AUR#846 May 23 Grain Market Reform; Wheat Quotas Cancelled; Business Council Expands; Media Policies; How Democracy Fails; Zbigniew Brzeninski Interview


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ACTION UKRAINE REPORT – AUR
An International Newsletter, The Latest, Up-To-Date
In-Depth Ukrainian News, Analysis and Commentary

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


UKRAINE’S ASPIRATIONS AND
GEOPOLITICAL ROLE
“So, the center of gravity of Ukraine’s orientation is going to change
and it’s continuing to change. And that is not anti-Russian; it’s simply
part of the new evolving global economic realities. And these people
who are businessmen, who are competitive, know that in the long run
a competitive and rapidly growing Ukraine has to be part, in some
fashion, of this larger global economy which is West-centered.”
Interview with Zbigniew Brzeninski by Myroslava Honhadze
Voice of America (VOA), Wash, DC, Tue, May 22, 2007

(Article Seventeen)

ACTION UKRAINE REPORT – AUR – Number 846
Mr. E. Morgan Williams, Publisher and Editor, SigmaBleyzer
WASHINGTON, D.C., WEDNESDAY, MAY 23, 2007

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

1. PROGRAM OF UKRAINIAN GRAIN MARKET REFORM
By Leonid Kozachenko, President
Ukrainian Agrarian Confederation (UAC), Kyiv
Published by the Action Ukraine Report (AUR) #846, Article 1
Washington, D.C., Wednesday, May 23, 2007

2. UAC SAYS CANCELLATION OF WHEAT & RYE EXPORT QUOTAS
WILL HELP SOLVE AGRICULTURAL FINANCING PROBLEMS
Ukrainian News Agency, Kyiv, Ukraine, Wednesday, May 16, 2007

3. BIO-FUEL PRODUCTION & CONSUMPTION SHOULD BE PRIORITY
FOR UKRAINIAN ECONOMY FOR NEXT 10 YEARS
Speaker Moroz wants a controlled and regulated state system set up
Interfax – Ukraine Business, Kyiv, Ukraine, Thursday, May 3, 2007

4. PRESIDENT YUSHCHENKO OUTLINES KEY INVESTMENT TRENDS
Interfax Ukraine, Kyiv, Ukraine, Monday, May 21, 2007

5. UKRAINE’S FERREXPO TO UNVEIL LONDON LISTING PLAN
Fourth largest reserves and resources of iron ore in the world
By Rebecca Bream, Financial Times, London, UK, Tuesday, May 22 2007

6. BUNGE INTEGRATES BRANCHES IN UKRAINE AND RUSSIA
INTO EASTERN EUROPEAN SUBDIVISION
Ukrainian News Agency, Kyiv, Ukraine, Thursday, May 17, 2007

7. PENNSYLVANIA BASED WESTINGHOUSE TO AID
UKRAINE ENERGY FREEDOM
By Bonnie Pfister, Pittsburgh Tribune-Review
Pittsburgh, Pennsylvania, Monday, May 21, 2007

8. U.S.-UKRAINE BUSINESS COUNCIL (USUBC) EXPANDS
MEMBERSHIP, STAFF AND PROGRAM
U.S.-Ukraine Business Council (USUBC)
Washington, D.C., Wednesday, May 16, 2007

9. NEW WARSAW STOCK EXCHANGE IPO PARTNER FROM UKRAINE
The Exchange Forum, London, UK. Tuesday, May 22, 2007

10. GREECE’S BANK OF PIRAEUS AGREES TO BUY 78%
OF UKRAINE’S INTERNATIONAL COMMERCE BANK (ICB)
AFX UK Focus, Athens, Greece, Friday, May 18, 2007

11. LOWER INFLATION PROMPTS UKRAINE KEY DISCOUNT RATE CUT
REUTERS, Kiev, Ukraine, Friday, May 18, 2007

12. UKRAINE SEEKS CONVERTIBLE HRYVNIA CURRENCY
REUTERS, Kazan, Russia, Sunday, May 20, 2007

13. ONE OF RUSSIAN BIGGEST PRODUCERS OF CHILDREN’S
NUTRITION ENTERING UKRAINIAN MARKET
Ukrinform, Kyiv, Ukraine, Saturday, May 19, 2007

14. THE ENERGY SECURITY STRATEGIES OF RUSSIA
AND ITS NEIGHBOURS (Three articles from Ukraine)
“Russian Foreign Energy Policy: An Analytical Compendium”
Research and Markers, Business Wire, Wednesday, May 2, 2007

15. UKRAINE: MEDIA POLICIES REVEAL DIVERGENT VALUES
COMMENTARY: By Marta Dyczok
Radio Free Europe/Radio Liberty (RFE/RL)
Belarus, Ukraine, and Moldova Report, Vol 9, No. 1
Prague, Czech Republic, Friday, May 18, 2007

16. HOW DEMOCRACY FAILS – UKRAINE IS THE CASE IN POINT
COMMENTARY: By Bruce P. Jackson
Weekly Standard, Washington, D.C., Friday, May 18, 2007

17. UKRAINE’S ASPIRATIONS AND GEOPOLITICAL ROLE
INTERVIEW: With Zbigniew Brzeninski
Interview By: Myroslava Honhadze (Gongadze)
Voice of America (VOA), Washington, DC, Tuesday, May 22, 2007


18. U.N. DEEPLY CONCERNED OVER ILL-TREATMENT IN UKRAINIAN
PRISONS FOR PRE-TRIAL SUSPECTS
REUTERS, Geneva, Switzerland, Mon May 21, 2007

19. VISA STANDING
EU states demeaning Ukrainians during visa application process
REPORT: By Dariya Ryabkova
Invest-Gazeta weekly, Kiev, in Russian 14 May 07; p 19-23
BBC Monitoring Service, United Kingdom, Thursday, May 17, 2007

20. WITH REGARD TO MR MATVEYEV’S “BAD WWII MEMORIES”
LETTER-TO-THE-EDITOR: By Halya Coynash
Kharkiv Human Rights Protection Group (HRPG)
Action Ukraine Report (AUR) #846, Article 20
Washington, D.C., Wednesday, May 23, 2007

21. UKRAINE: PRES YUSHCHENKO SETS 3RD SUNDAY OF EACH YEAR
AS REMEMBRANCE DAY FOR VICTIMS OF POLITICAL REPRESSION
Presidential Decree honours the Victims of the Great Terror of 1937-1938
Office of the President, Kyiv, Ukraine, Monday, May 21, 2007 (in Ukrainian)
Translated by Kharkiv Human Rights Protection Group (unofficial translation)
Published by the Action Ukraine Report (AUR) #846, Article 21
Washington, D.C., Wednesday, May 23, 2007

22. INTO THE BORDERLAND-IMAGES & STORIES FROM UKRAINE
Exhibition at the Museum of Cultures, Helsinki, Finland, Thu, May 17, 2007

23. UKRAINE: THE TUNNEL CHILDREN
Samantha Booth, The Daily Record, Scotland, Saturday, May 12, 2007
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1
. PROGRAM OF UKRAINIAN GRAIN MARKET REFORM

By Leonid Kozachenko, President
Ukrainian Agrarian Confederation (UAC), Kyiv
Published by the Action Ukraine Report (AUR) #846, Article 1
Washington, D.C., Wednesday, May 23, 2007

OUTLINE OF PROGRAM OF UKRAINIAN GRAIN MARKET REFORM

A. THE UKRAINIAN GRAIN MARKET REFORM TARGET —–
[1] Providing national food safety
[2] The absence of grain market chain entities discrimination
[3] Reliable and transparent grain price information, future price
and good delivery guarantee
[4] The change of the Ukrainian grain image from unstable and
risky to promising provided by modern risk control and management
[5] Sustainable development of the grain production by the significant
investment acceleration and market infrastructure development
[6] Adjustment of disputes between grain market players
independently from corrupted state court administrative system
B. GRAIN MARKET SUBJECTS THAT NEED LEGISLATIVE
AND ORGANIZATIONAL CHANGES —–
[1] The State Reserve
[2] The Agrarian Fund
[3] The Future Commodity Exchange
[4] The quality checking system and state grain balance control
C. STATE RESERVE REFORM —–
[1] 250,000 tons grain stock limit
[2] Prohibition to produce flour and other products made from grain
[3] Prohibition of any commercial grain activity except grain storage
[4] Grain stock refreshment is to be made transparently on a
competitive basis at any of the commodity exchanges
[5] The extra storage and processing grain equipment is to be
replaced from the submission of the State Reserve
[6] Expansion of grain storage and its renewal is to be covered
by state budget
D. AGRARIAN FUND REFORM —–
[1] Specifying of agricultural commodity list and terms of its delivery
as well as the State budgeting of its operations
[2] The sales of Agricultural Fund commodities is a mandatory of the
State Commodity Market Regulation Commission decision which is
to be done transparently at the commodity exchange market
[3] The State commodity market regulation commission has an
exclusive right to give suggestions to the Cabinet of Ministers of
Ukraine on a quota and licensing of operations with a grain if it
is necessary as well as to set the term of wellideties of these
measures.
[4] The State commodity market regulation commission is not
subordinated to The Ministry of Agrarian Policy and consists of
governmental officials and representatives of agrarian market
players equally.
E. FUTURES GRAIN MARKET & COMMODITY
DERIVATIVES —
[1] Warehouse receipt issuing system revision and transferring it to
the mandatory of The State commodity market regulation commission
[2] Revision of the rules and regulations of the licensing of the grain
warehouses
[3] Foundation of the insurance fund for providing warehouse receipts
liquidity
[4] Completion of harmonization of grain standards
R. PROGRAM IMPLEMENTATION SEQUENCE —–
[1] Creating of the governmental committee for the Ukrainian grain
market reformation
[2] Development of the specific program and action plans for its
implementation
[3] Discussion of both the program and the action plan in public
meetings and submitting it to the Cabinet of Ministers of Ukraine
committee for agrarian sector reformation for its approval
[4] Approval of the program by the Cabinet of Ministers of Ukraine
[5] Adoption of the legal and subordinate acts necessary for program
implementation [by the end of 2007]
[6] Completion of the program [till the end of 2008]
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2. UAC SAYS CANCELLATION OF WHEAT & RYE EXPORT QUOTAS
WILL HELP SOLVE AGRICULTURAL FINANCING PROBLEMS

Ukrainian News Agency, Kyiv, Ukraine, Wednesday, May 16, 2007

KYIV – The Ukrainian Agrarian Confederation (UAC) forecasts that the
cancellation of wheat and rye export quotas will produce positive effect on
problems with financing of the harvesting campaign in 2007. Ukrainian News
learned this from UAC’s press service.

‘Those opportunities given to farming enterprises for additional sale of
wheat and rye will help essentially improve preparations for the responsible
period – harvesting,’ UAC president Leonid Kozachenko
.

At the same time, according to Oleksii Vadaturskyi, the director general of
Nibulon Company, the decision is positive, though a bit belated.

He said that grain traders incurred additional losses from long storage of
grain, and today elevators have no possibility to prepare for receiving
grain on time.

‘They will be dispatching grain for exports, and people won’t have time to
prepare elevators’ material and technical base,’ Vadaturskyi said. As he
said, there might be problems with grain exports, since ‘the world market
got used to working without Ukraine.’

In turn, president of the Association of Farmers and Private Land Owners
Yaroslav Kardash believes that the Cabinet’s decision to cancel wheat and
rye export quotas is not belated.

‘At present, when farmers can estimate their possible harvests, they can
decide how and where it’s more profitable to sell products,’ he said.

As Ukrainian News earlier reported, on May 16, the Cabinet of Ministers
abolished wheat and rye export quotas.

Earlier, Agricultural Policy Minister Yurii Melnyk predicted that the
Cabinet of Ministers would cancel its resolution introducing wheat export
quotas before May 28.

In April, business associations in the agro-industrial sector requested the
Cabinet of Ministers to lift wheat export quotas.

On December 8, 2006, the Cabinet of Ministers set a quota of 1.106 million
tons on wheat exports for the 2006/2007 marketing year (from July 2006 to
June 2007). -30-
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3. BIO-FUEL PRODUCTION & CONSUMPTION SHOULD BE PRIORITY
FOR UKRAINIAN ECONOMY FOR NEXT 10 YEARS
Speaker Moroz wants a controlled and regulated state system set up

Interfax – Ukraine Business, Kyiv, Ukraine, Thursday, May 3, 2007

KYIV – Participants in a conference on bio-fuel production and consumption
have said that bio-fuel production should become an important state priority
in the Ukrainian economy for the next 10 years, the parliamentary press
service reported on Tuesday. The press service said that this is stipulated in
a conference resolution.

Moreover,the participants of the conference proposed that MPs bring into
law a number of proposals on the development of the production of
non-traditional sources of energy.

In turn, Speaker Oleksandr Moroz during the conference said that the
successful realization of a program on bio-fuel production in Ukraine could
be implemented if a controlled and regulated state system is set up.

“The state needs a regulated state-directed system. Then,we’ll see the
result,the needed effect,which we’re trying to achieve in realizing the
program,and not just the attempts of some enthusiasts. It should be large
state business,” the speaker said.

Moroz also said that the successful realization of the program on bio-fuel
production could impact the situation not only in the agriculture and energy
sectors,but also in the economy as a whole. He said that the draft law is
being drawn up for the second reading.

Participants in the conference asked the cabinet to take into account the
role of non-traditional sources of energy, in particular,bio-fuel,when
drawing up the Ukrainian energy strategy until 2030.

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4. PRESIDENT YUSHCHENKO OUTLINES KEY INVESTMENT TRENDS

Interfax Ukraine, Kyiv, Ukraine, Monday, May 21, 2007

KYIV – Ukrainian President Viktor Yuschenko has outlined the key trends in
attracting national and foreign investors to Ukraine’s economy.

“In my opinion, we are building a new and successful dialogue with
investors,” he said at an investment forum of Kyiv region, the presidential
press service has reported.

Yuschenko said privatization, agriculture and infrastructure development
projects were particularly attractive to foreign investment.

Most of Ukraine’s regions have unique business opportunities, he said, but
“these capabilities are used inefficiently because of the lack of dialogue
among business partners.”

“We do not know much about one another. We need [to give] additional
information about Ukraine’s potential capabilities,” he said.

The president said his government was going to stage legal and transparent
privatization of the country’s most attractive companies, among them
Ukrtelecom, the Odesa Portside Plant as well as a few engineering plants and
energy companies.

Speaking about infrastructure development, Yuschenko said he would discuss
ways to implement a number of large-scale transportation projects, such as
building railroad and ferry routes, during a GUAM summit in Baku next month.

He said that the Odesa-Brody-Plock-Gdansk oil pipeline project was a project
that involved a new level of cooperation, both continental and regional. Any
sector of the Ukrainian economy could be profitable and attractive to
investment, he added.

“The state must give businesspeople all of the administrative and legal
tools to help them feel atop the organization of market relations,” he said,
promising that Ukraine’s new parliament would adopt anti-corruption and tax
bills.

Yuschenko also spoke about the country’s economic achievements, stressing
the need to build closer ties with its neighbors, particularly the European
Union.

As the State Statistics Committee reported on May 17, the growth in direct
foreign investment in Ukraine in the January-March period amounted to
$847.1 million, which is 8.2% less than in the same period of 2006.

Direct foreign investment in the first quarter amounted to $1.33 billion,
whereas $535.7 million were withdrawn from Ukraine.

As of April 1, 2007, direct foreign investment grew to $22.434 billion or
$481.3 per capita. Direct foreign investment grew by 3.9% in the first
quarter.

The capital of non-residents from the Netherlands in the first three months
grew most – by $159.6 million. Capital invested by Austria grew by $148.9
million, by the United Kingdom by $127.1 million, Cyprus by $99.4 million,
the British Virgin Islands by $80.9 million, Russia by $78.6 million,
Germany by $56.1 million, Sweden by $52.2 million, and France by $42.4
million.

The largest growth of foreign investment was registered in the financial
sector – by $286.2 million. Direct foreign investment in construction grew
by $131.3 million, real estate, leasing and engineering – by $109.2 million,
industry – by $370 million, including a rise of $129.8 million in the mining
industry and $239.9 million in the processing industry. -30-
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5. UKRAINE’S FERREXPO TO UNVEIL LONDON LISTING PLAN
Fourth largest reserves and resources of iron ore in the world

By Rebecca Bream, Financial Times, London, UK, Tuesday, May 22 2007

LONDON – Ukrainian iron ore producer Ferrexpo will today announce that it is
planning to list in London, the latest company from the former Soviet Union
looking to raise funds from UK investors.

The company is controlled by 32-year old Ukrainian billionaire businessman
and politician Kostyantin Zhevago, who also owns interests in steel,
banking, and oil and gas.

Ferrexpo is run by Mike Oppenheimer, chief executive, former head of BHP
Billiton’s thermal coal division, who joined the group in August 2005.

The group’s main assets are the Poltava iron ore mine in central Ukraine and
a plant that turns the ore into concentrated pellets.

The mine was built in the 1960s and was one of the main suppliers of raw
materials to the Soviet steel industry, but a lack of investment in the
1990s following Ukraine’s independence led to a steep fall in iron ore
production.

Ferrexpo says it produced 8.6m tonnes of iron ore pellets last year, up from
7.8m tonnes in 2005. It plans to expand its output to 16m tonnes of pellets
by 2014 through the opening of a new mine close to the existing operations
in Poltava.

According to a person close to the deal, Ferrexpo has the fourth largest
reserves and resources of iron ore in the world, after market leaders CVRD
of Brazil, Rio Tinto and BHP Billiton.

Most of Ferrexpo’s iron ore output is sold to steelmakers in central and
eastern Europe, such as Voestalpine of Austria, and also, increasingly, to
Chinese steel groups.

About 70 per cent of the international trade in iron ore is controlled by
CVRD, Rio Tinto and BHP Billiton, and Chinese steelmakers are keen to find
alternative sources of ore to dilute these companies’ pricing power.

Ferrexpo is expected to have a market capitalisation of about $2bn (£1bn)
after its London listing, and is looking to raise about $500m through the
sale of new and existing shares.

The proceeds will be used to pay down debt and fund the building of the new
mine, according to people close to the company.

Mr Zhevago’s stake of 100 per cent is likely to fall to about 75 per cent,
and it is expected that the company will enter the FTSE 250 index as the
only Ukrainian company on the mainboard of the London Stock Exchange and
the only pure iron ore play in the market. Ferrexpo’s listing is being
co-ordinated by JPMorgan Cazenove.
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LINK: http://www.ft.com/cms/s/c072ba08-0801-11dc-9541-000b5df10621.html

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6. BUNGE INTEGRATES BRANCHES IN UKRAINE AND RUSSIA
INTO EASTERN EUROPEAN SUBDIVISION

Ukrainian News Agency, Kyiv, Ukraine, Thursday, May 17, 2007

KYIV – Bunge, an agrarian and food corporation, has integrated its branches
in Ukraine and Russia into an Eastern European subdivision with single
management. Ukrainian News learned this from the company’s press service.

The company noted that Dmytro Horshunov, who earlier worked as director of
Bunge Ukraine’s agro-business department, has been appointed head of the new
branch’s agro-business department (for Ukraine and Russia) and managing
director of Bunge Ukraine, and Dekster Fray [Dexter Frye], who earlier held
the post of managing director at Bunge Ukraine, has been appointed as vice
president of Bunge for Eastern Europe.

Dmitry Tsivilev, who worked as director for foodstuffs at Bunge Russia, now
will manage the same direction in Russia and Ukraine, simultaneously holding
the post of managing director of the company’s Russian subdivision.

‘Ukraine has great potential from the viewpoint of export supplies, and
Russia has a larger capacity of its domestic foodstuff market. Tense
integration of our company’s subdivisions in these countries will help us
boost effectiveness of our work, Dekster Fray said.

As Ukrainian News earlier reported, in late 2002, the Bunge corporation
acquired the Cereol group, which included the Dnipropetrovsk oil extracting
plant (one of the three largest producers of vegetable oil in Ukraine). The
Dnipropetrovsk oil extracting plant sells its products under the Oleina
trademark.

Bunge is also one of Ukraine’s leading exporters of grain. At present, Bunge
controls five grain elevators in Zaporizhia, Odesa, Dnipropetrovsk,
Kirovohrad regions and Crimea.

The company is also building a new oil extracting plant in Illichivsk for
processing sunflower, soy and rape seeds. -30-
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NOTE: Bunge is a member of the U.S.-Ukraine Business Council
(USUBC) in Washington, D.C.
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7. PENNSYLVANIA BASED WESTINGHOUSE TO AID
UKRAINE ENERGY FREEDOM

By Bonnie Pfister, Pittsburgh Tribune-Review
Pittsburgh, Pennsylvania, Monday, May 21, 2007

PITTSBURGH – Westinghouse Electric Co. is expanding its nuclear fuel
production business in Ukraine as part of a U.S. program to chip away at
Russian energy dominance in former Soviet states.

The U.S. Department of Energy will pay Westinghouse $14 million to
manufacture 42 fuel assemblies for South Ukraine 3, a nuclear reactor near
the Black Sea.

The Monroeville-based [Pennsylvania] firm will build the assemblies at its
Swedish fuel plant and deliver them to Ukraine’s government-owned utility
company, Energoatom, in summer 2009.

The contract is part of the Energy Department’s International Nuclear Safety
Program, which has given $750 million since 1992 to American engineering
contractors to improve safety at Soviet-built power plants, a department
spokeswoman said.

Most of the work is geared toward retooling safety features at reactors —
such as a 1996 contract Westinghouse won to install advanced safety
equipment at the nation’s reactors, including Chernobyl.

A 1986 explosion and 10-day fire there killed as many as 50 people and
exposed 4,000 others to radiation, according to the International Atomic
Energy Agency. Undamaged Chernobyl reactors continued operating until
1999.

Westinghouse’s new deal is the only contract in that program focused on
fuel diversification. Mike Kirst, director of central and eastern Europe for
Westinghouse’s nuclear fuel business, said that’s an important development
given Ukraine’s continued dependence on Russia for energy.

In January 2006, for example, Moscow turned off natural gas pipelines across
the border for several days, capping a months-long pricing dispute. Russia
provides all the fuel for Ukraine’s 15 nuclear reactors.

“The nuclear sector accounts for 50 percent of their power needs, far
greater than natural gas,” Kirst said in a telephone interview from Europe
last week.

“So the reverberations for their economy — if they do not have a
competitive second source of energy — could be much more dramatic. The
U.S. government and Ukrainian government have recognized that, which is
why we’re in this process.”

The deal builds upon a pilot program begun in 2000, when Westinghouse won
a $5 million Department of Energy contract to provide six fuel assemblies to
the South Ukraine plant.

A nuclear core is powered by three bundles of 42 fuel assemblies each, and
Westinghouse’s job was to design six assemblies that could sit alongside the
36 Russian-made assemblies. Designing and licensing took five years.

“For us it was a real technical challenge,” Kirst said. “Ukraine had never
licensed a non-Russian nuclear fuel before.”

The pilot fuel assemblies have functioned effectively for two years, and the
42-assembly contract could help Westinghouse prove itself to Kiev and, Kirst
hopes, open the door for more deals when Russian fuel contracts expire in
2011.

Westinghouse has not achieved complete success in the former Soviet bloc.
Last year the firm lost out to its Russian rival in a bid to continue to
provide fuel to Cez, the state-controlled utility of the Czech Republic.

Kirst confirmed news reports from Prague that Cez might end an existing
contract with Westinghouse early, replacing Westinghouse’s fuel assemblies
with those from Russia.

That’s after deviations in Westinghouse’s fuel assemblies caused outages at
Cez’s Temelin nuclear plant, leading to more than $36 million in unexpected
costs for the utility.

Kirst said Westinghouse replaced the flawed assemblies, and that the safety
of the plant was never in question. But with government-run companies still
controlling production, Russia can try to outflank its rivals on price.

“In this region, price is going to be our toughest test,” he said. “The
Russians are very aggressive in wanting to keep their market share and they
have a lot more potential for price flexibility than we do.”
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Bonnie Pfister can be reached at bpfister@tribweb.com or 412-320-7886.
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http://www.pittsburghlive.com/x/pittsburghtrib/search/s_508647.html

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NOTE: Westinghouse if one of the founding members of the U.S.-
Ukraine Business Council (USUBC) in Washington, D.C.

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8. U.S.-UKRAINE BUSINESS COUNCIL (USUBC) EXPANDS
MEMBERSHIP, STAFF AND PROGRAM

U.S.-Ukraine Business Council (USUBC)
Washington, D.C., Wednesday, May 16, 2007

WASHINGTON – The Executive Committee of the U.S.-Ukraine Business
Council (USUBC) has approved a program to expand the membership
and services of the Council during 2007.

The following steps have been taken so far this year to begin the movement
of the Council to a full-time, fully-functioning, adequately funded,
business association, providing a full range of services to its members,
according to Morgan Williams, SigmaBleyzer, who serves as President of
the USUBC.

1. OFFICE SPACE — The U.S.-Ukraine Business Council
(USUBC) has rented an office in downtown Washington, D.C. The
office is located within a suite of offices managed by the U.S.-Ukraine
Foundation (USUF). The U.S.-Baltic Foundation also rents an office
within the USUF suite. The new office is located at:

U.S.-Ukraine Business Council (USUBC)
1701 K. Street, N.W., Suite 903
Washington, D.C. 20006
Tel: 202 429 0551; Fax: 202 223 1224

2. PROGRAM COORDINATOR — Ulyana Panchishin has
been named Program Coordinator for the U.S.-Ukraine Business Council
(USUBC). Ulyana is originally from Ukraine and has been in the U.S. now
for eleven years. She is fluent in Ukrainian, Russian, English, Spanish,
and has a comprehensive understanding of Polish.

Ulyana is working part-time for USUBC under an agreement
USUBC has with the USUF to provide USUBC with a package of space
and administrative services.

Ms. Panchishin has been working on the U.S.-Ukraine
Foundation’s Community Partnerships Project funded by the U.S. Agency
for International Development (USAID) since 1999 as Program Assistant
and Program Manager. She will continue to work for USUF part-time.

She has coordinated activities of the 18 partner cities in the
U.S. and Ukraine which included numerous delegations of mayors, local
government officials, entrepreneurs and representatives of media and
NGOs; provided support in organizing training for over 230 Ukrainian
local government officials and 320 U.S. experts in various issues of local
government; and contributed to the project publication “Partners”.

Before joining the Foundation, Ms. Panchishin worked at the
Pittsburgh Council for International Visitors for the State Department-
funded Community Connections project which provided training for local
government officials, journalists, judges and legal professionals from
Donetsk. She also has experience of working in private sector as an office
manager and accountant assistant.

Ms. Panchishin holds a BA in English and Spanish Linguistics
from Kyiv State Linguistic University, Kyiv, Ukraine and Master of Public
and International Affairs from the Graduate School of Public and
International Affairs and Certificate in Eastern European Studies at
University of Pittsburgh, PA. She can be contacted at:

Ulyana Panchishin, Program Coordinator
U.S.-Ukraine Business Council (USUBC)
1701 K. Street, N.W., Suite 903
Washington, D.C. 20006
Tel: 202 429 0551
Fax: 202 223 1224
E-mail: upanchishin@usubc.org

3. MEMBERSHIP DEVELOPMENT — Fourteen companies
have been added to the USUBC membership since last December. The
membership now stands at thirty-six. This is the largest membership the
USUBC has had since its founding in 1995. The goal is to have fifty
members by the end of 2007. The new members are:

(1) American Continental Group, LLC
(2) Atlantic Group (media companies)
(3) Bunge North America
(4) Cardinal Resources
(5) The Coca-Cola Company
(6) The Eurasia Foundation
(7) Holtec International
(8) Kennan Institute, of the Woodrow Wilson
International Center for Scholars (WWICS)
(9) Kyiv-Atlantic Group of Companies
(10) Northrop Grumman
(11) Open World Leadership Center at the
Library of Congress
(12) TD International, LLC
(13) U.S. Civilian Research Development Foundation (CRDF)
(14) Vanco Energy Company
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EXECUTIVE COMMITTEE
OF THE BOARD OF DIRECTORS (USUBC) – 2007

Shannon Herzfeld, ADM
Michael Kirst, Westinghouse
Paul Nathanson, The PBN Company
Irina Paliashvilli, Ukrainian Legal Group
John Rauber, Deere & Co.
John Stephens, EMAlternatives, Secretary-Treasurer
Patrick Sweet, SASI
Morgan Williams, SigmaBleyzer, President
Van Yeutter, Cargill
Jack Heller, Heller & Rosenblatt, Legal Counsel
——————————————————————————————-
SENIOR ADVISORS TO THE COUNCIL

1. Anders Aslund, Senior Fellow
Peterson Institute for International Economics, Washington

2. Andy Bihun, Global Trade Development/
The Washington Group, Washington

3. Ariel Cohen, Ph.D, Senior Research Fellow,
Allison Center for International Studies, Davis Institute
for International Studies, The Heritage Foundation, Washington

4. Steven Pifer, Senior Advisor, Russia & Eurasia Program,
CSIS, former U.S. Ambassador to Ukraine, Washington
————————————————————————————————
MEMBERS-U.S.-UKRAINE BUSINESS COUNCIL-MAY, 2007

(1) AES Corporation
(2) ALICO/AIG
(3) American Continental Group, LLC
(4) Atlantic Group (media companies)
(5) Archer Daniels Midland Company (ADM)
(6) The Boeing Company
(7) Bunge North America
(8) Cardinal Resources
(9) Cargill
(10) Case New Holland
(11) Chadbourne & Parke LLP
(12) The Coca-Cola Company
(13) Deere & Company
(14) ECdata, Inc.
(15) EMAlternatives, LLC
(16) ESSI/TAMSCO
(17) The Eurasia Foundation
(18) Heller & Rosenblatt
(19) Horizon Capital Advisors,
LLC-Emerging Europe Growth Fund
(20) Kennan Institute, of the Woodrow Wilson
International Center for Scholars (WWICS)
(21) Kraft Food Ukraina
(22) Kyiv-Atlantic Group of Companies
(23) The PBN Company
(24) Northrop Grumman
(25) Open World Leadership Center at the
Library of Congress
(26) Procter & Gamble
(27) Russian-Ukrainian Legal Group (RULG)
(28) Salans, international law firm
(29) SASI
(30) SigmaBleyzer Private Equity Investment Group
(31) Siguler Guff & Co, LLC
(32) TD International, LLC
(33) U.S. Civilian Research Development Foundation (CRDF)
(34) Vanco Energy Company
(35) Westinghouse Electric Company
(36) WJ Export-Import Ag Group
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9. NEW WARSAW STOCK EXCHANGE IPO PARTNER FROM UKRAINE

The Exchange Forum, London, UK. Tuesday, May 22, 2007

Kiev-based Concorde Capital LLC has signed a co-operation agreement with the
Warsaw Stock Exchange under the WSE IPO Partner Programme aimed to attract
foreign companies to the Warsaw exchange. Concorde Capital is the 8th WSE
IPO Partner.

Concorde Capital LLC is a leading integrated financial services provider in
Ukraine, including M&A advice and service, IPO assistance, and brokerage
consulting. The company has a large analytical department which publishes
numerous reports on the Ukrainian capital market.

Concorde Capital is a leading (in terms of trading volume) PFTS Exchange
Member. For more information on Concorde Capital, please visit
www.concorde.com.ua

The WSE IPO Partner Programme, launched in the autumn of 2006, is designed
to ensure the support of WSE Partners – foreign brokerage houses – for WSE
promotion on foreign markets. The agreements with brokerage and investment
service companies are designed to attract, in a direct and indirect manner,
companies established outside of Poland.

Under the agreement, WSE Partners receive a special logo which they may use
in approaching prospective issuers as well as the possibility to include
information on their WSE-authorised partner status in their correspondence
and documents. The IPO Partners benefit, furthermore, from WSE assistance,
publications and through active participation in various promotional events.

The current list of WSE IPO Partners include: E-Volution Capital, Altera
Finance, Sokrat Capital, and Millennium Capital of Ukraine, Suprema
Securities and Hansabank of Estonia (operating in the Baltic states and
Russia), as well as Wood & Company of the Czech Republic.
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http://www.exchange-handbook.co.uk/index.cfm?section=news&action=detail&id=67123
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[return to index] [Action Ukraine Report (AUR) Monitoring Service]
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10. GREECE’S BANK OF PIRAEUS AGREES TO BUY 78%
OF UKRAINE’S INTERNATIONAL COMMERCE BANK (ICB)

AFX UK Focus, Athens, Greece, Friday, May 18, 2007

ATHENS (Thomson Financial) – Greece’s Bank of Piraeus said it has
reached an agreement to acquire 78 pct of Ukraine’s International Commerce
Bank (ICB), without specifying any financial details.

Bank of Piraeus said that ICB was established in 1994, has 850 employees
and 134 branches and points of sale, in 38 cities servicing 25,000 customers.

The Ukrainian economy is experiencing dynamic growth with a 7.1 GDP
growth rate last year which is contributing to the rapid development of the
local banking sector, the bank said.

Piraeus added that the acquisition expands the group’s international
presence which now includes eight countries Romania, Bulgaria, Albania,
Serbia, Egypt, the UK, US and Ukraine. The transaction is subject to
regulatory approval in Greece and Ukraine. -30-
————————————————————————————————-
Source: www.Euro2day.gr NewsWire, nick.skrekas@thomson.com ns/cml
http://www.iii.co.uk/news/?type=afxnews&articleid=6109323&subject=companies&action=article
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11. LOWER INFLATION PROMPTS UKRAINE KEY DISCOUNT RATE CUT

REUTERS, Kiev, Ukraine, Friday, May 18, 2007

KIEV – Ukraine’s central bank said on Friday it would cut its key discount
rate to 8.5 percent from 9.0 percent as of June 1 because of an improved
inflation outlook.

The bank’s first deputy chairman, Anatoly Shapovalov, said the decision was
prompted by figures showing inflation in the first four months of the year
had slowed to 1.3 percent from 2.3 percent in the same period last year.

“Given that inflation is half the forecast rate over the first four months
of the year, annual inflation could end up within six percent,” Shapovalov
told Reuters.

“The central bank has therefore decided to reduce its discount rate … with
the aim of strengthening the role of interest rates in directing resources
towards issuing credits in the real economy.”

The discount rate serves as a base indicator for a series of other
indicators in Ukraine. The previous rate has been in effect since
June 10, 2006. -30-
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[return to index] [Action Ukraine Report (AUR) Monitoring Service]
========================================================
If you are receiving more than one copy of the AUR please contact us.
========================================================
12. UKRAINE SEEKS CONVERTIBLE HRYVNIA CURRENCY

REUTERS, Kazan, Russia, Sunday, May 20, 2007

KAZAN, Russia – Ukraine will achieve full convertibility of its hryvnia
currency within a year and a half and investors should prepare for the
currency to become more freely floating, a senior central banker said on
Sunday.

“In one to one-and-a-half years the Ukrainian hryvnia will be a fully
convertible currency — like the Russian rouble and the Kazakh tenge,” said
Oleksandr Savchenko, deputy chairman of the National Bank of Ukraine.

Speaking at the European Bank for Reconstruction and Development’s annual
meeting, Savchenko said it was important to secure government backing for
the move.

He also noted that legislation to create partial convertibility was being
held up by Ukraine’s political crisis, with uncertainty over when the
country will hold a general election. -30-
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[return to index] [Action Ukraine Report (AUR) Monitoring Service]
========================================================
Send in a letter-to-the-editor today. Let us hear from you.
========================================================
13. ONE OF RUSSIAN BIGGEST PRODUCERS OF CHILDREN’S
NUTRITION ENTERING UKRAINIAN MARKET

Ukrinform, Kyiv, Ukraine, Saturday, May 19, 2007

KYIV – One of Russia’s biggest producers of children’s nutrition, the
company Nutritek is entering Ukraine’s market. It has already been
announced about starting supplies of the main brand and by mid 2008
the nutrition will be produced in Ukraine, the MIT Distribution Company
reported.

The company was established in 1990, produces juvenile nutrition at 12
enterprises in Russia and at one in Estonia.

In early 2006 the company Nutritek purchased over 56% of the Khorolsky
factory of children’s nutrition in Poltava region by 9 million USD. -30-
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[return to index] [Action Ukraine Report (AUR) Monitoring Service]
========================================================
14. THE ENERGY SECURITY STRATEGIES OF RUSSIA
AND ITS NEIGHBOURS
Three articles from Ukraine

“Russian Foreign Energy Policy: An Analytical Compendium”
Research and Markers, Business Wire, Wednesday, May 2, 2007

Research and Markets (http://www.researchandmarkets.com/reports/c55659)
has announced the addition of “Russian Foreign Energy Policy: An Analytical
Compendium (Volume 1)” to their offering.

Russian Foreign Energy Policy: An Analytical Compendium includes 9 incisive
reports which examine the political and economic implications of the new
Russian energy empire on Eurasia and on world energy markets.

The 9 individual country reports analyze the emergence of a Russian foreign
energy policy based on acquisitions of foreign energy assets by Russian
entities.

Readers will benefit from a uniquely authoritative and comprehensive survey
of the geopolitics of Eurasia and of the energy and energy security
strategies of Russia and its neighbours.

Based on factual case studies, each report has been written by leading
authorities on Russian hydrocarbons, critical energy infrastructure
protection and energy geopolitics.
CONTRIBUTORS:
– Margarita Balmaceda, Associate Professor, John C. Whitehead School
of Diplomacy and International Relations, and an Associate of Harvard
University’s Davis Center.
– Stephen Blank, Professor of Russian National Security Studies at the
Strategic Studies Institute of the U.S. Army War College.
– Ariel Cohen, Senior Research Fellow in Russian and Eurasian Studies and
International Energy Security at the Davis International Studies Institute,
the Heritage Foundation.
– Harold Elletson, previous Director of the NATO Forum on Business and
Security, leads The New Security Programme.
– Fariz Ismailzade is a political analyst based in Baku, Azerbaijan. Liana
Jervalidze is a researcher and analyst on the Caspian area energy policy
and regional studies.
– Olena Viter is a Senior Adviser to the Operational Department of the
Secretariat of the President of Ukraine.
– Rostyslav Pavlenko, PhD (Political Science), is Head of Situation
Analysis Service of the Secretariat of President of Ukraine.
– Mykhaylo Honchar is Deputy Chairman of the Board of Ukrainian
JSC “Ukrtransnafta”.
– Adnan Vatansever is Associate Fellow, Institute for the Analysis of
Global Security (IAGS) in Washington, DC.
– Series Editor: Kevin Rosner is a specialist in Russian oil and gas,
security of critical energy infrastructure, and international
energy-security policy. Dr. Rosner is also author of Gazprom and the
Russian State.
INDEX
Special introduction by Series Editor Kevin Rosner
1. Russian involvement in Eastern Europe’s petroleum industry: the case
of Bulgaria
2. Kazakhstan: energy cooperation with Russia – oil, gas and beyond
3. Belarus: oil, gas, transit pipelines and Russian foreign energy policy
4. Russia’s Energy Interests in Azerbaijan
5. Russian Foreign Policy and the implications for Georgia’s Energy
Security
6. Gazprom and the Russian State
7. Russo-Chinese Energy Relations: Politics in Command
8. Ukraine: post-revolution energy policy and relations with Russia
9. Baltic Independence and Russian Foreign Energy Policy
For more information visit http://www.researchandmarkets.com/reports/c55659
—————————————————————————————————–
Research and Markets Laura Wood, Senior Manager
press@researchandmarkets.com; Fax: +353 1 4100 980
——————————————————————————————————
[return to index] [Action Ukraine Report (AUR) Monitoring Service]
========================================================
15. MEDIA POLICIES REVEAL DIVERGENT VALUES

COMMENTARY: By Marta Dyczok
Radio Free Europe/Radio Liberty (RFE/RL)
Belarus, Ukraine, and Moldova Report, Vol 9, No. 1
Prague, Czech Republic, Friday, May 18, 2007

A look at Ukraine’s mass media provides interesting insight into the ongoing
political standoff in Ukraine. Because the country finally has a relatively
free media, the behavior of the various political actors is reasonably
visible.

Their actions toward media, in turn, reveal the divergence in political
values that are at the heart of the crisis.

The current situation is very much a continuation of the political struggle
from 2004. One of the slogans of the Orange Revolution was “No More Lies!”
(Ni Brekhni!), and since coming to power Yushchenko has started to deliver
on this promise.

However, after the Party of Regions of Yushchenko’s rival, Viktor
Yanukovych, won at the parliamentary polls in spring of 2006, they and their
coalition partners have been enacting a creeping coup, slowly moving back
into positions of power and reintroducing the old way of doing things.
Nowhere is this more visible than in the media.
DIVERGENT POLITICAL VALUES
So the real question is: what kind of relationship does the government have
with the media? Yushchenko and Yanukovych appear to have very different
ideas about the relationship between media and the state.

Since becoming president, Yushchenko has adopted a liberal approach to media
policy, with minimal state intervention beyond general regulatory measures
and overseeing a slow process of removing the state from media ownership.

He has allowed media to write, print, broadcast, and post whatever they
wish, and this has allowed freedom of speech to flourish for the first time
in the country’s recent history.

Despite facing constant criticism from the media, Yushchenko has not taken
any steps to reintroduce state-sponsored censorship, and this is the
behavior of a democratic leader.

Where Yushchenko falls short, as with so many other issues, is in doing
little to introduce or facilitate structural changes which would help
consolidate these gains.

Prime Minister Yanukovych and his coalition partners are taking advantage of
this and gradually moving to reestablish control — the creeping coup. Their
behavior toward media suggests that their political culture remains stuck in
pre-2004 semi-authoritarianism.

A telling incident occurred shortly after the Party of Regions began their
political comeback. On July 12, 2006, only a few months after the elections,
Party of Regions lawmaker Oleh Kalashnikov attacked two journalists just
outside parliament. Oleksandr Moroz has sued one website six times (epa)

The journalists, Marharyta Sytnyk and Volodymyr Novosad from STB
television, had the audacity to film him near the Verkhovna Rada.

Despite a major outcry from journalists, Kalashnikov faced no
consequences — he continues to sit in parliament and make statements about
the importance of constitutional government and the rule of law. Since the
Kalashnikov incident, attacks on the media, some physical, have increased.

A recent example took place on March 30, 2007, when Crimean journalists
Olena Mekhanyk and Oleksandr Khomenko from the Chornomorka TV station
were attacked as they filmed coalition supporters boarding trains headed for
Kyiv.

Kuchma-era tactics such as legal actions, harassment, and other forms of
intimidation have been on the rise. The pioneering “Ukrayinska pravda”
website has been sued six times over the last six months by Parliamentary
Speaker Oleksandr Moroz.

Renat Akhmetov, Ukraine’s richest man and an influential member of the Party
of Regions, recently launched legal action against the popular website
“Obozrevatel,” after its reporter Tetyana Chornovil found some old neighbors
from his home town of Oktyabrskoye and published a series of stories about
his youth.

The newspaper “2000” ran what turned out to be a fabricated story, which
falsely quoted Renate Wohlwend, rapporteur with the Parliamentary Assembly
of the Council of Europe (PACE), as saying Yushchenko’s April 2 decree
dissolving parliament was unconstitutional and he should resign.

Equally troubling was a remark to the press by Vadym Dolhanov, the husband
of Constitutional Court judge Syuzanna Stanik, who was dismissed from her
post by Yushchenko as the court was considering the legality of the
president’s April 2 decree.

Responding to a question from a female journalist about the couple’s
property holdings, Dolhanov responded by asking the journalist what kind of
underwear she was wearing.

The Yanukovych team has also slowly been trying to reestablish a structural
control over the media. After the 2006 parliamentary elections, the majority
coalition (the Communists, Socialists, and Party of Regions) appointed their
own loyalists, Eduard Prutnyk and Ihor Chaban, to head the State Committee
for TV and Radio Broadcasting.

On 20 March 2007, the state-controlled Ukrainian National Television Channel
1 canceled its only political debate program, “Toloka.”

This came one day after Yulia Tymoshenko and Our Ukraine leader Vyacheslav
Kyrylenko were guests on the show and had positive comments from 80 percent
of callers.

There was also a coup attempt in the parliamentary freedom of speech
committee, which is led by Tymoshenko ally and lawmaker Andriy Shevchenko.
Part of the committee met without him and elected Party of Regions lawmaker
Olena Bondarenko acting head on April 26.
JOURNALISTS — STILL A MIXED PICTURE
What has been the reaction of journalists to all of this? At best, their
behavior can be described as mixed. Although a truly independent media does
not exist anywhere, Ukraine’s media has longer than some to go toward this
ideal.

Despite the improvement in working conditions with the end of
state-sponsored censorship, overall the professionalism of many journalists
remains woefully low.

The basic elements of professionalism, autonomy, distinct professional norms
and a public service orientation are largely missing.

Only one media outlet, www.maidan.org.ua, bothered to check the source of
the Strasbourg disinformation story — most simply reprinted what was fed to
them.

Many journalists still lack a clear understanding of the role media plays in
a democratic society, and despite improvements, the media is still not
achieving its main purpose of providing clear, balanced and in-depth
information and analysis of major events.

Those who work for coalition-controlled media outlets continue to print and
broadcast what they are told. Ukraina TV’s unflinching adherence to the
Party of Regions party line is one demonstration of the extent of this
problem.

A new tendency — noted by Olha Herasymyuk, a former TV personality and
current Our Ukraine lawmaker — is that journalists are increasingly
avoiding difficult topics relating to the coalition.

“I am noticing that journalists are refraining from critical tones when
reporting on the coalition or government activities,” she said during a
recent interview. “It’s clear that they are becoming increasingly
frightened.” Given the renewed pressures they are facing, this return to
self-censorship is hardly surprising.

There is, nonetheless, some good news and reason for optimism. Great strides
have been made in developing investigative journalism, a genre practically
nonexistent in the era of former President Leonid Kuchma.

Channel 5, the website “Obozrevatel” and STB TV all conducted independent
investigations into allegations of corruption among Constitutional Court
judges when this latest crisis broke.

Analytical programs have also improved, with two shows really standing out:
“Ya Tak Dumayu” (This is What I Think) hosted by Anna Bezulyk on Studio 1+1
and “Five Kopeks” (best translated as Your Two Cents) with Roman Chayka on
Channel 5. To some degree, innovation is also on the rise.

On April 13, a group of national and regional TV stations staged a so-called
“Day Without Politicians on TV,” where they deliberately avoided inviting
the usual talking heads and provided their viewers with an alternative
perspective on the news.

It seems that the political culture and professionalism of journalists is
changing, but to a large degree continues to reflect the major political
divisions in society.
WESTERN REFLECTIONS
Two final points concern the international dimension. Yanukovych and his
coalition partners are appealing to Western public opinion, despite renewing
pressures on media at home.

Socialist leader and presidential opponent Oleksandr Moroz published his
thoughts on the crisis on the pages of the “International Herald Tribune,”
not “Izvestiya” — a huge change from 2004, when their focus was on Moscow.

The tone of Western reporting on Yanukovych and the coalition has changed,
too. On April 22, a “Daily Telegraph” article described the Ukrainian prime
minister as “a former weight lifter and onetime racing driver,” who speaks
“in the soft baritone that accompanies his deceptively mild manner” when he
explains that “‘the Ukrainian people have an old democratic tradition.'”

No mention was made of his criminal record, the well-reported falsification
of the 2004 election, or the creeping coup d’etat which precipitated the
current crisis.

The struggle between these two political blocs, and their very different
political cultures, is likely to be ongoing. The degree and nature of state
intervention into the work of the media will remain an important indicator
of just how far democratic consolidation has progressed in Ukraine. -30-
———————————————————————————————
NOTE: Marta Dyczok is an associate professor in history and political
science at the University of Western Ontario. The views expressed here
do not necessarily reflect those of RFE/RL. mdyczok@uwo.ca
———————————————————————————————-
http://www.rferl.org/featuresarticle/2007/05/6810c41e-4b8f-4edf-8101-1177409d3ff2.html
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16. HOW DEMOCRACY FAILS – UKRAINE IS THE CASE IN POINT

COMMENTARY: By Bruce P. Jackson
Weekly Standard, Washington, D.C., Friday, May 18, 2007

THE MOST CURIOUS thing about Europe’s newest democracies is their
propensity to suffer serious reversal at their moment of greatest triumph.

After gaining membership in the European Union and NATO, the Central
European success stories of the 1990’s have hit a bad patch recently.

In Poland, a government with roots in the Solidarity movement of the 1980’s
has alienated both Germany and Russia and divided its citizenry on the
painful issue of how to deal with Poland’s communist past.

In Slovakia, grumpy voters have decided to turn out their reformist prime
minister in order to elect an opportunistic populist whose policy
pronouncements have made the country an object of ridicule.

And, in Romania, for reasons known only to Romanians, the Parliament has
decided that formal entry into the European Union was the signal to launch
the impeachment of the president.

Given their problematic history, the temporary resurgence of reactionary
politics, populism, and political instability in these Central European
democracies might have been expected.

Like teenagers in their last summer before college, the collective
misbehavior of Europe’s most recent democracies is disappointing and
even annoying, but it is not serious.

Further to the East, however, the political frailties and miscalculations
that gave rise to these regressive trends within Europe may be fatal to the
more delicate democracies that are not yet anchored in Europe’s
institutions.

Ukraine is the case in point. There the democratic transformation which
began with the Orange Revolution in 2004 has collapsed into bitterness,
recrimination, and ongoing political crisis.

It is hard to avoid the conclusion that Ukraine’s entire political class has
failed the Ukrainian people in the critical early years of their democracy.

This failure has triggered the breakdown of the institutions, such as the
Parliament and constitution, which are essential to the rule of law and
accountable government. How did this happen, and who is to blame?

In 2006, in the first fair elections in Ukraine’s history, the voters split
their support among the three major parties, giving the Party of Regions
the largest share and control of the Government.

The Regions party, whose power base lies in Eastern Ukraine and whose
constituents are mostly Russian speaking, failed to reach a durable
political understanding with the leaders of the Orange Revolution, who hail
from the West of Ukraine.

The Regions Party did not move quickly enough to dispel fears about its
reputation for tolerating corruption and authoritarian measures while in
previous Governments.

Through a combination of the inaction by Regions and underlying cultural
antagonisms between East and West, the two other parties became convinced
that Regions intended to consolidate political power at the expense of the
president and opposition.

In response, the Parliamentary opposition, led by the charismatic populist
Yulia Timoshenko, made no secret that it regarded the results of the 2006
elections as illegitimate for the simple but unpersuasive reason that Yulia
herself did not win. Publicly, the opposition called for new elections.

Privately, they advocated “a second revolution” to complete the unfinished
business of the Orange Revolution, which was to imprison the “bandits” of
the Regions party. Hardly what the West expected from a democratic
opposition party.

Finally, there is the party of President Victor Yushchenko, whose face,
disfigured by poison, became the symbol of everything that was noble and
heroic about the Orange Revolution.

He was supposed to guide the birth of a modern Ukrainian nation as President
Vaclav Havel did for the Czech Republic during the last decade. Sadly, this
did not happen.

In the last month, President Yushchenko has dissolved the Parliament,
removed unfriendly judges from the Constitutional Court, and attempted to
dismiss the government.

Today, President Yushchenko rules the country by presidential decree in a
manner all too reminiscent of former Ukrainian president Leonid Kuchma. As a
consequence, the shaky institutional foundations of Ukrainian democracy have
begun to give way.

The prospect of elections later this summer seems unlikely to remedy the
causes of the disease that is destabilizing the fragile Ukrainian nation.

The only consolation is that this time Moscow cannot be held responsible for
the political chaos in Kiev. Ukraine’s political elite have done this to
themselves.

For the first time since the collapse of the Soviet Union and the flowering
of democracy throughout Central and Eastern Europe in 1989, the failure of a
European democracy is a real possibility.

Official visits between Kiev and Washington have been cancelled.
Negotiations between Ukraine and the European Union on visas and free trade
are on hold.

Even Ukraine’s entry into the World Trade Organization awaits the return of
a functioning Parliament to Kiev. In short, an isolated Ukraine is now
exposed to the potential restoration of Moscow’s influence and the adoption
of its authoritarian political model.

The Ukrainian voters are appropriately disgusted by the blind ambition and
recklessness of their leaders. Their websites are filled with dark talk of
civil war. But in the capitals of Western Europe, the crisis is studiously
ignored.

In Washington, officials are dumbfounded but still adamant–the United
States can do nothing. This is how democracies fail. -30-
———————————————————————————————–
Bruce P. Jackson is the president of the Project on Transitional
Democracies, a non-profit advocate for democratic change in the Balkans
and former Soviet Union in Washington, D.C. (bruce@ptdemocracy.org)
———————————————————————————————–
http://www.weeklystandard.com/Content/Public/Articles/000/000/013/660timdr.asp
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17. UKRAINE’S ASPIRATIONS AND GEOPOLITICAL ROLE

INTERVIEW: With Zbigniew Brzeninski
Interview By: Myroslava Honhadze (Gongadze)
Voice of America (VOA), Washington, DC, Tuesday, May 22, 2007

The US-EU Partnership Committee for Ukraine met on May 14, 2007, in Berlin
at a meeting jointly hosted by the Center for Strategic and International
Studies and the German Council on Foreign Relations to discuss developments
in Ukraine and ways to enhance Europe’s opening to Ukraine’s European and
Euro-Atlantic aspirations.

Myroslava Honhadze of VOA Ukrainian spoke with a leading member of the
Committee, former US National Security Adviser, today CSIS Counselor and
Trustee, Dr. Zbigniew Brzezinski, upon his return to Washington.

The Committee’s other members present at the Berlin meeting were
former German Minister of Defense Volker Ruehe, former Polish Foreign
Minister Bronislaw Geremek and former Norwegian Foreign Minister Jan
Peterson.

Myroslava Honhadze: Why did you and your colleagues decide to form the
US-EU Partnership Committee for Ukraine and what is the main purpose of this
committee?

Dr. Brzezinski: We decided to create that committee, because we believe that
Ukraine is an important European country and that the interests of Europe
and of the Atlantic Community, but also of Ukraine would be best served, if
Ukraine’s adhesion, closer connection with, cooperation, association,
eventually membership [in the European Union], were facilitated.

There is a further strategic goal behind that, namely if Ukraine moves to
the West, Russia inevitably will have to follow suite. If Ukraine doesn’t
move to the West, Russia’s nostalgia for an imperial role is going to
intensify, and, therefore, Russia will be more of a problem, Ukraine might
be more threatened and, therefore, it is in the interest of everyone
concerned to move that process forward.

Myroslava Honhadze: Ukrainian leaders have been declaring Ukraine’s
membership in the EU a strategic goal. In your opinion, is such a goal
realistic if one considers both the realities in Ukraine and the negative
mood in the EU towards further enlargement?

Dr. Brzezinski: It is a realistic goal provided one does not set a date that
comes too soon. In other words, it’s a realistic goal if one is patient. But
look at the likely social, cultural and economic impact of the European
football [soccer] championships that are going to take place in Ukraine and
Poland in 2012.

I have no doubt that that is going to have a very major impact not only on
the state of Ukrainian-European or Ukrainian-EU relations, but it’s going to
have a very significant impact on the political culture of Ukraine and
particularly the younger people.

It already has started having that effect. So, it’s a realistic goal, but of
course it will take a number of years of patient negotiations, of structural
changes, reforms in Ukraine, but more and more Ukrainians – both on the
social level, especially the younger generation, but also the oligarchs, the
people with business – know that Ukraine’s future is in Europe and not as
a periphery of Russia.

Myroslava Honhadze: If the goal of Ukraine’s EU membership is achievable,
what should both sides be doing today to make this goal a reality and can
the United States play a role in this?

Dr. Brzezinski: Well, the EU and the United States can help – the United
States largely by using its influence also to encourage the EU to be as open
[as possible], to make it clear that the EU is very receptive to closer
association with Ukraine, and also take tangible steps to promote more
contacts, easier visa arrangements, travel arrangements, facilitate
Ukraine’s entrance into the WTO, but the main burden of responsibility for
making that concept of the future into a reality lies on the shoulders of
Ukraine, just as it did earlier on the shoulders of Poland or of the Baltic
countries.

Neither the EU nor NATO are in the business of asking people “please come
and join us.” But if somebody wishes to join them, and these countries
qualify, if they are part of Europe, then they are welcome.

So, what we in the Committee are trying to do is to encourage the Ukrainian
leaders to take the kind of steps that would make Ukraine more attractive
and more appealing – transparency, rule of law, predictability,
institutionalized democracy and so forth.

Myroslava Honhadze: Some European countries are reluctant to enter into
close relationships with Ukraine for fear of antagonizing Russia and thus
jeopardizing their own energy security. How do you think this problem should
be addressed?

Dr. Brzezinski: I think there is a change taking place in that respect. Now
it is increasingly Russia that it antagonizing the West. And I think there
is a lot of evidence for that. The brutal Russian reactions vis-à-vis
Estonia, for example, the efforts to sabotage the Estonian Internet by
massive cyber attacks, not to mention the staged demonstrations which
were so violent.

All of that is giving Russia a very bad image in the West — the
cut-off of the flow of oil to Lithuanians, because the didn’t sell their
refinery to a Russian prospective buyer; the general attitude of opposition
to any efforts by the EU to diversify its energy sources. Not to drop
connections with Russia – far from it – but simply to diversify, that’s
irritating the West.

Then, the insistence of the Russians to have access “downstream” to
Western economies, but will not permit access “upstream” to
Russian resources to Western companies. All of that is prompting a gradual
reassessment of Russia’s current political regime in the West, and is making
more and more people conclude that Russia’s current policies are actually
very misguided and very dangerous to Russia in the sense that it is likely
to increase the tendency of Russia becoming isolated at a time when Russia
has very, very serious domestic problems, demographic problems, which
have not been effectively addressed by the present Russian regime.

Myroslava Honhadze: But how can Ukraine overcome these influences from
Russia?

Dr. Brzezinski: Well, Ukraine can only overcome them by itself, that is to
say, by consolidating its sense of nationhood, by trying to maintain good
relations with Russia whenever it’s feasible, by essentially indicating that
its movement toward the West is not anti-Russian, but also has as its
additional purpose to facilitate Russia’s eventual participation in this
Atlantic community, in the EU and so forth.

Myroslava Honhadze: Would Ukraine’s membership in NATO increase its
chances of European Union membership?

Dr. Brzezinski: Maybe, but I don’t think it’s a necessary precondition.
There are members of the EU that are not members of NATO. I think
that’s a decision that the Ukrainian people have to make.

By and large, however, the collaboration between NATO and the Ukrainian
defense establishment is moving forward very positively, and the Ukrainians
have been active, as we know, in Iraq, and they’ve been active also in joint
Ukrainian-Polish military formations.

I think the experience has been beneficial to Ukraine. It has
helped to create a more modern military establishment than the previous
Soviet military establishment.

Myroslava Honhadze: Ukraine is in a deep political crisis today. What do
you think went wrong and why, and do you see a way out of this situation?

Dr. Brzezinski: You know, it’s a huge, huge issue as to what went wrong. It
could be a question of personalities, it could be question of conflict of
personalities, of some indecision, perhaps some miscalculations, but the
past is past.

What has to be done now, it seems to me, is to have an orderly
election that perhaps will help to clarify the picture, and to also
facilitate some constitutional changes, which would eliminate massive areas
of ambiguity and even internal contradictions in the existing constitutional
arrangements.

There is an organization in the West, in Europe, called the Venice
Commission, which offers constitutional advice and professional judgments.
Perhaps, in some fashion, it could be engaged in helping to sort out this
terrible constitutional complexity that contributes to even more intense
personal and political conflicts in Ukraine.

But at the same time, having acknowledged the reality of difficulties,
confusion and conflict, one also has to acknowledge the fact that Ukrainians
have shown also an admirable patience and prudence, which testifies to what
would generally be called a higher or generally democratic political
culture.

For all of the arguments between Yushchenko, Yanukovych or
Tymoshenko, and people sleeping in tents in the center of Kyiv and so forth,
nothing has happened in Kyiv that in any way is reminiscent of what happened
in Moscow when there were political tensions involving Yeltsin, Gorbachev
and the others – gunfire in the streets, parliament shelled and so forth.

So, the Ukrainians have reason to be proud of the fact that their political
culture is a relaxed political culture, which absorbs some of these more
dramatic political conflicts. And if they can maintain that, then eventually
the chances are that there will be some compromise.

Now, there is an element of frustration in all of that, because when one
deals with Ukrainian political leaders one also gets a lot of promises,
commitments which are never fulfilled.

But somehow or other it’s done in a manner that reduces the hostilities and
tensions that this otherwise might have produced.

Myroslava Honhadze: What always seems to come to the forefront in Ukraine’s
political troubles is the divide between Eastern and Western Ukraine. What
steps do you think can be taken to bridge that divide?

Dr. Brzezinski: Well, perhaps the most important step is one that should not
be taken – namely, I don’t think the linguistic issue should be elevated
into some sort of a national conflict. Ukraine has an official language, a
state language, but as a practical matter, operationally, people speak
Russian or Ukrainian and a lot of people are very fluent in both languages,
and I think that is a reality that will change over time or perhaps it won’t
change.

And there are quite a few countries in the world in which more than
one language is spoken on a socially significant level – Belgium,
Switzerland, Canada. There are others – India. And I think that issue should
not become a major problem, because it could conceivably produce
emotional reactions that really poison the political atmosphere.

Beyond that, I think, what is terribly important is that there be respect
for rule of law and transparency and that, I think, would help to relieve
some of the problems of corruption and the persistent inability of the
political system to address serious violations of the law, serious crimes in
a fashion that is civilized and which is in keeping with the democratic
norms of the genuinely democratic societies in the world.

Myroslava Honhadze: The divide between eastern and western Ukraine also
has international implications. Politicians and businessmen from eastern
Ukraine, for instance, are much more likely to interact with their Russian
than their European or American counterparts. How can that be changed?

Dr. Brzezinski: Well, first of all, it is a fact that for many decades and
certainly throughout the entire Soviet era, but even before that, the
industrialization and modernization of what was the Czarist empire and in
what was the Soviet Union, tended to occur not only in Russia, but also in
Ukraine and some other parts of the former empire, and in Ukraine it tended
to occur more in the east than in the west.

Kharkiv, Donetsk, Dnipropetrovsk are all symptoms of that. So, it’s not an
artificial reality, but it’s a reality which is a consequence of the past.
And, therefore, the political and particularly the economic leaders, who
live in that part of Ukraine, quite normally and naturally have that established
set of connections.

But, with independence and with further modernization and with gradual
changes in the economy and with the inflow of foreign capital, that is
changing.

And there is no doubt – I know this for a fact – that some of the most
prominent oligarchs in what is called “the east” know that if they are to be
successful, the have to operate in the West. And they know that Ukraine,
presumably even this year, will become a member of the World Trade
Organization. That, too, is going to have enormous consequences.

So, the center of gravity of Ukraine’s orientation is going to change and
it’s continuing to change. And that is not anti-Russian; it’s simply part of
the new evolving global economic realities. And these people who are
businessmen, who are competitive, know that in the long run a competitive
and rapidly growing Ukraine has to be part, in some fashion, of this larger
global economy which is West-centered.

And, last but not least, consider the following: Russia has an impressive
rate of growth on a per annum basis, somewhat higher than Ukraine’s – but
it’s impressive – based almost entirely on the export of raw materials.

Ukraine has a very impressive rate of growth – about 7% – based largely on
its ability to compete as a modern industrial economy. That, too, has
consequences and it is part of this process that I am talking about.

Myroslava Honhadze: How does Ukraine fit into your recent writings about
the US needing to play a more positive role internationally in terms of
alleviating poverty and strengthening democracy around the world, rather
than being seen as militaristic and only concerned about US prosperity?

Dr. Brzezinski: Well, that is a criticism specifically of the way America
has exercised its special position in the world and particularly in the last
several years under the current presidency. I think that has, in my view, as
a view of a patriotic American citizen, helped to undermine American
credibility, American legitimacy, even respect for American power.

And that, of course, is likely to be exploited by those who have a special
animus toward the United States, in part because of the American victory in
the Cold War. But those happen to be the same people that, generally
speaking, are not terribly pleased by the reality of an independent,
sovereign, separate Ukraine. So, I think that the logical conclusions of that
are almost self-evident.

Myroslava Honhadze: Do you think that the United States pays enough
attention to that part of the world?

Dr. Brzezinski: Not lately, because of the negative consequences of what I
consider to have been a misguided American policy, namely starting a war in
Iraq which should not have been started and certainly not the way it was
done. And, I think, this has obviously diverted American attention and it
has also stimulated increasing tensions outside of Iraq, but in the area of
the Middle East and further east – Afghanistan, Pakistan. So, this has been
a very serious diversion away from other issues which should have been given
similar attention.

Myroslava Honhadze: And, lastly, in many circles you are considered a
friend of Ukraine. If that assertion is correct, how did this friendship come
about?

Dr. Brzezinski: Well, I like Ukraine and I am happy to see it being
independent. I think it helps in many ways to create a better, larger Europe
that increasingly extends into Eurasia, as I have said earlier in our
interview.

And maybe paternal influence plays a role in this. I was born in Poland
although I lived only three years of my life in Poland, but my father fought
for Polish independence, but he also fought against the Ukrainians in a city
he used to describe as “Lvuv” – a city which the Ukrainians call “Lviv,” a
city of which I am now an honorary citizen. And when I received that
honorary citizenship in Lviv I said to the Ukrainians that this is a city in
which my father fought against Ukrainians.

In fact, not far from the City Hall, where I was getting that very important
distinction, I said he was fighting against the Ukrainians for control of
the central railroad station in “Lvuv.” And I said to them, later when I was
growing up my father used to tell me that that conflict between Ukrainians
and Poles was a stupid conflict and it was, as he described it, a
fratricidal conflict, a conflict between brothers, which helped eventually
to deprive both peoples of their independence.

So, I imagine that probably also influenced my thinking, and I
have always enjoyed visiting Ukraine and I like the Ukrainian people. I like
some Ukrainian politicians. I even think that one of them is very attractive
[laughter]. There are many reasons why I like Ukraine.

Myroslava Honhazde: Do you believe Ukraine will succeed?

Dr. Brzezinski: I think it will succeed. I have no doubt about that. And I
think – it may sound strange – but I think this decision [for Ukraine] to be
the host for a major European event [Euro Soccer Cup] five years from now
is going to be a very, very major transforming event giving Ukraine not a
post-Soviet quasi-independent, still quasi-undefined self-identity, but a
clearly identified national identity that is at the same time also a clearly
European identity. -30-
—————————————————————————————————
Also present at the Berlin meeting were the four Task Force Directors of the
US-EU Partnership Committee for Ukraine CSIS Director of the New European
Democracies Project and CSIS Europe Program Senior Fellow Janusz Bugajski;
former U.S. Ambassador to Ukraine and CSIS Senior Adviser Steven Pifer;
former U.S. Ambassador to Lithuania and CSIS Senior Associate Keith Smith;
and Visiting Associate Professor at Georgetown University and CSIS Senior
Associate Celeste Wallander.
—————————————————————————————————-
LINK: http://www.voanews.com/english/
—————————————————————————————————-
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18. U.N. DEEPLY CONCERNED OVER ILL-TREATMENT IN
UKRAINIAN PRISONS FOR PRE-TRIAL SUSPECTS

REUTERS, Geneva, Switzerland, Mon May 21, 2007

GENEVA – The U.N. Committee against Torture on Monday voiced deep

concern over reports of ill-treatment of pre-trial suspects in Ukraine and said
it provided “insufficient legal safeguards” for detainees.

A panel of independent experts also cited reports that said detainees were
not brought quickly enough before a judge, lacked access to lawyers and
independent doctors and were deprived of their procedural rights.

“The committee was deeply concerned about allegations of torture and
ill-treatment of suspects during detention, as well as reported abuses
during the period between apprehension and the formal presentation of a
detainee to a judge”, their report said.

This meant that Ukraine was “providing insufficient legal safeguards to
detainees,” it said. It also referred to reported use of intimidation
techniques by the ex-Soviet country’s anti-terrorism unit within prisons.

Ukraine’s failure to conduct prompt and impartial investigation of
complaints of ill-treatment also gave cause for concern, it said.
It urged Ukraine to carry out reforms to make its general prosecutor’s
office more independent.

The U.N. Committee Against Torture investigates compliance with the
international treaty banning torture, ratified by 144 countries, including
Ukraine.

On Poland, the group said Polish officials had denied reports their country
housed covert prisons for Central Intelligence Agency (CIA) terrorism
suspects. It urged Warsaw to make public internal findings on the issue.

“The committee urged Poland to share information about the scope,
methodology and conclusions of the enquiry into those allegations conducted
by the Polish Parliament,” it said. -30-

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19. VISA STANDING
EU states demeaning Ukrainians during visa application process

REPORT: By Dariya Ryabkova
Invest-Gazeta weekly, Kiev, in Russian 14 May 07; p 19-23
BBC Monitoring Service, United Kingdom, Thursday, May 17, 2007

When it comes to the issue of visas to Ukrainian citizens, Kiev’s relations
with EU countries have turned into a one-way street, a Ukrainian business
weekly has said.

It said that while EU citizens no longer need a visa to visit Ukraine,
Ukrainian citizens applying for visas are faced with bureaucracy and
demeaning treatment that would be the envy of former Soviet institutions.

A poll found that queuing, excessive paperwork and rude behaviour by staff
at consulates are the biggest complaints, the article said.

It concluded by saying that although Foreign Minister Yatsenyuk will raise
the issue with EU states, it is unclear whether this will actually improve
things.

The following is an excerpt from a report by Dariya Ryabkova entitled “Visa
standing”, published in the Ukrainian weekly Invest Gazeta on 14 May;
subheadings are as published:

All attempts made to simplify the visa regime between Ukraine and the EU
ended with Ukraine cancelling the need for EU citizens to have visas [to
visit Ukraine].

The response to this from European states was to raise the cost of visa fees
for Ukrainians, introduce a requirement to provide data on money coming in
and out of personal bank accounts, and they are not much worried that the
waiting time for consideration of visa applications in their embassies
extends to several months.

An application for a visa interview through a consulate’s website was
supposed to make life easier for those Ukrainians planning to go abroad.
This is really convenient – you do not have to stand many hours in a real
queue or seek assistance from middlemen companies.

Yet, after a short period of time, for example, information appeared on the
website of the German Embassy that a person can sign up for an interview, as
was the case before, but first he or she is to transfer to the account of an
Indian company called VFS the small sum of five euros. Now recall that
according to various estimates, Germany grants over 100,000 visas for
Ukrainians every year … [ellipsis as published]

Germany’s example was followed by the enterprising Americans – you may
sign up for an interview by phone but it costs 12 dollars. The consulates of
countries like Belgium and the Netherlands went even further – VFS will
“assist” you in receiving the necessary documents for the sum of 35 euros.

A student visa to Great Britain costs 990 hryvnyas, which is twice as
expensive as an ordinary visa. The Italian and Spanish embassies require
separate mention.

You cannot find visa application requirements to visit Italy neither in the
native language of the inhabitants of the Apennines nor in English – this
part of the website simply does not work. Ukrainians can tell you thousands
of such stories but nobody cares about this.

With regard to procedures for granting visas for Ukrainians, relations
between Kiev and EU member states turned into a one-way street a long time
ago. On the one side, there are European states suffering from the flood of
legal and illegal migrants.

On the other, there are Ukrainian citizens who encounter such an attitude
and bureaucracy that would be the envy of former Soviet institutions.
Conflicts of interest multiplied by negligence on the part of embassy staff
give rise to numerous heated scandals and discussions in the mass media.

The Ukrainian Foreign Ministry also decided to get involved. In early May,
Foreign Minister Arseniy Yatsenyuk made a series of critical statements as
to his view of the problem of the granting of visas in Ukraine. These
statements were the result of a survey conducted by the Diplomacy Academy of
the Ukrainian Foreign Ministry.

A poll of 566 Ukrainian citizens who applied for visas to embassies of EU
member states showed that there are three main complaints about the work of
embassies – queues, an unreasonably large amount of documents required for a
visa and the impoliteness of staff. Of course, these complaints are made not
about every consulate office.

The head of the Ukrainian Foreign Ministry refused to name the most
“problematic” embassies as he wished not to spoil relations with European
states.

Yet, variants of the lists of the most “difficult” embassies can be found
without any problem on websites of the majority of Ukrainian travel agencies
and in analytical papers compiled by Ukrainian research centres.

[Passage omitted: visa requirements for Ukrainians wanting to visit EU
states are burdensome, demeaning]
EMBASSY VERSUS APPLICANT
COMPLAINT #1: QUEUES.
According to the representatives of other states that have their embassies in
Ukraine, the main reason that causes queues is not the slowness of the c
consulate machinery staff but the desire to examine all documents as carefully
as possible and a shortage of employees processing the documents.

The problem is that the number of people in the majority of embassies has
not changed while the number of applications from Ukrainian citizens is
constantly growing.

In 2006 alone, the number of Ukrainian tourists going to the Czech Republic
increased by 51 per cent, having exceeded the threshold of 50,000 persons
per year.

According to the French ambassador to Ukraine, Jean-Paul Veziant, during the
first four months of the current year his embassy also granted 46 per cent
more visas than during this same period in 2006. And this was done by the
same number of people working for the French consulate.

However, these explanations serve as little consolation for those Ukrainians
who have to temporarily “camp” next to the walls of some embassy.

According to “Monitoring …” [ellipsis as published, refers to “Monitoring
of Visa Policy of EU Countries”, published in Warsaw in 2006], the average
time that our compatriots have to spend near the consulates of European
states fluctuates between one hour (to receive a visa to Poland or Finland)
to four hours spent next to the walls of the Lithuanian embassy and 12 (!)
hours needed to receive a French visa.
COMPLAINT #2: THE LARGE NUMBER OF DOCUMENTS.
“An embassy has no right to change legal requirements which are mandatory
for receipt of a visa,” says Marko Naoki Lins – first secretary, head of the
press and protocol department at the German Embassy.

“Those who want to visit Germany or any other Schengen state normally
require a visa. In order to receive a visa, an applicant has to answer the
following question: What is your name? What is the purpose of your visit to
Germany/Schengen territory? Who will cover the expenses of the visit? Do you
have health insurance? Are you planning to return to Ukraine?.. [ellipsis as
published]”

In other words, the long list of documents required by the embassy is not
the result of excessive demands from embassies themselves. [Passage omitted:
Veziant says France is a country of immigration.]

Still, a long list of documents and an interview are not problems as such
(although a requirement to furnish a bank statement on bank account
transactions for the last three-six months, as well as many other
requirements, can be a big headache).

The main problem that causes a large amount of required documents is their
non-transparency and the inability of many consulates to cope with all these
documents on one visit.

At the same time, despite harmonization of the rules for entrance of foreign
citizens to Schengen territory, according to the Centre for Peace,
Conversion and Foreign Policy of Ukraine, visa procedures still leave a
great amount of room for manoeuvre for national policy.

Thus, the differences in the document requirements of consulates of various
European states, including those which are part of the Schengen zone, are
quite significant. This explains the need to visit foreign consulates
several times.

However, whereas for citizens of Kiev this need is a problem of free time,
people from the majority of Ukrainian cities and towns face the need to
cover hundreds of kilometres between their homes and the embassy without any
guarantee that they will receive a visa.

According to information provided by the embassies, of all Ukrainian people
willing to visit European states, 8.5 per cent are refused (7 per cent, 8.9
per cent and 10 per cent for embassies of France, Britain and Germany,
respectively). [Passage omitted: Many visa requests are not granted due to
false data provided by applicants.]

COMPLAINT #3: THE IMPOLITENESS OF STAFF.
Of course, the majority of visa refusals are caused by the fault of applicants
who submit incorrect or fake documents, conceal or distort personal data,
thereby raising doubts about the true purpose of their visit abroad.

Nonetheless, one can still easily recall the scandals caused by a refusal to
grant a visa to our compatriots because of entirely different reasons – the
incompetent, offensive or contemptuous attitude to applicants on the part of
consulate staff.

Recall the notorious failed visit of a Ukrainian group of businessmen,
politicians and journalists to Brussels at the invitation of the European
Parliament.

After one of the group members became nervous and was not able to clearly
state the goal of their visit during an interview with the embassy
representative, the entire group was refused a visa to Belgium.

Another example is a well-known case of “examination” of children from a
Kharkiv-based choir mentioned by the foreign minister. The choir leaders
received visas for their tour only after the children – the choir
participants – demonstrated outside the embassy building that they can sing.

No wonder that the majority of Ukrainians, as a result of such an attitude,
receive a complex about being “second class” and begin to doubt the
sincerity of European institutions that preach the principles of democracy
and equality of all people.

[Passage omitted: Ukrainian economy also suffers and incurs losses as a
result of visa problems.]
EUROPEAN INTEGRATION NOT IN WORDS
The head of the Ukrainian Foreign Ministry is going to solve the existing
visa problems through negotiations: with the European Commission – on
expanding the staff of EU consulate representative offices in Ukraine (to
solve the problem of queues) as well as unification of approaches of
Schengen states to procedures for submission of visa application documents;
with embassies – on “locally produced” visa problems.

Yatsenyuk also promised to take tough steps in the event that the
conversation with stubborn embassies remains fruitless – to hand out “yellow
cards” and disqualification for two penalties. The minister did not explain
which actions are implied by this colour grading.

However, even without the tough statements from the Ukrainian Foreign
Ministry, it is obvious that the dialogue between the ministry and European
embassies is not going to be held in a warm and friendly atmosphere.

Yatsenyuk’s attempts to influence the work of consulate offices were
perceived by the EU as gross interference in the sovereign rights of EU
member states.

“Recent statements made by Mr. Yatsenyuk resulted in a demarche by the
so-called EU ‘troika’ (Germany as the presiding state, the European
Commission and Portugal, which is the next presiding state),” the French
ambassador to Ukraine, Jean-Paul Veziant, has said.

“It is aimed at demonstrating that the granting of visas is the sovereign
act of a state. Any kind of ‘control’ over the activities of consulate
offices on the part of the accrediting state’s authorities is a breach of
diplomatic traditions.”

Thus, even if dialogue does take place, it will hardly deal with the
problems that are most acute in the visa domain today. One can only hope for
any significant changes in view of the expected signing of an agreement
between Kiev and Brussels planned for June 18 on simplification of the visa
regime.

So far, the signatory parties are keeping the provisions of this agreement
secret. “It will be more interesting to learn about this agreement after it
has been signed,” Arseniy Yatsenyuk says.

However, according to unofficial information, if this agreement is signed it
may include, in addition to other provisions (as to, for example, long-term
visas for certain categories of Ukrainian citizens), a provision on
unification of approaches by Schengen states to entry requirements for
citizens. In the long-term, they will be joined by the 10 countries that
will join the Schengen zone in December 2007.

However, western embassies are not refusing completely to cooperate with the
ministry. “We are always ready to discuss any problems with the Foreign
Ministry,” the French ambassador to Ukraine says. The German embassy also
promised to continue dialogue.

The most probable outcome that can be hoped for after this dialogue is
completed is the transfer of the document submission procedure into on-line
mode, as was done, for example, by the German embassy in Ukraine,
installation of information desks and work on the manners of consular staff.

The latter, according to analysts, could be improved with the help of simple
training aimed at making the consulate staff realize the importance of a
good attitude to people applying for visas and to demonstrate in practice
how professional and polite work with clients should look like. -30-
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20. WITH REGARD TO MR MATVEYEV’S “BAD WWII MEMORIES”

LETTER-TO-THE-EDITOR: By Halya Coynash
Kharkiv Human Rights Protection Group (HRPG)
Action Ukraine Report (AUR) #846, Article 20
Washington, D.C., Wednesday, May 23, 2007

RE: WWII Anniversary Conjures Up Some Bad Memories
Article By Vladimir Matveyev, JTA, New York, NY, May 3, 2007
Action Ukraine Report #845, Article 13, Monday, May 21, 2007

With regard to Mr Matveyev’s “bad memories:”

Any memories of atrocities committed against an ethnic group or by
collaborators with a murderous regime are undoubtedly very painful.

Here I would be in complete agreement with the author. I nonetheless
believe the publishing of such articles to be extremely unconstructive and
very much to be regretted.

This is not because the subject should be concealed. We all need the
truth, even when it hurts, and we need to confront it together.

What we must not do is to hurl unsubstantiated claims which, frankly, are
even difficult to grab hold of in Mr Matveyev’s article.

He says, for example, that “it is not believed that they [the UPA units]
specifically targeted Jews”, yet everything that comes later somehow creates
the impression that the UPA, and perhaps all of Ukraine, was a hotbed of
anti-Semitism.

I could focus on specific sentences. Many are very easy to refute. Some
are irrefutable, yet nonetheless require explanation. There were, for
example, many reasons why a lot of people in Western Ukraine saw the
communists as no less evil than the Nazis. From my comfortable armchair
hindsight, I believe them to have been wrong.

They also saw (or believed they saw) more Jewish than non-Jewish, people
supporting the communists, and some, unfortunately, drew conclusions.
That the conclusions were wrong is, from my armchair, entirely clear.

I could continue, but believe it would be equally unhelpful until this
subject is given proper treatment. There are a number of Ukrainian
historians who have tried to do precisely that, Mykola Riabchuk and
Yaroslav Hrytsak, to name but two.

Articles of this ilk have, over the last 60 years, brought us no closer to
the truth. Instead, by creating an overall picture through verbal shades
and nuances, without hard, confirmable or refutable, fact, they serve only
to divide people and to blur the real issues which need to be confronted
with unflinching and courageous commitment to the truth and to mutual
understanding.

Halya Coynash
Kharkiv Human Rights Protection Group (KHPG)
Kharkiv, Ukraine, halya@maidanua.org; www.khpg.org
————————————————————————————————-
WWII ANNIVERSARY CONJURES UP SOME BAD MEMORIES
Article By Vladimir Matveyev, JTA, New York, NY, May 3, 2007
http://www.jta.org/cgi-bin/iowa/news/article/20050503InUkraineWWIIann.html
————————————————————————————————-
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21. UKRAINE: PRES YUSHCHENKO SETS 3RD SUNDAY OF EACH YEAR
AS REMEMBRANCE DAY FOR VICTIMS OF POLITICAL REPRESSION
Presidential Decree honours the Victims of the Great Terror of 1937-1938

Office of the President, Kyiv, Ukraine, Monday, May 21, 2007 (in Ukrainian)
Translated by Kharkiv Human Rights Protection Group (unofficial translation)
Published by the Action Ukraine Report (AUR) #846, Article 21
Washington, D.C., Wednesday, May 23, 2007

KYIV – Ukrainian President Victor Yushchenko has issued a decree
establishing the third Sunday in May as Remembrance Day for the Victims of
Political Repression and instructing on measures for marking the seventieth
anniversary of the Terror of 1937-1938.
PRESIDENTIAL DECREE NO. 431/2007
On Measures to mark the 70th anniversary of the Great Terror – the mass
political repression of 1937-1938

In order to fittingly honour the memory of the victims of political
repression;

to draw public attention to the tragic events in Ukraine’s history brought
about by the forced inculcation of communist ideology to restore national
memory and affirm rejection of all manifestations of violence against
humanity in connection with the 70th anniversary of the Great Terror – the
mass political repression of 1937-1938 and in support of public initiative,

We hereby instruct:

1. That Remembrance Day for the Victims of Political Repression be
established and marked each year on the third Sunday in May.

2. The Cabinet of Ministers, together with the Security Service of Ukraine
and the Ukrainian National Academy of Sciences, to draw up and approve
within a month a plan of measures in connection with the 70th anniversary of
the Great Terror – the mass political repression of 1937-1938, these
including:

– Scholarly research during 2007-2008 on political repression against the
Ukrainian people; conferences, roundtables and other related measures;

– Publication of books, documents and materials on the mass political
repression of 1937-1938; ensuring that this material is distributed to
libraries, educational institutions, scientific institutions, as well as
measures to have certain works translated and published in other languages
to be distributed outside Ukraine;

– Urgent measures to conclude work on creating the National Historical
Memorial Reserve “Bykivnya Graves”, and on holding annual ceremonies each
year in May on its territory to honour the victims of political repression;

– Organization by the Ukrainian Institute of National Remembrance, drawing
on assistance from the All-Ukrainian cultural and educational human rights
charity Memorial Society of Vasyl Stus, the All-Ukrainian Association for
Political Prisoners and Victims of Repression, as well as other civic
organizations directly studying issues connected with political repression,
of measures to ensure the participation in August 2007 and subsequent years
of a Ukrainian delegation on traditional Remembrance Days at places linked
with the tragic events of mass political repression of 1937-1938, in
particular at the Sandarmokh Clearing and the Solovky Islands (in the
Russian Federation);

– Memorial lectures, lessons and other measures during 2007 and 2008 in
educational and cultural institutions aimed at raising awareness about the
mass political repression of 1937-1938;

– Ensuring the creation of museum collections, adding to such collections
and creating greater awareness of exhibits on historical events linked with
political repression in Ukraine, including the exhibition “Not to be
forgotten”, created by the Kyiv City Organization of the All-Ukrainian
Memorial Society of Vasyl Stus

– Involving school and higher institute students in collecting documentary
material and testimony of witnesses of political repression, especially in
order to build the collections of regional museums.

3. The Council of Ministers of the Autonomous Republic of the Crimea,
regional, Kyiv and Sevastopol City State Administrations:

– To provide for memorial gatherings, wreath-laying ceremonies at monuments
and memorial plaques and at burial places of victims of political repression
on 3-4 November 2007 in memory of the seventieth anniversary of the mass
execution of Ukrainians in Stalin’s labour camps;

– To take steps according to established procedure to erect plaques and
memorial signs at places linked with the mass execution and burial of
victims of political repression.

4. The Ministry of Foreign Affairs:

– To ensure that Ukraine’s diplomatic representations abroad hold measures
to mark the 70th anniversary of the Great Terror – the mass political
repression of 1937-1938, and also to invite members of the diplomatic corps
accredited in Ukraine to take part in such measures in Ukraine.

– To circulate information in the world about political repression in
Ukraine and its consequences for the Ukrainian people.

5. The State Television and Radio Broadcasting Committee of Ukraine:

– to ensure wide coverage in the mass media of the events to mark the 70th
anniversary of the Great Terror – the mass political repression of
1937-1938, and to organize related radio and television broadcasts.

6. To amend the Presidential Decree of 26 November 1998 No. 1310 “On
establishing Remembrance Day for the Victims of Holodomor and Political
Repression” (in the version of the Decree from 15 July 2004 No. 797),
removing the words “and political repression” from the title and the text.

The President of Ukraine, Viktor YUSHCHENKO
[Monday] 21 May 2007
——————————————————————————————
FOOTNOTE: Item 6 above is an important amendment. President
Kuchma first set the forth Saturday in November as Remembrance
Day for Victims of the Holodomor. Kuchma later changed his degree
by adding ‘and Political Repression.” President Yushchenko now has
set the third Sunday in May as Remembrance Day for the Victims
of Political Repression and the fourth Saturday in November is now
exclusively the day of Remembrance for the Victims of the
Holodomor [induced starvation, death for millions, genocide.]
AUR Editor Morgan Williams
——————————————————————————————
NOTE: Translation by Kharkiv Human Rights Protection Group,
Halya Coynash, halya@maidanua.org;
http://khpg.org/en/index.php?id=1179787176
————————————————————————————————
[return to index] [Action Ukraine Report (AUR) Monitoring Service]
========================================================
22. INTO THE BORDERLAND-IMAGES & STORIES FROM UKRAINE

Exhibition at the Museum of Cultures, Helsinki, Finland, Thu, May 17, 2007

HELSINKI – The “Into The Borderland – Images and Stories from Ukraine”
exhibition introduces the world of Ukraine’s eastern border. This is done by
means of bringing together photographs and stories of the people who live
near the border.

The photos and the recorded stories will put the visitors’ own familiar,
everyday surroundings in a new light and motivate them to re-think them: the
remote life of small villages at the eastern edge of Ukraine comes closer
under the gaze of the audience.

The four themes that introduce Ukraine’s border-world represent the four
aspects of human activity as regards the border and life in general.

People cross and protect a border by travelling across and protecting their
own country. But a border can also be grown: implanted into people’s
perceptions and attitudes.

Finally, a border can be remembered, as the past can be invoked or
forgotten. Eventually, not only a border but a state itself, a nation takes
shape. Ukraine’s changing eastern border tells us about the transformation
of contemporary Ukraine.

The exhibition has been put together in cooperation with the Finnish
Institute of International Affairs and the Finnish Cultural Foundation.

The exhibition will be open 9.5.2007 – 7.10.2007.
Museum of Cultures, Tennispalatsi, Eteläinen Rautatiekatu 8
Helsinki Finland, Tue-Thu 11-20; Fri-Sat 11-18,
————————————————————————————————-
LINK: http://www.kulttuurienmuseo.fi/
————————————————————————————————-
[return to index] [Action Ukraine Report (AUR) Monitoring Service]
========================================================
23. UKRAINE: THE TUNNEL CHILDREN

Samantha Booth, The Daily Record, Scotland, Saturday, May 12, 2007

CRAMPED, dark and squalid is the only way to describe the underground
network of disused heating chambers that thousands of Ukrainian children
call home. Worse, though, is the life they lead within these dingy tunnels.

Orphaned, abandoned or on the run from the abuse in the home, these
vulnerable children quickly fall in to a life of drugs and prostitution.

Often mistreated by older children already hardened by life on the streets,
they learn quickly that even the cops cannot be trusted.

And it all happens just metres away from the play parks and busy streets
where ordinary Ukrainians go about their daily business, often pretending
not to notice the filthy faces poking up from beneath manhole covers in the
road.

Magnus McFarlane-Barr is founder of Scottish International Relief and the
man behind a new project to try to help Ukraine’s street children.

He said: “The kind of life these children lead is really shocking and,
somehow, the fact it is all going on in areas where there are plenty of
people milling about, leading ordinary lives, make it even worse.

“I have worked with many children in desperate situations around the world
but I have never encountered kids who live in such an absence of love as the
children living on Ukraine’s streets.

“I have never come across many who have so little sense of community or
belonging.

“The local people generally despise them and treat them pretty badly, while
the police abuse them and continually move them on.
“And the places they live are beyond belief.”

According to Magnus, the youngsters gather in disused chambers under the
streets desperate for warmth despite them being dank, dark and depressing
places.

“Some groups are now so well established they have managed to find an old
TV, or some furniture from somewhere,” he said.

But it doesn’t make much difference. Living like that isn’t safe for
children but, sadly, there are not many alternatives.

“They don’t want to go into the state orphanages because they are no better
than prisons. A lot of them have left really bad situations at home but they
can also find themselves in truly horrific circumstances living on the
streets.

“All that is there for them is a life of abuse, crime and prostitution.”

Magnus first heard of the plight of the Ukrainian street children just over
a year ago. He had been incredibly moved by the work of Scots photographer
David Gillanders, who had taken pictures of some of the children on a trip
to the Ukraine.

Then he was approached by a friend who worked for homeless organisation
DePaul to see if there was anything he could do for them.

Magnus said: “I had been really moved by the photographs, so when a friend
at DePaul asked me if there was anything I could do to help, I knew I had to
look into it.

“So about a year ago, I made my first trip out to the Ukraine to see for
myself and, I have to say, I was shocked. When I first arrived the children
were getting no kind of help at all and the authorities were in almost
complete denial about their existence.

“The police would sometimes try to round them all up and put them into a
state orphanage but they are terrible places. They are huge institutions
where there is no kind of personal care, or individual contact and all the
children that live there spend all their time trying to escape. So you can
imagine what it would be like for children who have got used to living on
the streets.

“They have become so used to doing what they want when they want, that it is
hard for them to adapt to the regimentation of those kind of institutions.”

With the backing of Scottish International Relief, Magnus set up a project
in the Ukraine cities of Khariv and Odessa, between which there are about
1300 street children.

The project’s primary aim was to provide the children with a hot meal. But
in the nine months it has now been running, the project has developed to
such an extent that it has opened a day centre and offers basic first aid
and clean clothes.

Magnus said: “It is very hard to gain these children’s trust. But I am
delighted to say that we have had huge success in building strong
relationships with quite a few children and I would go so far as to say that
their lives have been transformed. “We now have regular contact with about
60 children.”

To begin with project workers would take a bus around the streets offering
the youngsters hot meals. Then, once the day centre opened and they felt
they could trust a child, they would invite them to go along.

Magnus added: “Next, we started giving them first aid because, as you can
imagine, there is a lot of violence on the streets and a lot of the girls
especially were turning up with swollen faces and black eyes.

“Self-harming is also a huge issue. Then, because they all smelled so badly,
we started offering the children clean clothes so we could take theirs away
to be washed.

“All these may sound like little things to us but to these kids they are
really important and make a huge difference to their lives.

“It is like how we make sure we mark the birthday of every child who goes to
the day centre with a proper celebration.”

While the work of Magnus and his team of volunteers is making a huge
difference to many of the children who live on Ukraine’s streets, he knows
only too well it’s only the tip of the iceberg and that there is no way he
can solve all the problems faced by these children.

Just a few days after he returned from his last trip to the Ukraine, two
17-year-old girls he met were involved in a horrific accident.
Returning to their underground shelters after a night working the streets
they were hit by a speeding car.

One was killed outright and the other is in intensive care, relying on cash
donations from a local priest and blood donations from Magnus’ team of
volunteers to cling to life.

Many of the children are addicted to glue sniffing and others become hooked
on a cocktail of over-the-counter drugs, which they crush together and
inject. The constant drug abuse often causes mini-strokes.

Magnus said: “Visiting a drug and rehab clinic in Odessa is one of the
saddest things I have ever seen in the Ukraine.

“The children were like zombies because they had taken so many mini-strokes
after taking these drugs there was nothing left of their brains. It was
awful to see.”

The project now aims to open a night centre and, if possible, try to resolve
some of the children’s individual situations.

Magnus said: “Of course, ideally we want to get them reunited with their
families but considering many of these kids are running away from some kind
of abuse it is not always appropriate. “But the least we can do is offer
them a ray of hope and that, too, is important.”

For more info or to make a donation contact Scottish International Relief on
www.sircharity.org or call 0800 698 1212.
————————————————————————————————-
[return to index] [Action Ukraine Report (AUR) Monitoring Service]
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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, Washington;
Founder & Trustee, Holodomor Exhibition & Education Collection
P.O. Box 2607, Washington, D.C. 20013, Tel: 202 437 4707
mwilliams@SigmaBleyzer.com; www.SigmaBleyzer.com
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