focus), Kiev, Ukraine, Thursday, Aug 03, 2006

KIEV (AFX) – Ukrainian President Viktor Yushchenko has signed a pact with
pro-Russian parliamentary parties stating that the country can only join the
NATO military alliance if the move is approved at a referendum.

The pact, seen as a precursor to the expected confirmation of pro-Russian
politician Viktor Yanukovych as prime minister, also declared Ukrainian to
be the state language while guaranteeing the “free usage of Russian”.

Yushchenko appeared relatively upbeat on his agreement with the pro-Russian
forces who he fiercely opposed in a 2004 popular uprising known as the
“Orange revolution”.

Yushchenko set joining the North Atlantic Treaty Organisation (NATO) as a
key goal for Ukraine when he came to power last year following the “orange”
protests that had overturned a presidential bid by his rival Yanukovych.

Yanukovych’s subsequent success at parliamentary elections this March was
seen as a dent in Yushchenko’s objective of integration with the West, even
though Yanukovych’s Regions party failed to get an overall majority.

The Ukrainian president signalled an end to four months of wrangling today
saying he would approve Yanukovych as prime minister, a decision that
parliament is expected to confirm tomorrow. -30-
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20. ROW OVER ARMENIAN GENOCIDE PUTS SENATE APPROVAL
FOR NEW US AMBASSADOR TO ARMENIA ON HOLD
Former US Ambassador resigned after accurately
describing the Armenian genocide as genocide
.

Agence France-Presse, Washington, D.C., Thu, August 3, 2006

WASHINGTON – Efforts by the White House to win quick approval
for its new ambassador to Armenia have hit a snag after a bipartisan
group of senators moved to force the US government’s formal recognition
that Turkey committed genocide during World War I.

The Senate Foreign Relations Committee on Tuesday quietly decided to
postpone for at least a month a vote on the nomination of career diplomat
Richard Hoagland as the next US Ambassador to Armenia, congressional
officials said Wednesday.

The move came as key committee members expressed open consternation
over the mysterious “resignation” of the current US Ambassador to
Armenia, John Evans — after less than two years on the job.

The senators are also frustrated with the administration’s persistent
refusal to use the word “genocide” to describe events in Turkey between
1915 and 1917, in which an estimated 1.5 million Armenians are said to
have been killed or died after being forcibly driven from their homes.

Armenians all over the world push for official recognition of those killings
as genocide.

However, Turkey argues that 300,000 Armenians and at least as many Turks
died in an internal conflict sparked by attempts by Armenians to win
independence for eastern Anatolia and secure assistance for their bid from
Russia, Turkey’s age-old foe.

While acknowledging that mass killings have taken place, US government
officials have so far sidestepped the touchy dispute by referring to them
as a “tragedy.”

The old row flared on Capitol Hill earlier this summer when Senator Joseph
Biden, the ranking Democrat on the committee, sent a letter to Secretary of
State Condoleezza Rice, questioning what he called an “unexpected”
decision to replace Evans with Hoagland.

Evans was posted to Yerevan in August 2004 for what was supposed to
be a three-year term.

“In this case, I am particularly troubled by reports that the decision to
recall Ambassador Evans may have been motivated by statements he made to
American citizens in which he accurately described the Armenian genocide
as genocide,” Biden wrote. -30-
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21. SEARCHING FOR MYTHICAL TREASURES ON THE
BOTTOM OF THE BLACK SEA

By Anastasiya Ringis, Kyiv Weekly, Kyiv, Ukraine, Wed, Aug 2, 2006

Ukrainian scientists recently discovered 490 unknown sunken ships at a depth
of 1,300 meters in which they found the remnants of a Byzantine ship and 200
well-preserved amphorae. In May of this year Ukrainian archeologists and the
famous American oceanographer Robert D.

Ballard, Director of the Institute of Archeological Oceanography at the
University of Rhode Island, conducted an underwater archeological expedition
in the Black Sea.

Serhiy Voronov, Director of the Underwater Archeology
Department at the Institute of Archeology of the National Academy of
Sciences of Ukraine, told KW about the discoveries of the expedition.

KW: How did the idea of going on an expedition come about?

SV: Last year we went on an underwater archeological expedition in search of
a sunken ship named Armenia, in which nearly 7,000 people had perished. We
explored quite a large area of the Black Sea.

Unfortunately, the exploratory equipment was outdated and only allowed us to
explore at a depth of no more than 240 meters. We were fortunate that the
information about our expeditions was published in foreign media.

Ballard learned about us in an article. He offered us his assistance and
some of the most state-of-the-art equipment these days. His Echo sonar
system can locate sunken objects at a depth of 4,000 m.

Our task was to find the Armenia, which sank during WW II, and give it
the status of a maritime memorial. Today, only the Titanic has such a
status with a total of 1,513 victims.

Information about the number of casualties from sunken ships in Ukraine
was for many years kept secret by the Soviet authorities.

We developed an expedition program based on archive data. After the
expedition we compiled a list of future maritime memorials.

They include the Armenia, the steamer Lenin (it evacuated the civil
population from Odesa; 4,000 people died), two destroyers Dzerzhynsky and
Bezuprechniy, which transported fresh naval forces to the besieged
Sevastopol, and three destroyers, which were on a combat mission and sank
not far from Feodosiya. Two German ships Thea and Totila also made it onto
the list with nearly 8,000 casualties.

KW: Was it easy to find these treasures?

SV: Not really. We chose 112 of the deepest sunken ships from Ukrainian and
Russian archives. The search was conducted based on coordinates fixed in the
documents, but it turned out that the archive data did not correspond with
reality by 99%. We found only two ships according to the archive data.

In some cases the data was off by 25 km. It turned out that something that
did not exist was documented. However, to our great thrill we found 490
unknown ships while we were moving from point to point.

KW: Which discoveries were the most unexpected ones?

SV: We found remnants of a Byzantine ship and almost 200 amphorae at a depth
of 1,300 meters. It is possible that the ship was going from Khersones to
Constantinople and sank not far off the shore. We also found a few sailing
vessels dating back to the times of the Crimean War and the Russo-Turkish
wars. Rigging, masts and cannons were well preserved.

A battleship dating back to 1918 was a real discovery for us. We think that
is the battleship Sinop. Only three such battleships were built in
Mykolayiv: Chesma, Catherine II and Sinop.

The Chesma sank in the Gulf of Tembrovsk, Catherine II – not far from
Novorossiysk, and Sinop was supposedly cut up into scrap metal, according to
archive documents. However, we found it turned on its keel upside down not
far from Sevastopol at a depth of 140 meters.

KW: Is it true that your expedition found the Black Prince sailing vessel,
on the board of which barrels with gold could be found according to legend.

SV: We indeed found a British or American sailing vessel at a depth of 35
meters not far off the coast from Balaklava. However, we did not manage to
identify it yet. There is a hole in its hull, which is evidence that the
ship hit upon some rocks. It did not sink immediately and was carried out to
sea by the waves. So, it might be one of the ships that wrecked in 1854.

A total of 33 ships sank not far off from Balaklava in that year. One of
them was the Black Prince. Unconfirmed information states that the sailors’
wages in the form of gold in barrels worth 22 mn pound sterling were on
board the ship. Many scientists have looked for those barrels of gold. The
ship hit the rocks in a storm and the gold sank together with it.

Although a special organization called Expedition of Special Purpose
Underwater Works was formed in 1922, the Black Prince was never found. Then
the Russians started making money on the sale of licenses for the search for
the ship. The French, Italians, Spaniards, Germans and Japanese all searched
for it.

The only ones not to search for the ship were the English. The fact is that
they most likely possessed information in their archives about the items on
board the ship.

KW: There are valuable exhibits on the bottom of the Black Sea that are
likely important for museums. Are there any plans to bring them to surface?

SV: Certainly. However, we have a little problem now: there are no official
methods of conservation in Ukrainian underwater archeology. An object that
had lain on the bottom of the sea for ages and was then raised to the
surface must be conserved at once, or else it will be destroyed by oxygen.

Even metal tanks disintegrate into pieces when raised to the surface, while
on the bottom of the sea they are completely safe. Because the layer of
hydrosulfide begins at a depth of 130 meters and it is a natural conservant,
things are well preserved in it, even paper, not to mention wood and metal.

At the moment, Ballard has given us a laboratory with equipment and
chemicals for conservation. Next year we plan to raise part of armaments
from the sunken ships we discovered.

KW: And where will those underwater expositions be kept and displayed?

SV: We began organizing the opening of the Maritime Museum of Ukraine this
year. We were offered premises on the territory of the Balaklava Bay. And we
also looking into acquiring underwater tourist submarines, so that those
interested in maritime military history can see with their own eyes such
exhibits that could not be raised as the Sinop.

The artifacts we found could make up a great exposition of the national
museum. And that is only the beginning: there was an “umbrella”, just one
kilometer wide, under our ship. That means we have only explored 0.05% of
the territorial waters. But the big picture is even more inspiring and
promising.

KW: So, there will be people who will begin individually looking for
maritime treasures?

SV: Yes, there are many such people already. But we are lucky. They can only
conduct expeditions no deeper than 100 meters – that is a maximum depth
accessible for professional divers. Specialized expensive equipment is
needed for underwater search expeditions.

Divers can find all objects that are lying no deeper than 100 meters.

With every dive some on-board equipment is dismantled. The fact is that it
is possible to find some material valuables on almost every sunken ship. If
you can’t sell them, then they have some value in your own personal
collection. One way or another, this business is profitable.

Underwater finds are sold as antiquities and as scrap metal. For example,
off the Tenderovska spit we found the scrap metal of the destroyer Frunze,
which sank in 1941. Though it was on the state account, it was located in a
remote and inaccessible place and an enterprise from Mykolayiv made use of
it: the 98-meter ship was cut up like a piece of sausage.

We are planning to raise the German tank Stug 3 this summer – this is quite
a rare piece of artillery. The tank lies at the depth of 40 meters. All the
inhabitants of a nearby village understand that such an exhibit attracts
foreign collectors.

KW: Is it possible to find barrels of gold and silver in our sea, as for
example, off the shores of Peru?

SV: In theory, everything is possible. But I do not know of any such facts.
We do not have archive materials about sunken ships that transported jewels
and precious metals. That is why often modern treasure hunters are simply
chasing myths. For example, in 1941 a ship called Polina Osypenko sank in
the Dniprobugskiy Estuary.

Rumors held that a collection of the Odesa Cognac Factory was found on the
ship and salvaged. Some experts say that each bottle is worth no less than
US $100,000. Archive documents state that Polina Osypenko transported spare
parts for the destroyer Ognevoi. Some explorers continue to look for the
German ship Leris.

According to legend, in 1943 a lot of the treasures stolen by the Germans
from museums were gathered from this ship. However, archive sources claim
that the Leris was one of the ships of the Wehrmacht.

Meanwhile, the cunning inhabitants of the city of Ochakiv will gladly tell
amateur treasure hunters about a ship with well-preserved amphorae, which
lies not far from the shore at a depth of 10-15 meters. They can even show
the exact place. for a cool US $1,000! -30-
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LINK: http://www.weekly.com.ua/?art=1154458123
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[return to index] [Action Ukraine Report (AUR) Monitoring Service]
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22. SECULAR STATE OR DON’T PUT HAND BETWEEN BARK & TREE

ANALYSIS & COMMENTARY: By Serhky Odarych
In Ukrainian translated into English by Maria Tsukanova
Ukrayinska Pravda, Kyiv, Ukraine, Friday, July 28, 2006

How funny it’s to watch either Patriarch Philaret unsheathing a sword
against the anti-Ukraine criminals or Ukraine politicians trying in vain to
form Local Orthodox Church.

It is one thing to hear such slogans from the lips of Moscow Patriarch
Alexius or Kyiv Metropolitan Vladimir dancing to his tune, but quite
another – Ukraine politicians who wish to Europeanize Ukraine.

In 18-20 centuries when the whole world witnessed the appear of new
government system – so called ‘nations’ – with no generation of ‘native’
politicians, Ukraine occupied by either imperial administration – in case of
Russia, or colonial one – in case of Austria-Hungary, lacked such
possibility.

It goes without saying that it gave a rise to one of the most conservative
and bureaucratic world system head by Sherbytsky personifying in the Former
Soviet Union’ times [FSU] the Ukraine’s stronghold of Moscow.

However, it figures that Crimean Tatars and Halychyna’s immigrants may
become the exception to the rule. As regards Tatars, they used, in terms of
genetic code, to live independently. In all likelihood, when the pseudo
national-and-democratic colleagues from the ‘continental’ Ukraine disappoint
them, Tatars will achieve independence.

Similarly, the experienced Halychyna’s intelligentsia [Halychyna is a region
of the Western Ukraine], that participated in the building-up of
Austria-Hungary Empire, now back Canada, Russia, Argentina, Australia, as
well as the Organization of Ukrainian nationalists and Ukrainian Resistance
Army (OUN-UPA).

Thus, in 1991 it was not Ukraine, but Ukrainian Socialistic Republic that
won independence with the administration instead of the nationwide-elected
power, with ‘God knows what’ instead of ideology and the maladroit persons
in place of bureaucrats.

Besides, Ukraine inherited heaps of the ‘very important FSU pensioners’ –
the former (as well as today’s!) ultraconservative mockeries of warriors who
went for a tank ride over the former Czechoslovakia, amused themselves in
Novocherkatsk town and came in Ukraine to live out their days in the
satisfied Ukraine hating it with their whole hearts.

It was they who planted the ground for current the language, religious,
ethnic and territorial conflicts between Ukraine residents.

Seizing the administration, the bunglers who neither were tired-up by the
principle of representative democracy nor bore responsibility towards
Ukraine population could think of nothing to do except to monkey Russian
government system.

Specifically, as regards the religion, they used a term ‘general local
church’, as to the language issue – ‘understandable to everybody’, instead
of ‘national’, not to speak of the economic that suffered from the oligarchs
plundering the national property.

In politics, the first Russian President Yeltsyn’s tank shot with a boom at
Russian White House [the residence of Russia Parliament], the former Ukraine
President Leonid Kuchma defeated by means of Venetian tactic the current
Parliament Speaker Oleksandr Moroz, who in his turn, for the time being, is
venting the anger on Ukraine President Victor Yushchenko.

Moreover, in the administration, the greenhorns’ gave the local elite on
feudal terms the complete control over Ukraine regions.
It was the beginning, exactly – the show was in full swing.

Meanwhile, the Fundamental Law specifies in black and white so as to
eliminate the double meaning – Ukraine is a secular state, in other words –
let’s not mix apples and oranges – state is state, church is church.

Theoretically, people can worship either what they understand or what is in
fashion today, the church doesn’t poke its nose in the politic affair – its
mission is to pray God for pardon of sinners.

In actuality, however, Victor Yushchenko within just one Easter night
manages to gallop all orthodox confessions. Should Jews, Mormons

and Muslims have a holiday this very day, he undoubtedly visits
synagogues and mosques as well.

One minister publicly celebrates a religious innovation: the Education
Ministry is going to introduce a new academic discipline – schoolchildren
will attend the lessons of God’s Law or Christian ethics.

During the presidential campaign Moscow Patriarch published a orthodox
calendar where close to the image of Christ not made by hand is the shining
faces of Yanukovych and Sabodan, where among the religious posts and
holidays wormed shyly one more red-letter day – the day of presidential
election which all orthodox believes should support one and all.

At one extreme, Philaret agitated for Yushchenko at the institutions of
higher education. At the other extreme, Akhmetov formed his own ‘jihad’ –
Party of Ukrainian Muslims.

You don’t know whether to laugh or cry! Yushchenko’ protégé Philaret,
forgetting about “Render therefore unto Caesar the things which are
Caesar’s, and unto God the things that are God’s” [Matt. 22:21], tries to

contend with Sabodan, behind whom looming the ominous figure of
Putin’s protégé Ridiger and KGB inheritance – the special department
of religious intelligence service and our pensioners, of course.

It would have been a mistake if they didn’t play the trump card against
none-to-clever state – hence the interlingual, interconfessional and
interethnic conflicts.

To put it in a nutshell, Ukrainian people and the power,

[1] firstly, shouldn’t ape Putin, in terms of trying to win secures’ back,
but get the support of those who may be not know how to cross themselves –
the hundred thousands of young people who stood on Maidan under Orange
and Blue-and-White flags.

[2] Secondly – to abolish the Kuchma’s decree saying that all communities
property belongs to the religious organizations, following Gavdyda’s example
[Gavdyda is the Ukrainian leader of OUN. Accordingly to the secret service
of Moscow Patriarchate, he was killed for the attempts to help the community
get back Pochayivska Lavra Church].

Moreover, Ukraine people must get back the 4000 historical and architectural
relics of the past seized with the connivance of the former Ukraine
President.

Our aim is not giving away our cultural heritage to orthodox priests and
their parishioners – ‘the very-important FSU pensioners’ who go under both
the church banners with the image of Christ and the pseudo-Marxist flags of
‘Konotop Witch [the heroine of “Konotop Witch by Ukrainian writer Kvitka
Osnovianenko].

[3] Thirdly, needless to say, politician should let oneself to be spotted in
no religious rituals: they personify the power of not theocratic monarchy,
but Secular republic! Thus, only the ordinary citizens Victor Yushchenko and
Victor Yanukovych can go to the churches, not Ukraine President of Prime
Minister.

[4] Fourthly – to hang on a dry branch by administrative and criminal order
all Ukraine rivals – to discourage anybody from provocations for a long
time! Politicians, look here! Don’t poke the noses into Church’s business!
In its turn, Church doesn’t poke one’s into yours!

[5] Fifthly, in place of new innovation, religious ethics, let’s think over
how to drive Ukraine education out of blind alley: everybody can notice with
the naked eye that the nation degenerates, in terms of intellect.

To conclude, we shouldn’t forget our FSU and post-FSU past: several millions
of people had to seek the refuge outside Ukraine unable accustoming
themselves to capitalism. It is useless to examine the phenomenon of Belarus
and its President Lukashenko whom the grateful population will immortalize
into a monument in 1-2 years.

Last but not least, let’s remember as.Our Father: Ukraine is Secular State!
I want to ask you, conscious, intelligent and decent Ukraine people: for the
time being, Ukraine has no provocateurs, but is ramp with those who yield to
provocations, hasn’t it?

To prevent further mistakes, lets remember the truism that our grandfather
tested by fire, swords and blood: When the masters fall out, their men get
the clout! Is it not the truth?

May God bless us! -30-
———————————————————————————————-
LINK: http://www2.pravda.com.ua/en/news/2006/7/31/5945.htm
————————————————————————————————

[return to index] [Action Ukraine Report (AUR) Monitoring Service]
========================================================
23. MAN WITH A MISSION:

NIGERIAN MINISTER SETS OUT TO SAVE KIEV
Adelaja Promotes God And Democracy in a Land Suspicious of Evangelism

By Alan Cullison, The Wall Street Journal
New York, New York, Friday, July 21, 2006; Page A1

KIEV, Ukraine — When Sunday Adelaja started prayer meetings in his shabby
apartment here 12 years ago, the only attendees were seven fellow Africans
who, like him, were stranded by the collapse of the Soviet Union. “I was
ready to give up,” says Mr. Adelaja, who says God had told him to revive
Christianity in the Slavic world.

So the Nigerian evangelist started trolling Kiev’s drunk tanks and jails.
Soon, drug addicts, petty crooks and recovering alcoholics with the shakes
were sitting on his couch listening to him preach, he says. Then their
family members joined, hoping that Mr. Adelaja could help loved ones mend
their ways.

He moved Sunday services out of his apartment and into a rundown sports
complex at the edge of this capital city. In the next decade of post-Soviet
economic crumble, Mr. Adelaja’s church grew. Today, he claims to run the
largest congregation in Europe, with more than 25,000 members in Kiev alone.

“God has sent a black man to bring religion back to Russia and the Soviet
Union,” Mr. Adelaja, 39 years old, bellowed at a recent sermon. “This is
hard here for many to accept.”

Also tough to swallow for some is Mr. Adelaja’s goal of bringing
Western-style democracy to Eastern Europe. Mr. Adelaja’s church has grown
beyond its core clientele of substance abusers and petty criminals to
include the mayor of Kiev and several members of Parliament, all of whom
have allied themselves with Ukraine’s West-leaning Orange Revolution.

Mr. Adelaja says his sermons have already helped topple governments in the
former Soviet republics of Georgia and Kyrgyzstan as well as Ukraine. Rivals
say he exaggerates his influence, but Moscow and its allies in the region
are taking no chances: He has been booted out of Russia and Belarus and
declared persona non grata in Armenia, he says.

The Kremlin has always been suspicious of evangelical churches. In Soviet
times they were considered cults and possible puppets of Western
governments. Now fears have been revived by Ukraine’s Orange Revolution,
which Moscow says the West wants to make an ideological springboard for
Western-style revolt in Russia itself.

“There is no question they are a tool of the U.S.,” says Alexander Krutov, a
member of Russia’s Parliament who would like to see new laws limiting the
activities of interlopers. He calls Mr. Adelaja’s church “an alien force
that must be stopped.”

Mr. Adelaja hardly fits the profile of many men of the cloth in Ukraine.
Sunday services start with Ukrainian girls in red uniforms dancing and
shaking pompoms on a smoky stage. Mr. Adelaja sports suits of neon blue,
green and angelic white. His televised sermons are now carried to millions
of viewers whom he has promised to help cure of ills ranging from diabetes
and cancer to marital strife and pimples. The service winds down with
confessionals from former drug addicts and a Eucharist of crackers and grape
juice.

Born in Nigeria to Presbyterian parents, he arrived in the Belarussian
capital of Minsk in 1986 on a scholarship from the Soviet Communist Party.
Authorities hoped Mr. Adelaja would one day return to Africa and help spread
communism. But after training as a TV journalist, he began to preach and was
kicked out of Belarus, he says.

He turned up in Kiev, where he started a church in his home. The early
preaching was a failure. Seven people arrived for his first meeting, fellow
Africans whom he knew from school. They met twice a week for a few months,
but nobody else came. “I began to realize I had a problem — it was a
national insult to hear a black man talk about God,” he says.

That was when Mr. Adelaja decided to start searching Kiev’s underbelly for
converts. He started self-help groups for drug addicts, alcoholics, and
churchgoers wanting to discuss family problems. He also made his church an
incubator for small businesses.

Borrowing the script of evangelical churches in America, he helped
parishioners start up a print shop and a recording studio, and had some of
the churchgoers who owned businesses conduct how-to seminars.

They were helped by some of Mr. Adelaja’s own prolific writings, including
“How to Grow Rich Without Tears.” Today, Mr. Adelaja’s “Embassy of the
Blessed Kingdom of God for All Nations” claims hundreds of churches in 24
countries, including Russia, Belarus, Tajikistan and Uzbekistan. Mr. Adelaja
is now planning a modernistic, $15 million megachapel in Kiev, a city
traditionally graced by golden cupolas of Orthodox churches.

Rivals charge him with pocketing donations and inflating the number of
churches by counting private prayer groups. Yurchuk Mitrofan, an archbishop
with the Russian Orthodox Church in Kiev, says Western money helped Mr.
Adelaja’s expansion — Mr. Adelaja says he has 22 churches in the U.S.
alone. “They came in using all kinds of Western techniques that we hadn’t
used before,” Mr. Mitrofan says.

The years after the Soviet collapse were an easy time to expand for sects
that promised to fill a spiritual vacuum, Mr. Mitrofan says. Members of one
large group, the White Brotherhood, were arrested en masse after their
leader pledged to stage her own crucifixion outside Kiev’s main cathedral.

Rivals demanded action against Mr. Adelaja’s church, too, and, in 1997, the
government dispatched a team of psychologists, doctors and folk
practitioners to observe the services. They produced a certificate giving
the church a clean bill of health, which Mr. Adelaja had framed and put on
the wall of his office in the sports stadium.

Mr. Adelaja framed another certificate from Ukrainian President Viktor
Yushchenko, who thanked him for supporting the Orange Revolution in 2004.
The church erected a tent chapel on Independence Square and offered shelter
to thousands of people who came to Kiev to protest elections that were
rigged in favor of the Moscow-backed candidate for president.

Mr. Adelaja says Moscow was shocked anew in March when a member of his
congregation was elected mayor of Kiev, a bastion of the Russian Orthodox
Church since 998, when Prince Vladimir baptized Kiev’s populace in the
nearby Dnepr River.

The mayor, Leonid Chernovetsky, rose to prominence thanks in part to his
work with the church: He coordinated the congregation’s food-distribution
program in Kiev’s poorer neighborhoods.

The reaction to the new mayor in Kiev was especially harsh in Moscow, which
looks down on Ukraine’s revolutionary experiments. A prime-time Russian TV
talk show invited Mr. Adelaja to appear in May, but when he arrived in
Moscow for taping, border guards at the airport told him his visa had been
revoked.

The program, “Let Them Talk,” aired without him, and provided a forum for
psychologists and lawmakers who accused him of zombifying his followers and
illegally practicing medicine. Participants saw the earmarks of a Satanic
cult. The show wrapped up ominously with a discussion of an unsolved satanic
murder of a Moscow woman.

Mr. Adelaja says the bad publicity only helps draw new members. “It’s too
late for Russia to stop me,” he says. “My message has already come to
Russia, and there are a thousand people who think like me there.” -30-
=======================================================
Write to Alan Cullison at alan.cullison@wsj.com1
http://online.wsj.com/article/SB115344641798013235.html

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