AUR#823 Mar 14 Economic Growth Strategy Needed; Bad Habits In Farm Policy; Threats to Ecosystem; American Soup; Putin At The Vatican; Lavra Crumbling

                 An International Newsletter, The Latest, Up-To-Date
                     In-Depth Ukrainian News, Analysis and Commentary

                      Ukrainian History, Culture, Arts, Business, Religion,
         Sports, Government, and Politics, in Ukraine and Around the World       

Mr. E. Morgan Williams, Publisher and Editor, SigmaBleyzer

              –——-  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

ANALYSIS & COMMENTARY: By Pavlo Prokopovych, Ph.D.
Kyiv Economics Institute and the Kyiv School of Economics.
The Ukrainian Observer magazine #229, Jim Davis, Editor
The Willard Group, Kyiv Ukraine, March 2007
2.                     UKRAINE: EASING EXPORT QUOTAS
Oxford Business Group, London, UK, Tuesday, 13 March 2007

                           IN GOVERNMENT FARM POLICY
THE EAR: By Jim DAVIS, Editor, The Ukrainian Observer magazine
The Willard Group, Kyiv, Ukraine, March 2007

                     TO FORM A STABLE, PROSPEROUS STATE       

Presentation by Geoff Hoon, UK Minister for Europe
Adam Smith Investment Summit, London, UK, Monday, March 12, 2007
British Embassy, Oslo, Norway, Monday, March 12, 2007

By Andrew E. Kramer, International Herald Tribune/New York Times
Paris, France, New York, NY, Tuesday, March 13, 2007

Leon Symon, London Jewish Chronicle, London, UK, Fri, Mar 9 2007

Bloomberg News, New York, NY, Tuesday, 13 Mar 2007

             Water, Soils, Waste Disposal, Radiation Pollution, Forest
By Oleksandra SHEPEL, The Day Weekly Digest #8,
Kyiv, Ukraine, Tuesday, 6 March 2007

RIA Novosti, Moscow, Russia, Monday, March 12, 2007

EuropaWorld, Cowbridge, Wales, UK, Friday, March 9, 2007

COMMENTARY: By Arnaud Dubien, Political scientist,
Editor-in-chief, Analytical Bulletin “Ukraine Intelligence”, Paris
EuraisianHome Analytical Resource, Tuesday, March 13, 2007

12.                             STORM FROM THE EAST
 Some loud dissent to government policy heralds from the Donbass region
BYuT Inform Newsletter, Issue 33, Kyiv, Ukraine, Tue, March 13, 2007

INTERVIEW: With Ukrainian President Viktor Yushchenko
Associated Press, Kyiv, Ukraine, Wednesday, Feb 28 2007

by John Marone, Kyiv Post News Editor
Kyiv Post, Kyiv, Ukraine, Thursday, Mar 01 2007

OPINION & ANALYSIS: By Vadim Dubnov. Independent Journalist.
RIA Novosti, Moscow, Russia, Wed, February 28, 2007

Agence France Presse (AFP), Kiev, Ukraine, Tue, March 13, 2007

By Martin Sieff, UPI Senior News Analyst, Wash, DC, Mon, Mar 8, 2007

18.                                   “AMERICAN SOUP”
       Russian reactions to Ukraine, Caucasus missile defence cooperation
COMMENTARY: By Vasiliy Sergeyev, Ilya Azar, & Fedor Rumyantsev website, Moscow, in Russian 2 Mar 07
BBC Monitoring Service, United Kingdom, Friday, March 09, 2007

                            IN UKRAINIAN CITY OF ODESSA
Itar-Tass, Moscow, Russia, Monday, March 12, 2007

By Victor Yasmann, RFE/RL, Prague, Czech Republic, Tue, Mar 13, 2007

                          CRUMBLES, THE PECHERSK LAVRA
Reuters, Kiev, Ukraine, Tuesday March 6, 2007
       Targeted girls from Lithuania, Russia, Ukraine, Moldova and Latvia
The Daily Record, London, UK, Thursday, Mar 08, 2007
By Ralph Riegel, Irish Independent, Ireland, Friday, Mar 09, 2007
PRWeb, New York, NY, Monday, March 12, 2007

                    To be held in Kyiv on Saturday, March 24, 2007
Chris Ford, Ukrainian Labour History Society, UK, Mon, Mar 12, 2007


ANALYSIS & COMMENTARY: By Pavlo Prokopovych, Ph.D.
Kyiv Economics Institute and the Kyiv School of Economics.
The Ukrainian Observer magazine #229, Jim Davis, Editor
The Willard Group, Kyiv Ukraine, March 2007

The housing market is of great economic importance in every country. In
poor Ukraine where most people’s wealth coincides with their housing
wealth, owning an apartment is considered as an inalienable right for
every Ukrainian household.

Because of the recent housing price surges, millions of Ukrainians have
experienced a considerable jump in their home’s worth. Nowadays the
average price of residential housing in the three million city of Kyiv is
about $2,600 a square meter.

Taking into account that Kyiv’s residential housing stock is close to 66
million square meters, one can conclude that the total value of Kyiv’s
housing stock ($172 billion) is equal to about 1.64 times Ukraine’s
nominal GDP (estimated at about $104.8 billion in 2006).

For comparison, the total value of the whole U.S. housing stock ($19.8
trillion) is 1.5 times larger than U.S. GDP ($13 trillion). Therefore, if
there is a bubble in Kyiv’s housing market, it is of significantly larger
proportions than anything observed in the U.S. housing market.

There are a lot of overpriced local markets for housing in the United
States. At the same time, it is almost impossible to determine if there is
an economic bubble in a market because buyers’ expectations of future
prices are a valid part of demand.

According to Stiglitz’s 1990 definition, a bubble exists “if the reason the
price is high today is only because investors believe that the selling price
will be high tomorrow — when ‘fundamental’ factors do not seem to justify
such a price.”

So, in order to check if the level of prices is consistent with underlying
fundamentals, economists use specially developed indices. One of them is
the home-price-to-income ratio.

To compute it, median, not average, values are used to identify the midpoint
of the corresponding distributions since average wages, for example, in poor
countries are skewed upward by a few reports of high wages.

Naples, Florida is widely regarded as one of the most overpriced real estate
markets in the United States. In March 2006, Naples’s median single-family
home price was $505,000 and Naples’ median household income was
$63,300. Therefore the home-price-to-income ratio was about 8. In Illinois,
for example, it was about 2.5.

Since then, housing prices have fallen in nearly every major U.S. housing
market. The number of homes foreclosed by lenders rose by 42 percent in
2006 from a year earlier. The mortgage industry has been plunging deeper
and deeper into distress because of a conspicuous rise in mortgage defaults.

Unfortunately, no information is readily available regarding Kyiv’s median
household income and median housing price.  From real estate listings, one
can conclude that Kyiv’s median housing price is at least $160,000, with
studios not fit for a family included.

For example, the median price for two-bedroom apartments is about
$210,000. Since Kyiv’s average monthly salary is close to $400, the median
monthly household income is not more than $600.

Therefore, Kyiv’s apartment-price-to-income ratio exceeds 22. It also
matters that prices for dollar-denominated mortgages in Ukraine are about
twice as high as U.S. mortgage prices, not to mention hryvnia-denominated
predatory mortgages.

According to the mortgage calculator, a family with
$24,000 in yearly income and $30,000 in savings can “aggressively” buy a
house worth $82,196 if the mortgage interest rate is a “Ukrainian moderate”
15 percent and there are no property taxes.  These calculations show that
risky mortgages and speculative demand have played not the least role in
inflating the bubble.

A housing bubble cannot develop without excess monetary liquidity and
inadequate regulation and supervision of the financial sector. This is the
case for both developed market economies and emerging market economies.

Inadequate regulation makes extending risky real estate loans by financial
institutions possible and the central bank provides excess liquidity.

In 2003-04, Ukraine experienced an export-led boom. Two major factors
were a surge in world commodity prices and the depreciation of the U.S.
dollar against the euro.

As a result of keeping the hryvnia significantly undervalued, the National
Bank of Ukraine (NBU) piled up considerable foreign exchange reserves,
about which the bank proudly boasted.

The NBU’s exchange rate policy also resulted in impressive money supply
growth and a two-digit rate of inflation. With Ukrainian goods becoming
relatively more expensive, the current account balance showed a deficit of
1.5 percent in 2006: Ukraine imported more than it exported.

Boosting the money supply without antagonizing international organizations
became quite of a problem for the quasi-independent central bank in 2006.

Along with increased borrowing, refinancing operations and reserve
requirement reductions were used by monetary authorities to offset the

In 2006, the reserve requirements for hryvnia-denominated deposits were
lowered from 8 percent to 0.5-1 percent in three steps on May 10, August
1, and October 1. The steepest reduction of the reserve-to-deposit ratio
took place on August 1.

Ukrainian banks had no options but to drastically expand credit in order to
get rid of swelling excess reserves. A huge explosion in prices ripped
through Kyiv’s previously dormant housing market at the end of last August.

It is unreasonable to assign all the blame for the August housing price
explosion to seasonal factors. The NBU could not have chosen a worse
moment for carrying out the money supply expansion. The ensuing
insignificant increase in the rate of inflation showed that the housing
market, together with the credit market, was truly a great absorber of
monetary shocks.

Among the other factors preventing the housing market from functioning
properly are corruption, and undeveloped and missing markets. The fact
that Kyiv’s scarce supply of housing is insensitive to changes in housing
prices (see Table 1) shows that there are supply-side restrictions. Many
of them can be linked to the wild corruption in Ukraine.

Certainly, the non-existence of a legalized market for land and the
undeveloped stock market have also been contributing to housing bubble
growth, with the housing market again playing the role of a great absorber
of excess monetary resources.

Moreover, the lack of investment opportunities has led to poor
diversification of Ukrainian bank’s assets: more than two-thirds of banks’
total assets are loans, much higher than in neighboring European countries.

Table 1. The Residential Housing Stock Put into Operation in Kyiv by
Year (in millions of square meters)
        2002      2003      2004      2005      2006      2007 (expected)
         1.1         1.1        1.05       1.2         1.3        1.4

In reporting figures for 2006, everything looks fantastic: a 7 percent
growth in Ukraine’s GDP, a 134.2 percent increase in credit to households
(up from 126.6 percent in 2005). Ukraine has been going through a credit
boom. Consequently, the current account balance has been moving in the
opposite direction.

According to a 2004 IMF study titled “Are Credit Booms in Emerging
Markets a Concern?” private credit booms in emerging markets are
associated with consumption and investment boom (70 percent probability)
followed by banking crises (75 percent probability) and currency crises (85
percent probability). In other words, credit booms are typically followed
by sharp economic downturns and financial crises.

Those in charge of economic policy in Ukraine are not fully aware of the
existence of the rental market for housing. Until now, it has been part of
the shadow economy. So, in an interview published on February 1 by the
Cabinet of Ministers of Ukraine’s official newspaper “Uryadovy Kuryer
(Government Courier),”

Finance Minister Azarov stated that “in Europe expenditures on public
utilities constitute, on average, 35-40 percent of total income. In our
country, they are twice as low.”

Unfortunately, Kyivites did not understand how lucky they were and
pressured Kyiv’s city council into lowering the utility tariffs on February

What is missing in Azarov’s explanation is the understanding that housing
expenditures in Europe also include rent and mortgage payments, not just
utilities-related expenses.

The NBU has been simply setting monetary policy with an eye toward
exchange rate stability and the government’s priorities, which certainly
attests to its quasi-independence. The bank has not paid due attention to
growing inflationary pressures for a number of years.

Last year’s 7 percent economic growth was accompanied, in a very direct
sense, by explosions in housing prices (67 percent) and credit growth. So
there is an urgent need for the government to switch to another economic
growth strategy, not employing monetary expansions without restraint.

What do an economy and a nuclear reactor have in common? The answer
to this question is square: They both tend to overheat. Everyone in Kyiv
knows what happened to the fourth block of the Chernobyl nuclear plant
in April 1986. The world’s worst nuclear accident was the outcome of a
controlled experiment.

In the course of the experiment an operator retracted too many control rods,
including manual control rods. An uncontrollable nuclear reaction ensued.
The operator pressed the emergency button too late.

The latest news from the NBU is that it sold 4,378 million hryvnias worth of
deposit certificates to Ukrainian banks on February 12-19.

When you add to that the 6,639 million hryvnias worth of banking resources
that the NBU sucked out of the economy in January 2007, the month previous,
you have over 11 billion UAH in liquidity squeezed out of the Ukrainian
market by the NBU in a very short period.

In the terminology of nuclear science, the monetary control rods have been
put in place.                                       -30-
NOTE: Pavlo Prokopovych, Ph.D., Kyiv Economics Institute and the
Kyiv School of Economics. The views expressed are purely the author’s.

[return to index] [Action Ukraine Report (AUR) Monitoring Service]
2.                    UKRAINE: EASING EXPORT QUOTAS

Oxford Business Group, London, UK, Tuesday, 13 March 2007

Last week Ukraine’s government relaxed export quotas on feed grains that
had been in place since last autumn.

Though some believe the move is a step in the right direction, quotas for
wheat exports remain in place, and many believe the government should adopt
a more consistent approach to agricultural regulation.

The government stated it enacted the quotas to protect domestic consumers

in an environment of growing global grain prices and to help overcome food
security concerns following a shortfall in last year’s harvest.

The move to ease these controls is good news to Ukrainian grain producers
and traders, but the market still has some way to go before it reaches

Ukraine’s agricultural sector has several assets that position it for
long-term growth as an exporter of grains, oil seeds and meats. It has an
abundance of black soil, a strategic, centralised location ideal for export
into multiple markets, and an experienced workforce.

However, the general consensus is that Ukraine’s sector does not live up to
its potential. Dexter Frye, managing director in Ukraine for US-based
agriculture company Bunge, told OBG, agriculture in Ukraine is not nearly

as productive as it is in a lot of other countries.

If you reach the same levels of productivity here as in Western countries,
there will be a huge exportable surplus even with good levels of local

One of the primary challenges is the need for modernization of the farming
sector. To invest in modern seeds, equipment and fertiliser, farmers need
capital, but Ukrainian farmers currently have limited means to access

Part of the problem is the current land ownership regime. Under the present
rules, land transactions must be approved by parliament.

This effectively cuts off the ability to transfer ownership of property and
therefore prevents farmers from borrowing against their land to access

Andreas Rickmers, general manager in Ukraine of American agriculture firm
Cargill told OBG that land reform would provide, the necessary stability and
predictability for landowners to make long-term investments in

Other channels to fund modernisation are limited. Some multinational
companies offer advances to farmers for investment, and select banks have
begun allowing easier terms for credit. But high costs have also meant that
money often goes less toward capital investment, and more toward
consumables such as petrol.

Said Frye of Bunge, There is a huge opportunity for Ukrainians to modernise
the farm sector, to increase efficiency..but they need money to do it.

Though figures vary, the World Bank estimates the total lost export revenue
is $300m, just for 2006. Moreover, the quotas sent the wrong signals to the
investment world, and may encourage grain traders to scale back operations
and discourage investment.

Said Rickmers, The export restrictions had a severe impact on the grain
industry with lasting consequences. The abolition of the quotas did not
really help. Even today the wheat export restriction remains, and we are not
sure of the government’s plans for the future.

The good news is that many think the earlier quotas will not affect total
production later this year. Planting for this year’s August harvest had
already occurred when the restrictions were introduced.

Going forward, industry insiders seem to agree that what the sector needs
more than liberalisation is consistency. One of the primary industry
complaints surrounding the quotas was the fact that they were introduced

By that time, grain traders had already bought grain, positioned it for
export and, in some cases, sold it to foreign buyers. This forced companies
to renege on contracts and much grain ended up going to rot.

Industry insiders do not expect that relaxing export controls will usher in
more liberal agriculture measures, as most expect a more controlled regime
in the near term.

According to Rickmers, power has been changing so frequently that
there have been no long-term trends but I think so far the trend has been
away from free markets.

This is bad for the market if it is not predictable. Most countries regulate
their agricultural market in one way or another, but most of these also have
a clear framework for how these operate.

Frye agrees, I’m hopeful that it will be more consistent. In reality, people
don’t crave liberalism or a tightening of controls, what they want is
consistency – they need to know what to expect if they follow the rules.
CONTACT US: General Enquiries
Editorial Enquiries

[return to index] [Action Ukraine Report (AUR) Monitoring Service]
                        IN GOVERNMENT FARM POLICY

THE EAR: By Jim DAVIS, Editor, The Ukrainian Observer magazine
The Willard Group, Kyiv, Ukraine, March 2007

As a small town boy,  I grew up in the tobacco, peanut and vegetable fields
of South Georgia and have spent a considerable part of my life involved with
agriculture at one level or another.

My involvement with agriculture in Ukraine has further convinced me of a
long-held conviction that governments, when dealing with agriculture, should
adopt the old motto that is taught to aspiring medical students, “First, do
no harm.”

Ukraine’s agricultural authorities have not shown themselves very adept at
adopting policies that actually benefit agriculture and some of the die-hard
socialist and communist elements in the parliament further complicate
matters by pushing policies that were out-of-date and just plain wrong 50
to 70 years ago.

Other politicians have shown themselves as totally corrupt in using
agriculture for their own purposes while doing great harm to farms and
farmers in the process.

If one seriously examines the recent history of agriculture in Ukraine, it
is hard to avoid the conclusion that the best thing that the government
could do for farmers – and consumers – is to get out of agriculture and

stay out.

Recently, an ill-advised action by the current government has led to
disruptions and negative consequences.

A government ordered blockage of export sales of grain without any notice
led to huge backlogs in the country’s port facilities, daily losses in the
hundred of thousands of dollars for wheat exporters who had contracted
shipments in good faith, and further damage to Ukraine’s already
questionable reputation as a reliable supplier.

Since late January, there have been reports that as much as 300,000 tons of
the stored wheat and other grains have spoiled and have been destroyed or

Grain stoppages are bad policy under any circumstances and this particular
stoppage appears to have been more ill-advised than most.

Farmers with winter wheat planted last August will be left wondering how
government intrusion into the market would affect their chances of
profitability in the coming year.

Some of those with stands that are not so good may very well decide to
simply abandon fields if there is a lack of certainty as to market
conditions in the coming summer and fall.

The exporters who have been buying wheat in previous years at levels that
supported both the domestic and foreign markets will either exit the market
or offer low prices for lower quantities to minimize their risks of further
losses that could be brought about if the government involves itself in the
grain market again in 2007.

Exporters will change their trading patterns to minimize risks, and this
will almost certainly have a negative effect on the profitability of
Ukrainian farms.

Some multinational companies closed their Ukrainian affiliates as a result
of the latest embargo, leaving considerable numbers of experienced
Ukrainian grain trade personnel unemployed.

At some point – and it may yet take years – Ukrainian governments may
finally arrive at the conclusion that going into the market and buying
reserve grain at market prices is the best policy for all concerned.
However, that lesson has not sunk in yet and it is hard to see it happening
any time soon.

Russian grain authorities have been considerably cleverer, sometimes
announcing intervention prices, but not necessarily making any purchases.

On the other hand, Ukraine follows the old communist-era rules, making
intervention purchases, thus giving jobs to bureaucrats who will then have
to work with this grain, write reports on it, move it from one place to
another and possibly wind up selling it under special circumstances that
benefit insiders but not the government and certainly not the farmers.

There is in my opinion an even darker side to this issue. There are those in
the legislative and other government branches today who greatly desire to
see agriculture brought back under strong government control and for the
oldest and worst agricultural institutions, Khlib Ukrainiy, to again raise
its ugly head.

Nothing could be worse for Ukraine’s farmers or the country’s reputation as
a reliable trader, but we seem to be headed in that direction.

All of this suggests that the sooner World Trade Organization accession
may be completed the better off everyone will be. WTO membership would
tie the hands of government and avoid many of the worst of the government’s
current abuses of its power. [Editor Jim Davis:]
[return to index] [Action Ukraine Report (AUR) Monitoring Service]

Presentation by Geoff Hoon, UK Minister for Europe
Adam Smith Investment Summit, London, UK, Monday, March 12, 2007
British Embassy, Oslo, Norway, Monday, March 12, 2007

Ukraine is Europe’s newest democracy. Its challenge now is to convert the
energy of the Orange revolution to form a stable, prosperous State. And
Business can play an important role in this transformation.

I know that you have just finished a session on macroeconomics and will next
discuss the investment climate. There are many people here much better
equipped than me to speak on these issues.

So I will concentrate on the broader issues of Ukraine’s political
development and its relationship with the UK and the rest of the EU.

I was in Ukraine just a few weeks ago. It was five years since my previous
visit, as Defence Secretary. I was struck by how much had changed. We all
saw the dramatic scenes of the Orange revolution on the television. And it
was powerful viewing. We saw democracy in action, on the streets.

Almost overnight, Ukraine’s relationship with the UK, Europe and the wider
world was transformed. This has allowed us to forge a much closer
relationship with Ukraine than in the past. Our main priority now is to work
with Ukraine to support its reform process.

This is already happening. We look forward to Ukrainian membership of the
WTO. This will be a major step forward in the reform process, a key step in
deepening Ukraine’s relationship with the EU, and an important point in
bringing Ukraine further into the global economy.

The UK strongly supports Ukraine’s Euro-atlantic ambitions. Currently, the
UK is supporting projects that provide assistance on EU policy
co-ordination, democratisation issues, and social services issues, to
mention only a few.

I heard much during my visit about continuing reforms. As a frequent visitor
to central and eastern Europe after 1989, I know how difficult it is to bed
down reforms that last. This is now the challenge for Ukraine.

We have seen significant progress in areas such as democracy and media
freedom. But, as you would expect, much remains to be done.

We would like to see still more political and economic reform and continued
efforts to tackle corruption and improve the rule of law. This will enhance
the everyday lives of Ukrainian citizens, improve the climate for foreign
investment and bring Ukraine closer to EU standards.

Ukraine’s EU prospects dominated my discussions in Kiev. This is not
surprising. Ukraine is, after all, a European state. And I firmly believe
that the possibility of EU membership must remain open to those parts of
Europe that are still in the process of transition, including Ukraine.

The next chapter of the story of Ukraine’s relationship with the EU is about
to be written. On 6 March, negotiations were launched on a new agreement
with the EU.

This will include a deep and comprehensive Free Trade Agreement that should
lead to extensive alignment of Ukraine’s external and internal market laws
and standards with those of the EU.

The new agreement with the EU will also deepen political co-operation,
support Ukraine’s reform efforts and contribute to the energy security of
both the EU and Ukraine.

EU enlargement has transformed the lives and societies of millions of people
across Europe. We in the UK want to see Ukraine benefit from this process.
But it is not easy.

The checklist of actions that must be completed before membership constantly
grows. And EU laws must not just be incorporated into local law, they must
also be implemented.

So my main message to Ukraine is to maintain momentum in the reform

process. And demonstrate real results.

Business has a crucial role to play. Investors should be frank friends to
the government. Investors know best what will work, for example in banking
reform. They know if corruption is impeding investment. And they know that
the rule of law is imperative to protecting their investments.

I hope, starting with this conference, we can see a partnership develop
which will deliver the practical reforms to spur further economic growth. I
wish you every success.

There is hard work ahead for Ukraine’s leaders and big changes for its
people. But I am confident that these changes will build a better future as
we move forward together.                         -30-

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

By Andrew E. Kramer, International Herald Tribune/New York Times
Paris, France, New York, NY, Tuesday, March 13, 2007

MOSCOW – Telenor, the Norwegian phone company, claimed Tuesday
that the telecommunications unit of Alfa Group, a Russian conglomerate
controlled by the billionaire Mikhail Fridman, had been paying journalists
in Ukraine to publish negative articles about Telenor in the midst of a
business dispute.

The Alfa subsidiary, Altimo, denied the accusation in a strongly worded
statement, saying that documents Telenor distributed to journalists to
support its claim were forgeries.

The documents were also filed as supporting evidence in an arbitration
process in New York, as part of a wider legal dispute between the
Norwegian and Russian companies.

Telenor’s claim, nonetheless, opened a window on one of the more cynical
business practices in the former Soviet Union, and one that is believed to
be widespread.

Telenor, the biggest telecommunications company in the Nordic region, and
Altimo, a major player in the former Soviet Union, are struggling for
control of two large assets – Kyivstar, the largest Ukrainian cellphone
operator, and VimpelCom, the second-largest Russian telecom. MTS is the

The companies divided ownership of Kyivstar and VimpelCom in a 2004
partnership that has unraveled into lawsuits in Ukraine, Russia and the
United States.

Telenor on Tuesday distributed what it said were internal Altimo planning
documents. They appeared to give an unusually fine-grained picture of the
budgeting and execution of a publicity campaign based on surreptitious
payments to journalists to plant negative articles about a business rival.

The effort, according to Kjell Morton Johnsen, Telenor’s vice president for
Central and Eastern Europe, was intended to discredit Telenor in Ukraine.

“The media and institutions in Ukraine are being used by a player in the
market for their own gain,” Johnsen said by telephone. “It’s insulting to
Ukraine that they can be used in this way. We need to get back to business
as normal.”

Johnsen said Telenor had obtained the documents from a person familiar

with Altimo’s business who wished to remain anonymous. Johnsen said
the documents were genuine.

One document distributed by Telenor and titled “Logical Rationale for the
Information Campaign under the Kyivstar Contract” purported to highlight the

It notes ruefully that Norwegian companies typically have unimpeachable
business reputations, and that any attack on Telenor thus must be preceded
by an effort to undermine the image of Norwegian business generally.

“In order to break the existing stereotype whereby Western business and, in
particular, Norwegian business, always ‘plays fair,’ an information wave” of
negative publicity should be employed, the document said.

It suggested planting “investigative” stories saying Telenor used double
standards: that it obeyed Western courts but disrespected Ukrainian law.

The document said such claims of disrespect would resonate with rising
nationalism in Ukraine after the 2004 Orange Revolution. “Nationalism

must become the starting point,” the document said.

A spreadsheet titled “Plan of an Information Campaign to Discredit the Image
of Norway in Ukraine” purported to show that Altimo planned to spend
$74,950 between Jan. 29 and March 31.

One expenditure of $4,000, according to the spreadsheet, would have gone
to plant a story saying Telenor had acquired Kyivstar under favorable terms
after it struck a deal with Leonid Kuchma, the unpopular former Ukrainian

A separate budget noted payments for stories that had already allegedly
appeared. Money was also noted to rent billboards that appeared in Kiev this
winter calling on Norwegian companies to obey Ukrainian law, a thinly veiled
campaign targeting Telenor.

Elsa Vidal, a specialist on former Soviet countries at Reporters without
Borders, a journalists’ group based in Paris, said planted articles were
commonplace in the region.

“Almost all companies pay money to newspapers to write about how good
their products are,” rather than place advertising, she said. “You can find
the same articles in two newspapers sometimes.”                -30-

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

Leon Symon, London Jewish Chronicle, London, UK, Fri, Mar 9 2007

LONDON – Pearls from London are helping to change the lives of Jewish
women at risk in the Ukraine as part of a joint international MicroEnterprise

operation involving Britain and America.

The MicroEnterprise scheme gives women in the former Soviet republic the
chance to start their own businesses.

Bob & Doris Gordon, Arthur & Andrea Waldstein and other Jews from
Boston MA are the architects and initiators of this project.

Started one and a half years ago, the MicroEnterprise scheme enables women
at risk, single mothers, widows and mothers with disabled children to earn a
living and build up their dignity by providing loans and expertise to set up
small businesses.

The Gordons and Waldsteins provided the know-how and expertise to set
up the project as well as the capital for the loans. Now, a donor in London
has provided $50,000 worth of pearls and jewellery to augment the project.

According to Slavic Brez, who is in charge of the scheme in the Ukrainian
town of Dnepropetrovsk, “so far more than ten loans were provided to woman
and this recent generous contribution will help an additional six to eight
women living here to run their own businesses.

It can transform their lives. Most are single parents or widows, usually
with children but without work. Life has been very hard for them. “This
scheme will give them the chance to support themselves, give them back their
dignity and self-esteem and show that they can stand on their own two feet”.

Whereas London has provided the pearls and other stock such as pendants
and brooches Boston has provided the capital to enable training in skills
such as book-keeping, business management and marketing.

The London element of the scheme is the brainchild of Rabbi Yonah Pruss, who
runs the office of the FSU (Former Soviet Union) Jewish Community Fund in
the UK which is part of Moscow-headquartered FJC (Federation of Jewish
Communities of the CIS (former Soviet Union).

This is a unique project” said Rabbi Pruss. “In addition to the very vital
day to day ongoing support of the elderly, children at risk and other
welfare assistance, this is the first project that empowers people to
support themselves. It is very low-risk and we hope to roll it out to other

One of the Ukraine’s biggest banks, with more than 4,000 branches, has
agreed offer the women loans at very low rates of interest – “because this
is business, not charity and all the loans will be paid back” said Mr Brez.

“These women could earn $500 – $600 a month, which is quite a lot for them.
Once they see that they can be successful, they start their own social
groups and take part in Jewish life generally.”             -30-

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

Bloomberg News, New York, NY, Tuesday, 13 Mar 2007

KIEV – Naftogaz Ukrayny, Ukraine’s state- run oil and natural-gas company,
will invest $800 million this year in oil and gas extraction and pipelines,
as it tries to lessen its dependence on imported energy.

“We will review all our projects and will concentrate on the most
profitable,” Oleksandr Kovalko, the chief finance officer at NAK Naftogaz
Ukrayny, said today at a press briefing in Kiev. Ukraine depends on imports,
mostly from Russia, for about 80% of its energy needs.

The country wants to invest in gas and oil extraction abroad and the Black
Sea with international oil companies to diversify. Naftogaz will invest as
much as $30 million exploring for oil and gas in Egypt.

Naftogaz plans to borrow $495 million to $554 million abroad and more from
Ukrainian banks, for a total of $653 million, to refinance loans, according
to Kovalko. The company’s current debt totaled $2.5 billion at the end of

Naftogaz will probably resume borrowing by the end of spring, Kovalko said.
“We will attract loans and we may also issue bonds,” said Kovalko.
“Everything depends on the situation in the world markets and our financial

Naftogaz got a $350 million loan at the end of last year and a $200 million
loan in February from Credit Suisse, Kovalko said, without giving any other

“We used this money to repay our $200 million debt to ABN AMRO in the

end of February this year,” he said. Kovalko said Naftogaz would increase
its net profit this year by cutting jobs and cost.

The government will also help to raise Naftogaz profit by allowing it to
raise prices for households in the H2 of 2006 after Russia doubled the price
it charges Ukraine for natural gas in January last year and raised them
again by 37% this year. Controlled prices for gas in the H1 of 2006 caused
Naftogaz to lose $731 million, Kovalko said.           -30-

[return to index] [Action Ukraine Report (AUR) Monitoring Service]
    NOTE: Send in a letter-to-the-editor today. Let us hear from you.
         Water, Soils, Waste Disposal, Radiation Pollution, Forest

By Oleksandra SHEPEL, The Day Weekly Digest #8,
Kyiv, Ukraine, Tuesday, 6 March 2007

Environmental problems are a constant worry for biologists, ecologists, and
physicians. Ukraine’s leading experts agree that air, water, and ground
pollution pose the greatest threat to humans.

Other acute problems include domestic and industrial waste disposal,
radiation, and shrinking forests, which are causing a decline in flora and
1. WATER —–
Ukraine’s major water resource is the Dnipro, along with the Danube,
Dnister, Southern Buh, Tysa, Prut, and other rivers. Experts stress that
every year nearly one-third of the Ukrainian population suffers from
illnesses caused by industrial waste being discharged in these bodies of

“The state of our water and the full flow of these major rivers largely
depend on the condition of their estuaries – small rivers of which there are
some 63,000 in Ukraine,” says Heorhii BILIAVSKY, head of the chair of
ecological auditing at the National Management Academy (NAU) and
international expert with the European Community’s research and development

“Their role is extremely important; suffice it to say that 90 percent of the
populated areas in our country are located precisely in the valleys of small
rivers and are using their water.

However, the state of these small rivers in Ukraine is alarming. According
to Derzhvodhosp statistics, Ukraine lost some 5,000 small bodies of water in
the second half of the 20th century; this will inevitably cause our large
rivers to degrade.”
2. SOILS —–
Soil has an immense value not only because it is the main source of food
supplies, but also because it is actively involved in purifying natural and
sewage water. It keeps the water balance on land, acting as a neutralizer of
a number of man-made disasters.

 Ukraine boasts the world’s largest deposits of chornozem. Proof of its
value is the fact that during the war the Nazi occupiers shipped out
trainloads of Ukrainian soil to the Reich.

According to Hryhorii FRANCHUK, head of NAU’s ecology chair,
Ukraine’s stocks and value of soils have been significantly reduced.

This is caused by the barbaric and insufficiently considered use of land,
erosion, salinization, and the sale of land to be used for quarry sites and
other industrial structures. Land use must be conducted intelligently and

Tetiana SAIENKO, deputy head of Ukraina University’s ecology chair, says:
“In the race for harvests, our soils are becoming increasingly overplowed,
and incredible amounts of mineral fertilizer and pesticides are being

As a result, the soil on huge tracts of land in the steppe and arid zones is
no longer capable of absorbing and releasing water; its structure has
degraded; and it is full of harmful chemical compounds. All over Ukraine
soil fertility is decreasing on a disastrous scale.”
As a rule, Ukraine’s waste storage and disposal procedures fail to conform
to sanitary requirements. This leads to a high degree of pollution of
surface and subterranean waters, as well as soil and air.

Ecologists have calculated that Ukraine’s dumps take over some 1,500
hectares a year. All this poses a danger to the environment.

“The bulk of this waste is produced in Ukraine by the mining,
chemical-metallurgical, fuel-energy, construction, and pulp and paper
industries, and agribusiness.

Most regions in Ukraine lack testing grounds with facilities for the
centralized storage and disposal of waste. Because of lack of funds and
unoccupied land, the possibilities for building modern waste disposal
facilities are limited.

In the past most waste was burned. Now this is prohibited because a number
of toxic agents are produced during incineration,” says Oleh SHULHA,
associate professor at NAU’s chair of ecological auditing.

Italian ecologists have produced research that should make us reflect on the
legacy we are leaving behind.

In 2005 their studies showed that a glass bottle and a polystyrene vessel
degrades over 1,000 years, compared to three months for paper containers,
five years for cigarette butts, 10-20 years for all kinds of plastic bags,
30-40 years for nylon products, and 500 years for metal cans.
The consequences of the Chornobyl catastrophe long ago grew beyond
environmental problems, becoming a link in a chain of socioeconomic,
medical, biological, demographic, and other problems.

Since the files of the Ministry of Atomic Energy of the former USSR were
declassified, a number of Ukrainian ecologists have been insisting on
banning all nuclear power plants, the sooner the better, condemning them as
a risky and hazardous source of energy.

“The main thing is that a nuclear power plant means technology above all,
something that cannot function with a 100 percent safety guarantee,” says
Dr. Biliavsky.

He cites the outstanding Russian journalist G.O. Medvedev, who said that
Chornobyl demonstrated man’s omnipotence and impotence. He also cautioned
mankind against getting carried away by its omnipotence: “People, don’t fool
around with it, because you are both the cause and consequence.”

In Biliavsky’s opinion, claims that atomic energy is inexpensive are a
deliberate falsification: the designers of nuclear power plants do not
include in the value of an atomic kilowatt such expenditures as recycling
and storage of radioactive waste, or expenses connected with operating
nuclear power plants in keeping with established safety standards. German
experts write that “nuclear energy is less expensive only where safety is
regarded as a matter of minor importance.”
5. FOREST —–
Forests are among the major absorbers of carbonic acid gas. They are the
planet’s lungs, supplying oxygen and other valuable materials, and
protecting the earth against erosion and dry hot winds.

Forests have a powerful health-building importance, since certain trees, like
white birches, pines, and fir trees, produce special volatile agents –
phytoncides – that destroy pathogenic bacteria and make air curative. Our
reckless chopping down of forests has considerably reduced the size of
forested areas, making both man and nature suffer.

Tetiana Bilyk, research fellow with the National Academy’s Institute of
Hydrobiology, believes that the swift progress of civilization has in no way
quickened the progress of animal and plant species; instead, it has
accelerated the process of their extinction.

This is because their natural habitats are being destroyed: there are too
many hunters, too many fishermen getting their catch by unauthorized means,
too many lumberjacks chopping down precious kinds of trees, and so on.

All ecological problems are important and interrelated. Ecologists in
Ukraine are alarmed that the government is paying scant attention to these

“Since 1992 the world has been concerned about harmonious development, but
in Ukraine such important bills as “The Strategy of Balanced Development”
and “On Ecological Education” still not been passed by parliament.

Franchuk says that the education and ecology ministries haven’t even gotten
around to coping with the Balanced Development Strategy project, even
though this strategy is being actively implemented in most countries.

Experts are also worried by the fact that the Ukrainian authorities are
refusing to cooperate with environmental organizations; this reduces public
influence on ecological problems to a minimum. They are also displeased
with the residual principle of financing.                  -30-

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

RIA Novosti, Moscow, Russia, Monday, March 12, 2007

LONDON – Ukraine plans to join the World Trade Organization (WTO)
later this year, a Ukrainian official told an investment summit Monday.

Igor Mityukov, adviser to the Ukrainian prime minister, said accession to
the WTO was this year’s priority for the Ukrainian government, and that
negotiations with WTO member-countries had almost been completed.

“We can see no insurmountable obstacles in this direction,” the official
said on the sidelines of the forum.

He said Ukraine’s parliament would soon have to adopt several draft laws,
which have already been approved in the first and second readings, and that
the government should efficiently introduce adopted legislation.

“I believe Ukraine could join the World Trade Organization in the latter
half of 2007,” Mityukov said

The Ukrainian official said he would refrain from comparing the timelines
for Russia’s and Ukraine’s accession to the WTO, since there were
“substantial differences between the two countries’ economies.”

He added that both countries should first of all pursue a coordinated tariff
policy so that their accession to the WTO would not undermine existing
economic relations.

To join the 150-nation World Trade Organization, Russia must sign bilateral
protocols and complete multilateral talks with all its trading partners in
the organization.                                  -30-

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

EuropaWorld, Cowbridge, Wales, UK, Friday, March 9, 2007

European Commissioner for External Relations and European Neighbourhood
Policy, Benita Ferrero Waldner, announced on the occasion of her meeting
with President Viktor Yushchenko on 8 March, that the European Commission
will provide a substantial increase in financial assistance to Ukraine over
the next four years.

An amount of EUR494 million should be available 2007-2010 to support the
reform process and the implementation of the EU-Ukraine Action Plan.

This represents a substantial increase compared to funding provided in the
past. In addition, Ukraine will benefit from increased lending by the
European Investment Bank.

Commissioner Ferrero-Waldner said: “Ukraine has made remarkable progress
in democratic and economic reforms since the Orange Revolution. With our
enhanced financial assistance we will support the country to continue with
its reform efforts.

Our assistance will focus in particular on:
[1] strengthening good governance and democratic institutions,
[2] bringing Ukrainian legislation and standards closer to those of the EU
[3] and supporting cooperation in key sectors such as energy, transport
     and the environment.”

Key EU assistance activities over the period 2007-2010 will include:
[1] Support for the implementation of the EU-Ukraine Memorandum of
Understanding on Energy to promote the progressive integration of the
Ukrainian energy market with that of the EU, the development of gas and oil
infrastructure and progress on energy efficiency, and the use of renewable
energy resources.

[2] Support to strengthen Ukraine’s capacities in the areas of border and
migration management against the background of the forthcoming entry into
force of a Visa Facilitation and Readmission Agreement between the EU and
[3] Support to strengthen the independence and effectiveness of the
judiciary and to ensure the impartiality and independence of prosecution.
[4] Support to address environmental challenges, notably in the areas of
climate change and improved water quality.
[5] In addition to this assistance, Ukraine will be eligible to draw on the
proposed Neighbourhood Investment Fund. This Fund will be used to
leverage additional lending from financial institutions including the
European Investment Bank (EIB) and the European Bank for
Reconstruction and Development (EBRD).
[6] A Governance Facility is being created to provide additional support on
top of normal country allocations to acknowledge and support the work of
ENP partner countries that have made most progress in implementing their
Action Plans.
                        EU ASSISTANCE TO UKRAINE
The EU is the largest donor to Ukraine and has since 1991 provided
assistance worth well over EUR2 billion, mainly under its Tacis programme.
During the last programming period 2004-2006 planned EU assistance
amounted to EUR212 million.

The yearly average was EUR70.7 million per year in 2004-06 and is
EUR123.5 million per year in 2007-10. EU assistance over the last
programming period focused on three priority areas:

[1] Support for institutional, legal and administrative reform,
[2] Support for private sector and economic development and
[3] Support in addressing the social consequences of transition.

EU assistance is also provided to strengthen nuclear safety and for the
destruction of anti-personnel landmines.
Under its new external mandate 2007-2013, a lending mandate of up to
EUR12.4 billion will be available for European Neighbourhood and
Partnership countries including EUR3.7 billion for Eastern Europe, the
Southern Caucasus and Russia.                      -30-
For more information:
[return to index] [Action Ukraine Report (AUR) Monitoring Service]


COMMENTARY: By Arnaud Dubien, Political scientist,
Editor-in-chief, Analytical Bulletin “Ukraine Intelligence”, Paris
EuraisianHome Analytical Resource, Tuesday, March 13, 2007

An impression of the recent visits of Viktor Yanukovych to Berlin (February
28, 2007) and Viktor Yushchenko to Brussels (March 8-9, 2007) is that the
EU – Ukraine relations are at a complete standstill.

The EU is not ready to view Ukraine as a candidate country, since France and
Germany, the driving forces behind the European integration, have imposed
certain restrictions.

The institutional crisis in the EU, beginning of a new electoral cycle in
France, the problem of Turkey’s EU membership that proves that it is better
not to give prematurely promises in order not to regret the consequences,
are contrary to Ukraine’s EU aspirations.

It has been made clear to Kyiv that the relations between the EU and Ukraine
will develop for a long time within the framework of the European
Neighbourhood Policy.

For all that, it does not mean that the EU turns its back on Ukraine as the
Russian and Ukrainian mass media often say. That is indicated by the almost
twofold increase in financing Ukraine by the EU, which was officially stated
on March 8.

We should bear in mind that Ukraine is located between the EU and Russia

and that Ukraine has closer ties with Russia.

The point is whether Ukraine can go through socioeconomic and political
modernization without joining the European Union in the near future. The EU
officials have not come to terms about it.

The “gas war” between Russia and Ukraine (January 2006) influenced the
Europeans despite the fact that the EU leaders took this conflict

Above all, we came to realize that the EU is vulnerable because it depends
on Russia’s energy supplies and that the priority here in Europe should be
given to the energy sources diversification with emphasis on the development
of the nuclear energy.

In this process Ukraine is considered an important element of the European
energy security, but of course, less important than Russia that has vast
energy resources.

That’s why the EU reaction to the events of January 2006 was more moderate
and restrained than that of the US.

More intense Russian-Ukrainian cooperation in the sphere of energy will not
necessarily be taken negatively by any of the EU countries, except,
probably, Poland and the Baltic states, provided that this cooperation
guarantees stability of energy supplies.

As regards the attitude to Ukraine’s Prime Minister Viktor Yanukovych, I
would say that realist vision starts prevailing among the European
bureaucrats as the 2004 presidential election is being erased from memory.

Yanukovych does not delight the Europeans as President Yushchenko used
to do at the beginning of 2005. But, as a matter of fact, the EU leaders
almost gave up as hopeless the Ukrainian President, who had proved to be

a weak strategist.                               -30-
[return to index] [Action Ukraine Report (AUR) Monitoring Service]
If you are receiving more than one copy of the AUR please contact us.
12.                           STORM FROM THE EAST
 Some loud dissent to government policy heralds from the Donbass region

BYuT Inform Newsletter, Issue 33, Kyiv, Ukraine, Tue, March 13, 2007

Despite a rash of economic data indicating a 7% growth in Ukraine’s economy,
the mood of the populace remains downbeat as dissatisfaction grows with the
administration of Prime Minister Viktor Yanukovych.

Surprisingly, some of the loudest dissent to government policy heralds from
the Donbass region – the political heartland of Mr Yanukovych’s Party of

Yet last week, the prime minister, during a visit to Hungary, trumpeted
Ukraine’s economic regeneration, “I am telling you that they dream that
someday the economy of Hungary will grow the same as Ukraine’s.”

Some thought Mr Yanukovych took his comments too far when he poured cold
water on EU growth rates. “We are not satisfied with the European GDP growth
of 3%. We should have not less than 7-8%. Then we will gradually catch up
with living standards, increase social standards and strive for the world
level,” said the premier.

“This is taking grandstanding to a new level,” said Oleksandr Turchynov,
deputy leader of BYuT, “the reality is he inherited a growing economy and
has pursued policies that have benefited an elite few while causing
widespread hardship.”

Last week there were reports of tens of thousands of people being left in
the cold in the Lugansk towns of Sverdlovsk, Krasnodon, Byelovodsk and
Lutugino, as heating was cut off because of unpaid communal tariffs.

Elsewhere workers have complained that wages are not being paid and sit-in
protests are taking place in several Lugansk mines over non-payment of

Despite GDP increasing to 7.1% in 2006, the State Statistics Committee said
that inflation in 2006 had risen to 11.6% compared with 10.3% in 2005.

Steel products make up more than 40% of Ukrainian exports and remain the
country’s principal source of hard currency. “The recent growth has been
driven by higher global prices for metallurgy and metal working,” said
Jonathan Schiffer, author of Moody’s 2006 report on Ukraine.

Notwithstanding the surge in heavy industrial output, there is a marked lack
of a “feel-good factor”  in the east of the country. The Donbass newspaper
indicated that as few as 2% of Ukrainians consider the domestic economic
situation as “good.”

“While many governments suffer from mid-term blues, they seem to have

come early for Yanukovych,” said Mr Turchynov.
Popular support for the government has evaporated in recent months, and is
attributed mostly to sharp increases in gas and electricity.

Another contributing factor is the growing inequality between the “haves”
and “have-nots” and nowhere is this more visible than in the industrialised
regions of the east.

The dilapidated state of infrastructure contrasts sharply to increased
industrial output. Ironically, much of the increased steel production is
destined for infrastructure projects in Asia.

The sense of injustice is magnified further by endemic corruption. A fact
picked up by the US State Department, which last week lambasted Ukraine
saying that corruption has spread over all branches of power. Bribery within
judicial system, police and even in high schools was singled out for

The dissatisfaction of citizens in eastern Ukraine is expected to benefit
the opposition, particularly BYuT.

The party hopes to build on its success during the 2006 parliamentary
election when it won in the historically eastern-leaning Kirovohrad Oblast
with 33% of the vote and came a strong second in the region of
Dnipropetrovsk with over 15% of the vote. Strong second places were also
secured in the eastern regions of Zaporizhia and Kharkiv.

It is not inconceivable that the east will be the battleground where the
future of Ukraine will be decided. In a thought provoking blog on the
website Foreign Notes, the author LEvko opined, “The huge human and economic
potential of the industrialised east of Ukraine has always played a foremost
role in the political set-up of the country.

It was from here Kuchma came to replace Kravchuk. And it was from here that
Yanukovych came to push out Yushchenko. It is possible that it is from here
the future victory of Tymoshenko will be prepared.”
NOTE: Questions or comments? E-mail us at
[return to index] [Action Ukraine Report (AUR) Monitoring Service]

INTERVIEW: With Ukrainian President Viktor Yushchenko
Associated Press, Kyiv, Ukraine, Wednesday, Feb 28 2007

KYIV – Ukrainian President Viktor Yushchenko on Wednesday accused the
Cabinet headed by his former campaign rival of seeking revenge for the
Orange Revolution, and said some of its decisions seem aimed at satisfying

Yushchenko beat out Viktor Yanukovych for the presidency after leading

2004 mass protests dubbed the Orange Revolution, but was forced into a
power-sharing arrangement last year with Yanukovych, whose Russian-leaning
party won the most votes in parliamentary elections and put together a
ruling coalition.

Decisions by the Cabinet and parliament’s governing coalition have been
“taken with such insufficient consideration that they can be based only on
emotions and the desire for some primitive revenge,” Yushchenko told The
Associated Press in an interview.

Since he returned to power as premier, Yanukovych’s coalition has trimmed
back Yushchenko’s authority and sought to counter the president’s strongly
pro-Western push in foreign policy.

Yanukovych has put Ukraine’s move toward NATO membership on hold and

forced the ouster of Yushchenko’s pro-Western foreign minister, and his party
last week refused to endorse the president’s new choice to be Ukraine’s top

Yanukovych’s party has also supported regional movements to make Russian a
second state language – an idea that Yushchenko has strongly opposed,
insisting that promoting the Ukrainian language is key to protecting the
country’s sovereignty.

Yushchenko said that he was concerned that some decisions seemed to be made
with an eye on the Kremlin’s interests, not Ukraine’s. “Such decisions do
not help develop relations if they are not grounded on the basis of national
interest,” he said.

He accused Yanukovych of failing to fulfill any of the pledges he undertook
when he signed a document aimed to promote national unity last year, as
Yushchenko demanded he do before agreeing to nominate Yanukovych as


The document was supposed to outline Ukraine’s main foreign and domestic
policy goals, including NATO membership and promoting Ukrainian as the sole
state language.

Yushchenko also accused the government of “very often ignoring the law and
the Constitution.”

But he insisted that he made the right – and only – choice when he agreed to
nominate Yanukovych, words apparently aimed at deflecting criticism from
supporters angry that he enabled the former premier to return to the
powerful position.

He added that he can’t be blamed for the collapse of the Orange Revolution
coalition, which led to Yanukovych’s return.

“What legal choice did we have?” Yushchenko said, stressing that his
decision was guided by electoral law, the results of the March parliamentary
elections and the makeup of the majority coalition formed in parliament
months after the vote.

“Let us be exact … I was guided exclusively by law so I live very calmly,”
he said.                                                     -30-
[return to index] [Action Ukraine Report (AUR) Monitoring Service]

by John Marone, Kyiv Post News Editor
Kyiv Post, Kyiv, Ukraine, Thursday, Mar 01 2007

Firebrand female politician Yulia Tymoshenko traveled to the United States
Feb. 28 for a several-day visit, hoping to confirm her unofficial title as
the leader of Ukraine’s democratic movement and gain points at home and
abroad against her lackluster political opponents: Prime Minister Viktor
Yanukovych and President Viktor Yushchenko.

During her Washington trip, Tymoshenko was scheduled to meet with US
Vice President Dick Cheney and Secretary of State Condoleezza Rice. The
high-ranking meetings mirror the level of diplomatic treatment granted to
Yanukovych during a Washington trip last December.

Yanukovych also met with Cheney and Rice during that trip, intended to
justify his government’s controversial policies, which include a cautious
approach to NATO integration initiatives backed by the US leadership.

Yushchenko was accepted with highest honors by President George Bush
during his last trip to the US in April 2005, following the Orange
Revolution that brought him to power.

Since then, he has lost much of his authority on foreign and domestic policy
to Yanukovych’s governing coalition, and his role as the country’s
democratic messiah has been questioned.

Yanukovych’s trip was overshadowed by a dispute with Yushchenko over
leadership at the country’s Foreign Ministry that left many diplomats
wondering which leader was in charge of foreign policy.

Both Yushchenko and Yanukovych remain caught up in a wrestling match
over authority on top government posts and policy.

As confusion in diplomatic circles persists with respect to who is calling
the shots in Kyiv, the ambitious Tymoshenko is scoring political points on
the domestic front and hopes to convince powerbrokers abroad that she is a
capable partner on the Ukrainian arena.

One of her goals will be to revamp her image as a radical and power-hungry
populist politician. She is also trying to rub off the view of being a loose
cannon on the economic front, a reputation that has stuck to her since her
days spearheading the calls for re-privatization while prime minister in

“As an unwavering supporter of freedom and democracy in Ukraine, I look
forward to returning to the birthplace of these historic principles,”
Tymoshenko announced before her departure.

Tymoshenko, who played a major role in rallying protestors during the Orange
Revolution, but was fired as prime minister in 2005 after a bitter falling
out with Yushchenko, is also looking forward to the country’s 2009
presidential elections.

In the short term, the Bloc of Yulia Tymoshenko (Byut) is pushing for early
parliamentary elections, in which it would be expected to do even better
than the 22 percent, or second place, that it got in the 2006 parliamentary

Recent opinion polls have put Tymoshenko way ahead of Yushchenko.
Yushchenko’s Our Ukraine bloc came in third during last year’s parliamentary

Tymoshenko is currently running neck and neck in the polls with Yanukovych,
the villain of the 2004 presidential elections, whom Yushchenko fatefully
accepted as premier last summer.

“We believe that after the Orange Revolution and the comeback of the old
political teams, the world stopped understanding Ukraine. I am going to the
United States to make Ukraine more understandable to the outside world,”
Tymoshenko said in Kyiv.

Tymoshenko’s US trip, her first as a major political figure, has been
carefully timed, according to political analyst Andriy Yermolayev.

Byut and Yushchenko’s increasingly divided Our Ukraine party signed an
opposition agreement on Feb. 24, thereby creating a counterweight to the
aggressive parliamentary majority consisting of the Communists, the
Socialists and the prime minister’s Regions party.

Yushchenko, who has had most of his powers snatched from him by
Yanukovych, could only welcome the move by Tymoshenko, who continues
to win over former Our Ukraine supporters.

“I approve and appreciate the unification of opposition forces in the
Verkhovna Rada [parliament] as an important pre-requisite to withstand the
systemic and open violation of Ukraine’s Constitution and current laws,” the
president said in a letter made public by his press service.

“She is going to present herself as Ukraine’s new democratic leader to the
world’s lead democracy,” said Yermolayev, who emphasized the symbolism
behind Tymoshenko’s visit in her role in reuniting the pro-Western Orange
political camp.

In a last-minute twist, Tymoshenko cancelled a scheduled appearance at
Columbia University in New York on Feb. 26. Her press service belatedly
attributed the cancelled appearance to illness. But high-profile meetings

with American politicians are still scheduled.

Taras Pastushenko, deputy head of Byut’s press service, said Tymoshenko will
meet with top senators, including Republican leaders Richard Lugar and John
McCain, a presidential candidate. A meeting with Democratic presidential
candidate Hillary Clinton is also possible, he said.

Byut’s press service said the Ukrainian opposition leader would meet with
members of the Ukrainian Diaspora, who overwhelmingly sided with Orange
parties against Yanukovych in 2004. In contrast, Yanukovych shunned
encounters with Ukrainian Diaspora during his US trip in December.

The Washington visit will also include speeches at the Center for Strategic
and International Studies and the National Press Club.       -30-
[return to index] [Action Ukraine Report (AUR) Monitoring Service]

ION & ANALYSIS: By Vadim Dubnov. Independent Journalist.
RIA Novosti, Moscow, Russia, Wed, February 28, 2007

MOSCOW – Yulia Tymoshenko bloc seemed to have miscalculated the right
time to raid the switchgear room in the Ukrainian Supreme Rada (parliament):
the deputies only needed to wait a few days until an 18-day break was

The success of that tactical move in no way brought Tymoshenko closer to
her strategic objective, disbanding the Rada, which had been inactive for a

Three days later, Tymoshenko turned the lights back on, promising to return
to the switchgear room, or somewhere else, because there is not a single
political crisis in Ukraine in which Tymoshenko would not have a hand.

Nor is there a political issue which would not become a political crisis
once she embraced it. Be it her own parliamentary election success, or an
increase in utilities tariffs, which is what plunged parliament into
darkness in the first place.

Tymoshenko has always opposed anything and everything. She opposed
President Leonid Kuchma. She opposed her political godfather Pavel
Lazarenko (prime minister in 1996-1997).

She was in opposition even when she was in power, which was twice. And
both times she opposed Viktor Yushchenko, who was first prime minister
and then president and her Orange soul mate.

One has a suspicion that should some miracle happen and Tymoshenko
become president she would be in opposition all the same. And no matter
to whom or what. In the context of Ukrainian realities, this makes no
difference. The problem lies with realities, not Tymoshenko, who is an
archetype of opposition.

She is tireless and her improvisations are prolific. But most important of
all, she does not care a jot whom she attacks and from what flank once she
has an opponent. Some might say she is unprincipled, and they would be
right. Some may admire her sense of timing and versatility, and they would
not be wrong either.

Today, Tymoshenko is defending those who have been told to pay 500 to
700 hryvnias – more than a hundred dollars – for heat and garbage removal.

She is the traditional mouthpiece of popular anger, not the Communists,
who actually helped to pass the tariff hike as part of an anti-crisis

Populism is the catchword. This left-wing slogan is also causing Our
Ukraine, with the president at the head, to line up behind her columns –
what else are they supposed to do knowing that they face early elections?

The archetypal opposition need not concern itself with in-depth logic and
hard background facts. Its business is to generate crises that would have
remained mere food for thought for political experts and economists if they
had not been stirred up by the opposition.

Ukrainian experts think the Yanukovich government made two mistakes.

[1] One was a simple decision to raise utility fees without any hint, verbal
or otherwise, of reform.

[2] The second was to heed widespread requests and start investing in the
essential sectors: coal and farming. Everything is so familiar that it is
time to speak of logic, rather than mistakes.

After winning the day, the Yanukovich cabinet needs to address two basically
disparate problems. On the one hand, the Party of Regions is compelled, with
an eye to the future, to go beyond its traditional regional borders and
become an all-Ukrainian party, and to increase its approval rating. On the
other, the cabinet must perform the functions that belong to it, i.e. run
the economy.

Which, given a short supply of ideas, is as difficult as raising its
popularity rating in Lviv (western Ukraine). The policy Yanukovich came
up with was logical and predictable: utility fees in excess of a hundred
dollars were expected to fill holes in the budget made deeper by its
senseless shakedown.

In response, lured by early elections, somebody would call a rally, while
Tymoshenko simply switched off parliament’s lights.

She is in opposition today, and in a war of all against all, everything is
permissible. In effect, this is the dream of any real opposition – to turn a
latent crisis into a lasting and permanent fix.

They do the same thing in Italy, a country where a Tymoshenko-style
opposition would feel right at home. In Ukraine, unlike in Italy, there are
things worse than a crisis.

Say, the ultimate victory of Tymoshenko herself. Because with her power,
lacking in principles and merciless, no one else could become an opposition
in Ukraine.                                              -30-
The opinions expressed in this article are those of the author and do not
necessarily represent those of RIA Novosti.
[return to index] [Action Ukraine Report (AUR) Monitoring Service]

Agence France Presse (AFP), Kiev, Ukraine, Tue, March 13, 2007

KIEV – A Pentagon delegation was in Ukraine on Tuesday to discuss a
controversial anti-missile system planned for deployment in neighboring
Poland and the Czech Republic, the US embassy said.

Lieutenant General Henry Obering, head of the missile defense agency, “will
discuss aspects of the US missile defence programme including proposed
missile defence bases in Poland and the Czech Republic,” the embassy said in
a statement.

Starting on Tuesday, Obering will meet officials in the president’s office,
the foreign ministry, the defence ministry, the national security council,
the national space agency and members of parliament. He will give a news
conference on Wednesday, the statement said.

The visit is part of a public relations drive to reassure foreign countries
about the planned missile defense shield, following sharp criticism by
Moscow and complaints by some in the European Union that its goals

have not been clearly explained.

US officials have also said they would want to site a radar to support the
system in one of the Caucasus nations of Armenia, Azerbaijan and Georgia.

Washington says the shield is directed against states such as Iran that
might acquire long-range missiles and denies claims in Moscow that Russia

is the target.

Russia has long objected to the expansion of the US-led North Atlantic
Treaty Organisation (NATO) towards its borders following the collapse in
1991 of the Soviet Union.

Ukraine, which lies between Russia and NATO member Poland, appears split

on the issue. President Viktor Yushchenko has courted the United States and
hopes his country will join NATO, while pro-Russian Prime Minister Viktor
Yanukovych is against membership, seeking only to join the European Union.
[return to index] [Action Ukraine Report (AUR) Monitoring Service]

By Martin Sieff, UPI Senior News Analyst, Wash, DC, Mon, Mar 8, 2007

The United States has launched its diplomatic offensive to try and improve
relations with Russia, especially on the thorny issue of building ballistic
missile defense facilities in Central Europe. But it is proving to be a
dialogue of the deaf.

The past week has seen heavy diplomatic activity on the ballistic missile
defense front.The United States and NATO have been trying at high levels to
persuade the Russian government that their plans to set up a U.S. radar
installation in the Czech Republic and a ballistic missile interceptor base
in Poland within the next five years are aimed only at Iran, North Korea and
other possible “rogue states” with missile capabilities, not at them.

U.S. Ambassador to Moscow William Burns said during a visit to Siberia
Tuesday that the U.S. and Russian governments should launch a new series

of bilateral talks to explain their conflicting stands on BMD issues and to try
and deal with their differences on them, the RIA Novosti news agency

Burns repeated the Bush administration’s position that building the ABM
radar and interceptor installations to protect European nations from the
threat of nuclear missiles launched by so-called “rogue” states would not
endanger Russia’s national security. He even offered the possibility that
Washington and Moscow could start a new cycle of cooperation on BMD.

However, Burns also made other comments certain to anger the Kremlin. He
said that the desire of two former Soviet republics, Georgia and Ukraine, to
join the U.S.-led NATO alliance was an expression of the desire of the
governments and populations of both nations.

For the Russian government, openly alarmed at what it sees as continued,
energetic U.S. efforts to reduce or destroy the Kremlin’s remaining
influence in its traditional home sphere of influence, the former Soviet
republics, or “near abroad,” those are incendiary comments.

Burns also referred to the NATO-Russia Council as a relevant mechanism to
try and defuse conflicts between the two powers over such issues. But from
the Russian point of view, this would have been regarded as just empty words
or boilerplate rhetoric.

For the NATO-Russia Council has been in existence for many years and from
the Russian perspective, it has served only as a platform for them to air
their protests — which they regard as always ignored — about the steady
encroachment of NATO bases, new alliance members and political influence
among their former allies and even in countries that were part of Russia and
the Soviet Empire for hundreds of years up to the disintegration of the
Soviet union at the end of 1991.

Burns’ comments indicated no softening of the U.S. position on BMD bases

and on the growing drive in Ukraine and Georgia, both former Soviet republics,
to join NATO – developments that would certainly infuriate the Kremlin.

The previous day (Monday) the head of the NATO alliance also sought to
soothe Russia on the BMD issue. But his comments looked unlikely to cut any
ice in Moscow.

Jaap de Hoop Scheffer, the secretary-general of the North Atlantic Treaty
Organization, said in Brussels that both NATO and the U.S. government had
shown “maximum transparency” to Russia on their reasons and plans for
building the new BMD installations in Central Europe, RIA Novosti reported.

But Russian Foreign Minister Sergei Lavrov rejected this line of argument
the following day, when he claimed that the Kremlin was still pressing the
U.S. government for answers about its missile defense plans.

“We are discussing the issue with our American colleagues and are asking
them for answers to our questions and concerns, which are completely
justified. Although meetings and briefings are being held on the issue, most
of our questions have not received any clear answers,” Lavrov said,
according to another RIA Novosti report.

The Russian foreign minister said transparency and trust were needed to
counter the dangers of uncertainty over future U.S. strategic intentions
being generated through the Bush administration’s BMD plans.

Lavrov said new U.S. strategic moves were being closely watched by the
Kremlin. He said sometimes U.S. initiatives were made public before
countries that would be involved had been informed of them.

The RIA Novosti report said that Russia was also concerned on March 1

when a senior U.S. Department of Defense official announced that the U.S.
government “would like to station a radar base in the Caucasus.”

“The announcement evoked suspicions in Moscow that Georgia could be a
possible site. Georgian officials have denied the possibility,” RIA Novosti

“The problem of strategic stability concerns everyone,” Lavrov said. “It is
not mere coincidence that calls are made in Europe, including by Germany, to
discuss issues such as the deployment of the American missile shield in
Poland and the Czech Republic,” he said.

Russia’s most senior generals have already publicly served notice that the
Kremlin is prepared to pull out of the Intermediate Nuclear Forces Treaty,
which has been a cornerstone of superpower détente since it was signed on
Dec. 8, 1987.

“If a political decision is taken to quit the treaty, the Strategic Missile
Forces are ready to carry out this task,” SMF Commander Gen. Nikolai
Solovtsov told a news conference in Moscow on Feb. 19.

And Russia’s top serving soldier, four-star Army Gen. Yury Baluyevsky, the
Chief of the Russian General Staff, warned Feb. 15, “It is possible for a
party to abandon the (INF) treaty (unilaterally) if it provides convincing
evidence that it is necessary to do so. We currently have such evidence.”

The Russian message appears clear: Verbal reassurances alone will not dampen
concern about the new BMD plans in Europe. Washington and Moscow

remain on a collision course over the issue.                  -30-
[return to index] Action Ukraine Report (AUR) Monitoring Service]
     You are welcome to send us names for the AUR distribution list.
18.                                “AMERICAN SOUP”
       Russian reactions to Ukraine, Caucasus missile defence cooperation

COMMENTARY: By Vasiliy Sergeyev, Ilya Azar, & Fedor Rumyantsev website, Moscow, in Russian 2 Mar 07
BBC Monitoring Service, United Kingdom, Friday, March 09, 2007

The US State Department report on cooperation with Ukraine and the countries
of the Transcaucasus in the creation of a missile defence system threatens
to cause a major furore in Moscow’s relations with Washington and Kiev. has learned that Russian parliamentarians are to raise the
“Ukrainian question” at the next Duma session. The military are already
threatening our neighbours with missiles.

The intentional or accidental mention of Ukraine on the list of countries
cooperating with the United States on the missile defence project has taken
the Russian-US conflict, which reached its apogee in Vladimir Putin’s

Munich speech, to a new level.

As has written before, on Thursday John Rood, US assistant
secretary of state for international security and nonproliferation,
presented a report in Washington which said that Kiev is cooperating with
Washington in some way in creating a global missile defence system.

The State Department document includes Ukraine on a list of more than 15
countries cooperating to some degree with the Pentagon within the framework
of the missile defence programme.

The list also includes Britain, Australia, Denmark, France, Germany, Italy,
Israel, India, Japan, the Netherlands, Taiwan, Poland, and the Czech
Republic. The American side’s statement on the possible participation of one
of the countries of the Transcaucasus in the missile defence project also
caused a sensation.

These plans were announced in Brussels by US Defence Department
representative Lieutenant-General Henry Obering. According to what he said,
it is a question of a radar installation.

Obering did not specify in precisely which part of the “Caucasus” the radar
will be installed. In this case, the term “Caucasus” covers the region that
is known traditionally to Russia as the Transcaucasus: Georgia, Azerbaijan,
and Armenia. There had already been speculation in the press that US
military facilities could spring up in either Georgia or Azerbaijan.

The news of the planned US cooperation with countries of the former CIS

[as published] drew an angry reaction from Russian parliamentarians.

Konstantin Zatulin, deputy from United Russia and member of the [Duma]
Committee for CIS Affairs, is in belligerent mood. In his view, the State
Department report is more than enough to provoke a tough reaction from

“In itself, the Americans’ persistent desire to drag Ukraine into the
missile defence system in Poland and the Czech Republic should not be

left without a reaction from the Russian side,” Zatulin told

“Our country’s Foreign Ministry should immediately, on the basis of this
officially published report, raise in public, within the framework of the
Putin-Yushchenko commission, the question why Ukraine is engaging in
coordination work on the missile defence system, contrary to consultations
with Russia,” the deputy stated.

“This should prompt an inquiry in the State Duma – in any case, I will ask
the question,” Zatulin threatened, reminding us that the next plenary
session of the Duma is on Wednesday [ 7 March].

Konstantin Kosachev, chairman of the State Duma Committee for International
Affairs, is slightly more cautious: “As I understand it, it is not a
question of any concrete agreement, but of American plans, and that does not
yet mean an official response from Ukraine.” However, in the view of the
United Russia deputy, even “at this stage, this report prompts many

“Obviously this shows even more disregard for the Russian side’s absolutely
justified concern, an even greater advance towards Russia’s – not Iran’s or
North Korea’s – borders.

If it turns out that there is already some kind of bilateral understanding,
there will be a huge number of questions for our American and Ukrainian
partners,” the head of the Duma committee stated.

The Russian military have gone even further than the politicians. Air Force
Commander in Chief Vladimir Mikhaylov threatened the neighbour states with
military conflict, in not very veiled terms.

Russia already has an appropriate response to the possible sitting of an
American radar in a country in the Caucasus region, the Air Force commander
in chief said on Friday.

“We have everything necessary to respond appropriately to all these
deployments,” Mikhaylov stated. “Russia’s S-400 [surface-to-air missile]
systems, whose range exceeds 400 km, ensure the performance of all the
necessary air-space defence tasks.”

The Foreign Ministry refused to give any comment to Aleksandr
Pikayev, chief of the disarmament and conflict resolution department at the
International Security Centre of the Russian Academy of Sciences Institute
of World Economy and International Relations, did not rule out the
possibility that Russia’s response to possible cooperation between CIS
countries and the United States could be very tough.

“As far as a radar in the Caucasus is concerned, it is well known that
Azerbaijan has apparently given preliminary consent, and how Russia will
react to that is the big question.

But it could be a matter of countermeasures that would be very painful for
Azerbaijan, up to and including imposing a visa regime and taking a tough
line on illegal – Azerbaijani – immigration,” the expert told

As far as Ukraine is concerned, Pikayev doubts that cooperation between Kiev
and Washington in building a missile defence system is more than a matter of
declarations, at least at the moment.

According to him, “Ukraine is hardly cooperating with the Americans more
than Russia is. It is most likely a question of some quite insignificant

He reminded us that under the Ukrainian Constitution real power rests with
the cabinet, which is supported by a majority in the Supreme Council. “While
Viktor Yanukovych’s cabinet is in power, I think Ukraine is hardly likely to
go beyond discussions, or maybe some minor contracts with the Americans,”
Pikayev said.

Major-General Pavel Zolotarev, deputy director of the Russian Academy of
Sciences Institute of the United States of America and Canada, takes a
somewhat different view.

He told that the way the Americans are putting the question, in
order to have a missile defence system that would, among other things,
devalue the significance of Iran’s missile potential, is the right one.

“This is one method of countering the proliferation of nuclear missile
weapons,” the expert believes. However, according to Zolotarev, there is not
enough real dialogue between Russia, the Western countries, and the United
States to resolve this problem.

“We say ‘not enough dialogue’ because dialogue has, in fact, been taking
place to some degree.

But not sufficiently actively – nor, maybe, at the necessary level – for the
announced decisions on siting, say, radar systems in the Czech Republic and
a missile defence system in Warsaw not to provoke a sharply negative
reaction from Russia,” Zolotarev believes.

The expert described the differences within the Ukrainian leadership on the
question of siting missile defence components as “a natural phenomenon given
the power crisis that persists in Ukraine.”

At the same time the expert believes that there are no grounds for a sharp
deterioration in Russian-US relations. “The American side has apparently
realized that it cannot operate in its customary style – when Washington
consults with nobody, acting on the basis of its own interests.

The Americans will most likely rectify this situation now, and try to
involve the Russian side, too, in dialogue,” the academic concluded.

Ukrainian politicians have not yet commented on the US State Department
report. But there has been a reaction from Azerbaijan and Georgia already.

Georgian Foreign Minister Gela Bezhuashvili, commenting on the question of
the possible siting of a missile defence radar on Georgian territory, stated
that “the United States has made no such request to the Georgian

Although Nika Rurua, deputy chairman of the parliamentary committee on
defence and national security, left a loophole: “If the United States needs
to deploy a missile defence system in Georgia, the Georgian leadership will
examine this issue.”

US Ambassador to Tbilisi John Tefft, for his part, stated that “there are no
plans to deploy a missile defence system in Georgia.”

The Azerbaijani Defence Ministry also refuted reports of the possible siting
of radars on the Republic’s territory. “No, this does not correspond to
reality,” the Republic’s Defence Ministry told Interfax on Friday.

Asked whether such deployment is possible in the future, the Defence
Ministry spokesman noted that the defence department cannot comment

on such questions.

“This question falls within the competence of the government and the
political leadership of the country, so the Defence Ministry, as an
executive body, cannot say anything about it,” the news agency’s
interlocutor said.

[Following paragraph is published as boxed section] EU Frightened
Even the EU is now so concerned by the situation that it has decided to
intervene in Russia’s spat with America.

On Friday, behind the scenes at the EU defence ministers’ meeting in
Wiesbaden, Germany, FRG Defence Minister Franz Josef Jung stated that he
intends to raise the question of the siting of the American missile defence
system in East European countries within NATO structures.

Germany’s concern is understandable: The selfsame American General Henry
Obering who announced the siting of a radar in the Transcaucasus also said
that the United States does not require the consent of other NATO countries
for such steps.

“We should without fail discuss this within the NATO framework,” Jung stated
in reply. The minister added that his intention is dictated by the special
relationship between the countries of old Europe and Russia, which will be
spoilt by America’s military plans. Jung suggested that the missile defence
question could be the subject of discussion at a session of the Russia-NATO
Council.                                               -30-

[return to index] [Action Ukraine Report (AUR) Monitoring Service]
                           IN UKRAINIAN CITY OF ODESSA

Itar-Tass, Moscow, Russia, Monday, March 12, 2007

ODESSA – An action in support of the Russian language was launched
on Monday in the multi-national Ukrainian city of Odessa.

The action will continue for a week and will involve all districts of the
city with population of about million people, sources from the press service
of the Ukrainian Union of Orthodox Citizens, which initiated the action,
told Tass.

Motor rallies, meetings and the collection of signatures in support of the
Russian language will be held within the framework of the action “I Speak
Russian”. Round-table discussions and conferences will be broadcast live
so that people could speak in support of or against polylingual Ukraine.

A mass meeting with a demand to consider at a city council session this week
the implementation of constitutional rights of citizens to a free use of the
Russian language in Odessa will become the culminating point of the action.

In May-June 2006, the city council of Odessa did not venture to follow the
example of the Donetsk, Zaporozhye, Lugansk, Nikolayev and Kharkov regions
as well as the cities of Donetsk, Dnepropetrovsk, Krivoy Rog, Lugansk,
Nikolayev, Sevastopol, Kharkov, Kherson and Yalta, which legalized Russian,
which is the mother tongue for most of their residents.

Kiev qualified these decisions as a manifestation of “language separatism,”
and they were challenged in court by regional prosecutor’s offices.

The Russian language has lost its special status in Krivoy Rog, Kherson,
Dnepropetrovsk and Zaporozhye. However, within the past month, courts
of different instances have rendered lawful the decisions of the Donetsk,
Nikolayev and Kharkov regional councils, which granted the status of
regional to the Russian language.                      -30-

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

By Victor Yasmann, RFE/RL, Prague, Czech Republic, Tue, Mar 13, 2007

On a recent trip to Jordan, Russian President Vladimir Putin asked his host,
King Abdullah II, if he could pray on the banks of the Jordan River.

The king, seeing that Putin didn’t have a decent place to pray, granted him
a hectare of land on the river bank. Upon his return to Moscow, Putin handed
over the land to the patriarch of the Russian Orthodox Church, Aleksy II.

Putin may well be hoping for a similar gesture as he visits the Vatican
today amid improving relations between the Catholic and Orthodox churches.

The Russian president has already visited the Vatican three times, but this
will be his first meeting with Pope Benedict XVI.
                                        TROUBLED TIES
Historical animosity between the two churches runs deep. The Orthodox
Church has accused the Vatican of aggressive proselytizing in Russia.

The Catholic Church has denied the accusations and has expressed concern
over the treatment of Russia’s Catholic minority. The two churches have also
argued over ecclesiastical property in Ukraine.

“Moscow is the ‘third Rome,’ and due to the lack of a ‘second Rome,’
relations with the ‘first Rome’ are very important to us.”

Putin, as a devout believer, has followed the Orthodox Church’s line. The
Russian president did not invite former Pope John Paul II to visit Russia,
as his predecessors Mikhail Gorbachev and Boris Yeltsin had done.

In 2005, the Russian Orthodox Church, with the help of its supporters in the
Kremlin and Duma, managed to push through new legislation that denoted
Russian Orthodoxy, Islam, Judaism, and Buddhism as Russia’s national
confessions. Catholicism received the status of a “guest confession.”
                             SOMETHING IN COMMON
But some observers have suggested that there is a greater chance for
reconciliation with Pope Benedict.

[1] First, Russia enjoys better relations with Germany, the country of the
new pope’s birth, than it does with the Poland of John Paul.

[2] Second, Putin, who lived in East Germany in the 1980s, speaks fluent
German. Today’s talks will reportedly be conducted in German.

The meeting is expected to concentrate on global issues, such as the Middle
East, religious extremism, and global terrorism. Putin is also expected to
discuss with the pope the possible return of a historic Russian church in
the southern Italian city of Bari. Putin plans to pray in the church, which
was built by Russia in 1913, on March 14.

Also up for discussion will be a possible meeting between Benedict and the
Russian patriarch. Such a meeting, most likely on neutral territory, has
been on the agenda for years, but, because of poor relations, has never been

                                        SHARED FEARS
Despite the churches’ differences, they have a lot in common. Both feel
threatened by what they see as rampant secularism and the spread of the
Islamic faith.

Commenting recently on Putin’s visit, the Russian Orthodox Church’s envoy to
European institutions, Bishop Hilarion of Vienna and Austria said: “There is
growing understanding that Catholics and Russian Orthodox [believers] face
common challenges like militant secularism and relativism, atheism, and
moral dissipation.”

Putin has been adept at using the Orthodox Church for his own political
ends. Some observers have suggested that he sees the Orthodox Church
as the ideological arm of the Kremlin.
                                     USING THE CHURCH
The Orthodox Church has often touted the Kremlin’s line, for example
attacking the European Union’s Energy Charter.

And with the Russian Orthodox Church and the Russian Orthodox Church
Abroad expected to officially reunite on May 19 after decades of schism,
Putin is being seen as the “unifier of the church.”

In the last year, Putin has also made efforts to mobilize the international
religious community to support his political line.

In July 2006, ahead of Group of Eight (G8) summit in St. Petersburg, Putin
convened the World Religious Summit in Moscow, which brought together
hundreds of clerics from around the world.

Or as Channel One commentator Pyotr Tolstoy said recently, “Moscow is the
‘third Rome'” and due to the lack of a “second Rome,” “relations with the
‘first Rome’ are very important to us.”
[return to index] [Action Ukraine Report (AUR) Monitoring Service]
       Please contact us if you no longer wish to receive the AUR    


Reuters, Kiev, Ukraine, Tuesday March 6, 2007

KIEV Its golden domes have towered over the capital Kiev for a millennium.
Awed by its mysterious beauty and intrigued by catacombs containing the
remains of scores of monks, thousands pray every day at the Caves Monastery,
spiritual symbol of Slav culture.

But visitors are unaware of impending danger — the monastery is crumbling.
Rain, snow, rising underground water and human negligence threaten to reduce
the site to nothing.

Monks and architects say time is running out and demand urgent action to
protect the Caves Monastery complex, known in Ukrainian as the Pechersk

“We need to hurry to preserve its main treasures and monuments, key elements
of this ensemble,” said the Lavra’s chief architect Tatyana Kulik. “We have
no time. Caves have already fallen in.”

Rising behind Kulik on a chilly winter day were the golden cupolas of the
mediaeval Uspensky Cathedral, mysteriously blown up during Nazi occupation
in World War Two and rebuilt in 2000.

A grand complex with striking belltowers, resplendent churches, chapels,
gates, monuments and seminary buildings, the Lavra was founded by monks

near the Dnieper river in 1051.

Over the centuries it grew to become the main sacred site of Orthodox
Christianity in eastern Europe. It now draws millions of tourists to its
upper and lower sections, a short drive from Kiev’s bustling city centre.

The upper section is a museum under government control. The lower part is
home to about 150 monks. Both are in a dire state.

“The lower part…is in more or less acceptable condition. Every day we walk
around the territory, check which wells are filled with water, inspect
cracks in churches or buildings,” said Pavel, the senior priest who runs the
monks’ community.

“The story is very different in the upper part. The sewage and water supply
system have not been repaired. Snow has started to melt. Pipes are filling
up. The water is coming down, tearing out walls and pipes. Two buildings are
in a terrible state.”
                                           SLOW DECAY
A few metres (yards) from Pavel’s study, a cosy room filled with golden
Orthodox icons, there emerges a picture of slow decay.

A supporting stone wall is riven with cracks as are church walls and
seminary buildings. A chapel lists dangerously. Stone steps are worn and in
danger of disappearing.

Monks and builders work feverishly to reverse the decline. Truckloads of
sand and concrete arrive at the site daily. “We are working to strengthen
the walls of the near caves against landslips,” says Father Varsonofiy as he
leads the way underground to a site of a cave accident in 2005.

Caves collapsed metres away from the cell of St Anthony, the first monk to
inhabit the caves almost 1,000 years ago. His remarkably preserved body is
kept nearby.

As Father Varsonofiy shows new props installed to bolster the ancient
corridor, visitors descend the flight of stone steps, each with a candle in

The underground passages lead to prayer niches and miniature chapels where
flames cast shadows on icons barely visible through the darkness. Priests
recite prayers.

Experts still cannot explain why the caves collapsed. “The processes of
deformation accelerated in 2005. We do not know what will happen this year
because no scientific research has been conducted,” Kulik said.

“We have not studied the reasons for the accident.” She believes the
monastery’s location on hills near the river is one factor in a long list of

Negligence, ageing sewage systems, mistakes in planning the city’s drainage
system and construction nearby also played a role, undermining stability

Lack of funding underscores all the difficulties. Ukraine’s government, its
eye cast firmly on public opinion, pays scant attention to historical
monuments at a time when increasing public sector wages and pensions

remain top items on the agenda.

Architect and monks agree a short-term solution will be of little use to the
ancient monuments. They want a long-term state plan to preserve the Lavra
for future generations.

“The state must take heed,” says Pavel. “This is the only sacred place of
such rank in Ukraine. It is called ‘the second Jerusalem’. We should
preserve it at whatever price. We, monks, are ready to sacrifice our lives.”
[return to index] [Action Ukraine Report (AUR) Monitoring Service]
     Targeted girls from Lithuania, Russia, Ukraine, Moldova and Latvia

The Daily Record, London, UK, Thursday, Mar 08, 2007

LONDON – ALBANIAN Luan Placiki was the head of a multi-million-pound

sex slave ring that stretched across Europe.

He targeted girls, some as young as 16, from east European nations such as
Lithuania, Russia, Ukraine, Moldova and Latvia. They were often sold on

to other Albanian gangsters in the UK, some in Scotland.

Russian student Olessia Khledod told how she was sold by Placiki, 29, left,
to an Albanian pimp in Glasgow. She was forced to work as a prostitute in
a flat before escaping.

In 2003, Placiki was found guilty of kidnapping and smuggling women into

the UK and forcing them into the vice trade. He was jailed for 10 years but
prosecutors appealed the sentence and it was increased to 23 years.

London’s Wood Green Crown Court had heard he brought at least 60

women into the country – police believe the true figure was closer to 200.

The women were lured with promises of jobs as waitresses and nannies but
were drugged, raped, beaten and forced to work round the clock as
prostitutes. The victims’ families were threatened with violence if they
contacted police.

When police arrested Placiki, they found more than pounds 200,000 in one
bank account alone. He also owned several properties in London and abroad.
He’d been granted a British passport in 2001 after claiming he was an asylum
seeker from war-torn Kosovo.                       -30-

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

By Ralph Riegel, Irish Independent, Ireland, Friday, Mar 09, 2007

A UKRAINIAN woman is to be deported – just weeks after she was honoured

by President Mary McAleese as one of Ireland’s outstanding charity volunteers.

Iulia Schakova (25) faces the threat of immediate deportation despite the
fact that her outstanding work with the children’s charity, Barnardo’s,
earned her a Presidential award just last December.

Iulia – who lives in Midleton, Co Cork – was devastated when her pleas to
remain in Ireland were rejected and she was served with a notice of pending

Yesterday Minister McDowell agreed to personally study the case after the
plight of Ms Schakova was brought to his attention by Cork TD Kathleen

Lynch (Lab).

“I am delighted about it (the intervention) – and I want to take this
opportunity to thank the minister for everything he is doing and for his
desire to look at my file one more time,” Iulia said. She added that she
will be broken-hearted if she has to leave Ireland.

Iulia has been living here for almost four years. After her marriage to an
Irish national broke up in 2005 she lodged an application for full Irish
citizenship, which was refused.                 -30-

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

PRWeb, New York, NY, Monday, March 12, 2007

NEW YORK – Sergiy Shvydkyy, internationally renowned avant-garde dancer,
mime-actor, choreographer and leading figure in contemporary performance
arts in Ukraine brings his unique choreographic vision, combining dance with
theatre, to North American audiences.

Currently residing in Canada, Maestro Shvydkyy recently premiered his work
“Master Class Carmen” at the “Cairo International Festival for Experimental
Theatre” to rave reviews.

His outstanding performance won an invitation by the Ministry of Culture of
Egypt to offer master classes and prepare a joint international project
later this year, combining artists from Egypt, Ukraine and North America in
a newly created and choreographed performance.

Recently, Shvydkyy founded the “Art Quick Dance Company” in Canada to
showcase his powerful gesture-based and intensively interpretive

New York , NY (PRWeb) March 12, 2007 – Sergiy Shvydkyy, an internationally
renowned avant-garde dancer, mime-actor, choreographer, teacher and leading
figure in contemporary performing arts in Ukraine, has recently returned
from Europe after the world premiere of a new work –‘Master Class Carmen’–
a reinterpretation of the Carmen myth to sold out audiences.

Set to the dramatic music of Maria Callas singing Bizet’s operatic
masterpiece and to the Bolshoi’s “Carmen Ballet” by composer Radion
Shchedrin, it combines dramatically evocative music with powerful movement.

With so many dance companies competing for recognition, it is difficult to
find one that attracts and captures audience’s undivided attention.

Shvydkyy’s intriguing new art form, which combines powerful expressive
movement with theatre, has heated up stages in Europe and is ready to leave
its mark in North America.

His unique narrative expression and dramatic virtuosity, combined with
high-camp theatricality make his interpretations particularly visceral,
physical, sensual and multi-dimensional. Combined with audio and visual
technology, the audience is drawn into a new, intensely moving experience.

Shvydkyy, himself classically trained in Kiev, creates works of great
expressive force, seeking a universally comprehensible gesture-based form of
artistic communication through choreography and intense music

Shvydkyy, now a Canadian citizen, resides in the Toronto-Hamilton area,
after leaving his native Ukraine to broaden his scope and influence in the
world of dance choreography and performance both in Canada and in the
United States.

In recognition of his 9 years’ participation and unique position as an
international cultural icon in contemporary dance performance theatre, the
“Art Quick Dance Company,” which Shvydkyy founded in 2005, was invited
by the Minister of Culture of Egypt to participate in this year’s “Cairo
International Festival for Experimental Theatre” with his performance of
“Master Class Carmen.”

By audition and then invitation, this internationally claimed Festival
chooses and features artists from all over the world in order to provide an
expressive medium for experimental theatre and exchange of ideas between
different cultures and civilizations.

In addition to having this invitation extended to him for the past nine
years, Shvydkyy was awarded the honor of opening the Festival in 1998
with his extraordinary rendition of ‘Venus in Furs’.

His performance of ‘Isadora Duncan’ (1997) was staged on a specifically
constructed platform in front of the Sphinx and the Pyramids.

Shvydkyy’s most recent creation, Carmen, is unique in both its dance style
and its interpretation of the story. There are not one but three Carmens who
compete for the attention of the soldier and the matador and thereby create
a range of compelling and different interpretations of their unconventional

The mission of Shvydkyy’s unique dance style is to “create and then create
more for creativity is the secret fuel which endows people with the ability
to think and further understand themselves in relation to others”.

His innovative efforts evoked much talk and acclaim from audiences in Cairo
as his famous story of love and betrayal was seen in “a new light focusing
not only on the physical but also on the emotional level of characters”
(Ministry of Culture of Egypt).

After the Carmen performance, he was invited by representatives of the
Ministry of Culture to offer master classes and prepare a joint
international project.

Maestro Shvydkyy will be organizing this project later this year, combining
artists from Egypt, Ukraine and North America in a newly created and
choreographed performance.

After Egypt, Carmen was performed to standing room only audiences in Kiev,
Ukraine for four consecutive nights. Ambassadors from Canada, the United
States, Brazil and Spain were in attendance as well as other officials and
patrons of the arts who expressed interest in the newly created dance

Shvydkyy, who looks more like a bodyguard then a master of movement, has
opened a new artistic window for audiences. His powerful new art form relies
heavily on dramatic, innovative movements and particular attention to
expressive interpretation of music.

Shvydkyy is “tired of traditional performances” and completely opposed to
“slavish imitation and repetition”. He brings audiences to tears in his
death scene in ‘Carmen Dance on Blood’ and has them holding their breath by
strapping knives to the arms of his ‘Carmens’.

Shvydkyy uses classically trained professional ballerinas, trains them in
expressive movement and acting, and then choreographs a spectacular event.

In addition to performing on stage, Shvydkyy has also acted in films such as
‘Good by Cairo’ directed by I. Ciszkewisz, Kiev and ‘The Divine Woman’
directed by A. Sadia Shekoo, Cairo (2005).

His move to Canada in 1999 gave him an opportunity to perform with the
Canadian Ballet Youth Ensemble in ‘The Nutcracker’, teach at ‘Expressions
Creative Dance’ (Hamilton, Ontario), conduct workshops and from 1999 to
2005, coach a professional skating team – Skate Canada – in movement and
expressive acting.

In addition to Carmen, he plans to debut “Salome” in the near future before
North America audiences.

Sergiy Shvydkyy, was born in Kiev, Ukraine and received his B.A. in
Choreography and Arts at the O.E. Kornijchuk State University of Culture and
Choreography (Kiev).

He subsequently became a professor of choreography at the State University
and then worked as a dancer with the Virsky Dance Company in Kiev.
Shvydkyy began his professional career as a dancer but soon combined his
love of performing with his talents in choreography.

His twenty year career includes performing worldwide – Ukraine, Russia,
England, Scotland, Austria, Egypt, United States and Canada.

In addition to “Carmen”, he has choreographed and performed in “Isadora
Duncan,” “Venus in Furs,” “Jonathan Livingston Seagull,” “Oedipus Rex,”
“Salome” and “Othello.” He is now a Canadian citizen and making North
America home for his “Art Quick Dance Company.”

MZI Global Marketing is promoting Maestro Sergiy Shvydkyy as part of
their heritage and cultural marketing programs in affiliation with the
Slavic Heritage Coalition Slavic Heritage Coalition.                  -30-
Art Quick Dance Company, Larissa Van Duser; 646-489-1242
[return to index] [Action Ukraine Report (AUR) Monitoring Service]
                    To be held in Kyiv on Saturday, March 24, 2007

Chris Ford, Ukrainian Labour History Society, UK, Mon, Mar 12, 2007

The conference, “Ukrainian Labour History: From Everyday Life To
Social Struggle” to be held in Kyiv on Saturday, March 24, will cover
the study of history and contemporary state of working-class
communities, culture, nationality, family life, gender, sexuality,
migration, theory, politics and organization – that is labour history

of Ukraine.

For six decades two historical orthodoxies have dominated the history
of Ukraine:
[1] the official Soviet history which crystallized in the late 1920’s,

     on the one hand; and
[2] diaspora’s orthodoxy which made a significant impact on the
     orientation of contemporary Ukrainian history.

Both orthodoxies have their advantages as well as they share many
commonalities which create obstacles for the development of Ukrainian

Leading figures and movements in Ukrainian past were adopted by the Soviet
orthodoxy and misrepresented to the meet the interests of the regime, which
was afraid of any independent grassroots protest; whilst the National
orthodoxy would adopted the same figures and movements diminishing their
socialist ideas and emphasising only their advocacy of national ones.

These problems cannot be seen separately from the context of the historical
climate in which they existed. Symmetrical ideological systems existed in
the East and West, mutually antagonistic, elitist and conservative in their
attitude towards grassroots movements for social transformation.

Both ruled out the possibility of an alternative to the established facts of
“actually existing socialism” or western capitalism, their assumptions were
pervasive in intellectual life including history and social science.

Following the collapse of the Soviet Union many historians in Ukraine freely
rejected the straightjacket of the old regime only to adopt orthodoxy of the
neo-conservative historians in the West.

The conference “Ukrainian Labour History: From Everyday Life to Social
Struggle” aims to attract attention and to give an impetus to deeper studies
of issues that have been given no place of importance on the historical
agenda of Ukraine.

This debate is not simply of academic importance, it is also related to the
current malaise in which Ukraine finds itself. To rediscover the past of
Ukrainian labour is also to make use of that understanding to shape their

The conference includes but is not restricted to the following issues:
[1] The everyday life and culture of peasant and working-class
      communities in Ukraine;
[2] Working conditions and struggle for labour rights. Ukrainian
      trade-union and cooperatives movements;
[3] Peasant movements and rebellions: from Koliivshchyna to
[4] Transformation of social and class structure of Ukrainian
      society, from the end of the XIX to the beginning of the

      XX century;
[5] Radical intelligentsia and labour. Ukrainian contribution to
     revolutionary theories;
[6] History and activity of Ukrainian socialist movements and
     parties as well as of the branches of Russian and international
     socialist organisations in Ukraine;
[7] Waves of labour migration from Ukraine. Social struggle of
      Ukrainians in the diaspora.

The conference will be held in Kyiv on March 24, 2007. Please, send
your proposals till March 20 to or on
fax: +38 (044) 234-89-21. Organizing committee phone number: +38
(097) 396-44-99.                              -30-

Contact: Chris Ford:
[return to index] [Action Ukraine Report (AUR) Monitoring Service]
   If you are receiving more than one copy of the AUR please contact us.

    Please contact us if you no longer wish to receive the AUR.    
       You are welcome to send us names for the AUR distribution list.
   If you are missing some issues of the AUR please let us know.
         A Free, Not-For-Profit, Independent, Public Service Newsletter
                With major support from The Bleyzer Foundation
      Articles are Distributed For Information, Research, Education
                Academic, Discussion and Personal Purposes Only
                                  Additional readers are welcome.
If you would like to read the ACTION UKRAINE REPORT- AUR,
around four times a week, please send your name, country of residence,
and e-mail contact information to Information about
your occupation and your interest in Ukraine is also appreciated.
If you do not wish to read the ACTION UKRAINE REPORT please
contact us immediately by e-mail to  If you are
receiving more than one copy please let us know so this can be corrected
If you do not receive a copy of the AUR it is probably because of a
SPAM OR BULK MAIL BLOCKER maintained by your server or by
yourself on your computer. Spam and bulk mail blockers are set in very
arbitrary and impersonal ways and block out e-mails because of words
found in many news stories or the way the subject line is organized or
the header or who know what.
Spam blockers also sometimes reject the AUR for other arbitrary reasons
we have not been able to identify. If you do not receive some of the AUR
numbers please let us know and we will send you the missing issues. Please
make sure the spam blocker used by your server and also the one on your
personal computer, if you use a spam blocker, is set properly to receive
the Action Ukraine Report (AUR).
                      YAHOO.COM & HOTMAIL.COM
Sometimes and do not deliver the AUR for
unknown reasons.  It is better to not use these two e-mail servers if you
have a alternative. 

                          PUBLISHER AND EDITOR – AUR
Mr. E. Morgan Williams, Director, Government Affairs
Washington Office, SigmaBleyzer, The Bleyzer Foundation

Emerging Markets Private Equity Investment Group
President, U.S.-Ukraine Business Council
P.O. Box 2607, Washington, D.C. 20013, Tel: 202 437 4707;
       Power Corrupts and Absolute Power Corrupts Absolutely.
return to index [Action Ukraine Report (AUR) Monitoring Service]

Leave a comment

Filed under Uncategorized

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s