AUR#767 Oct 3 Electricity For Gas To Ease Price Pressure; $130 Price For Gas Okay Says PM, Cold War Between Pres & Prime Minister; Little League Baseball

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               –——-  INDEX OF ARTICLES  ——–
              Clicking on the title of any article takes you directly to the article.               
    Return to the Index by clicking on Return to Index at the end of each article
      This month Russia can sign agreement on electricity supply from Ukraine.
By Roman Bryl, Ukraine Analyst
IntelliNews-Ukraine This Week, Kyiv, Ukraine, Monday, Oct 2, 2006

2.      GAS PRICE OF USD 130 PER 1,000 CUBIC METERS IN 2007 IS

Ukrainian News Agency. Kyiv, Ukraine, Thu, September 28, 2006

                                IN GAS SUPPLIES TO UKRAINE 
Ukrainian News Agency, Kyiv, Ukraine, Wed, September 27, 2006

ITAR-TASS, Moscow, Russia, Thu, Sep 28, 2006

          Tymoshenko says the de facto gas price has already been increased.          
Associated Press (AP), Kiev, Ukraine, Monday, October 2, 2006

INTERVIEW: With Ron Keller, Ambassador of the Netherlands to Ukraine
By Vitalii Kniazhansky, The Day Weekly Digest in English #29
Kyiv, Ukraine, Tuesday, September 26, 2006

Has 3,400 employees, plants in Mykolaiv & Kherson region, city of Simferopol
Interfax-Ukraine, Kyiv, Ukraine, Monday, October 2, 2006

Interfax-Ukraine, Kyiv, Ukraine, Monday, October 2, 2006

        Now employs 900, new plant could eventually employ 1500 people
John Walko, EE Times Europe Online, London, UK, Monday, Oct 2, 2006

      Fifth anniversary of operations in Ukraine with 10 stores, plans two more
Turkish Daily News, Turkey, Tuesday, Sep 26, 2006


                                    TURKEY, EGYPT, SERBIA
By Maria Petrakis, Bloomberg, Athens, Greece, Fri, Sep 29, 2006


Ukrainian News Agency, Kyiv, Ukraine, Monday, September 25, 2006


Ukrainian News Agency, Kyiv, Ukraine, Monday, September 25, 2006

Nine O’Clock, Bucharest, Romania, Friday, September 22, 2006

Mara D. Bellaby, AP Worldstream, Kiev, Ukraine, Friday, Sep 22, 2006

17.                         UKRAINE AND NATO MEMBERSHIP
            Ukraine’s Quest for Mature Nation Statehood – Roundtable VII
            October 17-18, 2006, Ronald Reagan Building, Washington, D.C
Center for U.S.-Ukrainian Relations (CUSUR)
New York, New York, Tuesday, October 3, 2006

                 Tension between the two is boiling over into open conflict.
BBC Monitoring research in English 29 Sep 06
BBC Monitoring Service, United Kingdom, Friday, Sep 29, 2006

19.                                  LAW AND PEOPLE APART
 The Orange and the White-and-Blue are not wrestling for the right to control the

observance of laws and not even for power as such. They are wrestling for money.
ANALYSIS & COMMENTARY: By Serhii Rakhmanin 
Zerkalo Nedeli On The Web (ZN), Mirror-Weekly, No. 37 (616)
International Social Political Weekly
Kyiv, Ukraine, Saturday, 30 September – 6 October 2006 year

                                   THE HUNT ON GOVERNORS”
       Cabinet moves to subdue local officials, fight will clearly be to the death
ANALYSIS & COMMENTARY: By Tetyana Nikolayenko
Ukrayinska Pravda web site, Kiev, in Russian 28 Sep 06
BBC Monitoring Service, United Kingdom, Monday, Oct 02, 2006

             Her first WTA tour singles title win, women’s professional tennis
Sony Ericsson WTA Tour, St Petersburg, FL, Sunday, Oct 1, 2006
REMARKS: By Dr. Paula Dobriansky, Under Secretary,
Democracy and Global Affairs, U.S. Department of State
Groundbreaking Ceremony for Victims of Communism Memorial
Washington, DC, Wednesday, September 27, 2006
      Financial assistance needed to support Little League Baseball in Ukraine
Action Ukraine Report (AUR) #767, Article 23
Washington, D.C., Tuesday, October 3, 2006
         Dr. Martha Bohachevsky-Chomiak steps down after seven years
U.S. Embassy Kyiv, Kyiv, Ukraine, Monday, September 11, 2006
U.S.-Ukraine Foundation (USUF), Washington, D.C., Sep, 2006
    This month Russia can sign agreement on electricity supply from Ukraine.

ANALYSIS: By Roman Bryl, Ukraine Analyst
IntelliNews-Ukraine This Week, Kyiv, Ukraine, Monday, Oct 2, 2006

Kyiv and Moscow reached the primary agreement on supply electricity to
Russia. The agreement looks like a scheme that allows the country to receive
extra volume of cheep natural gas for its needs.

Minister of energy and fuel Yuri Boyko convinced Gazprom not to raise the
price of gas by the end of the year and to leave it at USD 95 per 1,000 m³.

In turn Russia will get electricity. The negotiations about the electricity
supply are in the final stage and the final agreement on energy supply
should be signed in October.

Country has surplus of electricity production capacities —–

The first signs of possible cooperation in electricity supply appeared in
the beginning of September during the meeting of officials from ministry of
energy and the representatives of Russian Inter-RAO, which is in charge of
buying electricity abroad. According to deputy energy ministry Olexiy
Shebestov the country does not a surplus in electricity, especially in
winter time.

However, it has surplus in production capacities that are unused after the
price for natural gas was increased. In particular, there are 6 gas and oil
power units with 800 MW production capacity each and 2 units with 300 MW
capacity. If Russia managed to supply gas for these units they would produce
electricity for its needs, Shebestov said then.

Russia stops to buy electricity in mid-2006 that caused drop in export —–

The country at present suffers from the cut in electricity exports. In H1/06
amount of electricity sold abroad fell by 13.8% y/y to 4.6bn kWh.

Ukrinterenergo that exports electricity promised to increase the volume of
export by 14.4% y/y to 9.6 kWh in full-2006 and to gain USD 277mn for this
period of time.

Taking into consideration that electricity grid is not widely integrated
with European grid it will by difficult to increase export without selling
the power to Russia.

The grids of the two countries are deeply integrated since the Soviet Union
times. The refusal of Russia to buy electricity from Ukraine this year was
the reason for the decrease of electricity exports. To remind you the
country supplied 2bn kWh of electricity to Russia in 2005.

But following the price increase on natural gas Kyiv demanded to boost
electricity price for Russia to USD 0.025 per 1 kWh. Inter-RAO refused to
buy electricity for such price because it was higher than its domestic
price. Since then Russia did not import electricity from the country.

Inter-RAO still looks for natural gas supplier for Ukrainian power
stations —–

At present the representatives of Inter-RAO informed that they are close to
re-start the electricity imports in the short-term.

According to the head of company Andrew Rappoport Inter-RAO completes

the negotiations with natural gas supplier RosUkrEnergo on giving extra
volumes of the commodity for Uglegorsk power plant to produce electricity
for Russia.

Nevertheless RosUkrEnergo is reluctant to reveal at what stage are at
present the negotiations. At the same time Russian gas monopolist Gazprom
also did not announce what volume of gas it can give to Ukrainian power
stations. Still, Rappoport asks not to worry about that.

Inter-RAO is still looking the source of gas to be supplied to Ukraine and
when it is ready to determine of exact volume of the commodity it will
announce the price for imported electricity, Rappoport said.

To calm down the pessimists Inter-RAO informed that it already agreed

with Ukrainian ministry of energy on transit of electricity from the heating
power station in Moldova via territory of the country. A part of this
electricity will be used for supply Odessa region.

Country can receive cheap gas for its heating stations and export cheap
electricity produced by nuclear plants —–

The official taking part in the electricity negotiations did not name the
volume of gas that would be supplied for its production.

However, different sources said that it could be up to 1.2bn m³ by the end
of the year. It is a rather large amount taking into consideration that its
price would be less than what the country currently pays for the imported

Moreover, the country can gain extra profits selling to Russia the
electricity produced by nuclear power plants, which is cheaper than
electricity produced by thermal power plants.

The electricity that will be produced by the thermal power plants from
Russian gas could be sold to population, which is getting used to constant
price increases for electricity used.

To remind you national Commission on Regulation of Energy market, which is
in charge of electricity market, boosted by 25% the price for power in Sep 1
to about USD 0.05 per 1kWh. Before that, on Apr 1 it also increased the
price by 25%.

Moreover, the commission gave notice of its intention to revise the current
price for population biannually. So it can raise the price in Apr and Sep
2007 to reduce the cost of electricity production by the thermal power

At present nuclear power plants work utilizing full capacity to decrease the
volume of expensive electricity production of thermal power plants.

Electricity agreement to be first step of receiving cheap natural gas —–

The intention of Russia to cooperate in electricity supply shows that
countries manage to improve their energy relationship.

On one hand Russia needs extra volumes of power and the head of RAO EES
confirmed lately that the country could suffer from shortages of electricity
in winter in the most densely populated regions.

On the other side the question remains open how the electricity imported
from Ukraine can help to stop these shortages. This electricity can be used
efficiently for supply to neighbouring with Ukraine regions, like Krasnodar
(that is close to have electricity deficit).

But it would be rather problematic to supply the power for Moscow, St.
Petersburg and Tyumen regions, where the need for extra electricity is the
most acute.

We can make the conclusion that the electricity agreement is a part of big
program the goal of which is to avoid problems in the domestic economy
related to the rise of price of natural gas.

If the sides sign the electricity agreement it will be the first step
towards receiving of cheap natural gas. Initially, its volume will not be
enough to ease the pressure in the economy, but it is just the beginning.

[return to index] [Action Ukraine Report (AUR) Monitoring Service]
Ukrainian News Agency. Kyiv, Ukraine, Thu, September 28, 2006
KYIV – Premier Viktor Yanukovych believes that the gas price of USD 130
per 1,000 cubic meters in 2007 is acceptable for Ukraine. Yanukovych told
this at the open cabinet meeting on Thursday. He said that he held talks with
the Russian side on Thursday.

‘The price of USD 130 would be super good for us,’ Yanukovych noted. As
Ukrainian News earlier reported, Fuel and Energy Minister Yurii Boiko
forecast that the price of imported gas for Ukraine in 2007 would be USD
106-135 per thousand cubic meters.                    -30-

[return to index] [Action Ukraine Report (AUR) Monitoring Service]
                           IN GAS SUPPLIES TO UKRAINE 

Ukrainian News Agency, Kyiv, Ukraine, Wed, September 27, 2006

KYIV – Ukraine and Russia reached agreement to preserve the RosUkrEnergo
company in the scheme of natural gas deliveries to Ukraine. Ukrainian News
learned this from Russian gas monopoly Gazprom.

Following the meeting of Fuel and Energy Minister Yurii Boiko with Gazprom
head Alexey Miller in Moscow (Russia) September 26 – 27, the decision was
passed to preserve the pattern of gas supplies via RosUkrEnergo, as it will
make it possible to guarantee an acceptable price for both parties.

The press service also reported that the essence of the negotiations was the
signing of contracts for the delivery by RosUkrEnergo of Middle Asian gas in
the fourth quarter of 2006, taking into account the business conditions of
gas purchases by Gazprom.

The parties also reached agreement that the price of the gas sold by
RosUkrEnergo to Ukrainian consumers will make USD 95 per 1,000 cubic

meters in 2006.

The parties also determined the resource basis for gas deliveries to Ukraine
in 2007 – 2009 in the volume of 55 billion cubic meters a year.

Apart from this, the talks covered approaches to the formation of Middle
Asian gas price for the period of 2007 – 2009, based on free market
principles and taking into account strategic cooperation in gas industry.

The 2007 – 2009 gas price contracts must be concluded before 2007.

As Ukrainian News reported, in August Fuel and Energy Minister Yurii Boiko
expressed the intention to decide on RosUkrEnergo’s participation in the
scheme for supplying gas to Ukraine no sooner than November 2006.

Boiko forecasts that the price of gas imported to Ukraine in 2007 will be
USD 106 – USD 135 per thousand cubic meters. Earlier, Ukraine and Russia

agreed on closure of the Ukrainian gas balance for 2007 – 2009.

It was stated then that the total volume of imported gas to Ukraine will
amount to about 62 billion cubic meters a year.

Ukrainian Premier Viktor Yanukovych and Russian Premier Mikhail Fradkov

said after their meeting in Moscow on September 22 that Ukraine and Russia
intended to end soon the talks on the price of additional volumes of gas in

On August 17, Vice Premier Andrii Kliuev reported on a natural gas deficit
of 8 billion cubic meters.                                   -30-

[return to index] [Action Ukraine Report (AUR) Monitoring Service]
ITAR-TASS, Moscow, Russia, Thu, Sep 28, 2006

MOSCOW – An agreement on gas price reached between Russia and

Ukraine meets the interests of both states, the chairman of the
State Duma committee for CIS affairs told Itar-Tass on Thursday.

Russia is interested in seeing no economic decline in Ukraine and an
improvement in the situation in its budget and finance sphere, Andrei
Kokoshin said.

“Ukraine is our very important economic partner and neighbor, and we are
interested in the stability of our relations, their transparency and
predictability,” the parliamentarian said.
“This agreement was welcomed by EU states, particularly Germany, and was
considered as a very important signal concerning energy security in a short
and middle-term prospective,” he stressed.

“The agreement has demonstrated that we are normalizing our relations after
a new government and new parliament came to power in Ukraine,” Kokoshin

Under an agreement between the company Rosukrenergo and Russia’s gas giant
Gazprom, gas price for Ukrainian consumers will not change this year, and
will make up 95 dollars per 1,000 cubic meters. Gas price for 2007-2009 will
be finalized in the contracts before the end of the year.

[return to index] [Action Ukraine Report (AUR) Monitoring Service]
    Send in names and e-mail addresses for the AUR distribution list.

Associated Press (AP), Kiev, Ukraine, Thu, September 28, 2006 

KIEV, Ukraine – Prime Minister Viktor Yanukovych warned Thursday that
state-owned gas company Naftogaz is on the verge of bankruptcy, blaming
earlier bad management. Yanukovych said that Naftogaz could lose about

$1.5 billion this year.

“As a result of extraordinary financial obligations and a year-and-a-half of
criminal management, this company appears to be on the verge of bankruptcy,”
Yanukovych said during his Cabinet meeting.

Naftogaz is the state-owned company responsible for supplying Ukraine’s
residential and industrial consumers with gas. Company officials weren’t

immediately available for comment.

Ukraine saw a nearly twofold increase in the price of gas imports in January
after a bitter dispute with its main supplier Russia. The countries reached
a deal under which Ukraine would receive all of its imported natural gas
from a little-known intermediary company, RosUkrEnergo, that is owned
jointly by Gazprom and two Ukrainian businessmen.

As part of the deal, Naftogaz and RosukrEnergo created a joint venture to
sell gas to Ukraine’s industrial consumers; earlier, this market belonged to

Yanukovych’s party won the most votes in March parliamentary elections,

and Yushchenko last month gave in to pressure to submit his nomination as
premier to the legislature, which approved it.

Naftogaz previously was headed by an ally of Yushchenko, but the

company’s head resigned before Yanukovych became premier.     -30-
[return to index] [Action Ukraine Report (AUR) Monitoring Service]
       Tymoshenko says the de facto gas price has already been increased.
Associated Press (AP), Kiev, Ukraine, Monday, October 2, 2006

KIEV, Ukraine –Ukrainian opposition leader Yulia Tymoshenko on Monday
accused Ukraine and Russia officials with misleading the public by telling
them the price of gas would stay unchanged this year.

Russia’s state-controlled natural gas monopoly, OAO Gazprom, said last week
that it would maintain the price of natural gas for Ukraine at $95 per 1,000
cubic meters through Dec. 31.

“It is a political deception…the de facto gas price has already been
increased,” Tymoshenko told journalists, citing unidentified sources in the
Russian energy industry.

Tymoshenko did not say what the new price was, but said Moscow had

agreed to let Kiev wait to pay the difference in 2007.

She called the move an attempt to build up support for Prime Minister Viktor
Yanukovych, who is perceived as more pro-Russian than President Viktor
Yushchenko. Yanukovych took office in August, and securing a good gas deal
for Ukraine has been one of his top tasks.

Ukraine saw a nearly twofold gas price increase in January after a bitter
dispute with Moscow. The Russian company briefly turned off the gas to
Ukraine, triggering supply concerns in other European countries that receive
Russian gas via Ukrainian pipelines.

As part of the deal that resolved last winter’s fuel dispute, Ukraine agreed
to receive a mix of more expensive Russian gas and cheaper Turkmen imports
at a price of $95 per 1,000 cubic meters. Pressure to increase the price
rose last month after Turkmenistan hiked the amount Russia pays for the gas
it buys and then sells on to Ukraine.                  -30-

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

INTERVIEW: With Ron Keller, Ambassador of the Netherlands to Ukraine
By Vitalii Kniazhansky, The Day Weekly Digest in English #29
Kyiv, Ukraine, Tuesday, September 26, 2006

In early October a large delegation of Dutch entrepreneurs is coming to
Kyiv. They are expected to hold talks with their Ukrainian counterparts and
visit enterprises in various sectors of the economy.

To some extent, this visit will be a continuation of meetings held by a
Ukrainian business delegation in the Netherlands during President Viktor
Yushchenko’s visit to that country.

The Day interviewed Mr. Ron KELLER, Ambassador of the Netherlands to
Ukraine, whose contribution to the development of trade relations between
our two countries was recently marked by a special medal as a result of a
poll of entrepreneurs.

[The Day] “Ukrainians remember that your country was (and perhaps still is)
the biggest sponsor of technical assistance to our country, and they know
that the Netherlands has been providing useful and disinterested
consultative assistance to Ukrainian agriculture. Does your country intend
to continue this cooperation with Ukraine?”

[Amb Keller] “Definitely. This will be cooperation on the level of tax and
customs services as well as in agriculture, public utilities, nature
conservation, and environmental protection. I recently attended the
celebrations of the 230th anniversary of Dnipropetrovsk. They very much
appreciate the advice of our consultants, who helped them set up a
household waste treatment system.”

[The Day] “Are you satisfied with the level of trade relations and trade
turnover between our two countries?”

[Amb Keller] “One can never be fully satisfied. Still, I can say that we
have some very positive trends in trade. Trade between our countries tops
one billion euros and continues to grow. Trade turnover climbed by 20
percent in 2005 in comparison to 2004.

“Although the latest information hasn’t arrived, I can say for sure that
this parameter is growing this year, too. I’d like to note that it is not
only about increased Dutch exports to Ukraine. Ukrainian exports to the
Netherlands are also on the rise.

“To a large extent our economies are mutually complementary. Dutch
exports to Ukraine mostly include food and chemical products, computers,
equipment, and transport, while Ukraine exports metals, equipment, and

[The Day] “We are talking about developing economic ties, but is it possible
to develop them further if there are obstacles, namely, visa requirements?
Negotiations with the European Union on this matter are underway, but in all
probability they will end up with very few concessions for Ukrainian

[Amb Keller] “In reality, there are no major barriers that would prevent
Ukrainian citizens from traveling to the Netherlands. If you look at the
number of people who arrived in the Netherlands from Ukraine this year, it
is 20 percent higher than last year and 100 percent higher than 10 years

“Most individuals who want to visit the Netherlands are businessmen,
although there are many tourists, too. Out of the estimated 25,000
Ukrainians who can apply for a Dutch visa, just one to three percent will be
denied, only because they have no grounds for obtaining one.

“In other words, they might be people who have problems with their
documents or who actually do not want to go to the Netherlands but France
or other countries.”

[The Day] “But citizens of the Netherlands arrive in Ukraine without any

[Amb Keller] “Yes, the Ukrainian government has made this kind of decision.
But, as you know, to cross a border in the European Union, one must meet
certain conditions. The EU policy is not just the policy of the Netherlands,
and it is aimed at stemming illegal migration.

The Ukrainian authorities are taking equally determined actions in this
direction. But I’d like to stress again that there are no obstacles at all
for individuals who travel to the Netherlands on business, as tourists, or
if they want to visit their friends or relatives. This is in our interests,
too, because the Netherlands would like to invite Ukrainian investors – we
also need your products.”

[The Day] “What are the conditions in which your entrepreneurs and private
investors are working in Ukraine? How do they differ from the conditions
your businesses are used to at home?”

[Amb Keller] “Naturally, there are some particularities, although there are
very many common things. Both countries have a market economy, a lot of
consumers, a highly skilled labor force, a stock exchange, a stable
macroeconomic situation, and a stable currency.

All this is conducive to working both in Ukraine and the Netherlands. What
also attracts us is the mentality of Ukrainians, who are very openhearted
people. Yet there are some differences. One can speak, for example, about a
language barrier, although it can be easily avoided if one works with a
Ukrainian partner.

“Therefore, every Dutch company that is working successfully in your market
has a reliable Ukrainian partner, who is the key to success.

“But there also some things in the business environment that are not
conducive to business. It is very difficult to start a business. A lot of
licenses are required, far more than in the Netherlands.

More often than not, licenses are introduced for the sole purpose of raising
revenue for the state. There also are differences in the way the tax law is
applied to different facilities in different regions. Even if a contract has
been signed in compliance with all the rules, you are never sure that, in
the event of a dispute, the court will hand down a proper ruling.

“Customs control also takes too much time, and its results can be rather
unexpected. Sometimes you have to pay officials to make them do their job.
Current standards in Ukraine are not always in line with Europe’s.

Often problems arise over the right to own land and buildings. The financial
sector is not sufficiently developed either. These difficulties can, of
course, be overcome, which will have a positive effect both on Dutch and
Ukrainian businessmen.”

[The Day] “In which sectors of the Ukrainian economy are the interests and
private investments of the Netherlands concentrated? What other sectors can
be classified as attractive for your investors?”

[Amb Keller] “Our investments have been coming into the banking and
financial sectors, agriculture (very little), as well as logistics,
transport, and shipbuilding. There is a large shipyard in Mykolaiv to which

our investments have given a new lease on life. The waste treatment system
that I saw in Dnipropetrovsk has lived up to expectations.

Extremely promising is investment in energy production, computer hardware,
and software manufacturing. This is the sector in which Dutch business is
taking the greatest interest, and we hope that investments in these
facilities will be increasing.

“We have already mentioned the Shell gas and oil company, which intends to
invest not only money but also state- of-the-art technology in the
extraction of hydrocarbons in Ukraine.

“We also hope that investments will start coming to food industry and
electronics sectors. Naturally, this will depend on enthusiasm and on the
actions of companies that can do this. Their actions will (or will not) be
stimulated by the existing business environment in Ukraine. This depends on
your government.

“We can also intensify our cooperation in the field of tourism. Ukraine has
a lot of opportunities here. If you increase the number and quality of
hotels and infrastructure, and carry out an active promotion campaign, this
sector will burgeon. There is also a potential for investments in the
financial services sector.

It is about establishing new bank subsidiaries that can offer a whole range
of services, including insurance, to clients – both natural and artificial
persons. The Netherlands has great experience in this.

“In the last 20 years the Dutch economy has been transformed from one
oriented to the farming industry into one oriented to the service industry.
We should also remember the importance and potential of Ukrainian exports
to and investments in the Netherlands.

We are convinced that once Ukraine joins the WTO and signs a free trade
agreement with the EU, we will have many more Ukrainian products. The
debates now underway in Ukraine either exaggerate or simply pay more
attention to the risks of WTO membership, often forgetting about the

Frankly speaking, as an ordinary consumer, I would be more than glad to buy
some very tasty Ukrainian foods at the supermarket, if they are reasonably
priced, than buy expensive and absolutely tasteless produce grown in Dutch

[The Day] “Ukraine is vigorously debating our accession to NATO and the
European Union. Our people mostly have a positive attitude to the EU, but
they have a dim view of NATO. What can you say about NATO, of which
the Netherlands is a member?”

[Amb Keller] “Past threats no longer exist, but there are new threats – from
local conflicts to global terrorism. And these conflicts are now more
integrated than ever before: it is now difficult to say who is good and who
is bad.

“It is important to understand the degree of the danger to which, say, the
Internet or the international system of payments may be exposed in the
nearest future.

“Some Ukrainians think that your country is insured against this, but
someday it might also face these dangers. So it would be better if Ukraine
joined forces with other countries to combat these threats.

“Ukraine, just like the Netherlands, Belgium or France, cannot cope with
them on its own. We have joint energy, computer, and economic systems,
so we must protect them together.”                        -30-

[return to index] [Action Ukraine Report (AUR) Monitoring Service]
     NOTE: Send in a letter-to-the-editor today. Let us hear from you.
Has 3,400 employees, plants in Mykolaiv & Kherson region, city of Simferopol

Interfax-Ukraine, Kyiv, Ukraine, Monday, October 2, 2006

KYIV – The International Finance Corporation (IFC) is to allocate a $20
million loan to Ukrainian juice producer Sandora (Mykolaiv region) for a $99
million two-year investment program. The IFC board approved the loan last
week, the corporation reported.

The program is aimed at increasing production capacity, introducing new
types of packaging, manufacturing products for children, developing fruit
processing and concentrate production, expanding the distribution network
and increasing working capital.

Lithuanian businessmen Igor Bezzub and Raimondas Tumenas are the main
shareholders of Sandora, the IFC said. They each own 45% of company charter
capital. Sandora General Director Sergei Sypko owns the remaining 10% stake.

The company’s production base consists of two plants in Mykolaiv region and
two small fruit processing factories in the city of Simferopol and Kherson
region. Sandora has 3,400 employees.

IFC allocated two $10 million loans to Sandora in June 2004 and September
2005 to expand production capacity.                   -30-

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

Interfax-Ukraine, Kyiv, Ukraine, Monday, October 2, 2006

KYIV – Kremenchuk-based AutoKrAZ Holding Company in Poltava region,
Ukraine’s only heavy truck producer, has shipped the first consignment of
KrAZ-6443 four-wheel drive tractors to Ghana in West Africa, the company
told Interfax-Ukraine last week.

The company’s press service did not disclose the number of tractors to be
supplied to Ghana, saying that last time KrAZ trucks were shipped to Ghana
in 1960s. The tractors will be used for the transportation of mahogany.

The press service said that irrespective of the higher price of shipping
Ukrainian-produced trucks compared to European-assembled trucks to

consumers from West Africa, the simplicity in servicing and reliability in
repairing of KrAZ trucks tips the scale in the KrAZ trucks’ favor.

Moreover, the press service said that the company has signed a contract on
supplies of KrAZ vehicles for operations in opencast mines and
transportation of heavy excavation equipment (KrAZ-6443 truck tractors and
KrAZ-65032 dump-trucks) to Liberia (West Africa). AutoKrAZ assembles 25
basic models, over 150 modifications, and spare parts. The vehicles of the
holding are used in over 60 countries.
[return to index] [Action Ukraine Report (AUR) Monitoring Service]
          Now employs 900, new plant could eventually employ 1500 people

John Walko, EE Times Europe Online, London, UK, Monday, Oct 2, 2006

LONDON – Electronic manufacturing services provider Jabil Circuit Inc. is to
build a second plant in Uzhgorod, Ukraine that could eventually employ 1500
people. The 26,000 sq m facility should start operating in the second
quarter of next year.

Jabil (St. Petersburg, Fla.) already has an assembly and manufacturing
operation in the Special Economic Zone in Zarkappatya, Uzhgorod, which was
opened in 2004 and now employs 900, and the company says the second plant is
needed “to accommodate growing demand for electronic manufacturing services
in the region.”

The company said it plans to develop in the SEZ Zarkappatya an industrial
park integrating suppliers and partners, to provide cost effective
manufacturing and supply of a wide range of electronics products. It added
its 10 ha land plot has the capacity to double output if and when necessary.

Jabil already makes boards and end products in the region, with plants in
Hungary and Poland, as well as in Ukraine.

Commenting on the investment, John Lovato, Jabil’s president for Europe,
said: “We believe the Ukraine will become a major player in electronics

The country has all it takes to successfully compete with Asia on a landed
cost basis to the European market; well educated and available labor force
at a competitive cost, proximity to the European market, available natural
resources to develop a strong supplier base and cooperative government

Separately, the company said it would take a $120.2 million fourth-quarter
restructuring charge as it prepares to close plants in other parts of the

In a Securities and Exchange Commission (SEC) filing late last week, Jabil
did not specify which facilities are under threat, but industry speculation
has centered on the possible closure of one to two plants in the U.S., as
well as higher cost facilities in other parts of the world.

In the filing Jabil said it would take $81.2 million in charges for employee
severance and benefit costs, contract termination costs and other related
restructuring costs. The company will take further charges of $35.6 million
for material impairment costs and $3.4 million for fixed asset impairment

The restructuring plan referred to in the filing is part of the previously
announced $200 million to $250 million charge that the company said it
would record in its fiscal fourth quarter.

The company said last week it had revenues of $10.3 billion in fiscal 2006,
but delayed reporting full financial results, including earnings, until it
files a report with the SEC in mid-November.

[return to index] [Action Ukraine Report (AUR) Monitoring Service]
      Fifth anniversary of operations in Ukraine with 10 stores, plans two more

Turkish Daily News, Turkey, Tuesday, Sep 26, 2006

Turkey’s first household textile chain store, Linens, also the first to
establish itself in Europe, aims to increase its overseas market share to 20
percent in two years, the company’s general manager said in remarks on the
fifth anniversary of operations in Ukraine. The retailer is a division of the

Zorlu Holding group of companies

“Quality is more essential than quantity for us,” said General Manager Sule
Zorlu, predicting Ukraine will be the model for future growth in Eastern
Europe. The company currently has 99 stores in Turkey and 23 abroad,
including 10 in Ukraine.

Its 10 stores in Ukraine, including four in the capital Kiev, focus largely
on sales of hope set items and bridal gowns. Customers include the nation’s
first lady and Ruslana, the singer of Eurovision fame

With a total product line exceeding 16,000 items, total turnover last year
in Ukraine was $2 million. Total overseas revenue represents some 10 percent
of the company’s total turnover of $35 million and Ukraine leads in foreign
operations, followed by Romania.

Linens became the leader in the Ukraine market due to the advantage of
entering the market five years ago, Zorlu said. She noted the current number
of stores here will soon expand to 12, driven by a growth in disposable
income that increasingly is spent on home improvements

In addition to Ukraine, the Zorlu Group currently operates Linens stores in
Romania, Bulgaria, Albania, Macedonia, Kazakhstan, Azerbaijan and northern

Zorlu said she plans to open new stores in North Africa, including Libya,
where an outlet is already under construction, as well as Algeria, Morocco
and Tunisia. The company is also studying the Israeli and Egyptian markets
along with those in the Caucasus and Balkan regions.

“We gained a significant advantage in Ukraine with this strategy,” Zorlu
said. “Consequently, we want to grow in other countries using the Ukraine
                                 Favorite customer: Ruslana:
In Ukraine, Linens has become a shopping destination for well-known people
said local store manager Oleg Azarchenko: “A majority of our customers are
women. Ukrainian President Viktor Yushchenko’s wife and the wives of
Ukrainian ministers and deputies shop here. Even Ukraine’s famous singer,
the winner of 2004 Eurovision held in Turkey, Ruslana, shops with us.”
[return to index] [Action Ukraine Report (AUR) Monitoring Service]

 If you are receiving more than one copy of the AUR please contact us.
                                 TURKEY, EGYPT, SERBIA

By Maria Petrakis, Bloomberg, Athens, Greece, Fri, Sep 29, 2006

ATHENS – Greeks have been seeking adventure and profits beyond the
shores of their tiny country — population, 11 million — for centuries.

“History shows us that it’s only when Greeks look abroad that they
achieve,” National Bank of Greece SA Chief Executive Officer Takis

Arapoglou told shareholders on May 23.

Arapoglou, 55, is helping to keep up the tradition. On Aug. 18, National
Bank closed a deal to buy a controlling 46 percent stake in Turkey’s
Finansbank AS, for $2.8 billion. That’s the biggest takeover ever by a Greek
company outside its home market.

Greek banks have been a force in southeastern Europe for more than a
decade, buying up financial assets for low prices in Balkan countries such
as Bulgaria, Romania and Serbia.

Now, with growth expected to slow at home, they’re ranging farther afield,
with the Finansbank investment by National Bank just the latest example.
National is Greece’s largest financial institution, with $77.5 billion in

All four of Greece’s top banks have made recent overseas acquisitions. EFG
Eurobank Ergasias SA, Greece’s No. 2 bank, with $57 billion in assets,
acquired Turkey’s Tekfenbank AS, for $182 million in May and bought a
Ukrainian lender in July. It’s also opening branches in Poland.

No. 3 Alpha Bank SA is looking at Turkey and Ukraine. No. 4 Piraeus Bank SA
bought Egyptian Commercial Bank last year, the first Greek banking purchase
in the Arab world’s most-populous nation.
                                            CASH RICH
Greek banks have plenty of cash to spend on foreign acquisitions after years
of rapid growth in their home market. Borrowing by Greek households
increased more than 30 percent a year during the past five years as
consumers took out more auto, credit card and home loans, according to
figures compiled by Dutch bank ING Groep NV.

Low interest rates and economic growth that’s averaged 3.9 percent a year
for the past decade, twice the euro-zone average, have given Greek consumers

Now, the economy is slowing. Greece’s gross domestic product grew 3.7
percent last year, the lowest rate since 1999. In a May economic forecast,
the European Commission projected growth will fall to 3.5 percent this year.

As expansion decelerates, consumer confidence may flag, unemployment may
rise and spending and borrowing decline. So bankers are moving into
faster-growing markets like Turkey, where GDP is up an average of 7 percent
over the past four years.

The Finansbank deal was applauded by the government of Prime Minister Kostas
Karamanlis, whose New Democracy party dislodged the Socialists in March 2004
on a platform of making Greece more competitive and relaxing the state’s
grip on the economy.
                                          STOCK MARKET RISE
Karamanlis, 50, has helped former state-owned companies lure executives such
as Arapoglou, once a managing director at Citigroup Inc., from the private

Investors like the strategy. When National Bank offered stockholders 3
billion euros ($3.79 billion) in new shares to pay for the Finansbank
acquisition in June, they signed up to buy almost twice as many, according
to the bank.

And National’s stock had more than doubled in price, as of Sept. 28, since
Arapoglou took charge 2 1/2 years ago. The Athens Stock Exchange general
index has risen 60 percent since Karamanlis took office.

Politics — local and European — have put a damper on Karamanlis’s program.
One important reason the European Commission expects Greek economic growth
to slow next year is that the European Union has told Greece it will impose
financial penalties unless it trims its budget deficit to less than 3
percent, the maximum allowed under the EU’s Stability Pact.

Karamanlis has promised to push the deficit down to 2.6 percent this year,
from 4.5 percent in 2005 and 6.9 percent in 2004.
                                       RIGID LABOR LAWS
Cutting spending or raising taxes to meet that target could crimp consumer
spending, according to the government. The Bank of Greece, the central bank,
predicted in its annual report for 2005 that Greek growth rates would
decline unless the government made the economy more competitive.

Inflexible labor laws have helped keep unemployment high, the Bank of Greece
says. Unemployment has hovered around 10 percent for the last four years.

Greece has some of the strongest unions and strictest labor regulations in
Europe and ranks highest in the Balkans in terms of  “employment rigidity,”
according to rankings compiled by the World Bank.

Companies in Greece, for example, need government approval if they want
to fire more than 2 percent of their workforce in a month.

“Although Greece has benefited from macroeconomic convergence with the
rest of the EU, it still faces considerable structural challenges that could
impair growth prospects over the medium term,” ratings firm Moody’s
Investors Service said in a March report.
                                         HIGH INFLATION
Public-sector unions’ ability to wring concessions from the government
through the threat of strikes has helped force wages and other labor costs
up, contributing to an average annual inflation rate for the past five years
of 3.5 percent, the highest in the euro zone.

Since Greece adopted the euro in 2001, the unions have softened their stand
on privatization. Karamanlis has raised 4.6 billion euros by paring
government stakes in seven companies, including Hellenic Telecommunications
Organization SA, the biggest telephone service provider, and Opap SA, the
third-biggest gaming company in Europe.

Next year, Karamanlis plans to sell government shares in more banks, in the
national gas company, in Athens International Airport and in several ports.
And he’ll sell more of the state’s remaining 39 percent stake in Hellenic
Telecom, he says.

Financial services are a key driver of the Greek economy, alongside tourism,
construction and shipping. Greece is the world’s biggest ship-owning nation,
and huge growth in the transport of oil and other commodities increased
shipping industry receipts in 2005 to 4.6 percent of GDP, or 8.3 billion
euros, from 2.5 percent in 1999, according to National Bank figures.
                                       BANKS PRIVATIZED
Bank credit has helped boost private consumption, which now accounts for
about two-thirds of the Greek economy. Big banks that were entirely or
partly state-owned have been privatized over the past decade.

In November 2004, Karamanlis pushed through the sale of the government’s
remaining 7.5 percent stake in National Bank.

In August of this year, Credit Agricole SA, France’s largest lender, paid 2
billion euros to take a 72 percent stake in Emporiki Bank of Greece SA,
Greece’s sixth-largest bank. It bought 11 percent of the shares from the
Greek government and 21.4 percent more from state pension funds.

In contrast to conditions in Greece, cheaper labor, more flexible work rules
and fast growth make Greece’s southeastern European neighbors attractive
markets. Romania’s economy grew 4.1 percent last year, while Bulgaria
expanded 5.5 percent.
                                       PRIME NEW MARKET
Bankers such as Arapoglou and Eurobank CEO Nikos Nanopoulos consider the
region a prime new market. In Turkey, bank loans add up to just 31 percent
of GDP, compared with 80 percent in Greece and 117 percent in the entire
euro zone, according to estimates by Deutsche Bank.

By setting up business in the Balkan countries, the Greek banks are simply
following their clients. More than 3,500 Greek companies are doing business
in southeastern Europe, according to Greek government figures, 800 of them
in Bulgaria alone.

National Bank, Alpha Bank, Eurobank and Piraeus Bank all set up shop in
Albania, Bulgaria, Romania, Serbia and the former Yugoslav Republic of
Macedonia in the 1990s, when the region was known more for political
upheaval and ethnic cleansing than for mortgage lending.

Alpha established Banca Bucuresti SA in Romania in 1993; it was the first
foreign bank in that country of 22 million.
                                       BANKING ON SERBIA
The pace of Greek acquisitions has heated up in the past two years. Last
year, Alpha Bank bought Serbia’s Jubanka a.d. Beograd for 172 million euros.
Piraeus Bank has acquired three lenders in Bulgaria, Serbia and Egypt. And
Eurobank bought Nacionalna Stedionica-banka in Serbia in August 2005.

Michalis Colakides, deputy managing director at Piraeus Bank, says Greek
bankers are well equipped to deal with the growing pains of Balkan
institutions. “These countries are at a stage of development Western banks
are often unfamiliar with,” he says.

“They have a high number of small or family businesses and weak government
institutions. Greek banks know how to operate in such an environment.”

The newest development is the Greek banks’ move into Turkey. Greece had
virtually no economic investment in Turkey seven years ago. Relations were
tense, fueled by border disputes and the possibility of armed conflict over
the divided island of Cyprus.

That changed in 1999, when both countries rushed to each other’s aid after
earthquakes struck Istanbul and then Athens.

Cooperation was also fostered by the EU’s decision last October to begin
talks on admitting Turkey to the EU.
                                    REGIONAL POWERHOUSE
With 72 million people, Turkey is bigger than Greece, Bulgaria, Romania and
Serbia combined.

Arapoglou says National Bank will seek to acquire as much as 90 percent of
Finansbank this year by buying out minority shareholders. Control of
Finansbank makes National the biggest lender in the region, with 12 million
customers and half of its branches outside Greece. National also owns banks
in Albania, Bulgaria, Macedonia, Romania and Serbia.

Patrick Lemmens, who helps manage 3 billion euros at ABN Amro Asset
Management, bought National Bank shares after the Finansbank investment.
“Something that every European bank is faced with is the issue of long-term
revenue,” Lemmens says. “National Bank is looking at an extended horizon.”

Arapoglou isn’t finished. On Sept. 12, National Bank clinched a deal to buy
Serbia’s sixth-biggest bank, Vojvodjanska Banka AD, and is competing with
Hungary’s OTP Bank Nyrt to buy Romania’s seventh-largest bank, Casa de
Economii si Consemnatiuni SA.
                                HIGH MARGINS, LOW COSTS
National Bank is setting the stage for future growth once lending at home
slows, Chief Financial Officer Anthimos Thomopoulos told investors on

Aug. 31. The bank’s long-term goal is to make itself the leading financial
institution in southeastern Europe.

Arapoglou says one reason he’s investing abroad is to raise margins and
lower costs. Profit last year doubled to 727 million euros on 2.5 billion
euros in revenue and was up 70 percent for the quarter ended on June 30
compared with the same period last year.

In Greece, National Bank has cut its workforce by 10 percent through early
retirement programs, resulting in cost savings of about 70 million euros a
year, and Arapoglou says he may announce another job reduction this year.

The message is clear: Until the Greek government breaks down more barriers
to growth at home, the country’s bankers will look abroad.            -30-
Contact: Maria Petrakis in Athens at .

[return to index] [Action Ukraine Report (AUR) Monitoring Service]
             Send in a letter-to-the-editor today. Let us hear from you.
Ukrainian News Agency, Kyiv, Ukraine, Monday, September 25, 2006

KYIV – Softline, a Kyiv-based company making software modernized the

website of the State Employment service ( Ukrainian News
learned this from the company’s press service. Apart from this, 27 web portals
of regional employment centers were also modernized.

According to the press service, modernization on the basis of the
Medapolis.Portal website administration system was conducted in order to
improve the quality of providing services to the employment service clients,
as well as to guarantee the possibility of simultaneous servicing of a big
number of users of the Internet resource.

The portal presents news from provinces on the work of employment centers
with population and cooperation with employers, a renewed set of legislative
and normative documents on employment and social security, information
archives, and illustrated materials on the activity of the service.

Softline worked out and introduced an Internet portal for the State
Employment Service in 2003. Simultaneously, websites of regional employment
centers integrated in the portal of the State Employment Service were put
into operation.

According to Softline press service, in 2006 over 52,000 people used the
services of the Internet portal of the State Employment Service, which is
twice as many as last year.

As Ukrainian News reported, Softline was set up in 1995 to develop software
for computerizing business, and act as a system integrator. The company is
under control of international investment company SigmaBleyzer.    -30-
[return to index] [Action Ukraine Report (AUR) Monitoring Service]

Ukrainian News Agency, Kyiv, Ukraine, Monday, September 25, 2006

KYIV – The Chumak company (Kherson region) has said it would
commission a new ketchup cooking facility in December. Ukrainian News
learned this from Johan Boden, director for corporate development of
Chumak. The assembly works of new equipment will begin in October,
he said.
The company says the commission of the new facility will increase the
capacity of ketchup production by 3.5 tons per hour or 2.5 times to 5.8 tons
per hour.
The new boiling station will allow producing ketchup with adjuncts with the
size of up 10 mm, whereas now Chumak produces ketchup with adjuncts
under 3 mm.
As Ukrainian News earlier reported, Chumak company (Kherson region) said
it would invest USD 16 million in the development of manufacturing facilities
Canned Chumak.
According to the company, the reconstruction would increase the company’s
capacities of ketchup production in 2 times, mayonnaise – in 6 times, tomato
production – in 6 times.
In November, the European Bank for Reconstruction and Development (EBRD)
decided to provide a loan of USD 26 million to the Chumak company for
development of production.
Chumak company (Kherson region) ended 2005 with a net profit of 50.98
million. In 2005 the company increased net revenues by 65.9% or UAH 200.51
million, compared to 2004 to UAH 504.78 million.
The Swedish company South Food and a number of Kherson-based plants
founded Chumak in 1996. In 2000, the company’s plants were consolidated
into a closed joint-stock company named Chumak.
Chumak produces ketchups, sauces, tomato juice, mayonnaise, vegetable oil,
and canned vegetables under the Chumak and Darina trademarks.
According to the Agency for the Development of Stock Market Infrastructure,
49.6% of the shares in Chumak belonged to Manhasset Investments Ltd.
(Cyprus), 38.9% belonged to Chumak Holdings GmbH (Austria), while
11.5% belonged to ING Bank Ukraine (Kyiv) as of November 2004.  -30-
[return to index] [Action Ukraine Report (AUR) Monitoring Service]

Nine O’Clock, Bucharest, Romania, Friday, September 22, 2006

BUCHAREST – The Rompetrol Group has expanded into Ukraine by
establishing a subsidiary in that country that, for the beginning, would
operate in the area of bulk marketing of fuels. After two years, it will
operate its own network counting approximately 200 filling stations,
Rompetrol informs.

Rompetrol Ukraine in a first phase will import fuels produced by Rompetrol
Rafinare and will distribute them to private petrol station chains, reads a
Group press statement.

“The Ukrainian market needs quality products like those that Rompetrol
Rafinare produces, and the number one target this year is to develop there

a network of filling stations in the franchise system and also to build new
stations,” stated Group Vice-President Eric Kish, in charge of the
company’s regional development and expansion.

There are currently eleven refineries in Ukraine, only four of which
functional, and their production is below the normal capacity.

Rompetrol Ukraine will be headed by Laurentiu Argesanu who, since 2003,
has been Operations Director for Rompetrol.

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

Mara D. Bellaby, AP Worldstream, Kiev, Ukraine, Friday, Sep 22, 2006

KIEV – Ukraine missed an opportunity to launch necessary reforms after the
2004 Orange Revolution, and now is at risk of sliding backward, the head of
a United Nations-linked panel said Friday.

Kalman Mizsei, who formed the Blue Ribbon Commission for Ukraine in 2004
while serving as U.N. assistant secretary-general, said that the ex-Soviet
republic must press ahead to join the Geneva-based World Trade Organization,
liberalize its land market and start tackling corruption if it wants to send
out a positive message about its future.

“Ukraine did miss a big opportunity,” he told The Associated Press during a
visit to Kiev. “Part of the reason is that some people thought that the
parliamentary elections were so close to the presidential elections that
they couldn’t afford unpopular policies. I think that is wrong.”

President Viktor Yushchenko was swept to power in the 2004 presidential
election on promises of reform and closer ties with Europe after the mass
protests that year against election fraud.

The slow pace of reforms and infighting among his government hurt his party
badly in the March 2006 parliamentary elections, won by his former
presidential rival. Viktor Yanukovych, who is backed by some of Ukraine’s
leading industrialists, formed a majority coalition and is now premier.

Mizsei said he had been watching the debate over the 2007 budget being put
together by Yanukovych’s government.

“It looks to me like now we have the risk of another bad alternative, a very
protectionist policy, favoring those industries where the power base of the
current elite is,” he said.

He criticized the new government’s interest in relaunching special economic
zones, which give tax benefits to businesses operating in certain regions,
and its talk of raising customs duties.

Mizsei, who was scheduled to meet with senior government officials later,
said that he hoped they would listen to advice from the Blue Ribbon panel,
made of Ukrainian and international experts and organized by the U.N.
Development Program to give advice on social, economic and political

Its top recommendations are: capping the budget deficit at the 2005 level
and driving inflation under 10 percent, joining the WTO, undertaking
large-scale privatization and lifting the moratorium on the sale of
agricultural land.

While Yushchenko’s government missed many opportunities, “they were

moving toward a level playing field rather than this ‘our favorite groups’
type of approach,” he said.

As for the nation’s new democratic advances such as greater press freedom
and more protections for the political opposition, Mizsei said they were
firmly embedded: “There is an enormous energy behind those freedoms,

they are not going away.”                             -30-
[return to index] [Action Ukraine Report (AUR) Monitoring Service]
17.                    UKRAINE AND NATO MEMBERSHIP
          Ukraine’s Quest for Mature Nation Statehood – Roundtable VII
         October 17-18, 2006, Ronald Reagan Building, Washington, D.C

Center for U.S.-Ukrainian Relations (CUSUR)
New York, New York, Tuesday, October 3, 2006

Dear Friend of the UA Quest RT Series:

You are respectfully invited to be a participant at the seventh annual
roundtable of the Ukraine’s Quest for Mature Nation Statehood series, to
beheld in Washington, DC on October 17/18, 2006. This year, the forum
will be entitled “Ukraine and NATO Membership”.

The two day conference will bring together government and key non-
government representatives of Ukraine, the United States and Ukraine’s
several neighbors as well as experts from the world of academia to examine
and evaluate Ukraine’s readiness to assume a place in the Euro-Atlantic
world in one of its two critical dimensions, or more precisely, to accede
to the historically singular security alliance known as NATO.

To facilitate the said examination, the event will run four regular sessions
featuring eight panels, six highlight focus sessions, two working lunches
and two conference receptions. In total, more than seventy speakers are
expected to address the conference proceedings.

The complete program of this year’s forum and list of invited speakers is
provided below.  You are welcome to attend all of the specified plenary
sessions.  Your presence will certainly enhance the proceedings you may
choose to join. In addition, you are welcome to partake in both of the
Roundtable’s traditional evening receptions.

Due to the time constraints involved with organizing such a large forum, we
kindly ask that you respond by October 6, 2006 concerning your acceptance
to participate.  [Use the response material attached below]. For further
information, kindly contact Mykola Hryckowian, UA Quest RTS Technical
Coordinator, by phone: (212) 473 0839, fax: (212) 473 2180, or e-mail:, at your convenience.

Yours truly, William Miller, Co-Chair
Bob Schaffer, Co-Chair; Walter Zaryckyj, Program Coordinator
Program: Day I – October 17, 2006 ———-
VENUE: Ronald Reagan International Trade Center
9:00 AM – 9:30 AM Opening Remarks —–
9:30 AM – 10:00 AM Roundtable Focus Session I —–
Suggested Theme: Ukraine’s NATO Accession Process – The
Ukrainian Perspective
10:00 AM – 12:30 PM —–
I. Has Ukraine Met the “External Political Requirements” for NATO
Membership? [Two Panels]
1. The “Shared Values” Requirement
Suggested Topics: Adherence to the Democratic Process; General Market
Orientation; Dedication to Social Opportunity; Euro-Atlantic Security
2. The “Good Neighbor” Standard
Suggested Topics: Respect for Borders; Equitable National Minorities
Policy; Non Protectionist Economic Approach; Readiness to Promote
Cultural Exchange
12:30 PM – 1:00 PM Roundtable Focus Session II
Suggested Theme: Ukraine’s NATO Accession Process – The Polish
1:00 PM – 3:00 PM Working Lunch ———-
Suggested Theme: Ukraine’s NATO Membership – UA Political/Societal
Speaks Out: Viewpoint from the Executive Branch; Viewpoint from the
Verkhovna Rada; Viewpoint from the Third Sector; Viewpoint from the
Fourth Estate; Vox Populi Stand-in
3:00 PM – 5:30 PM ———-
II. Has Ukraine Met the “Internal Political Requirements” for NATO
Membership? [Two Panels]
1. The “Rule of Law” Requirement
Suggested Topics: Free and Fair Elections; Accountable Governance;
A Vibrant Civil Society; An Independent Press
2. The “Democratic Civilian Control over the Military” Standard
Suggested Topics: DCC over Defense Sector; DCC over Intelligence Sector;
DCC over Border Security Sector; DCC over Law Enforcement Sector
5:30 PM – 6:00 PM Roundtable Focus Session III —–
Suggested Theme: Ukraine’s NATO Accession Process – The Baltic
7:00 PM – 9:00 PM Conference Reception —–
Hosted by the Ukrainian Embassy to the United States
Day II – October 18, 2006 ———-
VENUE: Ronald Reagan International Trade Center
9:00 AM – 9:30 AM Roundtable Focus Session IV
Suggested Theme: Ukraine’s NATO Accession Process – A British
Voice on the Matter
9:30 AM – 12:00 PM ———-
III. Has Ukraine Met the “Economic Requirements” for NATO
Membership? [Two Panels]
1. The “Developed Market Economy” Requirement
Suggested Topics: Stable Growth of Annual GDP; Low Inflation & Limited
Budget Deficit; Steady Rise in Real Income; Adequate Social Safety Net
2. The “Reasonable Economic Security” Standard
Suggested Topics: Secure Land Borders; Secure Sea Lanes; Adequate
Industrial Capabilities; Energy Diversity
12:00 PM – 12:30 PM Roundtable Focus Session V —–
Suggested Theme: Ukraine’s NATO Accession Process – The US
12:30 PM – 2:30 PM Working Lunch —–
Suggested Theme: Ukraine’s NATO Membership and the “Russian Question”
Viewpoint from Brussels, Viewpoint from Warsaw, Viewpoint from
Moscow, Viewpoint from Washington, Viewpoint from Kyiv
2:30 PM – 5:00 PM —–
IV. Ukraine’s Road to NATO: Past, Present, Future Security Arrangements
[Two Panels]
1. Assessing Ukraine’s Preparation for NATO Membership (1997-2006)
Suggested Topics: Creation of a Professional Defense Force; Education of a
NATO Ready Officer Corps; Provision for Rapid Reaction Units; Upgrade
of Weaponry and C3I
2. Pondering Ukraine’s Future Course with Regard to NATO Membership
Suggested Topics: Present State of Affairs; UA NATO Future #1: “Fast
Track”; UA NATO Future #2: “Slow Track”; UA NATO Future #3: “On
5:00 PM – 5:30 PM Roundtable Focus Session VI —–
Suggested Theme: Ukraine’s NATO Accession Process – The NATO
Perspective 5:30 PM – 6:00 PM Concluding Remarks —–
7:00 PM – 9:00 PM Patron’s Reception —–
Hosted by the Ukraine’s Quest for Mature Nation Statehood RT Series
Steering Committee
Invited Speakers; John Wobensmith (VP for Development /AFPC)
Sen. George Voinovich (R-OH); Oleh Shamshur (UA Ambassador to the
US); Volodymyr Khandohiy (Deputy Minister of Foreign Affairs of
Ukraine); Kyle Parker (OSCE); James Greene (NATO Liaison UA);
Yuri Scherbak (UA NAS); Carlos Pascual (Brookings Institution);
Volodymyr Dubovyk (WWIC/ONU); Orest Deychakiwsky (OSCE);
David Kramer (DAS/DOS/EEA); Kostyantyn Morozov (UA FMA)
Steven Pifer (CSIS); Alexander Motyl (Rutgers U/CGG); John
Micgiel (Columbia University); Janusz Onyszkiewicz (VP/European
Parliament); William Miller (Kennan Institute); Ivan Vasiunyk (Dep.
State Sec.); Hryhoriy Nemyria (VR/BUT); Leonid Kozhara (VR/Party
of Regions); Pavlo Zhovnirenko (UA CSS); Tatyana Silina (Dzerkalo
Tyzhnya); Ilko Kucheriv (Democratic Initiatives); Jan Bugajski (CSIS);
Bohdan Futey (US Court of Federal Claims); Steven Nix (IRI);
Oleksandr Derhachov (IPES/UA NAS); Nadia Diuk (NED);
Bob Schaffer (Aspect Resources); F.S. Larrabee (RAND);
Hryhoriy Perepelytsya (UA NISS); Michael Haltzel (Piper Rudnick
Gray Cary); Valentyn Nalyvaychenko (Dep. Head/SBU);
Keith Smith (CSIS); Yuri Luik (Estonian Ambassador to the US)
William Taylor (US Ambassador to Ukraine); John Van Oudenaren
(Library of Congress); James Sherr (Fellow/CSRC/UK Defence
Academy); Ariel Cohen (Heritage Foundation); Brian Cox (EEA/Dept
of the Treasury); Serhiy Korsunsky (Economics Dept./UA MFA);
Anders Aslund (Inst. for Int’l Econ.); Edilberto Segura (SigmaBleyzer)
William Courtney (CSC); Vasyl Rohohyj (Dep. Secretary/UA NS&DC)
J. Benedict Wolf (US DOS/UA Economic Desk); Jerry Dutkewych
(Millennium Challenge); Ihor Burakowsky (IER&PC)
Robert McConnell (US-Ukraine Foundation); Paula Dobriansky (US
Undersecretary of State); Morgan Williams (SigmaBleyzer, Ukraine-
US Business Council); Robert Pszczel (NATO Information & Press Ctr.)
Jan Pieklo (PAUCI); Sergey Markov (Institute for Political Studies/RU)
Eva Shinagel (US DOS/NATO Affairs); Celeste Wallander (REA/CSIS)
Yevhen Zerebeckyj (NIIS/UA NS&DC); Ilan Berman (AFPC)
Dan Fata (DAS/EUR&NATO/US DOD); Leonid Holopatyuk (General
Staff/UA MOD); Michael Duray (UA NATO I&DC); Jan Neutze
(Atlantic Council); Bo Denysyk (Global USA); Jorgan Andrews
(US DOS/UMB); Volodymyr Tereshchenko (Dep. Minister/UA MOD)
Bruce Jackson (Project on Transitional Democracies); Steven Sestanovich
(Columbia University); Jaroslav Pilynsky (Kennan Institute UA)
Petr Lunak (Diplomatic Sector/NATO Headquarters); Adrian Karatnycky
(Orange Circle); Sen. Joseph Biden (D-DE); Roman Popadiuk
(GHW Bush Presidential Library).
Sponsors: American Foreign Policy Council; Center For US-Ukrainian
Relations; Congressional Ukrainian Caucus; Columbia University/ECEC
Democratic Initiatives Foundation; Embassy of Ukraine to the United
States; Harvard University/BSSP; International Republican Institute
Johns Hopkins University/SAIS; National Democratic Institute; New
York University /LAP; Organization for the Defense of Four Freedoms
for Ukraine; UA Center for Strategic Studies; Ukraine-US Business Council
Ukrainian National Women’s League of America; US Library of Congress
US-Ukraine Foundation;
RT Steering Committee: Chairs: William Miller, Bob Schaffer
Members: Vera Andrushkiw; Ilan Berman; Nadia Diuk; Olga Fishel;
Mykola Hryckowian; Adrian Karatnycky; Nadia Komarnycky McConnell;
Mykhailo Koziupa; Iryna Kurowyckyj;Ilko Kucheriv; John Micgiel;
Richard Murphy; Steven Nix; Jan Pieklo; Herman Pirchner;
James Sherr; John Van Oudenaren; Morgan Williams; Walter Zaryckyj;
Pavlo Zhovnirenko
Conference Venue Information —————
Tuesday, October 17, 2005
Ronald Reagan Building and International Trade Center
Pavilion Room; 1300 Pennsylvania Avenue, NW, Washington, DC
First Day Working Lunch – Pavilion Foyer
Conference Reception
Embassy of Ukraine to the United States
3350 M Street, NW; Washington, DC

Wednesday, October 18, 2005
Ronald Reagan Building and International Trade Center
Pavilion Room, 1300 Pennsylvania Avenue, NW
Washington, DC
Second Day Working Lunch – Pavilion Foyer
Patrons Evening Reception: By invitation only
Hotel Accommodations, The Washington Hilton, 1919
Connecticut Avenue, NW, Washington, DC

A limited block of rooms have been reserved for the conference at a
discounted rate of $229/night, including breakfast. For information
and reservations please contact
Ms. Daria Tomashosky, Hamalia Travel at:
or (941) 426 2542. Steering Committee
RTVII registration and sponsorship information can be found online at the
Center for US-Ukrainian Relations,

For additional information, please contact Mark Romaniw, UA Quest RTVII
Media Coordinator, by phone: (202) 412 6883, fax: (212) 473 2180, or e-mail:                         -30-

[return to index] Action Ukraine Report (AUR) Monitoring Service]
     You are welcome to send us names for the AUR distribution list.
                   Tension between the two is boiling over into open conflict.

BBC Monitoring research in English 29 Sep 06
BBC Monitoring Service, United Kingdom, Friday, Sep 29, 2006

Less than three months after Ukraine’s President Viktor Yushchenko was
forced to accept his former election rival Viktor Yanukovych as the new
prime minister, tension between the two is boiling over into open conflict.

Hopes that the Declaration of National Unity, a broad outline of agreed
policies signed shortly before Yanukovych’s appointment, would help

maintain the delicate balance are fading.

Indeed, some analysts are saying a state of “cold war” now exists between
the presidential camp and the Yanukovych-led ruling coalition.

While the prime minister is probing the president’s defences, the president
seems determined not to allow his former rival to take over as the country’s
main decision-maker.

In at least one key area, relations with NATO, Yanukovych has already
scuppered Yushchenko’s plans.

The two are in a stalemate following the introduction of the constitutional
reform last January. The president has to live with the prime minister whom
he can no longer sack.

Yanukovych, on the other hand, does not control a two-thirds majority in
parliament required to overrule the president’s veto on legislation.

He also needs pro-presidential MPs to push through liberal reforms which his
Communist coalition partners will probably resist, and he needs Yushchenko
himself to ease his own dealings with the West.

But despite their mutual dependence, relations between Yushchenko and
Yanukovych are deteriorating rapidly. Here is a brief account of their
recent skirmishes:

[1] RUSSIAN LANGUAGE: The first warning shot across the bow came during
Yanukovych’s trip to Russia on 16 August, where he said his party was still
determined to give Russian official status in Ukraine, but it would need to
secure a two-thirds majority in the Ukrainian parliament first.

The statement prompted an outcry from the president’s allies, who accused
Yanukovych of going back on his promises in the Declaration of National
Unity – a deliberately vaguely-worded and legally non-binding document.

The president urged Yanukovych to stick to the declaration. (Ukrayinska
Pravda, 17 Aug 06; Interfax-Ukraine 16 Aug 06)
NATO: During his visit to Brussels, Yanukovych declared that Ukraine would
put its plans to join NATO on hold and postpone joining the Membership
Action Plan (MAP), much to Yushchenko’s dismay.

The president’s allies once again accused Yanukovych of breaching the
Declaration, which said Ukraine should take all steps to deepen cooperation
with NATO and join after a national referendum, but did not specify policy
on MAP.

The defence and foreign ministers, both appointed under the president’s
quota, openly disagreed with Yanukovych’s position, and Yushchenko said he
had a “not a very pleasant conversation” with the prime minister upon the
latter’s return from Brussels. He added that under the constitution, foreign
policy is the president’s domain, not the prime minister’s.

Yanukovych retorted that he was sticking to the word of the Declaration, and
pushed through a resolution in parliament supporting his stance on NATO.

The Ukrainian media commented that Ukraine’s plans to join NATO had suffered
a serious setback. Speaking in an interview to Western journalists,
Yanukovych took a further swipe at Yushchenko, saying that the president’s
ambitions sometimes run ahead of what is actually possible. (UT1, 14 Sep 06;
5 Kanal, 15 Sep 06 )

[2] COALITION: Meanwhile, little progress has been reported from the ongoing
talks on the pro-Yushchenko Our Ukraine bloc formally joining the ruling
coalition of Yanukovych’s Party of Regions, the Socialists and the

The signing of the coalition declaration has already been postponed several
times, with Our Ukraine threatening from time to time to formally declare
its opposition to the government, with uncertain implications for Our
Ukraine ministers serving in the cabinet.

Party of Regions says it will not bow to Our Ukraine’s pressure to expel the
Communists from the Coalition, and Yanukovych warned Our Ukraine ministers
during a recent cabinet meeting that they were walking on thin ice.
(Interfax-Ukraine, 22 Sep 06, 5 Kanal, 28 September)

[3] YUSHCHENKO’S DECREES: A major row broke out when the cabinet

returned back to the president’s secretariat several of Yushchenko’s decrees.
The cabinet said it had no intention of carrying them out because they were
published before Yanukovych could put his own signature on them, apparently
in breach of the legislation.

The cabinet even went as far as saying it should take part in drafting those
presidential decrees which it will then have to implement. The presidential
secretariat said it was outraged and sent the decrees back to the cabinet.
The cabinet insisted it would disregard them.

 Both sides said they would ask the Constitutional Court to adjudicate,
while Yushchenko’s allies said the president will resist attempts by
Yanukovych to take over presidential powers.

Yushchenko himself said the implementation of the constitutional reform
should not be about “grabbing more powers”. The decrees themselves were
relatively routine, so the row seems to be a matter of principle rather than
policy. (Interfax-Ukraine, 25 Sep 06)

[4] PRESIDENTIAL SECRETARIAT: In mid-September Yushchenko sacked

the chief of his secretariat, Oleh Rybachuk, seen as ineffectual, and brought in a
team of tough managers led by Viktor Baloha, a former emergencies minister.

The move was widely seen in the media as an attempt to beef up the
secretariat so that it could stand up to the increasingly truculent cabinet.
(5 Kanal, 16 Sep 06;, 19 Sep 06; Segodnya, 26 Sep 06)

[5] ORANGE GOVERNORS AND MINISTERS: Yanukovych was seen as

making another challenge against Yushchenko on 28 September by calling for
the dismissal of five pro-Yushchenko regional governors, citing their poor

The call was made following angry exchanges at a cabinet sitting between
Yanukovych and those governors and cabinet ministers who represent the
president’s camp. Yanukovych even threatened Justice Minister Roman

Zvarych with dismissal.

Our Ukraine MPs later commented that the governors in question are
performing well enough and Yanukovych wants to get rid of them for political
reasons. The presidential secretariat said it is up to the president to make
decisions on firing and hiring governors. (5 Kanal, 28 Sep 06; Inter, 28 Sep


changed his plans to attend the cabinet sitting on 28 September after learning that
Yanukovych would call for the five governors to be sacked. Other reports
suggest Yushchenko turned back at the last minute because he was not given
the centre seat at the meeting.

The secretariat said the president did not show up because the cabinet
sitting was “poorly prepared”. The president’s failure to appear was seen by
the media as a sleight to Yanukovych. (UNIAN, 29 Sep 06, Interfax-Ukraine,
28 Sep 06)

[7] BUDGET AND OTHER LEGISLATION: Yushchenko sharply criticized

the cabinet’s budget draft on 28 September, singling out investment, foreign
trade, privatization and social policies.

He also said the cabinet was responsible for parliament’s decision to freeze
utility prices for the public, despite the president’s protestations and
without any means in the budget to pay for it.

Earlier, the president also criticized the cabinet’s draft of the law
outlining its own powers, saying that unless his proposals are taken into
account he would submit an alternative bill to parliament (and presumably
veto the cabinet’s version of the bill if it is passed). (Ukrainian
president’s website, 28 Sep 06)


Yanukovych cabinet has recently stepped up its previously muted criticisms
of its predecessors, saying that the Yekhanurov cabinet left the economy in
a state of crisis.

Yushchenko, who had repeatedly praised Yekhanurov’s performance, retorted
that the economy was growing steadily and that the Yanukovych cabinet must
make sure that the trend continues. (Delo, 7 Aug 06; UNIAN, 2 Sep 06 )
[return to index] [Action Ukraine Report (AUR) Monitoring Service]
19.                              LAW AND PEOPLE APART
        The Orange and the White-and-Blue are not wrestling for the right to
       control the observance of laws and not even for power as such. They
       are wrestling for money. No matter who wins, the people will be none
             the better, just because they are the means, not the goal in this
                            war. The law and the people are apart again.

Zerkalo Nedeli On The Web (ZN), Mirror-Weekly, No. 37 (616)
International Social Political Weekly
Kyiv, Ukraine, Saturday, 30 September – 6 October 2006 year

The political ‘wedding’ of the Oranges and the White-and-Blues has turned
into a political funeral. It was hardly a marriage of convenience and not at
all a marriage of love. It was a misalliance doomed to divorce.

The marriage contract with the pompous title, ‘Declaration of National
Unity,’ was anything but a binding document – as it abounded with vague
and ambiguous plans and was void of legal status.

Did they need that flirtation to unite the country? Certainly not, since
both forgot all about their ‘sacred mission’ on the following day. The
White-and-Blues knew that the Cabinet of Ministers was already theirs and
they simply wanted to get hold of power sooner.

It is much harder to comprehend the logic of the Our Ukraine and especially
its leader. It was evident that the show with several round tables, endless
negotiations on a ‘grand coalition’, tiresome monologues about unity, and
the silly procedure of adjusting the text of the declaration was just a
pretext for Yushchenko’s alliance with the Regions Party.

Such an alliance was the only way for him to retain some last remaining
powers and place his ‘dear friends’ in comfortable and cozy chairs.

The idea was obviously defective and Yushchenko’s advisers should have
studied the new Constitution and calculated the consequences.

Once the so-called ‘anti-crisis coalition’ was formed and Yanukovych became
Prime Minister, the lion’s share of executive and legislative powers fell
into the lap of the Regions Party, leaving Yushchenko with bleak chances to
remain a real political player.

Having signed the declaration, blessed his sworn enemy’s premiership, and
delegated his emissaries to the hostile government, he deprived himself of
the minimum of opportunities to maneuver.

Yushchenko simply had no other way but a deal with the Donetsk clan as he
had neither legal tools nor moral pretexts to wage a war.

The President has long proven to be helpless as a manager, reformer, and
legislator. In recent months, he has demonstrated his impotence as an
organizer and plotter.

His real influence on the government’s policy and the parliament’s lawmaking
work tends to be null. Ukraine’s modern history has shown many times that if
two centers of power do not cooperate, they are doomed to war.

This war has one subjective and many objective causes. Internal conflicts
have torn Our Ukraine for months and the Regions Party has only recently
showed signs of a latent feud.

 Both camps, however, feel somewhat relieved to see the comeback of the
former enemy: the onset of another campaign may close the dented ranks. The
big difference is that the Yanukovych-Akhmetov team is prepared for this war
while the Yushchenko team is not.

The first exchange of blows happened after Yanukovych’s resonant statements
in Brussels [about Ukraine being unprepared to join NATO; Yushchenko was
indignant with Yanukovych exceeding his premiership competence – A.B.].

Then the camps clashed swords over the so-called ‘countersign’ issue [the
Cabinet sent back seven presidential bills, explaining that they had no
binding force unless countersigned by the Premier – A.B.].

It is up to the Constitutional Court to decide which side in the conflict
was right. But the White-and-Blue side already appears to be the winner:
they looked more convincing, less hysterical, and thus stronger in the bout.

They surprised their Orange opponents with their ability to learn from past
mistakes: the team that had gathered a critical mass of lawbreakers learned
very quickly to achieve their goals through the letter of the constitution.

Yushchenko and most of his confidants seem to be still too lazy to read, too
reluctant to understand, and too aversive to accept the changed

Yushchenko is obviously and badly short of mature fighters, smart advisers,
and sensible spokesmen. His team lacks order and discipline. In the middle
of the fight, he made an emergency move – a total renewal of his

We have to admit that it was one of the few rational moves in almost two
years of his presidency. He should have made it earlier and thought it out
more, though. The legal service of his chancellery is still the weakest.

This new round of wrestling for power demands players of a qualitatively
different type. Both sides behave aggressively and defiantly.

In this respect, the new chief of the presidential secretariat Viktor
Baloga with his scrappy manners is not a bad choice. On the other hand,
Baloga’s legal illiteracy and nihilism make the President even more

The shortage of clever lawyers is also fraught with an inevitable defeat in
the course of political reforms. An early example was the
Yushchenko-Yanukovych duel for control over governors.

Immediately after the [March 26 – A.B.] general and local elections, a
number of local councils (controlled by the Regions Party) used their
constitutional right and voted unanimously for sacking the pro-Yushchenko

In accordance with the Constitution, the President was bound to dismiss
them, but he ignored this rule and even tried to hit back in July.

Remembering about his right of legislative initiative (which was a rare
case), Yushchenko motioned an amendment to the law on local self-government,
which would specify the procedure of passing the vote of no confidence in
heads of regional and district administrations.

He obviously aimed at maximally complicating the process and protecting his
governors from those arbitrary local councils. Even if his draft bill had
been impeccable in legal terms, the parliament would have hardly voted for

The anti-presidential majority held on tight to its rights. The document
collected a miserable four dozen votes [out of 450 – A.B.] and was sent

The second round of the wrestle for control over the governors started on
September 26. Its formal initiator was Viktor Baloga.

He convened a video conference with governors and stated the following:
“The head of a regional administration is a member of the President’s team.
Everyone must know and remember it.” The response came very soon.

Two days later, members of the Cabinet received the text of a draft
resolution that initiated the dismissal of the governors of Poltava,
Ternopil, Kharkiv, Kherson, and Chernigiv regions, “for unsatisfactory work
on solving the problems which hamper the state’s socioeconomic development.”

Our Ukraine accused the Regions Party of trying to usurp power and violating
the constitution. Its official statement was filled to the brim with

According to the authors, “The question of dismissal of governors may not be
considered at sessions of the Cabinet of Ministers since such issues are
beyond its competence. Governors’ performance must be evaluated from the
angle of professionalism rather than political expediency.”

Justice Minister Roman Zvarych went even further: “The Premier can’t have
said that, because the Premier ought to know the Constitution, which states
that it is the President who is authorized to initiate dismissals of

Then Yushchenko and Yanukovych exchanged ‘compliments.’ Next,
Yushchenko ignored the government’s session. Finally, Yushchenko
canceled his own meeting with governors.

As far as Zvarych’s statement is concerned, he should have read the
Constitution, which says the following: “Heads of regional administrations
shall be appointed and dismissed by the President of Ukraine upon
submission from the Cabinet of Ministers of Ukraine.”

It is hard to believe that the minister of justice does not know this
article. We hope it must have been a slip of the tongue or just a

As to the statement issued by the Our Ukraine, its authors should know that
the question of governors’ dismissals can and must be considered at the
government’s sessions as such issues are within its competence.

Here is a short historical digression that may help the reader understand
why governors are so dear to the people’s representatives.
In 1985, the Council of Europe initiated the adoption of the Local
Self-Government Charter.

The document was adopted after long discussions and was meant to enhance
local communities’ political, administrative, and financial independence and

The enlightened European community deems this as one of the cornerstones of
true democracy. Moreover, Brussels theoreticians regard the development of
local self-government as one of the main prerequisites for strengthening the
European Union.

With the development and enlargement of the European Union, economic
influence of the center on peripheries increases. This trend has to be
balanced off with democratic counterweights.

In this respect, many European politicians view self-organization of local
communities as the key deterring factor.

The Charter says that the true democracy, “Is not where power is centralized
but where it is distributed and delegated among localities.”

The Charter proceeds from an old and simple principle: local communities do
not have to refer to central authorities the issues that they can handle on
their own. The Ukrainian system of local self-government is built on the
opposite principle.

Joining the Charter, Ukraine assumed certain obligations, but it is in no
hurry to meet them. In this country, it is possible to solve problems of a
village school or a district hospital only in Kyiv. In Europe, local
communities enjoy the right to manage their own affairs.

The Ukrainians have such a right, too, but only on paper. The Constitution
grants them the right to solve disputable issues through a referendum, but
the absence of a relevant legal act deprives them of this right. The act of
1990 (!) contradicts both international practice and the Constitution of

For more than fifteen years, all political leaders have promised to make it
right but things are right where they started. Thus, at least in terms of
local self-government, Ukraine is far from ready to join the European

The main drawback of the Ukrainian system of local administration is that it
is ‘bicephalous’. There are two centers of influence: local councils elected
by residents and local administrations appointed by the President upon the
government’s submission.

Their competencies are defined and regulated by the laws, “On Local
Self-Government,” and, “On Local State Administrations.”

Each new amendment to either law grants local councils more authority,
which is natural since this country is going to move closer to Europe.

Now that the amendments to the Constitution have taken effect and the
proportional model of local elections has been established, state
administrations are losing weight and ground.

So, who are the governors? Whose team are they playing for? Who are
they subordinated to? What is so interesting about them?

[1] THEORY ONE: it is incorrect to call heads or regional administrations
‘governors.’ They do not represent local communities. They are official
representatives of the central government and are incorporated in the
executive chain of command.

[2] THEORY TWO: local administration officers have to play for different
teams. They are responsible to the President. They are subordinated to and
controlled by senior bodies of executive government (first of all, by the
Cabinet of Ministers).

Since legislation forbids district and regional councils to have their own
executive bodies, they delegate executive functions to state

In Europe, elected bodies of local self-government delegate their functions
through contracts with government agencies. In Ukraine, it is done by the
force of law.

Actually, district and regional administrations in Ukraine are
quasi-executive bodies of respective councils of people’s deputies.
Therefore, they are also accountable to local self-governments in the part
of delegated functions.

This model is tangled and nonsensical. On several occasions experts offered
a simple solution: to allow local councils to form their respective
executive bodies and replace state administrations with prefectures that
would only perform supervisory functions. Unfortunately, they were never

[3] THEORY THREE: the specific status of state administrations, the
peculiarities of the national legislation, and the proportional model of
local elections grant local councils the right to pass a vote of no
confidence in administration heads on political grounds.

Thus, a governor is responsible more politically than legally, like the
central government is responsible before the parliament. The Our Ukraine
representatives, who rebuke the Regions Party for the ‘politicized approach
to the governors,’ are obviously wrong.

So was the President, who motioned amendments to the law on local
self-government, trying to ‘cross out’ politics in the list of possible
reasons for passing the vote of no confidence in a governor. The
Constitution and active laws do allow regional councils to pass such a vote
for whatever reasons.

[4] THEORY FOUR: representatives of the Presidential Secretariat claim that
the President has the right to ignore a vote of no confidence. No, he does

Article 118 of the Constitution makes it incumbent upon him to dismiss an
administration head in case two-thirds of the local council members vote for

[5] THEORY FIVE: it is hard to say which team local administration heads
belong to, but it is for sure that they are not the President’s players.
Yes, they are responsible to him, but they are directly subordinated to and
controlled by the Cabinet of Ministers.

Besides, administrations are incorporated in the system of executive
government, which the President (unlike the Cabinet) represents just

Yes, the President appoints administration heads. He also has the right to
appoint judges. Does it mean that judges are also players in the President’s

[6] THEORY SIX: the President has limited influence on governors, but his
secretariat has none at all. Moreover, the Constitution does not provide for
an office like the presidential secretariat.

It is just a chancellery and it has no right to take over presidential
functions. Its chief has no right to summon governors and demand that they
carry out the President’s orders.

Whether the President has the right to give orders to governors is an open
question, but it is out of question that his chancellery does not have this

The presidential secretariat has no right to ‘take under special control the
analysis of normative acts issued by the government and the parliament.’

It has no right to consider candidatures for the posts of local
administration heads prior to their nomination. Many legal experts say that
presidential decree #675, which grants the presidential secretariat this
right, is a graphic example of very frivolous interpretation of the

One of them is the presidential secretariat staffer who is in charge of this
issue. He refused to sign-off on the draft decree and tried hard to dissuade
Yushchenko, but his argumentation failed to change the President’s mind.

[7] THEORY SEVEN: the President has limited influence on the selection of
candidate nominations for the posts of governors. It is the Cabinet that
nominates candidates and it is only district and regional councils that can
offer them.

The President only has a right to turn down a candidature offered to him.
Therefore, we insistently advise those who argue that governors are ‘members
of the President’s team’ to attentively read Article 118 of the Constitution
and the active legislation on local self-government.

[8] THEORY EIGHT: In accordance with the law, the Cabinet of Ministers is
the key decision-maker regarding both appointments and dismissals of

The Cabinet submits to the President a proposal to dismiss a governor. It
may recommend that the President dismiss a governor on grounds listed in the
law on public service. Negligent performance may be a sufficient

The President may disregard the recommendation, but it is not true that
dismissal of governors is his exclusive prerogative.
Why is Yushchenko so particular about the control over governors?

The official explanation looks nice: the President is the constitutional
guarantor of observance of laws in the entire country and the governors are
supposed to ensure observance of laws in their respective regions.

If this link were broken, the mechanism of democratic control would be lost.
Sounds nice, but there are some doubts. How can a governor ensure
observance of laws?

The answer is in Article 144 of the Constitution: if decisions passed by
local self-governments contradict the Constitution or active laws, they must
be invalidated.

The problem is that neither the Constitution, nor the active laws say
exactly who is authorized to invalidate such decisions. Governors have no
influence on any decision passed by any council.

Under Leonid Kravchuk’s presidency, his representatives had this right. His
successors Leonid Kuchma and Viktor Yushchenko never granted this right to
governors, although they were bound to.

Now chairpersons of local councils enjoy many more rights. For example,
village council heads or city mayors have a right to suspend or invalidate
decisions passed by local authorities.

They use this right very often, especially when decisions concern land.
Accordingly, regional administrations and their heads have narrower
competencies and rights.

All local authorities (from police to veterinarian services) are directly
subordinated to Kyiv, but the governor is always the one to blame for any

Previously, regional administrations apportioned the budget funds among the
towns and villages. Now each town or village is in direct contact with Kyiv.
Why fight for the governors then?

The simple answer is in Article 2 of the law on public service: the
administrations are responsible for the preparation and execution of the
budget. They are in charge of distributing subventions, funds for investment
programs, etc.

If the governor is ‘your man’, you are the first to receive allocations. And
if you also control the local council, you are the only one.

The Orange and the White-and-Blue are not wrestling for the right to control
the observance of laws and not even for power as such. They are wrestling
for money.

No matter who wins, the people will be none the better, just because they
are the means, not the goal in this war. The law and the people are apart
again.                                                 -30-

[return to index] [Action Ukraine Report (AUR) Monitoring Service]
                                THE HUNT ON GOVERNORS”
      Cabinet moves to subdue local officials, fight will clearly be to the death

ANALYSIS & COMMENTARY: By Tetyana Nikolayenko
Ukrayinska Pravda web site, Kiev, in Russian 28 Sep 06
BBC Monitoring Service, United Kingdom, Monday, Oct 02, 2006

Viktor Yanukovych’s cabinet is actively tying to take control of local
government institutions, an authoritative Ukrainian website has said.

The government has threatened President Viktor Yushchenko’s allies with
dismissal and is planning to apply financial restrictions to those officials
who refuse to cooperate with Yanukovych, the website said.

The following is the text of the article by Tetyana Nikolayenko, entitled
“From the Regions with love: Yanukovych opens the hunt on governors”,
published on the Ukrayinska website in Russian on 28 September, subheadings
have been inserted editorially:

[Prime Minister] Viktor Yanukovych has decided to heat up the war with the
president not only on the central level, but on the regional level as well.

On Tuesday [3 October], the cabinet intends to propose the president dismiss
the heads of five regional state administrations.

The leaders of Poltava, Ternopil, Kharkiv, Kherson and Chernihiv regions got
on Yanukovych’s black list. It is worth pointing out that all the cabinet’s
potential victims are the people of [pro-presidential bloc] Our Ukraine.

This decision is a logical continuation of Yanukovych’s recent statement
calling on all governors who were members of political forces which lost in
local government elections and which could not work constructively with
regional councils to resign.

And Yanukovych decided to attack them from two sides – from the centre and
along the flanks.

Should the president ignore Yanukovych’s statements, it cannot be ruled out
that these governors could get a “black mark” from the regional councils –
that is, a vote deeming their work unsatisfactory.

A few days ago, Kherson regional council speaker Volodymyr Demyokhin said he
intended to include the question of deeming the work of the Kherson regional
administration unsatisfactory on the September agenda.

And local Regionals are also continually threatening to take the chair away
from Kharkiv governor Arsen Avakov.

It cannot be ruled out that soon the loser-governors will be joined by head
of the Mykolayiv regional administration Oleksandr Sadykov, whose personnel
appointments are not well-liked by [Yanukovych’s] Party of Regions. But so
far his name has not got onto the black list.

But Ukrainian [opposition] People’s Party representative Valeriy Asadchev
has got there. Earlier, the Party of Regions did not have any special plans
for Poltava Region, but the Socialist Party of Ukraine has long had its eye
on it, and in contrast to Our Ukraine, the Socialists are courteously moving
into the fairways of Party of Regions politicians.

By the way, the Party of Regions encroaching on the heads of regional
administration is only the tip of the iceberg. The prime minister’s fellow
party members are easily applying the same type of schemes with regard to
the heads of local administrations lower levels.

The reason is a traditional one – poor showings of trust locally and a lack
of desire to find a common language with the local council where as a rule
the Party of Regions has the majority.

According to the predictions of the Committee of Voters [NGO], by the end of
September attempts will be made to change over half the heads of regional
and district state administrations.

In general, the Committee of Voters believes that by the end of the year,
nearly a third of the leaders of local administrations will be changed. The
main ways of dismissing the leaders of local state administrations at the
instruction of the government or a decision by the relevant local

And this is on the sly, because in comparison to the arrival of Our Ukraine
to power, no real cries of illegal dismissals are being heard – the full
“Regionalization” of the entire country is under way.

And the Committee of Voters says that Our Ukraine’s [possible] joining the
parliamentary coalition will not protect its representatives in local
administrations from being fired. “Should Our Ukraine move into the
opposition – the percentage of personnel rotations will increase.

Should hard-to-understand agreements or the ‘nonaligned’ status of Our
Ukraine be formed, it will lose part of its seats in local bodies of power
and the other part will become de facto loyal to the government coalition
and not to its own political bloc,” the organization’s report reads.

Meanwhile, Yanukovych’s comrades have decided to domesticate regional
authorities with financial levers.

For example, Article 97 [of the 2007 draft budget] says that in 2007: “The
Cabinet of Ministers determines the limit of the number of employees in
local state administrations, including their apparatus, their expenses and
their deductions; the size of local bodies of self government are determined
within the range of the general size, as determined to be typical staff
requirements confirmed by the Cabinet of Ministers of Ukraine.”

Bodies of local self-government are not recommended to pass decisions which
lead to increasing the number of employees in budget spheres.

And Article 98 gives the government the right, based on the conclusions of
the functional reviews of central and local bodies of the executive, to
employ measures to bring order to the system of these bodies and curtail the
number of employees. That is what the government structure looks like.

If the cabinet cannot influence personnel appointments in the regions and
districts, then it will use a financial noose against them.

If you don’t want them to bother you by looking for fleas in your coat – be
obedient, if not – the cabinet will quickly put you and your people on bread
and water.

“Earlier I opened the budget and saw the expenses of all 27 administrations.
Now the draft budget for 2007 puts a general sum of expenses for all the
administration on one line,” Valeriy Asadchev told Delo [newspaper] in an

And the head of the Mykolayiv administration, Oleksandr Sadykov, is certain
that the cabinet’s decision was passed in order to employ hands-on
management “and rule the regional administrations by financial levers”.
                             SUBORDINATING THE POLICE
By the way, local government agencies are not the only ones the cabinet has
decided to domesticate through finances. The same fate awaits the local

Because under the budget’s Article 139 the Interior Ministry’s units, where
local police units are established, will be supported at the expense of
local budgets of the corresponding level.

Among other things, these units include the traffic police, police patrols,
and precinct police inspectors, reception centres for minors and for
vagabonds and special reception centres for people subject to administrative

And like everyone knows, the one who pays, calls the music…[ellipsis as

And that is not all. The Party of Regions is already thinking about how to
annex another piece of authority by carrying out political reform on the
level of self-government.

The well-known lover of the idea of separatism, [MP] Viktor Tykhonov,
believes that governors and the mayors of cities are “great princes who have
power but practically no responsibility”.

And so the Party of Regions member recommends correcting the state of
affairs by introducing the following principle – the head of the regional
administration should represent the interests of the state, the president
and the prime minister, while the head of the regional council should have
its own executive and be elected at a session of the regional council.

In short, all power to the councils and the regions. Or, as Viktor
Yanukovych said, “We have arrived, and you won’t push us out.”

On the other hand, the president is clearly not going to give his regional
“front posts” to the prime minister. Through Arseniy Yatsenyuk, he has
already asked the cabinet to not touch his governors.

“There is a proposal from the president to discuss the issue in order to
resolve it constructively”, the president’s representative to the cabinet

Besides, the president’s secretariat is looking for other ways to defend
itself from the cabinet’s attacks. Via legislation, it intends to complicate
the procedure by which councils vote no confidence in the heads of district
and regional state administrations.

Presidential chief-of-staff Viktor Baloha spoke of this at a meeting with
governors this week. He instructed his deputy Viktor Bondarev and the heads
of regional administrations to introduce legislative proposals on this

So we can expect an exacerbation of the paper war between the secretariat
and the cabinet this winter and not only with regard to presidential
decrees, but with regard to governors’ chairs, too.

The fight will clearly be to the death, and as far as how this will affect
the work of local government agencies, don’t even ask.
[return to index] [Action Ukraine Report (AUR) Monitoring Service]
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          Her first WTA tour singles title win, women’s professional tennis
Sony Ericsson WTA Tour, St Petersburg, FL, Sunday, Oct 1, 2006

LUXEMBOURG, Luxembourg – Despite her 5’6″ frame, Alona Bondarenko
proved to the FORTIS Championships field throughout this past week that
she sure packs a lot of punch.

The 22-year-old Ukrainian polished off her maiden Sony Ericsson WTA
Tour singles title run with a 63 62 victory against Francesca Schiavone,
whose finals jinx remained intact.

Bondarenko, ranked No.62 and unseeded at the Tier II event, took it to the
No.5-seeded Schiavone with a dazzling display of power on Sunday, closing
her out in straight sets in a few minutes past the one hour mark.

She maintained an 83% first serve percentage, winning 80% of those points,
and also broke serve a total of five times during the match, making it
virtually impossible for her opponent to grab any momentum at all. The
Ukrainian cracked down-the-line winners like it was second nature.

“I didn’t think about how it was a final, and that I could win or lose; I
just played, and concentrated on every point,” said Bondarenko, who was a
runner-up to Sania Mirza in her only previous final, at Hyderabad last year.
“I concentrated a lot on my first serve. Today, I just focused on my game
and nothing else.”

“She played great,” Schiavone said. “She didn’t give me a chance. She only
gave away three or four points in the match. I was trying to find the
solution, to try and break her, come into the net, I did so many things. But
not so well I guess.”

The title run comes as somewhat of a surprise, considering Bondarenko hadn’t
even been beyond the round of 16 at a tournament this size all year long,
let alone in her entire career.

But she came up with the wins all week, beating No.8-seed Mary Pierce in her
opener and notching three set victories over fellow non-seeds Katarina
Srebotnik, Nathalie Dechy and Kveta Peschke.

She fended off a 5-2 deficit and match point in the third set against
Peschke, to whom she had lost easily in their only prior meeting. To cap it
all off with her third Top 20 victory was clearly the perfect ending.

“I’m very happy,” said Bondarenko, who also has wins over Tatiana Golovin
and Alicia Molik. “I hope it’s not my last title! Yesterday I was nervous
with Peschke. If I keep playing like I did here, it’ll help open doors for
me. I’m playing well.”

Despite coming away with another championship loss to add to her seven prior
runner-up finishes, Schiavone remained positive about the week, which
included the 10th Top 10 win of her career, a 61 61 quarterfinal rout of
Patty Schnyder.

“It’s okay. It’s not my time to win. I’m not so disappointed. She really
beat me. In the other finals I was always playing with the No.1, No.2, No.3
players in the world. So those were not easy. My time will arrive.”

Aside from Bondarenko and Schiavone, a number of other players made
noise during the Luxembourg week.

Polish teenager Agnieszka Radwanska was the breakout star, notching surprise
straight set wins over an injury-returned Venus Williams and top seed Elena
Dementieva en route to her first ever semifinal; Peschke also reached the
final four, dismissing Dinara Safina en route, a solid result after somewhat
of a disappointing season.

There was also a nice win over Martina Müller for former Top 10 player
Chanda Rubin, who hadn’t won a main draw match in over a year after
struggles with injury.

But one of the highest notes of the week came at the very end, as Schiavone
salvaged her championship Sunday with a comeback victory in the doubles
final. She and Peschke came from a set down to defeat Anna-Lena Groenefeld
and Liezel Huber, 26 64 61.

It is the Czech-Italian pair’s second title, having also won at Dubai
earlier this season, and it came just weeks after a career-best run to the
US Open doubles semifinals.

“I feel good,” Schiavone said. “Peschke and I have been playing for about a
year now and I feel really good playing with her. I’d like for us to win
more. It’s been a great tournament, finals in singles and this is a great
way to end it.”

“I’m so grateful and happy that Francesca had the energy to play the doubles
too,” Peschke said. “It’s a great feeling, a great moment. We’re gonna go
and have champagne now and celebrate!”                  -30-
[return to index] [Action Ukraine Report (AUR) Monitoring Service]

REMARKS: By Dr. Paula Dobriansky, Under Secretary,
Democracy and Global Affairs, U.S. Department of State
Groundbreaking Ceremony for Victims of Communism Memorial
Washington, DC, Wednesday, September 27, 2006

As we gather today to break ground for this memorial, we owe thanks to
those who made it possible. Dr. Lee Edwards, the Chairman of the Memorial
Foundation, along with the Foundation’s national and international members,
gave generously of their time and effort in leading this project, and we
thank them.

I am proud to recognize the significant contribution made by my father,
Ambassador Lev Dobriansky, who preceded Lee as chairman.

Members of Congress of both parties, including Congressman Dana
Rohrabacher, Congressman Lee Hamilton, and the late Congressman Jerry
Solomon, played a crucial role in enabling and supporting the Foundation’s

Our breaking of this ground in many ways signifies the end of the Cold War.
This project has been guided by men and women for whom the Cold War
was a central reality for most of their lives. The memorial built here will
stand after we no longer do.

It will educate future generations about the misery caused by communism, the
massive resistance efforts, and the fortitude of those who were victimized
by it and who ultimately overcame it.

Communism corroded the human experience of the 20th century. The sheer
number of victims staggers and chastens us.

Over a hundred million people died as a direct, and often intended,
consequence of decisions made by Communist rulers. The innocent lost
their lives in Katyn Forest; in the frozen gulag; on the streets of
Budapest; in the fields of Cambodia.

Those who did not die at the hands of Communist rulers suffered terribly
under totalitarian regimes. They could not speak their minds; they could not
travel freely; they could not realize their inherent potential; they had no
say in the direction of their nation.

One of this country’s great presidents, Ronald Reagan, stated frequently
that communism is contrary to human nature. All people everywhere want
to express their ideas, to worship as they see fit, to work at a trade or
profession of their choosing, to own private property, above all to shape
the future of their lives and that of their country.

The fall of communism in nation after nation at the end of the 20th century
was a victory of the human spirit, a vivid demonstration that it burns with
a vital fire even under conditions designed to smother it.

It is right and necessary that we remember and pay tribute to those who
suffered under, persevered, and eventually triumphed over tyranny and

The memorial that will rise on this ground, the Goddess of Democracy, is a
universal symbol of freedom, representing in majestic form the rights and
aspirations of all women and men.

Students in Tiananmen Square in 1989 erected this figure. It reminds us
that many still live under communism — including close by, in our own

It is the right of every woman and man to live in freedom, and it is the
duty of all who enjoy liberty to stand by those who seek to attain it. Here
today are representatives of countries that threw off the yoke of tyranny
after decades of oppression.

We gather to mourn and memorialize the victims of communism. Let us
also honor them by rededicating ourselves to the furtherance of our
democratic ideals.                                   -30-
FOOTNOTE:  Paula Dobriansky, Undersecretary for Democracy and
Global Affairs, U.S. Department of State, is the highest ranking person in
the Bush Administration with Ukrainian heritage.  It is interesting she

did not mention any of the crimes of communism against the Ukrainian
people in her speech.  One of the major crimes of communism anywhere
was the Holodomor (induced famine, death for millions, genocide)
carried out by Stalin in Ukraine in 1932-1933. One could have expected 
Undersecretary Dobriansky to mention the Holodomor. AUR EDITOR
[return to index] [Action Ukraine Report (AUR) Monitoring Service]
      Financial assistance needed to support Little League Baseball in Ukraine

Action Ukraine Report (AUR) #767, Article 23
Washington, D.C., Tuesday, October 3, 2006

WASHINGTON – Basil P. Tarasko, District Administrator of the Little

Leagues in Ukraine (1995-present), from Bayside, New York, has announced
the trip schedule for his 43rd trip to Ukraine in his capacity as volunteer.

Mr. Tarasko will arrive in Kyiv on Friday Oct 20. On Oct 21, he will leave
for Ostroh, visit an orphanage for deaf students, with the intent of
starting a new Little League program there. Later, he will visit Rivne and
Verba to meet Little League officials.

In his trip through Lutsk, Mr. Tarasko will meet with Peace Corps volunteers
starting a girls Little League (LL) softball program, and also meet with the
Rector of the Volyn State University and with local sports officials.

On Oct 26, he will leave for Donetsk to conduct a baseball and softball
clinic on the 28-29th  for teachers from orphanages. Ukraine LL will pay for
the transportation, housing, and meals for those teachers from orphanages.

Mr. Tarasko plans to return to Kyiv Oct 30, then travel to Kaniv to welcome
the 13th orphanage into the LL program and meet the children and local
supporters. If all goes well, this orphanage will play in a tournament in
early March during the Shevchenko Days festivities!

Other items on Mr. Tarasko’s list are to meet with members of Priyateliy
Ditey Fund to plan the 2007 first ever Little League Championships in the
world for children from internats (orphanages), meet with Peace Corps
officials to discuss expansion of LL baseball and softball programs
throughout Ukraine for 2007, and to visit Kirovograd to discuss plans for
2007 LL tournaments.

For more information, suggestions and offers of help, including financial
assistance, we urge you to please contact:

Basil P. Tarasko, District Administrator of the Little Leagues in Ukraine
36-46 212th St., Bayside, NY 11361 USA,
Cell: 718.415.7821 USA, In Ukraine 8.097.544.9141
Email:; Please visit:

In Ukraine: Vitaliy Lizogubenko: 8-097-544-9141, Assistant Dist Admn.

[return to index] [Action Ukraine Report (AUR) Monitoring Service]
         Dr. Martha Bohachevsky-Chomiak steps down after seven years

U.S. Embassy Kyiv, Kyiv, Ukraine, Monday, September 11, 2006

KYIV – Mr. Myron O. Stachiw has been appointed Director of the Office

of the Fulbright Representative in Kyiv, Ukraine.

Dr. Martha Bohachevsky-Chomiak will step down from her position as

Director after seven years of dedicated and distinguished service to the
Fulbright Program in Ukraine.

We thank Dr. Chomiak for her leadership and commitment to the values
of the Program and her success in establishing a strong office staff and an
effective Fulbright alumni organization in Ukraine.

Mr. Stachiw is a specialist in American social history and architectural
history, as well as anthropology, historic preservation and archaeology.

He has spent the last two years in Ukraine as a participant in the Fulbright
Scholar Program, teaching historic preservation at Kyiv Mohyla Academy

and Taras Shevchenko National University.

He has also been engaged in projects relating to Ukraine’s cultural heritage
and the impact of the Chernobyl disaster.

Before taking up his Fulbright fellowship, he was on the faculty at Roger
Williams University and worked as an independent consultant on cultural
history and preservation, particularly in New England.  He holds degrees
from Brown University and Boston University, and speaks Ukrainian fluently.

Established in 1946, The Fulbright Program is the most prestigious
international program for exchange of scholars funded by the United States

The mission of the Fulbright Program is to increase mutual understanding
between the people of the United States and the people of other countries.

Since its opening in Ukraine in 1992, more than 200 Ukrainians have
completed a year of academic research in the United States and over 120
Americans have conducted scholarly work and teaching in Ukraine.

Grants are awarded on a rigorously competitive basis to individuals selected
on the basis of academic excellence and professional qualifications.
Public Affairs Section, United States Embassy Kyiv
(380 44) 490-4026, 490-4090, Fax (380 44) 490-4050;
[return to index] [Action Ukraine Report (AUR) Monitoring Service]

U.S.-Ukraine Foundation (USUF), Washington, D.C., Sep, 2006

WASHINGTON, DC – The U.S.-Ukraine Foundation’s Board of Directors has
appointed Vera Andrushkiw as the new Vice President for External Relations.

In this capacity, Ms. Andrushkiw will formally represent the U.S.-Ukraine
Foundation and oversee its outreach efforts.

While assuming this post, Ms. Andrushkiw will continue her responsibilities
as Project Director of the U.S.-Ukraine Foundation’s Community Partnerships
Project (CPP), a position she has held for seven years.

“I am deeply honored to be nominated for the position of Vice President for
External Relations of the U.S.-Ukraine Foundation.  It is exciting to be
part of the mission and the 15 year legacy of the Foundation and to
represent it both in the U.S. and in Ukraine.

At this time it is important to explore new directions and options to widen
our impact in promoting democracy, encouraging free market reform and
enhancing human rights in Ukraine and strengthening U.S.-Ukraine relations,”
stated Ms. Andrushkiw.

The U.S.-Ukraine Foundation’s Board of Directors met on August 18, 2006 to
discuss the Foundation’s activities over the past fiscal year and planned
initiatives for the upcoming year.  At the meeting, the Board approved Ms.
Andrushkiw’s new position as the Vice President for External Relations.

Commenting on Ms. Andrushkiw’s dedication to the U.S.-Ukraine Foundation’s
work, Nadia McConnell, U.S.-Ukraine Foundation President expressed that “We
greatly appreciate the many talents and contributions Vera Andrushkiw has
made to the Foundation.  This title acknowledges the contributions that she
has been making since joining the U.S.-Ukraine Foundation seven years ago.”

Prior to joining the U.S.-Ukraine Foundation in 1999, Ms. Andrushkiw was a
lecturer in Ukrainian studies in the Department of German and Slavic Studies
in the College of Liberal Arts at Wayne State University and the Coordinator
of Ukrainian Programs in the WSU School of Business Administration for the
L’viv Institute of Management in L’viv, Ukraine.

From 1997 to 1999, Ms. Andrushkiw was the Director of the Harvard Ukrainian
Summer Institute Program and was a lecturer for Advanced Ukrainian for
Business. Ms. Andrushkiw has lectured at the University of Michigan, Wayne
State University, Immaculate Conception Ukrainian High School and in

Elected President of the L’viv Institute of Management International
Supervisory Council for 1997-98, Ms. Andrushkiw served in that capacity
until 2001.

Ms. Andrushkiw was awarded the Certificate of Honor by the Honorable

Yuri Scherbak, Ukraine’s Ambassador to the United States for her work in
facilitating U.S.-Ukraine relations and in 2001 she was awarded a medal of
distinguished scholar by the Ministry of Education of Ukraine for her work
with the L’viv Institute of Management on the occasion of the 10th
Anniversary of Ukraine’s Independence.

Ms. Andrushkiw received her B.A. (1964) from Hunter College, New York,
M.A. (1966) from the University of Pennsylvania and is a Ph.D. Candidate
at the University of Michigan.                              -30-
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McConnell, President; John Kun, Vice President/COO; Vera
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Bilynskyj, VP/Director of Field Operations; Marta Kolomayets, CPP
Kyiv Project Director, Kyiv, Ukraine. Web:
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genocidal famine in Ukraine.’ Hollywood, CA,
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