Daily Archives: September 25, 2006

AUR#763 Sept 25 Concerns About Crimea; Sea Of Tears; A Ukrainian Ulster; Coal Mine Dangers; 7 Trillion $ Buried Underground; NATO & US Loathing In Russia

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TV 5 Kanal, Kiev, in Ukrainian 1400 gmt 20 Sep 06
BBC Monitoring Service, United Kingdom, Wed, Sep 20, 2006

Press Office of the President of Ukraine
Kyiv, Ukraine, Wednesday, September 20, 2006

A hub of the modern slave trade
The Economist print edition, London, UK, Thursday, Sep 21, 2006

INTERVIEW: With Oleksandr Formanchuk, Political Expert and
Volodymyr Prytula, Head, Committee for Monitoring Press Freedom in Crimea
Den, Kiev, Ukraine, in Ukrainian Thursday, 21 Sep 06, p 1, 2
BBC Monitoring Service, United Kingdom, Saturday, Sep 23, 2006

Assisted by new deputy head of the Presidential Secretariat Viktor Bondar.
Ukrainian News Agency, Kyiv, Ukraine, Sunday, September 24, 2006

Andrii Yanytskyi, Ukrainian News Agency, Kyiv, Ukraine, September 18, 2006

By Mykyta KASIANENKO, Symferopil
The Day Weekly Digest in English, Kyiv, Ukraine, Tue, Sep 12, 2006

The Associated Press, Donetsk, Ukraine, Sunday, Sep 24, 2006

The Associated Press, Kyiv, Ukraine, Sunday, September 24, 2006

The Associated Press, Moscow, Russia, Friday, September 22, 2006

INTERVIEW: With Dmytro Hursky, Chairman, State Geological Service
By Olena POZDNIAKOVA, Ukrinform, special to The Day
The Day Weekly Digest in English, #26, Kyiv, Ukraine, Tue, 5 Sep 2006

In the big picture, lack of financing is one of the major obstacles to the
implementation of the oil and gas development projects in Ukraine.

ANALYSIS & COMMENTARY: By Oleksandra Ivanova
Ukrayinska Pravda On-line, original article in Ukrainian
Kyiv, Ukraine, Thursday, September 21, 2006

Wednesday, September 27, 2006 from 4:00 pm to 5:30 pm
The Heritage Foundation, Washington, D.C.
The Heritage Foundation, U.S.-Ukraine Foundation,
Atlantic Council of the United States
Action Ukraine Report (AUR) #763, Article 13
Washington, D.C., Monday, September 25, 2006

Official bilateral dialogue, Sep 25-29, 2006, Webcasting live
U.S.-Ukraine Foundation, Washington, D.C., Monday, September 25, 2006

Global security, economic competitiveness, energy and the environment.
We discuss strategies on supporting fledgling democracies
in places like Ukraine and Lebanon.
PRESENTATION: By Benita Ferrero-Waldner, European Commissioner
External Relations and European Neighbourhood Policy
Breakfast Briefing with the American Business Forum on Europe (ABFE)
and the US Council for International Business (USCIB)
New York, New York, Wednesday, September 20, 2006
Europaworld, Cowbridge, Wales, UK, Friday, 22 September 2006

Controlled destruction of 1,000 Ukrainian man-portable air
defense systems (MANPADS) was completed
Office of the Spokesman, U.S. Department of State
Washington, DC, Thursday, September 21, 2006

“The Americans bombed the Serbs, they destroyed Iraq, now
they want to steal Ukraine from us.”
Agence France-Presse, Moscow, Russia, Sunday, September 24, 2006

Ukrainian News Agency, Kyiv, Ukraine, Thu, September 21, 2006

Michael Mainville, San Francisco Chronicle Foreign Service
San Francisco, California, Sunday, September 24, 2006

The Thracians – lived between modern-day Ukraine and Turkey
Daniel McLaughlin, The Observer, London, UK, Sunday Sep 24, 2006

Anna Melnichuk, AP Worldstream, Uman, Ukraine, Friday, Sep 22, 2006

BBC NEWS, United Kingdom, Saturday, Sep 23, 2006

By David Hardie, Edinburgh Evening News
Edinburgh, Scotland, Saturday, Sept 23, 2006

Lev Fedyniak, Director, Ukrainian Film club, Ukraine, Mon, Sep 25, 2006

The Ukrainian Quarterly, New York, New York, September 2006

TV 5 Kanal, Kiev, in Ukrainian 1400 gmt 20 Sep 06
BBC Monitoring Service, United Kingdom, Wed, Sep 20, 2006

KIEV – [Presenter] Ukrainian President Viktor Yushchenko is concerned over
processes taking place in Crimea. During a meeting of the National Security
and Defence Council of Ukraine, he criticized both central and local Crimean
authorities for their failure to ensure stability in the autonomous republic
and to settle land allocation issues there.

Crimea is on the agenda of today’s meeting of the national security council,
which is still in progress. Provisions of the draft 2007 budget law which
have to do with national security and defence is another key issue.

Prime Minister Viktor Yanukovych, parliamentary speaker Oleksandr Moroz,
cabinet members and representatives of the Crimean Council of Ministers and
the law-enforcing agencies are attending the meeting.

[Yushchenko] What does Crimea need for its quiet development? There are no
shortcomings in programmes or viewpoints. There are many such programmes.

It seems to me that this meeting today should not seek a yet another programme
or adopt new decisions, ignoring a bunch of decisions adopted by the
national security council 10 months ago. Esteemed colleagues, we do not need
more decisions. We need a will and an official willing to implement this
instead of trying to conceal the real situation. -30-
[return to index] [Action Ukraine Report (AUR) Monitoring Service]

Press Office of the President of Ukraine
Kyiv, Ukraine, Wednesday, September 20, 2006

KYIV – Victor Yushchenko has told reporters the National Security and
Defense Council of Ukraine will quarterly monitor the land problem in Crimea
to see whether the local authorities and the central government can solve

The President is convinced the current situation in Crimea shows that “the
state has not controlled the issue over the past few years.”

He bitterly admitted that the peninsula had lost a third of its wildlife
preserves, while the number of land seizures exceeded 8,500. Given the fact
that most of these lands have not been seized by the Tatars, he reproached
to local government for poor control.

Mr. Yushchenko believes their major fault is the inability to inventory the
lands and formulate a proper position on land resources.

“Today’s meeting was not aimed at developing a series of new decisions but
focused on resuming the implementation of the relevant decisions that we
discussed nine months ago. We will quarterly monitor the implementation of
these decisions,” he said.

The meeting also focused on Crimea’s language and education problems. There
are about 600 schools in the autonomy, 93% of them Russian, with only 50% of
Russian residents.

There are 25% and 15% of Ukrainians and Tatars, with only seven and fifteen
national schools, respectively. Mr. Yushchenko said the government should
consider the public interest when solving this problem.

“I would like to assure you that the reason of these intentions was our
desire to give the young generation a chance to enjoy access to several
languages without creating any antagonistic tendencies which could spark
language conflicts,” he said.

“I do not want to politicize these issues. [.] I do not want my government
to be accused of failing to help children of different nationalities to have
access to language learning through various language programs,” he said,
adding that the same approach was used in all the regions with such a

The Head of State said the Council had also decided to provide two thousand
scholarships to teenagers representing Crimea’s national minorities.

They also discussed ways to preserve the republic’s cultural heritage.
Having referred to a recent ethnic conflict in Bakhchysaray, Mr. Yushchenko
said such arguments should be resolved quickly and effectively.

“So we emphasized the necessity to develop a political dialogue with
different nationalities. I appreciate the ideas proposed by Crimea’s ethnic
groups to stabilize the republic, and not only during the high season. We
really want to see Crimea stable,” he said.

The participants discussed economic programs to develop the region,
particularly transit projects to improve the region’s financial stability
and create jobs. They said the existing center-to-region budget mechanism
“is faulty and results in the non-transparent use of budget funds.”

“The President and his government understand that Crimea poses a particular
challenge. This territory is influenced by a number of, perhaps,
non-standard factors, and, considering them, the center must formulate
unique policies for this region,” he said.
[return to index] [Action Ukraine Report (AUR) Monitoring Service]
A hub of the modern slave trade

The Economist print edition, London, UK, Thursday, Sep 21, 2006

THE ex-slaves are easy to spot among the passengers disembarking from
the Istanbul ferry at Odessa. As other women wobble merrily away up the
Potemkin steps, the victims of human trafficking look hungry, carry little
luggage and, in winter, shiver in their summer clothes.

Odessa grew rich in the 19th century by exporting Russian grain. These days
one of its main trades is in flesh. The city is a collecting hub for women
from across the former Soviet Union who, unbeknown to them, have been
snared by traffickers.

From Odessa and elsewhere in Ukraine they are conveyed west to Europe and
east to Russia, or south to Turkey and the Middle East. Twice a week ferries
from Istanbul bring back those, often ill and pregnant, who have been
deported by the Turks.

Katya, who is 19, was deposited in Odessa last week by the Southern Palmira,
after a tragically familiar misadventure. Encouraged by a woman she thought
was a friend, she went to Istanbul, expecting work in a restaurant (fake
advertisements are also used for recruitment).

To pay off alleged debts, she says, she found herself turning tricks in a
disco. Her friend sold her to a pimp from another town where, she says, she
slept six to a room, was threatened when she was too tired for sex, and
given money only for food.

She was freed by the police (others escape, and some are beaten for trying)
and begged the money for her ferry ticket from an ex-client. Another young
woman, conveyed to Odessa by the Caledonia, says she grew up in an
orphanage, and was taken to Turkey by a woman who promised to adopt her.

It can be hard, says Natalia Savitskaya, of Faith, Hope and Love, an Odessa
support group, to persuade these women that anyone wants to help them,
rather than entrap them again. The group offers medical, legal and
vocational aid, and helps to repatriate non-Ukrainians.

There are awareness-raising programmes in schools and at the port and
airport, plus a hotline for would-be emigrants. But there are always some,
says Ms Savitskaya, who are convinced that it won’t happen to them.

Poor, neighbouring Moldova is a big source of women. So is
Transdniestria (see article), whose pig-headed authorities refuse to
acknowledge the problem.

Turkey is said to have become more sensitive to the crime; other receiving
countries, such as the United Arab Emirates, less so. And the traffickers
are diversifying.

Fredric Larsson, of the International Organisation for Migration in Kiev,
says that Russia and Poland have superseded Turkey as the top destinations.

The slaves are now often males forced to work in construction or
agriculture, sometimes with the connivance of local police. Forced begging
and organ removal are also money-spinners.

Despite changes to Ukrainian law and a dedicated police unit, trafficking
remains a tough crime to prosecute. Even if the recruiters (some of them
former victims) are found, their bosses are often abroad. Many of the
trafficked are reluctant to testify.

Most women who land in Odessa are, like Katya, poorly educated, and often
from villages that subsist on remittances from happier emigrants. Many have
been abused at home. It isn’t only poverty, says Inna Tsobenko of Veritas,
an educational group. “They want a beautiful life.”

The combination of good looks, naivety and brutal unscrupulousness is
always profitable. Several buildings in Odessa are adorned with reliefs of
two young girls with nooses round their necks: they hanged themselves,
legend has it, after falling prey to white-slave traders. -30-
[return to index] [Action Ukraine Report (AUR) Monitoring Service]

INTERVIEW: With Oleksandr Formanchuk, Political Expert and
Volodymyr Prytula, Head, Committee for Monitoring Press Freedom in Crimea
Den, Kiev, Ukraine, in Ukrainian Thursday, 21 Sep 06, p 1, 2
BBC Monitoring Service, United Kingdom, Saturday, Sep 23, 2006

Two experts interviewed by a Ukrainian newspaper are sceptical that the
central Ukrainian authorities can influence the situation in Crimea. They
said that the autonomy’s problems have been neglected over the period of
Ukrainian independence and that Kiev still has no clear strategy or
objectives in its policy.

The following is the text of the article entitled “Crimea it is almost a
Ukrainian Ulster,” published in the Ukrainian daily Den on 21 September;
subheadings are as published;

A meeting of the National Security and Defence Council [NSDC] chaired by
Ukrainian President Viktor Yushchenko took place yesterday [20 September],
at which the social situation in Crimea was discussed. Experts on Crimea
shared their views on the autonomy’s problems with the Den newspaper.

Oleksandr Formanchuk, political expert:

Without doubt the issue submitted for discussion by the NSDC is extremely
important and significant for the country’s national security. However, it
is no secret, and we should say this, that the issue of Crimea is being
considered at such a high level not for the first time.

Yet, the problem has been getting worse for the last 15 year and has become
more dangerous. It seems to me that to date the highest state bodies have
not made up their minds on key issues: what should be the place, role,
nature and significance of autonomy in Ukraine.

Within the state there is no clarity and clear position on the problems of
the role and place of the Crimean Tatar people, who are a key link in
resolving the Crimean Tatar problem.

Regardless of how long this continues, but Crimean Tatars do not determine
the territorial autonomy in Crimea and will carry out a protest battle for
changing it into national [autonomy], for the return of all rights,
including property rights. And they do not hide this.

Unfortunately, virtually nobody in the country appreciates the depth and
complexity of this problem. There is only surprise at the fact there is no
sense or clear understanding or clear concept as to what need to be done
with such an autonomy, how to reform it, how to integrate it into Ukraine,
how to build it up, and what to do with it in the future?

This leads to fragmentation of the Crimean political elites and permanent
clashes and conflicts between them, which the centre [Kiev], it seems to me,
always even stimulated.

In reality, as regards Crimea and the Crimean Tatar people, the resolving of
these problems is a key link in strengthening the foundations of national
security for Ukraine.

Unfortunately, the policies carried out up till now by Kiev as regards
Crimea and the Crimean Tatars, only stimulated insecurity, increased risks
and wound up the spring of potential conflict, and did not assist solution
of these areas.

This is due to the fact that the country still does not have an adequate
doctrine on solving these problems which would be mandatory for bodies of
state power of all levels and all convocations regardless of the parties
which are in power.

In overall terms our country has still not made up its mind about the basic
principles of inter-ethnic and inter-faith work and relations along the
“autonomy-centre” axis\ [ellipsis as published]

Today, Crimea is, in my view, simply a decorative appendage to a unitary
state which simply irritates many politicians in Kiev due to the complexity
and lack of understanding of problems by them.

And so it would be desirable if the latest meeting of the NSDC were to
broaden the understanding by the central bodies of power of the essence and
nature and character of the Crimean autonomy, problems in Crimea and those
risks which this region carries with it.

However, to be frank, unfortunately, I have little confidence in this and
that today’s politicians can find the key to solving the Crimea problem in

This is a task for the future and it would be very good if, on the path to
this, no harsh conflict arises, but we manage to get away with no violent
conflict but with a more or less tense conflict between the sides, a “cold”
war instead of a “hot” war. And even this will be an achievement. Perhaps
they will be replaced by wiser politicians [ellipsis as published].

Volodymyr Prytula, head of the committee for monitoring of press freedom in

I believe that in overall terms, an analysis of the socio-political
situation in Crimea on the part of state leaders at such a high level as the
NSDC is hopelessly late. This should have been done a few years ago or even

And today the situation in Crimea is very difficult from the geopolitical,
ethno-political and economic points of view and, from the viewpoint of state

And in order for the decisions of the NSDC to be a bit more active, it is
very necessary today to sharply step up the presence of the uniformed
agencies the Security Service of Ukraine, the Prosecutor-General’s Office,
the police and military organizations as the first step of long-term,
systemic and very clearly thought out work with normalizing the situation in
the autonomy.

To date a very paradoxical situation has existed: neither a concept of
inter-ethnic relations nor a regional development strategy, neither do other
state doctrines reflect to an adequate extent the complexity of the Crimean
problem or the ethno-political situation, neither the Crimean Tatar factor
nor the inter-faith and inter-religion problems, nor threats to threats of
foreign influence over Ukraine through Crimea, and do not point to ways of
reducing the tension and reducing the level of risks.

And this is at a time when throughout the last few years this set of
problems had a tendency to become more acute and complicated. And, in
many aspects, influence from abroad led to, starting in 1991, irreversible
changes taking place in the autonomy.

Let’s take two factors.

[1] First, the statement that autonomy in its current form, renewed by a
referendum on 20 January 1991, which allegedly protected this creation from
reform, is absolutely wrong. The referendum renewed the Crimean Autonomous
Soviet Socialist Republic, allegedly in the form of 1921-45. However, it was
not like this for a single day.

In addition, the Supreme Council [parliament] of Crimea and former president
Yuriy Meshkov [elected president of Crimea in a non-binding poll in March
1994] disregarded the result of the referendum and, using authoritarian
methods, created, in place of the Crimean Autonomous Soviet Socialist
Republic, an almost independent republican and then the Autonomous Republic
of Crimea. Such options were not considered at any referendum and complete
force was used [to implement them].

As a result, the current autonomy is an absolutely bureaucratic creation, in
which there is a bureaucratic machine which is 50-100 per cent more than
when it was a region [Russian: oblast], and which successfully protects the
interests of officials and their disproportionate appetites from the
influence of the centre and state leaders.

Surely it is nonsense that our legal education and theory of state building
believe blindly that the nature of autonomy created by lawyer Meshkov cannot
be changed?

It is shameful to understand, however, in the course of 15 years [of
Ukrainian independence] our lawyers and state builders failed to see that
the nature of territorial autonomy contravene the needs of the state, and
failed to find a form for it which would be appropriate for the interests of
the state and the people, and not for Crimean bureaucrats.

[2] Secondly, the absolute lack of understanding by Kiev of the factor of
the Crimean Tatar people draws attention to itself.

As a result, a people who successfully stood up to the absolutist machine of
the Russian Empire, a people who for over four centuries successfully stood
up to the totalitarian machine of the USSR and as a result of which
fulfilled its dream and returned to its homeland, because unlike other
peoples of Crimea, it does not have another land apart from this land, is
now once again forced for 15 years to stand up for its rights with protests
in various forms in now democratic Ukraine!

Today, Crimean Tatars are feeling disappointment in the ability of the
Ukrainian state to resolve inter-ethnic and inter-religious problems.

Third, the Ukrainian people living in Crimea who have, starting in 1991,
been expecting that at last they can in its own country realize its own
ethno-cultural rights to language, education, culture, way of life as well
as a new way of inter-ethnic relations, have also for 15 years been forced
to feel themselves like a Diaspora whilst living in Ukraine, suffering
ridicule and disregard on the part of Crimean state bodies of the interests
of one’s state and people.

As a result in the last 15 years Crimea has turned into a whole
anti-Ukrainian enclave, where the country’s constitution is disregarded and
the rights of ethnic rights even more than was the case in the USSR.

Proof of this is in the decree issued by the president in February on the
socio-political situation in Crimea was implemented perhaps by a few per

In fact, none of the president’s instructions and decrees have been
implemented and one gets the impression that there is total sabotage of the
head of state’s decisions. However, in this situation when authority does
not belong to the president, it is difficult to say whether something can be

I have a pessimistic view of the ability of the current state bodies in
today’s political and constitutional situation to find a key link in the
Crimean problem and not find a way of resolving it.

This would be possible if constitutional reform were to be annulled and a
strong presidential vertical of power could competently and intelligently
protect the integrity of the state and the interests of the people, despite
strong external and internal pressure, and the anti-crisis coalition [led by
Party of Regions and including the Party of Regions and Socialist Party] is
simply not capable of carrying out this task and does not need it.

I believe that the problem of Crimea in Ukraine will become even more acute,
will grow and worsen, and I cannot see a body, which is capable of solving
it. In Ukraine there is not a single politician, not even of the level of
Yevhen Marchuk, who successfully solved the crisis situation in 1995 created
by the Supreme Council of Crimea and the so-called “Moscow government.”

However, nobody took the next steps and, as a result, after this the problem
only worsened and the level of conflict in Crimea only grew.

And that is why the main task of the NSDC at the current stage, which it is
capable of carrying out, is to at least increase the position of
law-enforcement bodies in Crimea to the extent that they would be able, in
the event of a radical worsening in the situation to oppose the pressure and
not to allow a geopolitical or internal conflict.

It is bitter to comprehend this, however, Crimea is today gaining the
attributes of a Ukrainian Ulster, and in this situation it is necessary to
be ready for an armed conflict, to a conflict, and, first and foremost, to
opposition from outside [ellipsis as published]. -30-
[return to index] [Action Ukraine Report (AUR) Monitoring Service]
Send in names and e-mail addresses for the AUR distribution list.
Assisted by new deputy head of the Presidential Secretariat Viktor Bondar.

Ukrainian News Agency, Kyiv, Ukraine, Sunday, September 24, 2006

KYIV – President Viktor Yuschenko, Crimean Council of Ministers Chairman
Viktor Plakyda, Crimean Parliament Chairman Anatolii Hrytsenko, Presidential
Representative to Crimea Hennadii Moskal, Sevastopol city state
administration chairman Serhii Kunitsyn and law enforcement agencies’
representatives discussed social and economic situation on the peninsula on
September 22.

Viktor Yuschenko disclosed this to the press at a briefing after the
meeting. ‘Our meeting today was dedicated to continuation of the talks
started at the National Security and Defense Council meeting and entitled
‘Social and Economic Situation in Crimea,’ Yuschenko said.

The president promised to prepare next week (September 25 – October 1) a
decree foreseeing steps to do by Kyiv and Sevastopol to make Crimea ‘stable,
calm and prosperous.’

‘We spoke about necessity of economic development (of Crimea), extension
of potential, including resort and transit potential,’ the president said.

He called the stoppage of land distribution in 2007 one of the most
important tasks. He said that about 40,000 Crimean people have not yet
received state allowances for land. The president also said that the work on
inventory of land plots in settlements and outside them has just been

He said that the participants of the meeting discussed a number of
humanitarian issues, in particular policy in the sector of health protection
in Crimea, fighting against HIV/AIDS, and initial medicine in 2007. They
also discussed issues of education and interethnic relations.

The president was assisted by newly appointed deputy head of the
Presidential Secretariat Viktor Bondar.

As Ukrainian News earlier reported, on September 20, Viktor Yuschenko
criticized authorities’ activity on solving Crimean problems at a meeting of
the National Security and Defense Council.

He voiced his confidence that Crimean problems had not been solved due to
the deficit of funds or absence of officials’ willingness.

The members of the National Security and Defense Council said that the
authorities had lost control over distribution of lands in Crimea, in
particular about one thirds of natural reserve lands were lost and about
8,500 cases of land self-acquisition were registered. A total of 25% of
lands were subjected to the inventory in settlements and 40%, outside the
settlements. -30-

[return to index] [Action Ukraine Report (AUR) Monitoring Service]

Andrii Yanytskyi, Ukrainian News Agency, Kyiv, Ukraine, September 18, 2006

KYIV – Sevastopol Economic Appeal Court has ruled that Russia’s use of
navigational and hydrographic facilities in the Crimea is illegal. The press
service of Ukrainian Prosecutor General’s Office announced this to Ukrainian

According to the announcement, the Sevastopol Commercial Appeal Court
overturned Crimean Commercial Court’s decision to reject a lawsuit in which
the Prosecutor-General’s Office demanded an end to the Russian Defense
Ministry’s illegal ownership of property as well as navigational and
hydrographic facilities in the Crimea and their return to Ukraine.

Sevastopol Commercial Appeal Court upheld the arguments of the
Prosecutor-General’s Office and ordered transfer of the navigational and
hydrographic facilities, including lighthouses, navigational light signals,
and special signs from the Russian Defense Ministry to Ukraine (in the
person of the Derzhhydrohrafia state organization).

Sarych lighthouse head and representative of Derzhhydrohrafia Yurii
Leschenko told Ukrainian News that Sevastopol Economic Appeal Court made
decisions on the case at two hearings: on September 11, the court viewed the
issue on ownership of 22 Crimean facilities, which are situated out of the
administrative and territorial borders of Sevastopol; and on September 14,
Ukraine received other 77 navigation and hydrographic and administrative
facilities in Sevastopol.

As Ukrainian News earlier reported, Ukraine and Russia are in dispute over
the ownership of hydrographic facilities in the Crimea.

Russia says that these facilities are at its disposal and that it pays rent
for them in accordance with the relevant agreements.

Ukraine denies existence of such agreements and is seeking to regain control
of the facilities through the courts. -30-
[return to index] [Action Ukraine Report (AUR) Monitoring Service]

By Mykyta KASIANENKO, Symferopil
The Day Weekly Digest in English, Kyiv, Ukraine, Tue, Sep 12, 2006

On Sept. 7, Hennadii Moskal, the Ukrainian president’s permanent
representative to the Autonomous Republic of the Crimea, summarized
the 2006 resort season’s preliminary statistics for the Crimea.

His press consultant Liudmyla Mokhova told The Day that the meeting
established that the resort season’s financial results with regard to resort
activity, retail trade, and the public food sector – are lamentable.

In 2006 Crimean resort facilities, including treatment at spas and
sanatoria, accommodations, and tourist and tour services, generated 71.7
million hryvnias’ worth of tax returns, a mere 5.9 percent of all local
budgets’ revenues. The central budget has received 33.8 million from the
Crimea, 27.7 percent less than during the same period last year.

In terms of food services, legal entities have submitted 7 million hryvnias’
worth of tax returns to the consolidated Crimean budget. The resort sphere
registers only 0.6 percent of all taxes collected in the Crimea, and the
central budget, a mere 0.3 percent.

Income tax levied on individuals renting out their homes during the resort
season is one source of revenue for the state budget. In the Crimea 6,143
officially registered residents rent their homes, paying a total of 871,000
hryvnias in income tax.

The republic’s tax authorities have a list of names of 397 individuals –
owners of hotels and small resort facilities – who have paid 756,200
hryvnias to the government.

Experts believe that this figure represents only one-third of all
mini-boarding houses. According to data collected by the Crimea’s resort and
tourism ministry, there are over 1,100 privately owned mini-hotels and
mini-boarding houses in the peninsula.

President Yushchenko’s permanent representative to the Crimea noted that the
peninsula still cannot be regarded as a resort, because it is maintained by
trifling revenues from the non-resort sector.

The State Joint Stock Company Chornomornaftohaz, which generates 33.4
percent of the state’s revenue, is the main taxpayer. Revenue coming in to
local budgets from the resort industry is also insignificant. There, payroll
and land taxes prevail, constituting 61.1 and 11.2 percent, respectively.
[return to index] [Action Ukraine Report (AUR) Monitoring Service]
NOTE: Send in a letter-to-the-editor today. Let us hear from you.

The Associated Press, Donetsk, Ukraine, Sunday, Sep 24, 2006

DONETSK – Ukraine Miners with eyelids rimmed black with coal-dust rush
past rose bushes that mark the entrance to eastern Ukraine’s Zasyadko mine
for another day of work deep in the coal pit. They never know whether they’ll
walk back out again.

Ukraine’s coal mines are some of the most dangerous in the world, a risk
illustrated starkly this week with the deaths of 17 miners in three separate

Seventy-five percent of the country’s mines are at risk of explosions due to
dangerously high levels of methane gas, officials say, but many are
profitable and others are the only source of income for hundreds of
thousands of families.

Despite the dangers, the government, facing rising natural gas prices, has a
growing appetite for the country’s rich coal reserves, and has called for
production to be increased by a third to 80 million tons in 2007.

The accident Wednesday at the Donetsk region’s Zasyadko mine killed 13 and
injured 61 workers. Hours later, three more miners died, apparently from gas
poisoning, at another Donetsk mine.

Yet another miner died Thursday in Donetsk’s Kirovska mine from a rock fall,
and in the Fominske mine, three were injured by an outburst of gas,
emergency officials said.

“Of course, it is dangerous but I have no time to think about this,” miner
Petro Martyshchenko, who was knocked unconscious by methane poisoning
at the Zasyadko mine this week, said as he ate soup in his hospital bed. “I
need to feed my three kids.”

Donetsk, about 730 kilometers (450 miles) southeast of Kiev, is the heart of
this former Soviet republic’s coal mining sector.

Mining is part of the culture. The local soccer team is called Shakhtar, or
Miners, and it’s easy to identify who works down in the pits in this city of
just over 1 million: they are the ones with the permanently coal-stained

During the Soviet era, the miners were hailed as heroes. The big Soviet-era
inscriptions still remain, proclaiming “Glory to the Miners of Donbass” (the
Donetsk basin). But today, Ukraine’s miners complain that they are “cannon

Since the 1991 Soviet collapse, 4,700 miners have been killed in accidents.
Officials say that for every 1 million tons of coal brought to the surface
in Ukraine, three miners lose their lives.

Experts say Ukraine’s mines are dangerous largely because they are so deep,
typically running more than 1,000 meters (3,280 feet) underground. In
comparison, most European coal beds lie at a depth of 500 to 600 meters
(1,640 to 1,970 feet).

Zasyadko, the site of Wednesday’s deadly accident, is one of Ukraine’s
deepest, going down 1,300 meters (4,265 feet).

“The deeper it goes, the more methane. As a result, we lose hundreds of our
boys,” said Mykhailo Volynets, head of Ukraine’s Industrial Trade Union of

Methane is a natural byproduct of mining, and it must be ventilated to
prevent explosions. But some mines rely on outdated ventilation equipment,
officials said.

Last year, President Viktor Yushchenko restored the Coal Ministry in an
attempt to exercise more control over the sector, which remains largely

The ministry, in turn, revived a special department to ensure that mines are
following safety rules, and it has proposed spending 150 million hryvnas
(US$29.7 million/euros 23.4 million) next year to help mines replace
outdated equipment and safety control systems.

“The current system of safety at mines is ineffective,” Coal Minister Serhiy
Tulub acknowledged. “We are trying to change it.”

The problems go deeper, though. Volynets said that Ukrainian mines pay
workers based on the volume of coal removed, rather than by the hour – a
practice at odds with other mining countries. “To get a decent salary,
miners often don’t observe the rules,” he said.

And it’s rare that anyone faces punishment when accidents do occur. A 2002
methane gas explosion in Zasyadko that killed 20 miners resulted in criminal
charges being filed against mine officials for negligence, but a court has
yet to return a verdict.

“I came through three accidents safe, but this one hit me,” complained miner
Martyshchenko as his wife, Oksana, sat nearby, tears in her eyes. “My life
is worth nothing for them.”

In just the first eight months of this year, 4,473 Ukrainian miners suffered
injuries and 134 have died.

Martyshchenko knows the statistics. But he makes 2,500 hryvnas a month
(US$495 or euro 391), well above the average monthly salary of 918 hryvna
(US$182 or euro 143), which is why he keeps going back down.

Ukraine’s current government, run by a prime minister from Donetsk, sees the
solution in selling the state-owned mines to the private sector, but some
say that will foster more corruption instead of leading to greater
investment. Of Ukraine’s 273 mines, 100 have been privatized.

The Zasyadko mine, which is being rented from the state, is known for being
one of the most dangerous, although officials insist safety rules are
strictly observed. For Ukraine’s miners, going down in the pits is a risk
they accept, albeit grudgingly.

“Any one of your shifts could be the last for you,” said miner Vasyl
Fedorov, 45. -30-
[return to index] [Action Ukraine Report (AUR) Monitoring Service]

The Associated Press, Kyiv, Ukraine, Sunday, September 24, 2006

HOW MUCH COAL?: Ukraine produced 60.4 million tons of coal last year.
By 2007, officials hope to increase that by 20 percent to 80 million tons. The
country has 273 mines, with 170 still under state control.

COAL VS. NATURAL GAS: Coal accounts for about 27 percent of Ukraine’s
energy supply, compared to natural gas, which comprises for 44 percent. During
the last 15 years, Ukraine has steadily replaced the use of coal with supplies
of cheaper natural gas.

But this year’s gas dispute with Russia, which led to a sharp increase in
price and the prospect of further increases to come, has prompted the
government to look again at coal.

NEW TECHNOLOGY: Ukraine’s metallurgical sector has started to pursue
technology that allows it to use a coal dust mixture, rather than natural
gas, in production.

In 2003, the Zasyadko mine launched a program to begin using methane – a
byproduct of mining – to generate heat and electrical energy, a technology
that some saw as another domestic solution to rising gas prices. -30-

[return to index] [Action Ukraine Report (AUR) Monitoring Service]

The Associated Press, Moscow, Russia, Friday, September 22, 2006

MOSCOW – Ukraine will ensure the smooth transit of gas to Europe this
winter, the nation’s prime minister said Friday after talks with his Russian

Viktor Yanukovych also said that Ukraine and Russia would agree on a gas
price for the final months of the year in the “coming days” and would set a
price for 2007 in October.

Ukraine pays US$95 (Euro75) per 1,000 cubic meters – a price that Yanukovych
said Ukraine would seek to keep at least until the new year.

“The question of US$95 is of great importance for us, although we clearly
understand that this is a difficult issue,” he said in televised comments
following the talks with Russian Prime Minister Mikhail Fradkov.

Russia strongly supported Yanukovych’s fraud-marred bid to win the Ukrainian
presidency in 2004, and his return as prime minister was broadly seen as a
boost for the Kremlin’s interests in Ukraine, as President Viktor Yushchenko
tries to move the ex-Soviet nation closer to the West.

The Kremlin said that Russian President Vladimir Putin met with Yanukovych
late Thursday.

Ukraine, which receives much of its gas supplies from Russia, agreed to a
twofold price increase earlier this year after a bitter dispute with
Russia’s Gazprom state-controlled natural gas giant.

The Russian company briefly turned off the taps to Ukraine at the height of
winter, which also triggered a brief shutdown of supplies to western Europe
after Ukraine began siphoning gas passing westward through its pipelines.

As part of the deal that resolved the dispute, Ukraine agreed to receive its
imported natural gas at a price of US$95 (?75) per 1,000 cubic meters from
an intermediary company, RosUkrEnergo – a joint venture between Gazprom
and a company owned by two Ukrainian businessmen.

However, pressure to increase the price is rising after Turkmenistan hiked
the amount Russia pays for the gas it buys and then sells on to Ukraine.

“We would like to be governed by the agreements which we had (before),
despite the change in conditions for Turkmen gas,” Fradkov was quoted as
saying by the RIA Novosti news agency.

Yanukovych also said that underground gas storage facilities were in the
process of being filled, before the peak winter heating season.

“I am sure that we will perform this task and supply the necessary volumes
of gas for Ukrainian consumers,” Yanukovych said, according to RIA Novosti.

Gazprom has warned that Ukraine was building up its winter gas supplies too
slowly, possibly endangering smooth deliveries to Europe and raising the
threat of a repeat gas crisis.

In the midst of last year’s freezing temperatures, Ukraine skimmed the extra
gas it needed from the export pipeline supplying Europe, meaning some
European customers experienced a shortfall.

Separately, Fradkov said that Russian companies were interested in investing
in metallurgy, high technology and other industries in Ukraine. He
criticized what he called the “delays of the past two years,” referring to
the period following the 2004 Orange Revolution that helped bring Yushchenko
to power, when Russian companies had faced difficulties doing business in

Yanukovych said the two side would seek a “balance of interests” ultimately
aimed at creating conditions for free trade between the two countries. -30-

[return to index] [Action Ukraine Report (AUR) Monitoring Service]

INTERVIEW: With Dmytro Hursky, Chairman, State Geological Service
By Olena POZDNIAKOVA, Ukrinform, special to The Day
The Day Weekly Digest in English, #26, Kyiv, Ukraine, Tue, 5 Sep 2006

One of the chief arguments of those who opposed Ukraine’s independence was
the claim that this country lacks rich mineral resources, of which Russia
has plenty.

So, the argument went, if Ukraine broke away from the Soviet Union, it would
lose a powerful raw-material base comprised not only of oil and gas but a
whole range of fossil fuels.

The majority of Ukrainians – even staunch advocates of independence,
including some well-informed, knowledgeable, and experienced individuals –
readily accepted the myth created by Soviet propaganda that Ukraine’s earth
is exhausted.

But is this the real situation? In geological terms, what is Ukraine’s
territory like?

Ukrinform’s observer Olena Pozdniakova posed this question to Dmytro
HURSKY, chairman of the State Geological Service of Ukraine.

“In terms of quantity and quality of fossil fuel deposits, Ukraine occupies
a stable first place in Europe: its territory represents 0.4 percent of the
world’s land mass and a population comprising 0.72 percent of the world’s

Our country accounts for about 5 percent of the worldwide extraction of
mineral resources worth more than 20 billion US dollars a year. This
includes mineral raw materials, semi-concentrates, concentrates, and
products made from them.

“Out of the 120 varieties of mineral resources consumed by people today,
Ukraine exploits 98. As for other varieties, deposits are being prepared for
exploitation or prospecting.

“As estimated by the Ukrainian Academy of Sciences’ Council for the Study
of Ukraine’s Productive Resources and other national institutions, the gross
value of ready-to-exploit mineral resources hidden in the bowels of the
earth is 7.5 trillion US dollars.

The world’s top uranium-rich countries, such as Canada, the US, the Republic
of South Africa, and Australia, estimate our reserves and resources at 11.5
trillion dollars. In clearer terms, this works out to approximately $220,000
of already surveyed reserves for every Ukrainian citizen, including

“Ukraine is tops in the world as far as deposits of many mineral resources
are concerned. For example, we have about 7.8 percent of iron ore, 43.6
percent of manganese ore, about 20 percent of titanium ore reserves, and, to
a smaller extent, zirconium and hafnium ores, etc. Ukraine is one of the
world’s top ten uranium-rich countries.”

[Ukrinform] “How did the myth of Ukraine’s mineral deficiency come about?”

“The fact of the matter is that in Soviet times emphasis was placed on the
so-called traditional mineral resources. In other words, the state budget
provided funds for search and geological surveys of about 60 varieties of
mineral resources.

For some reason, Soviet geological policy prescribed that
gold should be prospected in Siberia or near Magadan, diamonds in northern
Yakutia, platinoids in the northern part of Krasnoyarsk Territory, and so
on. As a result, Ukraine did not exactly fit in with the Union’s geological
objectives. For instance, it was forbidden even to raise the question of
prospecting for gold in Ukraine. Not a single penny was ever allotted for

[Ukrinform] “Why were no funds allotted for gold prospecting? Why was this
kind of policy pursued vis-a-vis Ukraine?”

“I can’t begin to judge this because the only policy I have dealt with for
almost 42 years is called ‘mineral raw materials” of the country in which I
was working. So I will answer your question this way: there was a time when
large territories were fenced in by barbed wire.

When I was very young, I ended up at one of the largest and most closely
guarded uranium ore deposits, where 10,000 convicts and 18 of us young
specialists worked.”

“Clearly, unpaid convict labor was an important pillar of the Soviet
economy, so uranium, gold, and diamonds were being prospected for in faraway
places where you didn’t need to pay wages to workers – a typical Soviet
approach. But what about Ukrainian gold?”

“So far only one medium-sized gold deposit has been prepared in Muzhiyivske,
Transcarpathia. It began to yield gold when it was commissioned in 1999.”

[Ukrinform] “How large are its gold reserves?”

“Only about 55 tons. But let’s compare the potential resources of Ukraine
and, say, the Russian Federation, where I happened to work for a very long
time in Siberia, the Far East, Chita and Irkutsk oblasts, my native Magadan
oblast, and the Yakut region.

Russia’s territory accounts for 17.8 percent of the world’s land mass, and
its potential is estimated at 4,500 tons of gold, while Ukraine’s gold
resources amount to 3,200 tons, with 0.4 percent of the world’s land mass.
Is the comparison clear?

“A lot has been done in the years of independence to survey and begin
exploiting gold deposits in Transcarpathia and the Donetsk massif. There are
six deposits on the Ukrainian crystalline shield alone – Klyntsivske,
Mayske, Yuryivske, Balka Zolota (‘Golden Gully’ – Ed.), Balka Shyroka, and
Balka Serhiyivska, with total reserves of gold reaching 620 tons. We are
searching for and trying to attract investors because we lack funds to
prepare the deposit for exploitation.”

[Ukrinform] “Have geologists done a good job of exploring Ukraine? Is it
true they have surveyed only four percent of its territory, as some media
have reported?”

“Detailed geological maps are the best proof that the country has been
surveyed well. I can say proudly that geological mapping is very well
developed in Ukraine, which makes it possible to forecast, search for, and
identify the deposit pattern of various mineral resources.

Incidentally, in this field we surpass not only the CIS countries but Europe
as a whole. The world’s leading geological services consider our maps to be
brilliant. Ukraine’s geological map already shows more than 8,000 deposits
of mineral wealth ready for exploitation and another 20,000 that are being

“Over the years of independence, when we began to deal with the so-called
non-traditional (for Ukraine) mineral resources, the map of Ukraine has
marked hundreds of deposits of zinc, gold, platinoids, rare and rare-earth
metals, other alloying metals, and copper.

Incidentally, there was no copper in Ukraine until now: we still import it
from Poland and some independent CIS countries. Meanwhile, the copper
deposits that were discovered in Volyn and Podillia in the early 1990s are
estimated at 25.6 million tons, while Ukraine’s current requirement is
200,000-230,000 tons. It will take time and financial effort, though, to
prepare this deposit for exploitation.

“As for the percentage you mentioned, this may be a reference to Ukraine’s
exclusive economic zone on the Black and Azov Sea shelves. This area has
been explored quite extensively, but its deposits of oil, gas, and gas
condensate have not been adequately surveyed, and only four percent of the
resources are ready for exploitation.”

[Ukrinform] “Is it true that Ukraine was the Soviet Union’s main supplier of
gas and oil before the 1970s, and can we say that our capacities in this
field are now exhausted?”

“We can’t avoid figures here. In the banner year of 1976, Ukrainian gas
producers extracted 76.8 billion cubic meters of gas, i.e., more than
required for domestic use. This gas was delivered to the entire European
part of the USSR, including the Baltic republics, Belarus, and, naturally,

Ukraine used to produce 15.4 million tons of oil – precisely the amount
needed to ensure this country’s economic security today. This scale of
production was possible owing to extensive geological surveying: test
drilling of oil and gas deep wells alone was done at the rate of 650-670
linear meters a year.

But later, the Ukrainian gas and oil complex was simply stripped of
investments, which put an end to regular geological surveying. Today, test
drilling is being done at an estimated 200,000 linear meters a year; until
recently, it was a mere 50,000 meters. Can a pace like this really promote
the country’s mineral and raw-material complex?

“Now about exhaustible gas horizons: on our advice, the government of
Ukraine recently invited international bids to exploit the Prykerchenske
offshore area, which occupies an area of 12,960sq km and is between 70 and
2,000 meters deep. This is an area where we cannot work with our equipment
and technology, which are hardly modern.

The tender was won by Vanco International, one of Europe’s largest
companies. Ukrainian and foreign oil and gas experts estimate that
Prykerchenske alone can yield at least 300 billion cu. m. and, at most, up
to 3 trillion cu. m.

“After the bidding was over, our geologists discovered a new oil deposit,
just next to this gas area, estimated at 100 million tons. So we are happy
that our optimistic forecasts have come true.”

[Ukrinform] “Will Ukraine be able to supply itself with its own energy

“This is a thorny question because it involves a lot of aspects. What do we
have? According to government statistics, the reserves now under
exploitation represent 1.3 trillion tons of natural gas, about 150 million
tons of oil, and about 112 million tons of gas condensate.

The potential resources of gas and oil are also significant. But the efforts
of prospectors and geologists alone are insufficient to solve the serious
problem of this country’s energy security.

“The government should pursue a clear-cut mineral reserves and economic
policy. Domestic fuel requirements could be fully met if outdated technology
and power-consuming equipment were scrapped and replaced with energy-saving
technologies in gas and oil production, as well as in other sectors of the
Ukrainian economy.”

“Some people predict that the wars of the future will be waged for drinkable
water, not oil.”

“Clear, artesian, subterranean water is increasingly becoming the world’s
No. 1 mineral. Ukraine’s hydrogeologists have done their best to provide
this country with pollution-free, drinkable water. If we accept the
Ukrainian potential of surveyed resources of clean water at 100 percent, the
current nationwide utilization of these resources varies from 8 to 18
percent in the regions.

At the same time, the utilization of this precious mineral is far from
ideal. To drink ecologically pure, safe water, we should allocate funds and
implement new equipment and water-saving technologies. Instead, we still do
not have a clear-cut state economic policy of utilizing underground waters
that are ecologically pure and safe.”

[Ukrinform] “What about mineral waters? Is Ukraine well stocked?”

“You know, for more than 30 years I worked only in the field, but geologists
use the word ‘field’ to describe mountains, the tundra, deserts, swamps, and
steppes. I have prospected for minerals in the Kalahari and Sahara deserts,
in the Atlas Mountains, Siberia, and the Far East – there’s hardly a place I
haven’t been to.

So I don’t know any other country that is as rich in every well-known
variety of mineral water as Ukraine. Every day the media advertise a few
famous mineral spring spas, but this is a drop in the ocean of salubrious
water that nature bestowed on our country. And it is a crime not to use it
to improve our nation’s health. But, again, the situation here leaves much
to be desired. There are many things to do.”

[Ukrinform] “We have discussed earth, water, and fire (i.e., oil and gas),
which are the most important spheres of geological activity. And now, let’s
talk about money. When Ukraine became independent, the field of geology
faced the necessity of adopting new economic methods of managing mineral
resources and a new system of funding geological surveys. Has there been any
success here? From what sources is this sector being financed?”

“Let me tell you that geology paid for itself a long time ago. The sector is
being financed from a special state budget fund that receives allocations
from businesses as payment for surveys that geologists have completed on
behalf of the state.

Every deposit of one mineral raw material or another is valued from hundreds
of millions of hryvnias to many billions and trillions.

Every ton of extracted iron ore or oil, every gram of gold represents
payments for previous geological surveys. These are the funds with which
geologists are further developing Ukraine’s mineral and raw-material base.

“But if we lived off these funds alone, geology would disappear as a
profession. In 1991, the year the Soviet Union collapsed, the sector was
financed at a level equivalent today to UAH 945 million. Conversely, in 1999
the sector received ‘a shot in the arm’: UAH 76 million.

Of course, we have been searching for contract work as well as domestic and
foreign investors. By doing so, we have maintained a constantly functioning,
mobile, and highly skilled state-run geological service of Ukraine, which in
turn has helped maintain and develop Ukraine’s mineral and raw-material

“The year 2000 was a turning point. The Yushchenko cabinet settled its
accounts with geologists: it cleared UAH 25.6-million in wage arrears to
people who had been eking out an existence. A total of UAH 286 million was
earmarked for the development of the mineral and raw-material base.

This year’s state budget provides UAH 821 million for the sector, but now,
eight months into the year, we have been financed at a mere 39.6 percent. It
is extremely doubtful that the country’s mineral and raw-material base will
develop in these conditions.

“Now, about other sources of funding. First of all, we are doing a
considerable amount of contract work, cooperating with domestic and foreign
investors to extract various mineral resources. We are constantly
formulating strategically important economic projects, for which, I hope,
international bids will be invited.

Under the Constitution and the Mineral Resources Code, the earth’s interior
belongs to the people of Ukraine, but it can be leased through a system of
auctions. The highest bidder will receive special permission to exploit
mineral deposits for up to 20 years.”

[Ukrinform] “What are geologists offering for auction?”

“Eighteen licenses for geological surveys and exploitation of deposits were
sold at last May’s auction, including twelve special permits to extract
titanium ore, coal, granite, sand, quartz sand, quicklime, flux lime, and
peat, as well as six licenses for geological surveys and the experimental
and commercial development of mineral deposits, such as titanium ores, oil,
gas, etc. The auction netted a total of UAH 15,722,000. This practice is
still in its infancy, though.

“But things do not always go smoothly: the rules of the game change every
year, and this scares off both national and foreign investors. We are
drawing up a law ‘On Leasing the Earth’s Interior and Deposits of Mineral

I hope the current Verkhovna Rada passes this law, as it will create proper
conditions for those who would like to work fruitfully with the earth,
search for new deposits and develop already surveyed ones – in other words,
to do a noble cause.

Incidentally, this job also pays very well. Worldwide experience shows that
one imaginary monetary unit invested in mineral resources generates six to
ten monetary units in terms of mineral and raw-material output. This is the
golden rule.

Over the past six years (2000-2006), the state budget has invested UAH 1.79
billion to develop Ukraine’s mineral and raw-material base, and received
minerals and raw materials worth UAH 141.2 billion. The golden rule of
geology also applies to our lands.” -30-
LINK: http://www.day.kiev.ua/168138/
[return to index] [Action Ukraine Report (AUR) Monitoring Service]
If you are receiving more than one copy of the AUR please contact us.
In the big picture, lack of financing is one of the major obstacles to the
implementation of the oil and gas development projects in Ukraine.

ANALYSIS & COMMENTARY: By Oleksandra Ivanova
Ukrayinska Pravda On-line, original article in Ukrainian
Kyiv, Ukraine, Thursday, September 21, 2006

Recently the Minister for Fuel and Energy of Ukraine Yuriy Boyko shared his
vision of the oil and natural gas production process within the aquatorium
of the Black Sea and the Sea of Azov.

The minister has expressed an opinion that the state-owned companies should
have a priority in the production of carbonates on the Ukrainian sea shelf.

According to Mr. Boyko, within the nearest two years the financing of USD
500 million up to USD 800 million should be raised for the purposes of naval
carbonates exploration.

The minister empathized that Ukraine has enough natural resources and
technical opportunities to apply for financing from the major foreign banks
in order to implement Ukrainian oil and gas production projects.

Mr. Boyko expressed an opinion that while granting licenses to oil and gas
production our country should be primarily oriented to the companies which
“are providing sources of energy to the people of Ukraine”.

Nobody disputes the fact that our country gravely needs domestically
produced natural gas and that State authorities must take urgent measures to
increase the amounts of domestic production and storage facilities.

Nevertheless, the hope that Ukrainian oil and gas production companies would
cope with the difficult task of exploring Ukrainian sea shelf is too vague.

The peculiarities of Ukrainian oil and gas production industry shall be
taken into account. These peculiarities can be boiled down to several key
Licensing of natural resources exploration and exploitation is within the
scope of authority of the Ministry for Environmental Protection and Cabinet
of the Ministers. Carbonates do fall under the category of the natural

Therefore, despite the fact that the Ministry for Fuel and Energy is
responsible for providing energy to Ukrainian companies and individuals, it
has no authority to influence the state policy of carbonates exploration and

The only Ukrainian company capable of exploring sea shelf is
Chernomornaftohaz State Stock Holding Company. The company is led by

Ihor Franchuk, the notorious ex-MP and former son-in-law of the President

Despite having obvious advantages (primarily well-qualified personnel that
has impressive working record on Crimean Peninsula) Chernomornaftohaz
lacks finances and equipment.

In the big picture, lack of financing is one of the major obstacles to the
implementation of the oil and gas development projects in Ukraine.

According to the statistics only one out of three wells yields the outcome
that is sufficient for starting the production; the price for each of the
sea based wells can vary from USD 60 million up to USD 100 million and that
is the triple amount of what should be usually spent on drilling a well on
the ‘conventional’ soil.

Therefore, one actually working well will require from USD 180 million up to
USD 300 million of financing and the production cost for such natural gas
will be several times higher comparing to the conventionally produced gas.

Therefore, the sale of the naval-extracted gas to the consumers at the
artificially reduced prices will not allow the expenses to be paid back.

Yuriy Boyko failed to explain where Chernomornaftohaz is planning to get the
financing; he only announced that at the recent moment the company is
actively seeking foreign investors who have enough experience in the
high-depth maritime production of oil and natural gas.

Won’t it be more reasonable to spend this money on improving the production
areas where Chernomornaftohaz is already active?

The drill rigs which Chernomornaftohaz currently owns allow drilling at the
depth of 80 meters while the major deposits of carbonates in the Black Sea
lie at the depth of 100 up to 1000 meters. This range of the depth includes
so-called ‘Scythian’ Area which the government of Yuriy Yekhanurov planned
to sell earlier this year.
On February 20, 2006 the government of Yuriy Yekhanurov introduced
amendments to the licensing procedure as established by the Regulation of
the Cabinet of the Ministers No. 168.

Needless to say, these amendments were ‘inspired’ by the management of
Naftohaz. Amendments entitled companies that sell the natural gas under the
official State tariffs (read: Naftohaz and its subsidiaries) to apply for
licenses to the prospective areas and deposits without any tender being

According to the State Geological Service of Ukraine, 59% of the exploration
and industrial exploitation licenses in Ukraine are granted to the two major
state-owned companies: Ukrhazvydobuvannya (46%) which is a subsidiary of
Naftohaz Ukrayiny and Nadra Ukrayiny (13%).

“State-owned companies are the major producers of the natural gas in Ukraine
and that is a problem”, Hennadiy Rudenko, the former Chairman of the
Parliamentary Committee in Charge of the Natural Resources says.

“If Ukraine will continue the discouraging practice when the majority of
licenses are granted to the state-owned enterprises, we are at a certain
risk of freezing the development of the oil and gas industry in Ukraine
delaying the market entry of the large foreign companies. In this case the
private investors would not be able to work at our market directly and will
be forced to enter the market via Ukrainian state-owned enterprises”.

Mr. Rudenko expressed an opinion that such a situation may decrease the
attractiveness of the industry for the foreign investors. Moreover, such
situation may create a fertile ground for corruption that is already quite
frequent for the oil and gas industry.

Unfortunately, the motto “Let the subsoil belong to the state-owned
companies” does not meet the modern realities. -30-
LINK: http://www.pravda.com.ua/en/news/2006/9/21/6416.htm
[return to index] [Action Ukraine Report (AUR) Monitoring Service]
Send in a letter-to-the-editor today. Let us hear from you.
Wednesday, September 27, 2006 from 4:00 pm to 5:30 pm
The Heritage Foundation, Washington, D.C.

The Heritage Foundation, U.S.-Ukraine Foundation,
Atlantic Council of the United States
Action Ukraine Report (AUR) #763, Article 13
Washington, D.C., Monday, September 25, 2006

WASHINGTON – You are invited to attend a panel discussion on
“Ukraine, Europe, and Energy Security” sponsored by The Heritage
Foundation, the U.S.-Ukraine Foundation, and the Atlantic Council
of the United States on Wednesday, September 27, 2006 from 4:00
pm to 5:30 pm at The Heritage Foundation, Washington, D.C.

The January 2006 natural gas crisis between Moscow and Kyiv
highlighted Ukraine’s current energy vulnerability, as well as unsettling
gas consumers throughout much of Europe. Energy security is among
the most urgent priorities facing Ukraine today.

The panel discussion will address policies that Ukraine might adopt to
strengthen its energy position, and how those policies would impact
both suppliers and consumers in the region.

Opening Remarks: Edward Chow, Energy Consultant
Commentators: [1] Leonid Kozhara (invited),
Deputy to the Verkhovna Rada (Party of Regions)
[2] Ariel Cohen, Senior Research Fellow, Heritage Foundation
[3] Ihor Shevliakov, International Center for Policy Studies, Kyiv
Moderator: Steve Pifer, Former U.S. Ambassador to Ukraine

Wednesday, September 27, 2006 from 4:00 pm to 5:30 pm
The Heritage Foundation, Lehrman Auditorium
214 Massachusetts Ave NE, Washington, DC 20002
Please RSVP to Will.Schirano@heritage.org – Acceptances Only
[return to index] [Action Ukraine Report (AUR) Monitoring Service]
Official bilateral dialogue, Sep 25-29, 2006, Webcasting live

U.S.-Ukraine Foundation, Washington, D.C., Monday, September 25, 2006

WASHINGTON – The U.S.-Ukraine Policy Dialogue is designed to supplement
and deepen the official bilateral dialogue between Ukraine and the United States
through the involvement of government officials, members of the Verkhovna
Rada and Congress, and representatives of non-governmental organizations,
the media and the business community.

The U.S.-Ukraine Policy Dialogue is assisted financially by the Bureau of
Educational and Cultural Affairs of the United States Department of State
under the authority of the Fulbright-Hays Act of 1961, as amended.

This September session is the third of four working sessions, which are held
alternately in Washington and Kyiv.

Participants are divided according to their expertise into four issue areas,
or Task Forces, each of which is managed by U.S. and Ukrainian partner
organizations and co-chaired by high-level American and Ukrainian experts.

The four Task Forces are: Politics and Governance; Foreign Policy and
National Security; Economics and Business; and Media and Information.

While in DC, the Ukrainian participants will meet with senior officials of
the U.S. government, representatives of NGOs, congressional committees, and
think tanks in the Washington, DC, who can provide further insight on these
issues and how objectives might be achieved.

The findings produced during the meetings with each Task Force and U.S.
government officials will be included in a final “action plan” of
recommendations to present to the governments of the United States and

The U.S.-Ukraine Foundation will be WEBCASTING LIVE this year’s

Policy Dialogue.

Registered users will be able to watch the conference live online on Monday,
September 25 and Thursday, September 28 (see detailed schedule below).
Recorded videos will be archived and available for viewing from

Registration fee for attending the conference online and watching the
recorded videos is $35.

Registrants will have an opportunity to watch live presentations delivered
by key U.S. and Ukrainian policy makers in the areas of National Security,
Governance, Foreign Policy, Economics, Business, and Information. In
addition, live webcasting will allow for online questions during the
Thursday, September 28th session.

To register for the LIVE WEBCAST, please visit:
Should you have any questions regarding the webcast, please contact
Oleksiy Synelnychenko at (202) 223-2228 or at oleksiy@usukraine.org.
[return to index] [Action Ukraine Report (AUR) Monitoring Service]
Global security, economic competitiveness, energy and the environment.
We discuss strategies on supporting fledgling democracies
in places like Ukraine and Lebanon.

PRESENTATION: By Benita Ferrero-Waldner, European Commissioner
External Relations and European Neighbourhood Policy
Breakfast Briefing with the American Business Forum on Europe (ABFE)
and the US Council for International Business (USCIB)
New York, New York, Wednesday, September 20, 2006
Europaworld, Cowbridge, Wales, UK, Friday, 22 September 2006

First let me thank Sven Oehme of the American Business Forum on Europe
and Peter Robinson of the US Council for International Business for this
invitation to talk to you, and Sidley Austin for so generously hosting this

And thank you to everyone for having bravely battled through the traffic to
get here – while UN Ministerial Week is seen by us diplomats as a crucial
contribution to the UN’s work of building a better, safer world, I know for
New Yorkers it brings anything but a better world!

On a serious note, standing in this great city today, a city I had the
pleasure of living in myself for several years, one can scarcely imagine the
enormity of the tragedy which hit it five years ago.

It is to New York’s great credit that 9/11 did not reverse the City’s
economic boom; far from it, it continues apace. I read recently that if New
York City were an independent state it would have the second highest per
capita GDP in the world!

The role New York’s business community has played in making it the city it
is today is much admired throughout the world. Perhaps The Economist
newspaper put it best in giving its 2004 survey of this city the headline,
“a caring socialist republic run by cut-throat capitalists.”!

And that business community is also at the core of the transatlantic
business links which form the bedrock of EU-US relations. I know ABFE and
USCIB are doing excellent work in consolidating those ties, and I thank you
for all you are doing to help bring our business communities closer

Ladies and Gentlemen,
This morning I’d like to present you with the “balance sheet” of what we
could think of as the EU-US “joint venture”. We have an impressive array of
assets, yet the current geo-political market-place presents us with a number
of risks.

Let me begin by assessing the “shared equity” of our relations. This has
increased in value enormously over the last 18 months or so. We have moved
from a time of tension and frustration to one of cooperation and
understanding. There’s a new spirit of constructive engagement between us,
and the June Summit between President Bush and the European Union was
one of the most fruitful yet.

Of course the political difficulties we had were never mirrored in our
economic relations, which continued to go from strength to strength. But
undoubtedly, as you will know better than I, a more positive political
atmosphere also has benefits for business.

Our renewed commitment to transatlantic cooperation is, I hope, here to
stay. Indeed, I believe it has to stay, because the “business environment”
in which we are now operating requires it.

Both of us are facing increased competition from new players in the global
market, who are threatening our dominant position – in both commercial and
ideological terms. As globalisation continues to gather pace we face new
competitors for energy supplies, raw materials, consumers and investment.

We are also both exposed to more risks than ever before, security threats
including terrorism, failed states and the proliferation of weapons of mass
destruction; environmental threats like climate change; pandemics; energy
shortages and price hikes; and waves of uncontrolled migration as a result
of poverty and conflict around the world.

These risks are too great, too multi-dimensional to be dealt with by one
country alone. If we are to insure ourselves against a more uncertain and
more turbulent future, we need to work together. And we need to ensure we
have the effective multilateral institutions necessary to help us deal with
these global risks.

It is the realisation of the commonality of the threats we face and the
impossibility of tackling them alone which underlies the renewal of our
transatlantic cooperation.

For the same reason our relationship needs more focus than ever before.
There are four areas where we need to direct our collective energies: global
security, economic competitiveness, energy, and the environment.

There is no shortage of security threats to the United States and Europe.
The European Union’s response has been a concerted effort to build up its
foreign, security and defence policy, in recognition of the fact that our
global economic power is not matched by an equivalent political punch.

That is also an implicit response to the justifiable criticism from many in
the United States that we have not, in the past, pulled our weight in
dealing with crises and conflict around the world.

As a result we are now a better and more effective partner and are working
with the US to defend our collective interests and build a safer world. We
now have around 60,000 European peacekeepers serving across the globe. And
the EU provides the backbone of the international community’s presence in
Kosovo, the Democratic Republic of Congo and Aceh, to mention but a few.

Our cooperation in fighting terrorism is now well-established. We are
working together on terrorist financing, radicalisation, and recruitment.

We are putting in place the legal and regulatory infrastructure to prevent
the proliferation of weapons of mass destruction and their means of
delivery, particularly to terrorists. And we have jointly pushed for the
implementation of arms control, disarmament and non-proliferation treaties.

We must of course be careful to strike the right balance between heightened
security and the continuation of open trade and passenger transport. The
business community sees more than most the costs we pay for increased
security, and we must keep these in proportion.

If we allow ourselves to pay too high a cost, whether in requirements for
container security, demands on airlines to provide passengers’ details,
human rights and personal liberties or, in the case of the EU,
discriminating against friendly countries over the visa waiver, then we
allow our enemies to win.

We must not lose sight of what we are striving to protect – our humanity,
our dignity, and our openness to others.

Around the world the EU and US are working together to avert or resolve
conflicts and crises. In Afghanistan the EU is providing 80% of the troops
in NATO’s International Security Force. And the EU and US shared the costs
of the presidential and parliamentary elections.

This summer we worked together to resolve the situation in Lebanon, and are
both leading members of the international Quartet dedicated to pushing for
peace between Israelis and Palestinians.

We have committed ourselves to working more closely to promote democracy
and human rights around the world.

We discuss strategies on supporting fledgling democracies in places like
Ukraine and Lebanon, assisting the growth of democratic consciousness in
Egypt and Georgia, and confronting dictatorships like Zimbabwe and

But to be seen as credible and trustworthy by others we need to be
scrupulous in our own behaviour. That means maintaining the very highest
standards in observance of the rule of law and respect for fundamental human
rights. At the Summit we had a frank exchange of views with President Bush
on this point in the context of the fight against terrorism.

It is an issue of great concern to Europeans, as I know it is to many
Americans. It’s not a subject to joke about, but in business terms I’m
afraid it would have to count as a serious reputational liability for the
United States.

For the future it is vital that we continue and extend the scope of our
cooperation on global security. And the European Union will focus on
turning itself into an even more effective player on the world stage.

The second focus is economic competitiveness. The economic and trade
ties between us will remain key to driving the global economy.

Whilst other economies around the world may be growing at a startling pace,
and gaining an ever larger share of world GDP, in absolute terms the
European Union and the United States still account for almost 6O% of the
world’s GDP. Where the transatlantic market place leads, the global economy

But if we want to maintain this position we have to remain ahead of the
game. And we have to secure our position by ensuring the global market
place is run on the basis of a transparent set of common rules.

For that reason the EU continues to support a global multilateral trade
deal. The current climate is clearly not right for pushing forward
negotiations, but we are willing to go back to the negotiating table as soon
as there’s a possibility to do so.

The political and economic costs of an indefinite suspension of the Doha
Development Agenda are far greater than the costs of a less-than-perfect

The EU and the US must exercise global leadership in pushing for an
agreement which will strengthen economic growth, improve living standards
and alleviate poverty around the world.

There’s also more we can do to strengthen our bilateral economic relations.
At the EU-US Summit we focused on two important initiatives, enforcing
intellectual property rights worldwide and tackling barriers to
transatlantic investment on both sides.

Within Europe we need to address our particular liabilities and focus on
boosting our economic performance and compensating for our ageing

We are making progress – economic growth has accelerated to its fastest
growth for six years, domestic demand is picking up, and unemployment has
dropped to its lowest point since 1998.

But there is more to do, and in the coming years the European Commission
will focus on fighting economic nationalism, defending and widening the
internal market and ensuring a clear and coherent stance on competition
issues. We are determined to deliver concrete results for both business and

The third joint area is energy. Energy will be of central importance to the
long-term stability and prosperity of the global economy.

We are faced with record-high oil prices and increased dependence on foreign
supplies of fossil fuels. According to current trends the EU will import 70%
of its energy in 2030, compared to 50% today.

The US faces a similar challenge, which is why earlier this year President
Bush made his famous call for an end to American oil addiction.

To put things in perspective, Europeans consume 12.5 barrels of oil per
person per year, exactly half of what each US citizen consumes. The
Chinese consume only 2 barrels of oil each.

So it’s no surprise that energy has risen to the top of the political agenda
and was one of the major issues at the EU-US summit.

We agreed there should be strategic cooperation between us, addressing
energy supply security – including diversifying supply routes, enforcing
market rules and protecting infrastructure; alternative sources of energy;
and energy efficiency.

The key is to increase predictability by creating the right market
conditions and legal frameworks in both producer and transit countries. And
to work together on technological developments that will help us diversify
our energy sources.

The EU and the US have an important role to play in providing the global
leadership required for practical action to take place.

Success will bring new economic opportunities; cleaner air and drinking
water; and a chance to halt and perhaps reverse environmental degradation.

Which brings me to my final topic, the environment. A surprise block-buster
in cinemas this summer was Al Gore’s film “An Inconvenient Truth”, which so
dramatically and convincingly makes the case for manmade global climate

This has not traditionally been an area on which the EU and the US have seen
eye to eye, but we are now converging in our appreciation of the scale of
the global environmental challenges we face.

As the film points out, large swathes of the planet – this city included –
are scheduled to disappear under the ocean if we do nothing to change our

In my home country, Austria, we are increasingly confronted with annual
floods and disappearing glaciers.

At the Summit in June we set up a high level dialogue on climate change,
clean energy and sustainable development. The idea is to find ways to get
cost-effective emission cuts, develop and use new technologies and renewable
fuels, and focus on environmental issues like biodiversity.

Business has not always been the strongest champion of environmentalism,

but I believe that too is changing as we realize the enormity of the threat we
face, and the inevitable impact on commercial interests that will have.

Environmental protection is increasingly being seen as a joint
responsibility between government, business, and civil society.

Ladies and Gentlemen,
That completes today’s review of the balance sheet of transatlantic
relations. Do our liabilities outweigh our assets? No. Should we be issuing
a profit warning, or selling stock options? Certainly not.

The business environment is certainly challenging, but we have the necessary
tools and most importantly the political will to rise to those challenges.

If we continue our close cooperation and focus on the four areas I’ve
highlighted: global security, economic competitiveness, energy and the
environment, the projections for the future look bright.

I forecast dividend payments ahead! -30-
LINK: http://www.europaworld.org/week278/speechferrero22906.html
[return to index] [Action Ukraine Report (AUR) Monitoring Service]
Controlled destruction of 1,000 Ukrainian man-portable air
defense systems (MANPADS) was completed

Office of the Spokesman, U.S. Department of State
Washington, DC, Thursday, September 21, 2006

WASHINGTON – The world’s skies were made a little safer this week when
the controlled destruction of 1000 Ukrainian man-portable air defense
systems (MANPADS), was completed on September 20 in northeast Ukraine,
outside the city of Shostka.

These weapons, deemed by Ukraine to be excess to its defense needs, are but
the first installment in a 12-year weapons and munitions destruction project
being undertaken by Ukraine and NATO in a NATO-Partnership for Peace
Trust Fund initiative – – the largest such multilateral destruction project
of its kind.

The United States is the lead sponsor of the first three-year phase of this
project to which it already has contributed over $3.64 million. 12 other
countries and the European Union have pledged over Euro5.6 million
(approximately $7.2 million).

Ukraine is providing most of the operational funding and in-kind support. A
total of approximately $27 million will be required from donors to complete
the project. Additional contributions, including those from non-NATO
members, will be welcomed.

In addition to the MANPADS that were destroyed, 15,000 tons of stockpiled
excess and unstable munitions, including ammunition for automatic weapons,
artillery shells, and mortar rounds, and 400,000 small arms and light
weapons, are scheduled to be destroyed during the first phase.

By the end of the twelve-year project, a total of 1.5 million small arms and
light weapons, and 133,000 tons of munitions will have been safely

The impetus for this extraordinary project is twofold.
[1] First, Ukraine has suffered several major explosions of unstable
ordnance in some of its munitions depots. Controlled destruction of the
remaining dangerous ordnance will reduce the public safety threat and
health risk to Ukrainians who live near such depots.

[2] Second, the destruction of weapons and munitions that are no longer
needed by Ukraine to defend itself will ensure that they are never obtained
by illicit arms traffickers, criminals, or terrorists. -30-
LINK: http://www.state.gov/r/pa/prs/ps/2006/72935.htm
FOOTNOTE: The U.S. State Department in another article said, “The
threat from MANPADS is very real. The State Department estimates
that since the 1970s more than 40 civilian aircraft have been hit by
MANPADS, causing about 25 crashes and over 600 deaths around
the world.

[return to index] [Action Ukraine Report (AUR) Monitoring Service]
“The Americans bombed the Serbs, they destroyed Iraq, now
they want to steal Ukraine from us.”

Agence France-Presse, Moscow, Russia, Sunday, September 24, 2006

MOSCOW – For a moment, modern Moscow seemed to be caught in the
past: Soviet flags soared over 1,500 chanting protestors while Communist
party officials rained shame on the United States and NATO.

But this was no state-ordered show. On the contrary, the protest this month
against planned NATO and US military exercises on Russian soil grew so
heated, it brought calls for President Vladimir Putin’s resignation.

“They’re selling out our interests the way they always do,” said a red-faced
Irina Bespalova, 62, as hundreds chanted: “Putin, step down!”

“The Americans bombed the Serbs, they destroyed Iraq, now they want
to steal Ukraine from us,” Bespalova said, referring to plans by pro-Western
Ukrainian President Viktor Yushchenko to bring his country into NATO.

Fifteen years after the end of the Cold War, NATO can still provoke Russian
fear and fury the way few things can, as shown by a wave of protests over
the planned military exercises — even after they were postponed in early

“Russians have never loved NATO,” Vyacheslav Nikonov, a Kremlin-
connected analyst, told AFP. “You rarely have warm feelings about military
blocs you’re not a part of.”

Those feelings have only grown colder as the alliance has crept through
territory that was once in Moscow’s sphere of influence in two rounds of
post-Cold War enlargement.

The alliance embraced Poland, Hungary and the Czech Republic in 1999,
then seven Baltic and central European states in 2004.

But anti-NATO animosity has reached a new high, analysts said.

First, “this is an extremely different Russian leadership than the one that
swallowed the previous two rounds of enlargement,” said Clifford Kupchan,
an analyst at the Washington-based Eurasia Group.

“This is a petro-empowered leadership that sees itself as resurgent,”
Kupchan said. “In many ways, the Russians are back … These guys are
not going to take a more serious round of NATO enlargement lying down.”

Second, the most likely new NATO members are former Soviet republic
Georgia — already firmly in the West’s orbit since the 2003 Rose Revolution
brought President Mikheil Sakaashvili to power — and, more importantly,

“Ukraine occupies a very special place in the Russian consciousness,” said
Fyodor Lukyanov, editor of the journal Russian in Global Affairs.

Given centuries-old ethnic and cultural ties between Russia and its western
neighbor, “pulling Ukraine into NATO would raise anti-NATO and anti-
Western sentiment to the point where it would be uncontrollable,” Lukyanov

“It would be a wonderful trump card for those who say that NATO and the
West are deceiving us with talk of partnership, that they only want to
weaken Russia.”

And Russia is hardly indifferent to Georgia’s path toward the alliance, as
when a Friday agreement that NATO and Georgia would begin an
“intensified dialogue” brought swift protest from the Russian foreign

“Georgia’s joining the current, unreformed NATO … will seriously affect
Russia’s political, military and economic interests,” the ministry said in a
statement. Still, the talk of partnership between Russia and NATO is not
just talk.

Russia has been a member of NATO’s Partnership for Peace program since
1994, and though this year’s NATO exercises were postponed, the Russian
government “has had long-term plans to increase contacts” with NATO,
Nikonov said.

Also Friday, Russian Defense Minister Sergei Ivanov announced that Russia’s
Black Sea fleet would participate in NATO’s Operation Active Endeavor in
October, a maritime anti-terrorism program.

And Russia’s concerns over Ukraine have been somewhat eased, Nikonov
said, by the appointment of Ukrainian Prime Minister Viktor Yanukovych,
who is seen as pro-Russian and recently put the country’s NATO bid on hold.

Meanwhile, Lukyanov said, various political groups have been stoking anti-
NATO feelings for their own ends in the heated atmosphere before
Russia’s 2007 parliamentary vote and presidential elections in 2008.

“That’s easy enough to do,” he added. “People were raised on anti-NATO
sentiments. That’s not going away anytime soon.” -30-
[return to index] Action Ukraine Report (AUR) Monitoring Service]
You are welcome to send us names for the AUR distribution list.

Ukrainian News Agency, Kyiv, Ukraine, Thu, September 21, 2006

KYIV – The U.S. Embassy in Ukraine has plans to help Ukrainians learn more
about NATO. U.S. Ambassador to Ukraine William Taylor made a statement
to that score to the press after taking part in the opening ceremony of the
center for voluntary HIV/AIDS testing with the chief military hospital of
the Ukrainian Defense Ministry.

A decision to be taken by the Ukrainian people and the Ukrainian government
must a decision based on knowledge, he said.

He said the U.S. Embassy would encourage relevant discussions at
roundtables, seminars, conferences throughout Ukraine.

The Untied States hopes that all arguments for Ukraine’s joining NATO and
against the joining of the organization will be widely spread by media to
facilitate productive discussions, he said.

He said Ukraine and NATO should continue deepening their cooperation, which
must be practical. “When Ukraine takes the decision, the NATO doors will be
open,” he said.

As Ukrainian News earlier reported, during the meeting of Ukraine-NATO
commission in Brussels (Belgium) in September, Premier Viktor Yanukovych
called cooperation with NATO important for Ukraine, but said that a mere of
12-25% of Ukrainians supported Ukraine’s membership of NATO.
[return to index] [Action Ukraine Report (AUR) Monitoring Service]

Michael Mainville, San Francisco Chronicle Foreign Service
San Francisco, California, Sunday, September 24, 2006

SUKHUMI, Georgia — Before the collapse of the Soviet Union, the lush
region of Abkhazia was a playground of the Soviet elite.

Joseph Stalin, Nikita Khrushchev and Mikhail Gorbachev all had opulent
summer homes along its shores. Soviet holidaymakers crowded its beaches,
and the boardwalk of the capital, Sukhumi, was renowned for its nightlife.

Locals like to say that when he met Khrushchev in Abkhazia, Cuban
President Fidel Castro raved that its beauty matched that of his homeland.

Today’s Abkhazia is a far cry from its halcyon days. More than a decade
after a devastating war with Georgia over its post-Soviet status, the tiny
self-declared state is a gutted, desperately poor shell of its former self,
its once-exclusive hotels now derelict and whole villages lying in ruins.

Largely cut off from the rest of the world, it is also a potential flash
point for renewed violence in the volatile region along Russia’s southern

“In a way, our problem is that we live in such a beautiful place,” said
Abkhazia’s de facto president, Sergei Bagapsh. “That is why there are those
who want to take it away from us.”

The status of the would-be state came up before the United Nations on Friday
when Georgian President Mikheil Saakashvili, who came to power after the
2003 “Rose Revolution,” told the U.N. General Assembly that Abkhazia is
part of his country, as is Georgia’s other violence-torn separatist enclave,
South Ossetia.

“If the purpose of our revolution was to guarantee all citizens of Georgia
have the right to participate fully in the life and decisions of the
state — then our revolution remains unfinished,” said Saakashvili, a
U.S.-educated lawyer.

“Let us be under no illusions. The residents of our disputed territories are
under a form of gangster occupation which hopes the international community
will lose interest and reward the results of ethnic cleansing.”

Backed by other former Soviet states seeking closer ties with the West,
including Ukraine and Moldova, Georgia pushed successfully for discussion
of “protracted conflicts” in the region to be included on the General
Assembly’s agenda. A Russian-backed attempt to block the debate failed by
one vote.

The Abkhazians, who speak their own language, declared independence in
November 1994 and set up their own government, complete with a president,
parliament and Cabinet, but have failed to win recognition from any country.

Georgia has maintained an economic blockade — the only access to the
outside world for its 200,000 residents is a 100-yard border crossing with

Abkhazia’s survival, in fact, depends on generous support from Russia, which
finances the separatist government and has provided Russian passports to
more than 90 percent of its citizens.

Russian tourists have started to return to its beaches, and income from
tourism last year helped double the local budget to $35 million.

Saakashvili has said that only “peaceful means” will be used to restore
Abkhazia to Georgian control, but Abkhazians fear otherwise. They point to
Georgian defense expenditures, which surged more than 140 percent last year
to $146 million — the biggest increase worldwide in 2005. Georgian
officials say the spending increase is part of the country’s plan to
modernize the military in its effort to join NATO.

“Why do they need these weapons? What could they be for, except to attack
Abkhazia?” Bagapsh said.

Over the summer, Georgia retook control of a strip of Abkhazia called the
Kodori Gorge. The move was backed by the Bush administration, but it raised
alarm bells among Kremlin-backed Abkhazian officials.

“We fear that the operation in Kodori was only designed to establish a
bridgehead for a wider invasion,” said Sergei Shamba, Abkhazia’s de facto
foreign minister.

Indeed, tensions inside Abkhazia have soared since the Georgian operation.
“We are ready to fight them, even if they have the support of the
Americans,” said Bagapsh. “We have enough weapons, enough soldiers and
enough friends to defend our nation.”

Russia, meanwhile, has installed hundreds of its soldiers in the region as
peacekeepers. Georgia accuses the soldiers of backing the separatists, and
the Georgian parliament has called for them to be removed.

After the takeover of the Kodori Gorge, Russian Foreign Minister Sergei
Lavrov warned that Russia would protect its citizens and peacekeepers in
Abkhazia “by all available means.” Russian forces also conducted a series of
extensive military exercises last month along the Georgian border.

In Sukhumi, many Abkhazians believe war is inevitable. “We don’t want to
fight, we don’t want blood,” Astamar Basaria, a 39-year-old unemployed
laborer, said as he drank coffee under the shade of a palm tree.

“But the Georgians will never accept that we have our own country. And
if they try to take it away from us, we will defend our homeland.”
[return to index] [Action Ukraine Report (AUR) Monitoring Service]
The Thracians – lived between modern-day Ukraine and Turkey

Daniel McLaughlin, The Observer, London, UK, Sunday Sep 24, 2006

Luck is only sometimes on the side of Bulgaria’s archaeologists, as they
race gangsters to unearth the treasure of the ancient Thracians.

It was with Daniela Agre last month when she came across a Black Sea hotel
owner flattening a 2,000-year-old burial mound and found a horde of gold and
silver jewellery that she thinks belonged to a Thracian priestess.

Another archaeologist was served in a remote rural shop by a woman wearing
a string of 5,000-year-old gold beads, found by her husband in sunflower
fields where a large Thracian treasure trove was later discovered.

Famed for their ferocity and horsemanship, the Thracians – who lived between
modern-day Ukraine and Turkey – were long considered a barbarian race whose
greatest contribution to history was Spartacus, the slave who rebelled
against Rome.

But just as a series of spectacular finds is deepening their understanding,
academics fear the violent mafia that has dogged Bulgaria’s bid to join the
European Union are beating them to vital pieces of the historical jigsaw.

Gavrail Lazov, head of archaeology at Bulgaria’s National History Museum, is
celebrating another remarkable find while lamenting his country’s failure to
crush crime. Last month, his colleagues unearthed 20,000 Thracian ornaments,
one a dagger made of platinum and gold.

‘It is 5,000 years old and still so sharp a man could shave with it. Perhaps
it belonged to a king, but it is too early to be sure,’ Lazov said.

Indeed the riches of Thracia may rival those of ancient Troy. The most
spectacular find is the 2,500-year-old burial mask of a Thracian ruler, a
solid gold visage more than 10 times heavier than the Mask of Agamemnon,
which is the centrepiece of the National Archaeological Museum in Athens.

‘Bulgaria has more ancient artefacts than any European country except Greece
and Italy,’ said Lazov. ‘We have 15,000 Thracian burial mounds, and 400
ancient settlements – but it is terribly hard to protect them all. Looting
has boomed since the end of communism 15 years ago.’

Under pressure from Brussels, Bulgaria has tightened border controls and
pledged to crack down on crime. It is expected to find out on Tuesday
whether it can join the EU in January.

But in a country where the average monthly wage is £120, Lazov fears the
criminals will always prosper. ‘Right now, it would be easier to catch bin
Laden than all these thieves,’ he said. -30-
[return to index] [Action Ukraine Report (AUR) Monitoring Service]
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Letter to Yuri Pavlenko, Ministry of Youth, Family, and Sports Affairs; Kyiv, Ukraine

by Terry Hallman, People-Centered Economic Development, Kharkiv Ukraine
Saturday, Sep 23, 2006

Following is the full letter, in English language, to Yuri Pavlenko:

Honorable Yuri Pavlenko
Ministry of Youth, Family, and Sports Affairs
Kyiv, Ukraine

23 May 2006

Dear Mr. Pavlenko,

I am writing this out of concern for children in Ukraine’s state institutional care. Please understand from the beginning, I am a friend. At the same time, some of what I have to say here is troubling and could possibly be perceived as not in the spirit of friendship. It is my interest to arrange to work closely with your ministry and US government, and any other governments that might be interested, to create greatest possible assistance and help for all of these children.

I am a US citizen and director of a non-governmental organization in Ukraine focused on social welfare in Ukraine. US government usually listens very carefully to my ideas and proposals. What I discuss with you here will be duly discussed with US government. It is first necessary to discuss issues with you.

To get directly to the point, Ukraine has a very serious problem with many children in state institutional care, specifically in internats/orphanages that have been described as death camps. This is a very, very serious matter that was not addressed by previous governments. I am concerned that this might escape your notice and care now.

The claim of death camps for children comes from various researchers throughout the former Soviet Union, including specifically very recent researchers and humanitarians in Ukraine. This problem is not unique to Ukraine, but it does exist in Ukraine. I have no doubt about this. In fact, with your permission and authority, I can and will go to internats in question, take photos, and show you.

I request your cooperation in doing so.

Surrounding these internats is some sort of conspiracy of secrecy. Researchers mentioned above were sworn to secrecy prior to being allowed into such internats, or else they would not be allowed in to try and help the children there. They were also told that if they revealed the location(s) publicly, they would not be allowed to returned and no further aid to dying children would be permitted. The conditions they described to me are horrific. Somewhere between your office and individual directors of various internats, there are people who have motivation to block information about the truth and reality of these internats. In other words, there is a cover-up going on, and innocent children are dying as a result.

Innocent children are dying, Mr. Pavlenko. In one internat that I know of fairly well, and I can’t say where because of the secrecy imposed on researchers and aid workers who discussed this with me, part of the job of internat workers is to dig graves for dead children.

There is no good reason and no excuse for this in a civilized country. I understand very well the harsh limitations and lack of concern from previous government, but now it is time to help these children – not ignore them and maintain harsh secrecy about their very existence. The problem may now be so bad that it will be very, very expensive to fix it and get these children to safety. That does not mean it can’t be done.

I am willing, and almost surely able, to persuade US government to help with funding if funding is needed. I want to help get 100% of children currently in Ukraine’s orphanages and internats into small group homes, foster families, and adoptive families within Ukraine. By my estimation, that could easily cost $800 million in the first year, and $325 million per year after year one. I believe US government and perhaps other governments will be willing to help, but only if the problem is clear. That means going to the various internats where children are dying, taking photographs, and showing them. This will get people interested in helping with what is otherwise an invisible problem. It is invisible, but that does not mean it is unknown. Many people already know of this reality, and we are wondering why Ukraine maintains even today so much secrecy about it? It is not a big secret, plenty of people know, so it’s more like Ukraine is trying to keep secret what thousands of people already know about. Moreover, if this secrecy is maintained, there is no reason to believe that aid will get to these children, even if hundreds of millions of dollars become available. Further, secrecy in and of itself is extremely suspicious, and would seem to suggest possible corruption and therefore diversion of any funding intended only to help the children.

I am sure I can create a joint Ukraine/US project to help all of these children, not only the children in worst internats, but all children in all orphanages and internats. To do this, I simply need your help and cooperation so that I can get past the secrecy, get photos, and immediately get emergency assistance to the most desperate conditions. I think it will be quite difficult to get such assistance, especially involving large amounts of money and resources, without clear evidence to show the situation and get past the secrecy.

This secrecy is deeply disturbing, and is costing children their lives for no other reason than secrecy itself. Surely you understand that this cannot continue in a civilized country. Again, these internats are not secret, but certain people somewhere along the line continue to try and perpetuate a secret that is no longer secret. The larger questions are these: who is doing this, and why are they doing it?

In any case, this issue will not go away, and if anything can only get worse for Ukraine’s reputation at a time when Ukraine certainly does not need and cannot afford such glaring examples of human abuse of her own citizens – children, Mr. Pavlenko. Little children. To say that this is an outrage does not even begin to describe it. There are no words for this, none at all. It is another Holodomor, in this century, this time especially for children. It cannot continue, cannot be allowed under any conceivable norms of human conscience and decency.

I thank my friends in Ukrainian media for translating this letter and getting it to you, and I thank them for their deep concern in this matter. I hope to hear from you soon, and will meet with you at your convenience.


Terry Hallman (P-CED)

——————————————————————————————————– [return to index] [Action Ukraine Report (AUR) Monitoring Service] ======================================================== Please contact us if you no longer wish to receive the AUR ========================================================


Anna Melnichuk, AP Worldstream, Uman, Ukraine, Friday, Sep 22, 2006

UMAN – Hebrew wafted through the air, bearded men in black prayed and
danced as thousands of Hasidic Jews from around the world descended on
this Ukrainian farming town to celebrate the Jewish New Year.

The annual men-only pilgrimage, once outlawed during Soviet times, has
become the central event in Uman, not only for the Jews who converge on
this town, but for its poor residents who depend heavily on these temporary
guests to supplement meager wages and pensions.

Participants set up giant tents and a big cafeteria to feed the estimated
20,000 people that organizers were expecting before Rosh Hashana begins at
sundown Friday, while residents hawk souvenirs such as fur hats, knives and
alarm clocks.

This quiet, far-off-the-tourist-track town, about 200 kilometers (125 miles)
from Kiev, has come alive as men pray, dance and recite psalms around the
grave of Rabbi Nachman of Bratslav, hidden in Soviet times in a dilapidated
barn among old village houses and Soviet-era apartment buildings.

Nachman, who died in 1810, was renowned for his mystical interpretations of
Jewish texts, and his belief that higher spirituality could be achieved
through a combination of prayer, meditation and good deeds. On his deathbed,
he is said to have promised to be an advocate for anyone who would come and
pray beside his tomb.

That promise – and Nachman’s suggestion that prayer carried more power
during Rosh Hashana – has been drawing thousands of pilgrims yearly.

“This is … a chance to touch the living faith of our fathers,” said Borys
Varminshteyn, who was making the pilgrimage from Myrhorod in central

Nachman said, “‘You will pray for me here and I will pray for you there,'”
said Avraam Levitsky, 51, who was making the pilgrimage from the Black
Sea city of Odessa.

For decades, it wasn’t so easy for Jews to get here. In 1920, three years
after the Bolshevik revolution, the Soviets ordered the old Jewish cemetery
where Nachman’s grave lies to be destroyed, and for homes to be built in its

A wealthy Jew from the Ukrainian capital bought the plot of land and built a
small house there to preserve the grave. The officially atheist Soviet Union
sharply restricted access, although some Jews secretly made their way,
risking arrest.

Since the Soviet collapse, Jews have been able to visit Uman freely and in
the last six years, the commemorations have ballooned into a massive event.

In the space of 10 days, Uman residents can earn up to 13 times the average
monthly salary of 982 hryvna (US$196, A154) by renting their homes to
pilgrims coming to pray at their spiritual leader’s tomb. “We live here from
Hasids to Hasids,” said Svitlana Bevz, 66.

Not everyone in this town of 100,000 is pleased. Some 400 police patrol the
gathering, setting up checkpoints around town. Residents complain that they
are questioned if they want to go into an area occupied by the Hasids.

Uman was once home to thousands of Jews, but more than a century of
pogroms, Nazi massacres, Stalinist repression and emigration have cut their
numbers to just a few hundred.

While most of the devout go home at the end of Rosh Hashana, their presence
in Uman has had lingering effects: a kosher supermarket has sprung up, and a
new hotel is under construction that will respect their requirements – the
rooms have no mirrors and bathtubs are replaced with showers.

The showers are needed so the Jews can take a mikvah, a ritual bath, which
requires that water be living, and therefore running.

Nachman’s tomb has been renovated, and the Hasids are building a 4,000-seat
synagogue, which would be the largest in Ukraine. -30-
[return to index] [Action Ukraine Report (AUR) Monitoring Service]

BBC NEWS, United Kingdom, Saturday, Sep 23, 2006

The remains of the Danish-born mother of Russia’s last tsar are being taken
to St Petersburg, 140 years after she first arrived in Russia. Empress Maria
Feodorovna will be buried alongside her husband, Tsar Alexander III, as she
had wished.

Her descendants joined Danish royals and officials for a memorial service at
Roskilde Cathedral, west of Copenhagen. Born Princess Dagmar in 1847, she
changed her name and converted to the Russian Orthodox faith on marriage.

The tsarina had six children, including Russia’s last Tsar, Nicholas III,
who abdicated in 1917 during the Revolution. Months later he and his family
were executed by Bolsheviks. There have been lengthy negotiations between
Russia and Denmark on the terms of the transfer.
Prince Dimitri Romanov, Alexander II’s great nephew, has organised the
return of the remains to Russia where Maria Feodorovna “lived the best years
of her life.”

“It was our dream, my brother Nicholas and I, to grant the empress’s wish
and I feel great satisfaction and pleasure for our family to finally see our
wish come true,” he said.

The coffin is being taken by Danish ship, to Russia. The coffin is due to be
reburied on Thursday in the Peter and Paul Cathedral in St Petersburg.
LINK: http://news.bbc.co.uk/2/hi/europe/5372956.stm
[return to index] [Action Ukraine Report (AUR) Monitoring Service]

By David Hardie, Edinburgh Evening News
Edinburgh, Scotland, Saturday, Sept 23, 2006

UKRAINIAN football fans have thanked Hibs supporters for their aid
to orphans in Dnipropetrovsk, writes DAVID HARDIE.

They showed their gratitude by handing over a massive hand-painted
plate and matching tankards.

The presents were given to chairman Rod Petrie by Steve Carr, Alix
Stewart and Barbara McDonald, members of the Dnipro Appeal, which
has now raised almost £20,000 to help the youngsters.

Originally intended to be a one-off offer of help after Tony Mowbray’s side
drew Dnipro in last season’s UEFA Cup, the appeal is now a registered
charity which has now extended aid to a second orphanage in the Ukrainian
city as well as a pregnancy crisis centre.

Carr, who recently returned from a third visit to Dnipro, said: “We met up
with some local fans and they presented us with the plate and tankards as
a ‘thank you’ for everything the Hibs supporters have done.

“Hopefully the presents will now find a place within Easter Road where
they can be admired by our own supporters.” -30-
LINK: http://edinburghnews.scotsman.com/sport.cfm?id=1408472006
[return to index] [Action Ukraine Report (AUR) Monitoring Service]

Lev Fedyniak, Director, Ukrainian Film club, Ukraine, Mon, Sep 25, 2006

UKRAINE – Ends-of-the-Earth Publishing is pleased to announce
the creation of the UKRAINIAN FILM CLUB.

Modeled after book-of-the-month type clubs, the UKRAINIAN FILM
CLUB will offer all kinds of Ukrainian films- classic, historical,
documentary, children’s, cultural, cartoons, travel and more, all on a
monthly basis.

Films include such classic works, as TINI ZABYTIX PREDKIV or the
docu-drama HOLOD-33, travel films like Vidomi I Nevidomi Lviv, and
cartoons like VSE PRO KOZAKIV, for example, along with many, many

Film reflects a nation’s culture. They are brief vignettes of life at a
particular time and place. Many Ukrainian films have been hidden or
otherwise unavailable.

Some of these films are very difficult to find, often in videocassette (and
then in PAL/ SECAM format) and VERY expensive. But now, for a
nominal cost, and in DVD or VCD formats, a whole library of Ukrainian
films can be put together for the enjoyment of the entire family.

What’s more, membership in the www.UkrainianFilmClub.com helps
struggling Ukrainian filmmakers as a portion of each membership goes
to support new Ukrainian films.

A catalog is being put together for one-at-a-time purchases so that
individuals looking for specific titles can add to an already existing

Finally, wholesale arrangements are available for businesses looking to
add Ukrainian films to their product base.

If you or your organization has a newsletter, a membership with which you
regularly communicate or with whom you meet on a regular basis, are involved
with youth, schools or cultural groups, and the like, won’t you please make
an announcement about this wonderful opportunity to experience Ukrainian
films, to introduce them to a whole new generation or collect them for your
own viewing pleasure?

If you have any questions, please feel free to contact Lev G. Fedyniak at
Inquiry@UkrainianFilmClub.com; (www.UkrainianFilmClub.com).
[return to index] [Action Ukraine Report (AUR) Monitoring Service]

The Ukrainian Quarterly, New York, New York, September 2006

NEW YORK – The new Summer 2006 issue of The Ukrainian Quarterly is
now available. The English-language scholarly journal includes such
interesting articles as:

[1] OUN-Between Collaboration and Confrontation with Nazi Germany;
[2] The Political Prisoner’s Dilemma: Evidence from the Great Terror in

the Soviet Union;
[3] The Ukrainian Famine of 1932-1933 as Genocide in the Light of the

UN Convention of 1948; and,
[4] The Emergence of State Polity and National Aspirations in Ukraine –

Two Coins or Two Sides of One Coin?

To purchase a copy of The Ukrainian Quarterly, please send check or money
order in the amount of $8USD to: The Ukrainian Quarterly, 203 Second
Avenue, New York, NY 10003. E-mail: uq@ucca.org.
[return to index] [Action Ukraine Report (AUR) Monitoring Service]

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