Monthly Archives: April 2008

AUR#895 Apr 2 Germany, France & Russia Stand Against Ukraine & Georgia; United States Supports Ukraine & Georgia; Russia Warns Ukraine

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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       
 
GERMANY, FRANCE & RUSSIA STAND AGAINST
UKRAINE & GEORGIA FOR NATO MAP
                        
ACTION UKRAINE REPORT – AUR – Number 895
Mr. E. Morgan Williams, Publisher and Editor, SigmaBleyzer
WASHINGTON, D.C., WEDNESDAY, APRIL 2, 2008
 
INDEX OF ARTICLES  ——
Clicking on the title of any article takes you directly to the article.               
Return to Index by clicking on Return to Index at the end of each article
1.  GERMANY PUTS THE BRAKES ON UKRAINE & GEORGIA
THE NATO SUMMIT: By Gregor Peter Schmitz in Washington D.C.
Der Spiegle Online,  Germany, Friday, March 28, 2008
 
2FRANCE WON’T BACK UKRAINE AND GEORGIA NATO BIDS
Reuters, Paris, France, Tuesday, Apr 1, 2008

3RUSSIA WARNS UKRAINE AGAINST NATO MEMBERSHIP
RIA Novosti, Moscow, Russia, Tuesday, April 1, 2008

4BUSH TO SEEK PATH FOR UKRAINE, GEORGIA TO JOIN NATO
DESPITE FRENCH-GERMAN AND RUSSIAN OPPOSITION

By Terence Hunt, Associated Press (AP)
Bucharest, Romania, Tuesday, April 1, 2008

5BUSH DEFIES RUSSIA ON UKRAINE FOR NATO
Agence France-Presse (AFP), Kiev, Ukraine, Wednesday, April 02, 2008

6U.S. AND UKRAINE CHALLENGE RUSSIA ON NATO EXPANSION
By Anne Penketh, Diplomatic Editor, The Independent

London, UK, Wednesday, 2 April 2008

7.   ROBUST ALLIANCE
The Alliance Stands At The Fork in the Road, Nudge It Forward
EDITORIAL: The Wall Street Journal, New York, NY, Wed, April 2, 2008

8A SUMMIT OF HOPES AND FEARS
Roman Olearchyk, Ben Aris and Bernard Kennedy
bne, BusinessNewEurope, Berlin, Germany, Thursday, March 27, 2008

9GERMAN CHILL TOWARD NATO’S GROWTH IGNORES PAST
Commentary by Frederick Kempe, President, Atlantic Council
Bloomberg, New York, New York, Tuesday, April 1, 2008

10EXCLUDE UKRAINE FOR INCLUSIVE SECURITY
The price of the question
OP-ED: by Timofei Bordachev, Director of the Center for European and
International Research, State University – Higher School of Economics
Kommersant, Moscow, Russia,  Monday, March 31, 2008

11BUSH VOWS TO PRESS KIEV’S NATO CLAIMS
By Roman Olearchyk in Kiev and James Blitz in London
Financial Times, London, UK, Tuesday, April 1 2008

12BUSH VISITS A UKRAINE DEEPLY SPLIT OVER BID TO

JOIN WESTERN ALLIANCE NATO
By Peter Baker, Washington Post Staff Writer
The Washington Post, Washington, D.C. Tue, Apr 1, 2008; Page A12

13PRESIDENT BUSH & PRESIDENT YUSHCHENKO OF UKRAINE
EXCHANGE LUNCHEON TOASTS
Presidential Secretariat, Kyiv, Ukraine, Tuesday, April 1, 2008

14U.S., UKRAINE SIGN TRADE, INVESTMENT COOPERATION PACT
Reuters, Washington, D.C., Tuesday April 1 2008

15NATO SHOULDN’T ADVANCE TOO FAR EAST
OP-ED: By Malcolm Rifkind, MP was Defence Secretary, 1992-95
Telegraph, London, United Kingdom, Wednesday, April 2, 2008

16PUTIN’S LAST STAND
VIEW: By Anders Aslund, Daily Times,

Lahore, Pakistan, Wednesday, April 2, 2008

17THE PRICE RUSSIA MUST PAY FOR BEING HYSTERICAL
OP-ED: By Yevgeny Kiselyov, a political analyst
Hosts a radio program on Ekho Moskvy
Moscow Times, Moscow, Russia, Wednesday, April 2, 2008

18UKRAINIAN INVESTORS UNDETERRED BY CREDIT SQUEEZE
By Roman Olearchyk, Financial Times
London, United Kingdom, Wednesday, April 2 2008

19MJA ASSET MANAGEMENT, LLC, JOINS THE U.S.-UKRAINE
BUSINESS COUNCIL (USUBC), INVESTS IN HISTORIC STRUCTURES                        
U.S.-Ukraine Business Council (USUBC), Wash, D.C., Mar, 2008

20BANKS: BENIGN FORECAST HIDES NASTY SURPRISES
International Banks Expanding in Romania, Ukraine, and Russia
By Stefan Wagstyl, Financial Times,

London, United Kingdom, Tuesday, April 1 2008
 
A World Leader in Aerospace, Combat Systems,
Marine Systems, Information Systems & Technology
U.S.-Ukraine Business Council (USUBC), Washington, D.C, Mar, 2008
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1
GERMANY PUTS THE BRAKES ON UKRAINE & GEORGIA

THE NATO SUMMIT: By Gregor Peter Schmitz in Washington D.C.
Der Spiegle Online,  Germany, Friday, March 28, 2008

US President George W. Bush wants to bring more Eastern European countries
into the military alliance at the upcoming NATO summit. But Germany is
thwarting his plans, because of concerns about Ukraine and Georgia — and in
deference to Russia.

German objections dominate the debate over NATO expansion in the final days
leading up the military alliance’s summit meeting in the Romanian capital
Bucharest.

James Goldgeier, a member of the National Security Council in the
administration of former US President Bill Clinton, told SPIEGEL ONLINE: “I
am amazed at how openly the current differences between Berlin and
Washington are being aired. In February it was the German role in
Afghanistan. Now it’s about the issue of NATO expansion, in which Germany
quite openly orchestrated the resistance to Ukraine and Georgia. This is
relatively unusual in advance of this sort of summit.”

Romania’s Ceausescu-era parliament building in Bucharest will host next
week’s NATO summit.Goldgeier’s words ring especially true when one considers
the importance of the issue for the Bush administration.

NATO expansion is one of the few strategies it took over almost seamlessly
from the Clinton administration. “Bush absolutely wanted to get the
acceptance process for Georgia and Ukraine underway in Bucharest,” says
Goldgeier.

A clear signal that things will not go quite as smoothly as Bush had hoped
was the discussion among foreign policy and security experts at the Brussels
Forum, sponsored by the German Marshall Fund, less than two weeks ago.

Moderator Ronald Asmus, who, as a senior official in the Clinton
administration in the 1990s, played a key role in the initial push to expand
NATO eastward, opened the meeting by calling EU and NATO expansion an
historic success. Asmus went on to rave about how the map of Europe had been
redrawn, and praised the joint tour de force by Europeans and Americans.
NATO

But after his nostalgic excursion into the past, Asmus was forced to segue
into a significantly trickier present, one in which the euphoria of new NATO
and EU membership has all but disappeared.

The crucial question is this: In addition to membership invitations that
will be extended to Albania, Croatia and Macedonia at the NATO summit in
Bucharest from Tuesday to Thursday of next week, should Georgia and Ukraine
be given the thumbs up for membership in the not-too-distant future?

In addressing the conundrum, Asmus’ tone quickly turned from jubilant to
sober. Would the United States be able to achieve these goals, he asked the
group apprehensively? There are already many critics today, he added,
critics like the Germans.

“An official from the German foreign ministry told me recently that he
couldn’t think of one member of the foreign affairs committee of the German
Bundestag who supports the initiation of NATO membership negotiations with
Ukraine and Georgia,” Asmus said.

Many Germans were sitting in the audience — and agreed with Asmus’
characterization. Eckart von Klaeden, foreign policy spokesman of the
conservative Christian Democratic and Christian Social Union (CDU/CSU)
parliamentary group, was only too willing to list Germany’s concerns.

In Ukraine, he said, large segments of the population oppose the idea of
NATO membership. And Georgia, with its internal conflicts? “We don’t want
another Cyprus in NATO,” said von Klaeden, referring to the Mediterranean
country’s division into Turkish and Greek regions.

Volker Stanzel, a highly-placed official at the German Foreign Office,
described the regional effects of another NATO expansion — and the concerns
in Moscow. “Russia is in the process of domestic political change, which,
together with a new president, also affects its foreign policy,” says
Stanzel. Is the right time for NATO to seek conflict with the Russians by
pushing eastward? Stanzel’s position: “Is this truly necessary?”

Despite the German objections, diplomats say that a row in Bucharest is
unlikely. Washington now seems more receptive to arguments coming from its
allies. Elizabeth Sherwood-Randall, a NATO expert at Stanford University,
told SPIEGEL ONLINE: “There is already a lot of frustration among our
partners over NATO’s fixation on Afghanistan and Kosovo. It takes up so

many resources that there is very little room left for strategic debates within
the alliance.”

According to Sherwood-Randall, the member nations are making it increasingly
clear to Washington that they do not feel that their contributions are
sufficiently recognized — contributions that in many cases were achieved in
the face of substantial resistance from within their populations.

All of which suggests that the Americans will hold back in Bucharest, at
least when it comes to new finger-pointing relating to the Afghanistan
mission. The Canadians will likely take a similar approach. In a recent
interview with SPIEGEL ONLINE, their defense minister, Peter MacKay,
reiterated Canada’s call for a stronger German role.

But now the Canadians assume that their demands will be met in Bucharest,
where other member states are expected to pledge 1,000 additional troops to
come to their aid in embattled southern Afghanistan.

And the expansion issue? Last week Bush continued to campaign for Georgia
and Ukraine with personal calls to European capitals. He also plans to pay a
demonstrative visit to Kiev just before the NATO summit.

But even senior Washington diplomats expect the Bush administration to come
around, perhaps by accepting a declaration that would lay the groundwork for
the beginning of an acceptance process for Ukraine and Georgia. The White
House apparently no longer believes that a rapid admission process, like in
the first expansion round, is possible today.

As expansion veteran Asmus recently wrote in Foreign Affairs, three key
factors have changed since then: the global situation, the candidate nations
and Russia. “Finally, Russia has changed,” he wrote. “In the 1990s, it was a
weak, quasi-democratic state that wanted to become part of the West. Now, a
more powerful, nationalist, and less democratic Russia is challenging the
West.”

This has not failed to escape the attention of President Bush, who has spent
the last few weeks seeking closer ties with Moscow. He sent Secretary of
State Condoleezza Rice and Defense Secretary Robert Gates to Moscow to

allay Russian concerns over the planned US missile defense system in Eastern
Europe.

The president even plans to meet directly with Putin after the NATO summit,
on April 6 in the Russian Black Sea resort of Sochi, an accommodating
gesture that has surprised even some of his top advisors. “Good relations
with Russia are important to us,” Bush said this week.

Perhaps the election has something to do with it. John McCain, who is
campaigning to succeed Bush in the White House, could suffer in the
presidential race as a result of his support for the unpopular president’s
Iraq policies. A new escalation with Russia, instigated by the White House,
would only underscore the impression of a devastating Republican foreign
policy legacy.

Of course, McCain himself is seen as being highly critical of Moscow. The
Arizona senator has often said that he sees only three letters in Putin’s
eyes: “a ‘K’, a ‘G’ and a ‘B’.” While Bush was sending his love letter to
Moscow this week, his fellow Republican had a different message for the
Russians.

As long as democracy does not progress in Russia, McCain said in a speech

on foreign policy, there could only be one conceivable reaction: The G8 must
exclude Russia. (Translated from the German by Christopher Sultan)
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2.  FRANCE WON’T BACK UKRAINE & GEORGIA NATO BIDS

Reuters, Paris, France, Tuesday, Apr 1, 2008

PARIS – France will not support bids by the former Soviet republics of
Georgia and Ukraine to become members of NATO, putting it at odds with
the United States, French Prime Minister Francois Fillon said on Tuesday.

“France will not give its green light to the entry of Ukraine and Georgia,”
Fillon told France Inter radio. “France has an opinion which is different
from that of the United States on this question.”

NATO leaders hold a summit later this week in Romania where Georgia and
Ukraine hope to obtain a Membership Action Plan (MAP) — a road map to
eventual entry already secured by Croatia, Macedonia and Albania.

President George W. Bush arrived in Ukraine late on Monday ahead of the
summit, and officials accompanying him remained optimistic that the alliance
could extend the plan to both countries at the summit.

“We think it’s very, very, very important (for) Georgia and Ukraine, that we
welcome their aspirations to be part of NATO, that we have an active
engagement in helping them move in that direction,” National Security
Council adviser Stephen Hadley told reporters aboard Air Force One.

“And the president has made clear we think the best way to do that is to
offer MAP at Bucharest and that’s what the president is pushing hard for.”

However, French officials are reluctant to embrace Ukraine and Georgia
because of fierce Russian opposition to their NATO membership drive.

“We are opposed to the entry of Georgia and Ukraine because we think it is
not the right response to the balance of power in Europe and between Europe
and Russia, and we want to have a dialogue on this subject with Russia,”
Fillon said.

“That’s what the president of the Republic will say in Bucharest tomorrow,”
he added.
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(Reporting by Francois Murphy and James Mackenzie; Editing by Crispian
Balmer and Ibon Villelabeitia)
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[return to index] [Action Ukraine Report (AUR) Monitoring Service]
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3.  RUSSIA WARNS UKRAINE AGAINST NATO MEMBERSHIP

RIA Novosti, Moscow, Russia, Tuesday, April 1, 2008

MOSCOW – Ukraine’s admission to NATO will have a negative impact on

European security and on Kiev’s relations with Moscow, a Russian deputy
foreign minister said on Tuesday.

“Ukraine’s accession to NATO will cause a deep crisis in Russian-Ukrainian
relations that will affect all-European security. Therefore, the West must
also make a choice as to what kind of relationship with Russia is in its
interests,” Grigory Karasin said.

He said that Kiev’s admission to NATO would require a review of Russia’s
own security policy.

“Our policy with regard to Ukraine will be based on respect, but we will
develop it depending on Ukraine’s further actions,” he said.

 
He also said Russian and Ukrainian foreign ministers were to meet “in the
very near future,” and that a meeting of an intergovernmental commission on
economic cooperation was to be held later in Kiev. Russia’s Foreign Ministry
earlier said the ministers would meet on April 15 in Moscow.

Karasin was addressing a parliamentary hearing on the future of a
Russian-Ukrainian friendship, cooperation and partnership treaty, which
expires in exactly a year.

Some MPs have suggested that Russia should pull out of the treaty if Ukraine
joins NATO’s Membership Action Plan (MAP), a program that prepares

countries for accession to the Western military alliance but does not guarantee
membership.

The State Duma has proposed several recommendations to the Russian
government with regard to Ukraine – from tearing up the Russian-Ukrainian
treaty to extending it, but only if the treaty on the Black Sea Fleet’s
presence in Ukraine is extended for another 20 years.

“NATO’s approach to Russia’s borders is a situation that is unacceptable to
us, and we will do all we can to prevent that from happening,” State Duma
Speaker Boris Gryzlov said.

He said one of the reasons why he objected to Ukraine’s admission to NATO
was that the move was opposed by the majority of Ukrainians.

U.S. President George W. Bush arrived in Ukraine late Monday and following a
meeting with President Viktor Yushchenko told journalists on Tuesday: “We
support MAP for Ukraine.”

The visit is a stop-over before the April 2-4 NATO summit in Romania, which
Russian President Vladimir Putin will also be attending, as a guest.
Ukraine’s leaders requested in January to join NATO’s Membership Action
Plan.

However, despite Washington’s unequivocal support for Ukraine’s bid,
membership is far from certain, with the majority of Ukrainians and a vocal
minority in parliament resisting the plans, partly over fears of provoking
its former Soviet master Russia.

The Kremlin threatened in February to target missiles at Ukraine if Kiev
joins NATO and allows Western military facilities on its territory.

On Monday, thousands of people gathered on Kiev’s Independence Square
(Maidan Nezalezhnosti) to rally against Bush and NATO, displaying Communist
flags and banners with the slogans: “NATO is worse than the Gestapo” and
“Put Bush’s bloody dictatorship under an international tribunal.”

Yushchenko condemned the rallies, however, saying: “these were the flags
that caused totalitarianism and suffering, the deaths of millions of
people.”

Ukraine’s drive toward NATO membership has triggered domestic parliamentary
opposition protests amid widespread antipathy toward the alliance. A survey
published earlier this month said only 11% of Ukrainians supported the idea
of NATO membership, while almost 36% were strongly opposed.
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LINK: http://en.rian.ru/russia/20080401/102683298.html

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[return to index] [Action Ukraine Report (AUR) Monitoring Service]
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4.  BUSH TO SEEK PATH FOR UKRAINE, GEORGIA TO JOIN
NATO DESPITE FRENCH-GERMAN & RUSSIAN OPPOSITION

By Terence Hunt, Associated Press (AP)
Bucharest, Romania, Tuesday, April 1, 2008

BUCHAREST, Romania – Unflinching from a fight, President Bush said Tuesday
he fully supports proposals to put ex-Soviet states Ukraine and Georgia on
the road toward joining NATO despite French and German qualms it would

upset relations with Moscow.

Bush’s declaration laid the groundwork for an uncomfortable showdown when
leaders of the 26-member military alliance gather in Bucharest for a summit
Wednesday to Friday. France refused to back down under U.S. pressure.

t”France will not give its green light to the entry of Ukraine and Georgia,”
Prime Minister Francois Fillon said. “We are opposed to Georgia and
Ukraine’s entry because we think that it is not the correct response to the
balance of power in Europe, and between Europe and Russia.”

Bush turned up the heat on allies by making a high-profile visit to Ukraine
before traveling to Romania.

Soviet-era flags were carried in the streets of Kiev on the eve of Bush’s
arrival, the president noted. More than half of Ukraine’s population, most
in the Russian-speaking east and south, is deeply suspicious of the West and
opposes membership, polls show.

Brushing aside doubts in Ukraine, Bush said, “Look, this is an interesting
debate that’s taking place and … as every nation has told me, Russia will
not have a veto over what happens in Bucharest, and I take their word for
it. And that’s the right policy to have.”

Ukraine and Georgia are seeking a precursor to membership known as a
membership action plan that spells out what they would have to do to join
the alliance. Such a plan could take years to fulfill.

“I’m going to work as hard as I can to see to it that Ukraine and Georgia
are accepted into MAP,” Bush said. “I think it’s in our interests as NATO
members, and I think it’s in Ukrainian and Georgian interests, as well.”

To emphasize Bush’s case, the White House released excerpts of a speech he
will deliver Wednesday just hours before the summit opens.

Granting Ukraine and Georgia an action plan “would send a signal to their
citizens that if they continue on the path of democracy and reform, they
will be welcomed into the institutions of Europe,” according to the speech.
“And it would send a signal throughout the region that these two nations
are, and will remain, sovereign and independent states.”

There were backstage negotiations to resolve an argument among NATO partners
about Ukraine and Georgia; U.S. officials said they were uncertain of the
eventual outcome. White House press secretary Dana Perino said Bush was not
looking for a compromise.

“We are working very hard to talk with our allies and make the case,” Perino
said. “But it could be a clarifying moment, and that’s not a bad thing,
either.”

Bush also urged NATO allies to embrace a missile defense plan for Europe
that Russia has hotly opposed. U.S. officials have raised hopes that Bush
and Russian President Vladimir Putin may reconcile the differences when they
meet this weekend.

Bush, in the speech, quotes U.S. intelligence officials as saying Iran is
moving closer to testing an intercontinental ballistic missile capable of
reaching the United States and all of Europe, if it chooses.

“Today, we have no way to defend Europe against this emerging threat, so we
must deploy ballistic missile defenses here that can,” Bush said.

He said the system is not aimed at Russia. “The Cold War is over. Russia is
not our enemy. We are working toward a new security relationship with Russia
whose foundation does not rest on the prospect of mutual annihilation.”

In Ukraine, Bush told President Viktor Yushchenko the U.S. “strongly
supports your request” and a similar effort by Georgia for a path into NATO.

Russia is not a NATO member and holds no veto authority over the alliance’s
decisions. But all NATO actions require a consensus, meaning any one of the
26 nations can blackball a potential new member. Greece, for example, is
threatening to block Macedonia’s membership application because of a dispute
over Macedonia’s name.

Bush said it was a “misperception” that the U.S. might soften its push on
behalf of Ukraine and Georgia if Russia were to ease opposition to
Washington’s plan for the system to be based in Poland and the Czech
Republic.

“There’s no trade-offs. Period,” Bush said, adding that is exactly what he
told Russian President Vladimir Putin in a recent telephone call.

Bush and Putin, whose successor takes over in May, are meeting Sunday in the
Russian Black Sea resort of Sochi. White House officials have expressed
hopes the leaders could end months of sharp disagreements and strike a deal.

As if to give a last reminder of Russia’s wishes, Putin’s deputy foreign
minister, Grigory Karasin, said Ukraine’s accession to NATO would cause a
“deep crisis” in relations with Ukraine and the West.

Nine former Soviet bloc countries are in NATO, and Russia opposes Ukraine
and Georgia even starting the process, fearing a further loss of influence
among the former Soviet sphere.
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[return to index] [Action Ukraine Report (AUR) Monitoring Service]
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U.S.-Ukraine Business Council (USUBC): http://www.usubc.org
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5.  BUSH DEFIES RUSSIA ON UKRAINE FOR NATO

Agence France-Presse (AFP), Kiev, Ukraine, Wednesday, April 02, 2008

KIEV: George W.Bush last night threw his support behind Ukraine’s bid to
join NATO and told Russia it would have no right to veto the move.

But in a sign of protracted debate at the annual NATO summit in Bucharest
this week, France opposed letting Ukraine and Georgia into the alliance,
with Prime Minister Francois Fillon saying it could upset the balance of
power in Europe.

Speaking at a news conference in Kiev, the US President said Washington
wanted to see Ukraine and Georgia, both former Soviet republics, given a
Membership Action Plan, a formal step towards joining NATO.

“I strongly believe that Ukraine and Georgia should be given MAP and there’s
no trade-offs, period,” said Mr Bush, with Ukrainian President Viktor
Yushchenko at his side.

Mr Bush, however, stopped short, of saying that the Atlantic alliance must
extend MAP agreements to Ukraine and Georgia at the summit, which opens in
Bucharest tonight. His comments were likely to stoke tension with Russia,
and the membership move is opposed by Germany, France and other European
powers.

Mr Fillon said: “We are opposed to the entry of Georgia andUkraine because
we think that it is not a good answer to thebalance of power within Europe
and between Europe and Russia.”

Russian officials warned before Mr Bush spoke that Ukraine’s membership of
NATO would undermine European security.

“Admission of Ukraine into NATO will lead to a deep crisis in
Russian-Ukrainian relations. This affects pan-European security,” Russian
Deputy Foreign Minister Grigory Karasin said.

“So the West must decide what kind of relationship with Russia will serve
its interests.”

Russian President Vladimir Putin has threatened to target Ukraine and
Georgia with nuclear missiles should they join the alliance. Mr Bush said he
had recently spoken with Mr Putin to explain why the US supported Ukraine
and Georgia joining NATO and to assure the Russian leader that Moscow had
nothing to fear from such a move.

The US President and Mr Putin, both of whom leave office within a year, are
to meet this weekend at the Russian leader’s residence in the Black Sea
resort of Sochi.

Mr Bush said last night that Russia “won’t have a veto” over who is allowed
to join NATO. A top Russian official quickly responded by saying that

Moscow would make sure its position was taken into account.

“Russia has the right to express its view and has sufficient political
authority for its view to be reckoned with,” said Russia’s ambassador to
NATO, Dmitry Rogozin.

Mr Bush also admitted that there was still no agreement with Russia on US
plans to set up missile defences in two other former Soviet bloc states –
the Czech Republic and Poland.

“Obviously, we’ve got work to do to persuade (Mr Putin) that the missile
defence system is not aimed at Russia,” Mr Bush said. He said he was
“hopeful” there could be an agreement. Russia says the system is a direct
threat to its security, a notion dismissed by the US.
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[return to index] [Action Ukraine Report (AUR) Monitoring Service]
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6.  U.S. & UKRAINE CHALLENGE RUSSIA ON NATO EXPANSION

By Anne Penketh, Diplomatic Editor, The Independent
London, UK, Wednesday, 2 April 2008

President Bush has thrown down the gauntlet to Russia and set the stage for
a showdown with Europe by expressing public support for Ukraine and
Georgia to become members of Nato, Mr Bush said after talks with Ukraine’s
President, Viktor Yushchenko, that America “strongly supports” the former
Soviet republic’s bid for membership.

“In Bucharest this week, I will continue to make America’s position clear:
we support Map for Ukraine and Georgia.” Map refers to Nato’s membership
action plan for future members.

Nato itself is divided over whether to offer the two former Soviet republics
a path towards Nato membership. France and Germany want to avoid
antagonising Russia, which is opposed to Ukrainian and Georgian membership,
and the26-member military alliance operates on the basis of political
consensus.

Mr Bush said the outcome of the Nato meeting should not be prejudged, but
the French Prime Minister said yesterday: “France will not give its green
light to the entry of Ukraine and Georgia. We think that it is not the
correct response to the balance of power in Europe, and between Europe
and Russia.”

Other states, however, are concerned about Russia – which is not a Nato
member – having what amounts to a veto over Nato membership. Mr Bush said
he had been assured by other Nato leaders “Russia will not have a veto over
what happens in Bucharest. I take their word for it.”

President Vladimir Putin, attending his last major international summit
before he becomes prime minister next month, will hold talks in Bucharest
with Nato leaders. Nine former members of the Soviet bloc are already Nato
members.

Mr Putin’s spokesman, Dmitry Peskov, warned Ukraine and Georgia that
membership would “lead to additional tension”. In a telephone briefing from
the Kremlin with foreign reporters, he did not respond directly when asked
about possible linkage between the membership issue and a dispute with
America over plans to locate parts of a US missile defence shield in Poland
and the Czech Republic.

Mr Bush, who is expected to discuss the missile shield with Mr Putin at
their final summit in the Russian resort of Sochi next weekend, has rejected
any trade-off.

Mr Peskov said Russia would prefer the US to shelve its deployment plans,
but added: “We appreciate the effort from our American partners, and we are
ready to continue our mutual search for the way out of this very complicated
situation” which he said affected Russia’s strategic and national security
interests.

The Nato summit is expected to extend invitations to at least two
countries – Albania and Croatia – to join the alliance. A third invitation
had been expected for Macedonia. However, Greece repeated yesterday that it
would veto Macedonia joining unless there was an agreement with Athens on
the country’s name.

There has been a dispute for 15 years over Macedonia which has the same name
as a northern Greek province over which it is accused of having territorial
claims. It has UN membership under the provisional name of the Former
Yugoslav Republic of Macedonia.
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http://www.independent.co.uk/news/europe/us-and-ukraine-challenge-russia-on-nato-expansion-803539.html?r=RSS
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[return to index] [Action Ukraine Report (AUR) Monitoring Service]
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7.   ROBUST ALLIANCE
The Alliance Stands At The Fork in the Road, Nudge It Forward

EDITORIAL: The Wall Street Journal, New York, NY, Wed, April 2, 2008

George W. Bush is enjoying a week in the half of Europe that welcomes him
without clenched teeth. But the President had better be ready to spoil the
valedictory tour with tough diplomacy, particularly over NATO, or leave
unfinished business for the next Administration.

The centerpiece of the Eastern European swing is the three-day NATO summit
in Bucharest starting tonight. Washington pushed to hold it in the Romanian
capital to highlight NATO’s role in the ex-Soviet bloc.

Romania is one of seven new Alliance members brought in during the Bush
years. This strategic commitment is suddenly in doubt, however, thanks to
wavering in certain European capitals about the next step.

The invitation party for three future members from the Balkans – Croatia,
Albania and Macedonia – is in danger of being spoiled by Greece. A minority
government in Athens insists that neighboring Macedonia change its name, or
it won’t be allowed into NATO.

This absurd dispute over who gets symbolic claim to the name of Alexander’s
birthplace threatens stability in a region already roiled by the fallout
from Kosovo’s independence. The Greeks don’t know better, so Mr. Bush
and the other leaders have to find a creative solution.

Also on the table in Bucharest is whether Ukraine and Georgia belong in the
West. A preliminary step is a Membership Action Plan, or MAP, to one day
join NATO. Offering a MAP starts a long process with no preordained result.

Macedonia, Albania and Croatia got theirs a decade ago. In Kiev yesterday,
Mr. Bush said that “I strongly believe that Ukraine and Georgia should be
given MAPs,” and promised that Russia “will not have a veto.”

The current signals suggest otherwise. After meeting with Vladimir Putin in
Moscow on March 8, German Chancellor Angela Merkel hardened her
opposition to opening NATO’s door to Ukraine and Georgia.

About 10 other member states took cover behind her. Ukraine is too divided
over NATO, goes their argument, and Georgia’s democracy too unsettled by
last winter’s street riots and early elections. And why – the real reason –
annoy Russia?

A rebuff in Bucharest, which as of last night looked likely absent a
stronger American push, would be dangerous for Ukraine and Georgia, for
NATO and for Europe as a whole. It’s also morally wrong; these countries
are freely asking to be given a chance.

For all its troubles, Ukraine is the healthiest democracy in the old Soviet
Union (bar the three Baltic states). Germany effectively wants to consign
this large, strategic country to Russia’s sphere of influence.

In Georgia, Mikheil Saakashvili did his country no favors with his crackdown
last winter. A positive signal from NATO is the best way to help guide the
freest country in the Caucasus toward the West.

NATO has played an unheralded but critical mentorship role throughout the
post-Cold War era, starting with its invitations to Poland, Hungary and the
Czech Republic. It can do the same for Georgia and Ukraine.

Other pieces of the puzzle are falling into place better in Bucharest.
President Nicolas Sarkozy plans to announce plans to boost the French
military presence in Afghanistan, heeding the call from Canada and NATO
for reinforcements in the south of the country.

The U.S., Britain and Canada are leading the fight against the Taliban,
while Germany, Italy and Spain are convinced Afghanistan is a
“reconstruction” job. The summit usefully recommits the Alliance to see
the task there through.

NATO continues to mock its post-Cold War obituarists, meeting fresh
challenges – Eastern Europe, Balkans, Afghanistan – and enjoying renewed
political support, including, in a welcome surprise, from the new French
government.

But again, in Bucharest, the Alliance stands at a fork in the road. A lame
duck from the White House has another opportunity to nudge it in the right
direction.
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LINK: http://online.wsj.com/article/SB120708328456881367.html
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8.  A SUMMIT OF HOPES AND FEARS

Roman Olearchyk, Ben Aris and Bernard Kennedy
bne, BusinessNewEurope, Berlin, Germany, Thursday, March 27, 2008

While Romania is set to enjoy two days of special holiday during this year’s
Nato summit in Bucharest on April 2-4, the atmosphere inside the halls and
meeting room will be anything but a holiday one.

At the top of the agenda, of course, will be Nato’s expansion; several
countries want to join, Russia wants to prevent them. However, worryingly
for the alliance there is a large existing member, namely Turkey, which
appears to be heading in the opposite direction.

According to sources close to Nato, neither Ukraine nor Georgia will be
formally accepted as candidates for Nato’s programme intended to prepare
aspiring members for joining the military alliance at April’s summit in
Bucharest, despite a last-minute push by US President George W. Bush.

Instead, the Nato leadership will seek a formula to reaffirm support for
Kyiv and Tbilisi’s bids, while putting the divisive issue off and giving
them more time to build up support amid member countries, the sources say.
The delay will also avoid aggravating relations with Russia, which has
issued dire warnings about the consequences that would follow the further
eastward expansion of the military alliance.

“There is an effort to find a formula which will not say ‘no’ to Ukraine and
Georgia, but will de facto put the decision off for later,” says Ilko
Kucheriv, a well-connected pro-Nato advocate in Ukraine who heads the
Kyiv-based Democratic Initiatives Foundation.

The ministerial meeting of Nato countries in Brussels on March 6 ended
without a consensus on these so-called Membership Action Plans (MAPs). The
US’ efforts have so far failed to convince key Western European alliance
members, foremost among them France and Germany, to support these bids.

These countries are worried that such moves would strain already tense
relations with Russia, which adamantly opposes Nato’s further expansion to
regions it views as falling within its own sphere of influence.

Russia’s outgoing president, Vladimir Putin, warned in February that Moscow
could point missiles at Ukraine should its former Soviet ally join Nato and
become a host for military bases.

“Nato member governments are not ready to offer MAP to Ukraine and Georgia,”
says Stephen J. Flanagan, senior vice president and director of the
International Security Program at the Washington DC-based Center for
Strategic and International Studies.

“There are doubts about the depth of support for Nato membership in Ukraine,
uncertainty about political trends in Georgia, and concerns that the move
would further strain relations with Russia. However, the US and others will
want to be sure that this reluctance does not send a message that Moscow’s
confrontational diplomacy is successful. The allies will look for some
concrete steps short of MAP to enhance dialogue with Ukraine and Georgia
that would keep Nato’s door open.”

Kucheriv says it’s the Russian factor that’s the main problem. “If Russia
did not make such a big issue out of this, then Ukraine and Georgia would
have been accepted into the Nato MAP long ago,” he says.

To the Kremlin, the Cold War never ended. Nato broke its promise made to
Russia in the early 1990s not to expand, yet today alliance troops are at
its western border in the Baltics; Poland is about to get a missile system
that sits in Russia’s front yard; and Ukraine, Georgia and Azerbaijan are
all actively pursuing membership. Russian President Vladimir Putin feels
like a man with a gun at his head.

Nato’s expansion is frightening for those brought up in the Soviet Union.
The non-stop propaganda taught them that Nato was their arch enemy,
untrustworthy and aggressive. So the West’s attempt to persuade them that
“we’ll all friends now” takes a leap of faith.

On the other side, small countries that broke with Moscow, like the Baltic
states and Georgia, want the protection of bigger countries against their
old master.

But in other countries, like Ukraine, the population is more ambivalent
about Nato; recent polls show the majority are all for joining the EU (if
and when Ukraine is offered membership), but the majority don’t want to join
Nato even if their leaders do.

The US seems determined to push home its advantage while it can. US
Secretary of State Condoleezza Rice and Defense Secretary Robert Gates were
in Moscow in the middle of March to try and break the deadlock over the
planned missile defense systems proposed for Poland. However, both sides dug
in their heels and little progress was made.
NO MORE MR NICE GUY
Imagine, then, how a former KGB colonel, whose whole career was built on
fighting a subcutaneous war with Nato members, feels. President Vladimir
Putin’s frustrations and fears over Russia’s relations with its former enemy
spilled over into a speech he gave in Munich just over a year ago in
February 2007.

The speech was the most outspoken Putin has been in his criticism of the
West and drew a line under the Kremlin’s less-than-enthusiastic efforts to
compromise with the other side. He dismissed out of hand the risible excuses
offered for the expansion by Nato command.

“I think it is obvious that Nato expansion does not have any relation with
the modernization of the alliance itself or with ensuring security in
Europe,” said Putin in Munich. “On the contrary, it represents a serious
provocation that reduces the level of mutual trust. And we have the right to
ask: against whom is this expansion intended?”

In the first decade following the fall of the Soviet Union, Russia was
offered promises that Nato would not expand – they were promptly broken.
Then it willingly signed up to a new Treaty on Conventional Armed Forces in
Europe that regulated the Cold War military presence – only to see this
treaty fall into limbo. “And what happened to the assurances our western
partners made after the dissolution of the Warsaw Pact?”

Putin asked the delegates in Munich. “Where are those declarations today? No
one even remembers them. But I will allow myself to remind this audience
what was said. I would like to quote the speech of Nati General Secretary Mr
Woerner in Brussels on 17 May 1990.

He said at the time that: ‘the fact that we are ready not to place a Nato
army outside of German territory gives the Soviet Union a firm security
guarantee’. Where are these guarantees?”

Amongst the many bones of contention is the stalled Adapted Treaty on
Conventional Armed Forces in Europe (ATCAFE), which was signed by the Cold
War rivals in 1999. The treaty was supposed to define the new military
relations in the post-Cold War world.

However, nine years on and only four of the 30 countries that signed off on
the deal have ratified it: Russia, Ukraine, Kazakhstan and Belarus. The rest
have linked ratification of this treaty to the so-called Istanbul
Commitments, which calls for Russia to remove its troops from Georgia and
Moldova.

The Kremlin has heavily criticised this link and suspended its membership
last year in frustration. The other important treaty of the Cold War-era,
the Strategic Arms Reduction Treaty that limits long-range nuclear weapons,
is due to expire in 2009, but attempts by Washington and Moscow to work out
a replacement deal have also failed.

The upshot of this impasse is that the Cold War treaties governing military
relations are still effectively in force.
REARMAMENT
At the start of 2007, the Kremlin launched a $1-trillion investment
programme that will run until 2012 to replace the worn out Soviet-era
infrastructure, which has cause much comment. However, less noticed is a
parallel programme to modernize and re-equip the Red Army that will cost
approximately $250bn over the same period.

This is a staggering amount of money and the development of Russia’s economy
is closely intertwined with its defence sector; it is no coincidence that
the state-owned arms export agency Rosoboronexport has also become a de
facto holding company for an increasingly acquisitive Kremlin and home to a
slew of new “national champions.”

Russia is a young democracy and so the support of the military remains a key
element in domestic high politics, as was so dramatically demonstrated by
Boris Yeltsin’s constitutional coup of October 1993. Putin always peppers
his “state of the nation” speeches with military detail that largely gets
ignored by the commentators.

And amongst the very first policy statements Russian president-elect Dmitry
Medvedev made after being nominated by Putin was a comment that Russia needs
a strong navy. “The navy must be revived so that Russia is a naval power,”
Medvedev said in January. “We were respected when we were naval power.”

And on top of everything else, arms exports are good business;
Rosoboronexport has more than doubled its revenues in the last eight years
to bring in over $7bn in 2007. Amongst the very first changes Putin made
after taking office in 2000 was to take Rosoboronexport directly under the
control of the presidential administration.

In addition to his job as president, Putin is also Russia’s best arms
salesman and has negotiated a string of multi-billion-dollar arms deals in
parallel with trade and energy ones during his many trips abroad. Arms
exports have become a foreign-policy tool for the Kremlin.
SECOND THOUGHTS
While states to the west, north and east may still view Nato membership as a
proof of their Western credentials and a potential steppingstone to EU
membership, to the south in Turkey – a Nato member since 1955 and still
stuck in the EU queue – the goals of the alliance appear to be diverging
increasingly from its own.

Although Ankara has twice taken command of Nato’s Isaf force in
Afghanistan – and currently has about 675 troops in the country – it is at
least as reluctant as any other Nato member to supply troops to “combat
terrorism” in the east and south of the country.

Speaking to Turkish journalists in Brussels on March 17, Nato General
Secretary Jaap de Scheffer named Turkey as one of the countries which is not
currently fulfilling its pledges to the Nato effort in Afghanistan.

But almost simultaneously, Chief of General Staff Yasar Buyukanit was
restating his opinion that he would “not send a single soldier” for combat
operations beyond the remit of Isaf. Tens of thousands of Turkish soldiers
were already fighting terrorism, General Buyukanit underlined, in a
reference to the conflict with violent Kurdish nationalist PKK rebels. In
February, Turkey lost 27 men in an eight-day land operation against PKK
positions in northern Iraq.

Buyukanit’s words may be designed to cut across the bows of Prime Minister
Recep Tayyip Erdogan, amid rumours that Washington is seeking more forces
for Afghanistan in return for its tolerance of and intelligence support for
Turkey’s northern Iraq operations.

Ankara has hosted a string of high-level US visitors in recent weeks,
including Defence Secretary Robert Gates and was due to receive Vice
President Dick Cheney in the third week of March. But widespread public
suspicion that February’s incursion was cut short on orders from Washington
is complicating any negotiations.
MISSILE SHIELD
Turkish commentators also have reservations about Nato-EU cooperation and
the controversial US-proposed missile shield to be sited in the Czech
Republic and Poland. Any handover of Nato responsibilities to the EU could
exclude Ankara from decision-making even where immediate concerns such as
Cyprus or the territorial disputes with Greece are affected.

The shield, ostensibly designed to intercept missile attacks from “rogue
states” like North Korea and Turkey’s neighbour Iran, will not provide full
protection to Turkey or other states in Southeast Europe. However, Nato may
join the project without being able to agree to extend its coverage.

Following speculation that the US was proposing to make Turkey a third site
for the shield, a US Embassy spokesperson told the daily Today’s Zaman on
March 18 that Gates had recommended during his visit to Ankara on February
27-8 that any effort by Turkey to acquire a medium-range missile defence
system should be coordinated with its Nato allies – effectively curtailing
the Turks’ options.

One Nato project that Ankara does back is the membership of Albania, Croatia
and Macedonia, all of which it regards as friendly Southeast European
states. “Turkey will strongly support the two candidate countries Macedonia
and Croatia as well as Albania being invited for membership in the April
2008 Nato summit in Bucharest,” Foreign Minister Ali Babacan said at a joint
press conference with visiting Albanian Foreign Minister Lulzim Basha in the
Turkish capital on February 26.

However, if Greece’s objections to Macedonia’s name are not overcome, Turkey
may be unwilling to reward Athens by agreeing to membership for two
countries only.

Turkey is also likely to express support for Ukraine, Georgia and Azerbaijan
if they persist in their Nato membership drives. Nevertheless, Nato’s
expansion in the Black Sea region could raise fresh question marks,
according to Mustafa Turkes, professor of International Relations at the
Middle East Technical University in Ankara. Turkes notes that Romania and
Bulgaria have been challenging Turkey’s policies in the region since joining
Nato with Turkish support.

“The more active Nato becomes, the more the question of capacity will
emerge. Any move into unfamiliar regions gives cause for concern. Today we
are talking about Afghanistan; tomorrow it may be Pakistan. I think Turkish
views about Nato’s global role have changed. Confidence in Nato is not as
high as it once was,” Turkes concludes.
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LINK: http://www.businessneweurope.eu/storyf.php\?s=916
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9.  GERMAN CHILL TOWARD NATO’S GROWTH IGNORES PAST

Commentary by Frederick Kempe, President, Atlantic Council
Bloomberg, New York, New York, Tuesday, April 1, 2008

There are still times when Germans must be reminded of history’s lessons.

One of those came after the Sept. 11 attacks, when a courageous Chancellor
Gerhard Schroeder risked a no-confidence vote to take German combat troops
to Afghanistan. His argument: History’s obligation wasn’t pacifism, as many
argued, but a willingness to shed blood against new despots and terror.

Sadly, Germany may fail history’s test this week at the NATO Summit in
Bucharest, beginning tomorrow. Chancellor Angela Merkel has led opposition
to an alliance membership path sought by Georgia and Ukraine, states that
grew out of the former Soviet Union.

Though France, Italy and Spain also oppose, U.S. officials see Germany as
the chief impediment because the majority of alliance countries are in
favor, including all former Soviet bloc members. Merkel’s arguments seem
sound at first blush, but they are misguided and dangerous.

Her position: No country should join the North Atlantic Treaty Organization
if it has an unresolved territorial conflict with a neighbor (Georgia) or
where most of its citizens are against membership (Ukraine). The underlying
argument is that NATO shouldn’t risk worsening relations with the region’s
biggest power and energy spigot for the purpose of lower priorities.

Further, Merkel sees a window of opportunity for improved relations with
Russia in Dmitry Medvedev. She was the first foreign leader to visit the
president-elect.

What Merkel forgets is that West Germany itself entered NATO in 1955,

whenit had one of history’s most-intractable territorial conflicts with the
Soviet Union over Berlin, which Georgian President Mikheil Saakashvili
brought up with U.S. President George W. Bush last month in Washington. The
Soviets saw the move as such a direct threat that they then formed their own
military alliance: the Warsaw Pact.
STIRRING UP TROUBLE
This time around, Russian President Vladimir Putin says he will point
nuclear weapons at a Ukraine with NATO ambitions. His foreign minister,
Sergei Lavrov, warns that a membership course will only stir up more
separatist trouble in Georgia’s breakaway regions of Abkhazia and South
Ossetia.

So when Merkel says, as she did March 10, that “countries that are involved
in regional or internal conflicts can not become members (of NATO),” she
not only forgets her own history but gives the Kremlin a permanent veto on
Georgian membership.

German Foreign Minister Frank-Walter Steinmeier himself conceded last year
that blocking accession on the grounds of unresolved conflicts “will enable
third parties to drag out the process endlessly.”

The further lesson of history is that NATO membership ultimately helped West
Germany normalize relations with the Soviet Union. Within the security of
alliance embrace, West Germany won Russian diplomatic recognition in 1955
and eventually gained reunification as a free and sovereign country.
OFF-TARGET
Germany’s opposition to Ukraine’s request for a membership action plan is
just as mistaken. German officials seek solace in polls that show a large
majority of Ukrainians oppose NATO membership (unlike Georgia, where

more than 70 percent voted in favor in a referendum).

But that misses the point.

German officials are confusing actual membership, which neither Ukraine nor
Georgia seeks, with the proposed action plan, which would require a healthy
diet of political and military changes that might last a decade before
membership. That gives Ukrainian politicians some time to educate their
voters about NATO’s benefits — even though Ukraine already participates in
a host of NATO operations.

Merkel is right that the West must urgently reach out more effectively to
Russia. It isn’t the ideological enemy the Soviet Union was. Its current
animosity is rooted in resentment over lost standing and territory following
its Cold War defeat. It is a crucial player with rising economic and energy
clout.
EASING TENSIONS
Bush will meet with Putin on April 6 in Sochi, Russia. Given Putin’s more
cooperative tone during a recent visit to Moscow by Secretary of State
Condoleezza Rice and Defense Secretary Robert Gates, U.S. officials see a
chance for a missile-defense deal and improved relations.

Yet history’s lesson is that frustrating Georgian and Ukrainian ambitions is
a price that won’t buy a more cooperative Russia for very long. It can only
encourage revisionist thinking that Russia must defend and expand its sphere
of influence, when the real challenge is how to make Russia part of a common
cause.

German Chancellor Helmut Kohl gained reunification on favorable terms
because he kept his country firmly anchored in the West and resisted West
Germany’s historical temptation to find middle ground between Russia and its
neighbors. If Germany wants to play an historic role now, it must do that
again.
PLAYING THE PART
It shouldn’t only support Georgian and Ukrainian ambitions, joining forces
with its eastern neighbors from Poland to Estonia that are lobbying Germany
for such an outcome, but it also should propose a creative course that would
deepen the alliance’s links with Russia, with the ultimate goal of that
country’s own NATO membership.

A Russian general already sits in NATO headquarters, Russian troops are
involved in NATO’s anti-terrorist initiative Operation Active Endeavor in
the Mediterranean, and Russia, unlike any other non-alliance member, can
communicate through its own NATO- Russia Council.

The NATO Summit will be about many things this week. The alliance will try
to deepen its commitment to stabilizing Afghanistan. It will try to extend
membership offers to Albania, Croatia and Macedonia. (Sadly, Greece may
block Macedonia not due to its qualifications but because it objects to its
name.) It will attempt to expand its mandate to energy and cyber threats.

Yet perhaps nothing is more important to the future of the alliance and
Europe than how Germany interprets history’s lessons.
—————————————————————————————————
(Frederick Kempe, president of the Atlantic Council, is a Bloomberg News
columnist. The opinions expressed are his own.) To contact the writer of
this column: Frederick Kempe in Washington at fkempe@acus.org
—————————————————————————————————
http://www.bloomberg.com/apps/news?pid=20601039&sid=a29rV8U2VSgY&refer=home

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10.  EXCLUDE UKRAINE FOR INCLUSIVE SECURITY
The price of the question

OP-ED: by Timofei Bordachev, Director of the Center for European and
International Research, State University – Higher School of Economics
Kommersant, Moscow, Russia,  Monday, March 31, 2008

U.S. President George W. Bush’s visit to Kiev casts light on U.S. strategy
in Eurasia and the prospects for regional security. Relations between
Ukraine and NATO are a question of the stabilization or erosion of the
situation from the Atlantic to Vladivostok.

The former is possible through the creation of an international procedure
that will include all states in the region. The latter will be the
unavoidable result of the expansion of a union led by the United States.

The expansion of NATO in the 1990s was the reason the idea of a “new world
order” failed and the countries of the West were unable to form institutions
of collective security.

Why did it happen? First because he very scale of the expansion was
insufficient to accomplish the goals set for it. The inclusion in the bloc
of ten countries that had no independent military or strategic value was
able to stabilize only a very small part of Europe.

Second, Russia, the second center of power in Eurasia after the U.S., found
itself not only outside NATO, but in very complex relations with it. With
all the consequences that implies. Including extra-regional players like
China.

I will grant that these European problems may look less important from the
point of view of U.S. global policy. It is much more important for
Washington to obtain new allies in Europe that it can depend on to carry out
its projects that are not related to European security. But in that case,
the destabilizing role of the U.S. in Europe can be considered a fait
accompli.

European history provides indisputable examples of a country’s membership in
NATO playing a decisive role in its movement toward democracy or away from
confrontation. Italy was literally saved from political chaos at the end of
the 1940s. The membership of Turkey and Greece in the alliance allowed them
to avoid military clashes more than once.

But we will not forget that, in the case of Italy, participation in NATO was
reinforced by the role of founder of the European integration process. And
the alliance’s structures allowed Greece and Turkey a unique opportunity to
discuss disputed issues.

Neither of those factors are active in case of Ukraine. The European Union
will not accept Ukraine as a member in the next 10-15 years. Nor is there
any threat of conflict between Ukraine and another NATO candidate country.
Thus, the value of Ukraine’s membership in the alliance is null for security
in Eurasia and for its own development. But the potential harm in domestic
political turmoil and disassociation with Russia is huge. It has not only
regional dimensions, but global.

The strategic stability of Eurasia can be achieved only through full
participation by the countries that can disturb that stability, such as
Russia and the U.S. Keeping Ukraine out of NATO leaves open the possibility
of correcting the mistake of the 1990s. And the future possibility of
entering into a system of universal Eurasian collective security that
includes the “old” members of NATO, and Ukraine, and, most importantly,
Russia.

Timofei Bordachev, director of the Center for European and International
Research, State University – Higher School of Economics
———————————————————————————————–
LINK: http://www.kommersant.com/p873176/NATO_expansion/
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11.  BUSH VOWS TO PRESS KIEV’S NATO CLAIMS

By Roman Olearchyk in Kiev and James Blitz in London
Financial Times, London, UK, Tuesday, April 1 2008

President George W. Bush on Tuesday promised Ukraine he would press for

the nation to take a significant new step towards joining Nato at Wednesday’s
summit, arguing that the outcome of negotiations should not be prejudged.

Speaking in Kiev on his way to Wednesday’s Nato meeting in Bucharest, Mr
Bush praised the “bold decision” by Ukraine to seek to join the alliance,
saying “Russia will not have a veto over what happens next” in the Romanian
capital.

But although Mr Bush remains committed to allowing Ukraine and Georgia to
join the alliance’s Membership Action Plan (Map), senior diplomats from
across the alliance were drafting a final communiqué that aimed to avoid an
overt split on the issue between the US on the one hand and Germany and
France on the other.

Paris and Berlin have indicated they are opposed to the two former Soviet
republics getting Map status, partly because it would offend Russia. “We
think it is not the right response to the balance of power in Europe and
between Europe and Russia,” François Fillon, French prime minister, said on
Tuesday.

Diplomats from one European Union state said it was likely the final
communiqué would say a membership perspective for the two former Soviet
republics had now been opened, but that Map would not be granted at this
stage.

According to these diplomats, the communiqué will welcome Ukraine and
Georgia’s aspirations to join Nato and will set up structures that go beyond
the current level of “intensified dialogue”. The diplomats say Nato will
agree to review their membership status in about 2010.

Despite tensions between Moscow and Washington over the issue of Nato
expansion, there were signs that this weekend’s summit between Mr Bush and
Russian President Vladimir Putin could make further progress on the issue of
ballistic missile defence.
Mr Bush said: “I’m hopeful we can have some breakthroughs. I’ve made it
abundantly clear to President Putin that the missile defence system is not
aimed at defending against Russia.”

Robert Gates, the US defence secretary, was similarly upbeat in Denmark. He
said that “the Russians are probably never going to like missile defence”
but indicated that US compromises recently offered to Moscow could lead to a
deal.

“I think that the assurances that we have provided and the mechanisms that
we have proposed give them assurance that it’s not aimed at them, and my
hope is that that will lead to positive outcomes both in Bucharest and in
Sochi,” he said.

In Moscow, a Kremlin source told Reuters news agency that in Sochi Mr Bush
and Mr Putin would sign a document outlining the framework for strategic
relations between their two countries.

“Experts are working on a joint document, which will become a roadmap of

our co-operation during a transitional period and for the medium term,” the
Kremlin source said.

“I wouldn’t prejudge the outcome yet. The vote will be taken in Bucharest,”
Mr Bush said speaking to journalists at a joint press conference with
Ukraine’s pro-western president, Viktor Yushchenko.

Mr Bush’s Kiev visit comes on the eve of the April 2-4 Nato summit where
members are divided on whether to proceed with eastward expansion of the
military alliance by accepting bids by Kiev and Georgia to be accepted into
the ‘Membership Action Plan,’ a first step towards preparing for formal
membership.

“Your nation has made a bold decision, and the US strongly supports your
request. In Bucharest this week, I will continue to make America’s position
clear. We support MAP for Ukraine and Georgia,” the US president said.

Russia’s outgoing president, Vladimir Putin, is expected to stick to his
country’s hard-line warnings against Nato expansion at the summit in what is
likely to be one of his last major appearances before stepping down. Earlier
this year, Mr Putin warned that his country could point missiles at Ukraine
if it were to house military bases as a Nato member.

Kiev’s foreign policy shifted away from Moscow after the Orange Revolution
of 2004, which propelled Mr Yushchenko to power. European Union and Nato
membership were declared top foreign policy goals. The US has backed speedy
western integration for Kiev.

Wary of Moscow, Eastern European Nato members have backed the bids by Kiev
and Tbilisi. But fearing a backlash from Moscow, and expressing reservations
that support in Kiev for Nato is small, Germany and France have dragged
their feet on the issue.

Mr Bush said his country would continue to strongly push for Ukraine’s and
Georgia’s speedy integration into Nato, saying it in the interest of the
bloc. “We come with a message for Ukraine. Your country has a solid
 partner,” Mr Bush said.

“Ukraine is the only non-Nato nation supporting every Nato mission,” he said
referring to Kiev’s active role in peacekeeping efforts in Kosovo and other
areas.

Sitting alongside Mr Yushchenko, the main champion of the post Soviet
republic’s westward shift, Mr Bush said: “I am proud to be sitting next to a
leader who has strong convictions and courage. Ukraine has demonstrated its
commitment to democracy and open markets. I know you are proud of these
achievements and you should be!”

Moscow is deeply concerned about the eastward expansion of Nato into what it
sees as its own sphere of influence. But Mr Yushchenko repeated concerns
made in recent days by Georgia’s president, Mikheil Saakashvili, that
certain Nato members were de facto giving Moscow veto power at the alliance
by thwarting their bid.

Mr Bush said he was told by Nato members that they would not allow Russia to
exercise a veto vote against Ukraine’s and Georgia’s bid, and he added,
Russia (not a member) should not have any such veto influence.

Mr Bush said he would continue efforts to convince Mr Putin in Sochi later
this week that Nato expansion and a US backed missile defence system
envisioned for eastern Europe pose not threat to Russia.
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http://www.ft.com/cms/s/0/6e33b500-ffcf-11dc-825a-000077b07658.html

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12.  BUSH VISITS A UKRAINE DEEPLY SPLIT OVER BID
TO JOIN WESTERN ALLIANCE NATO

TRAVELING TO NATO SUMMIT
By Peter Baker, Washington Post Staff Writer
The Washington Post, Washington, D.C. Tuesday, April 1, 2008; Page A12

KIEV, Ukraine, March 31 — The hundreds of thousands of demonstrators
who camped out on Independence Square here three years ago toppled a
pro-Russian government in favor of a Western-oriented coalition that pledged
to move this former Soviet republic closer to the rest of Europe.

But by the time President Bush arrived here Monday to hail the emerging
democracy and urge the NATO alliance to put Ukraine on the path to
membership, the mood on the square had changed. “Yankee Go Home,” read
one sign. “NATO Hands Off Ukraine,” read another. A hand-painted banner
unfurled around the square used a four-letter obscenity to describe what
both Bush and NATO should do.

Communists are no longer a dominant force in this society, but the thousands
flying hammer-and-sickle flags on the square did reflect a broad division in
a country situated on the edge of east and west.

Although Bush strongly supports President Viktor Yushchenko’s aspirations to
join NATO, the Ukrainian public is deeply split over the idea, in the face
of Russian opposition. Western European governments, also concerned about
Moscow’s reaction, are divided.

Bush landed here Monday night and was welcomed with the traditional gift of
bread and salt in advance of meetings Tuesday aimed at promoting Ukraine’s
candidacy. He heads Tuesday evening to Bucharest, Romania, for a three-day
NATO summit where the issue will be debated.

The alliance is poised to offer membership to Croatia, Albania and
Macedonia; Bush wants to offer a map toward membership further down the
road for Ukraine and its fellow former Soviet republic Georgia.

“We feel a gap in our security because all of our neighbors, to east and
west, are in some sort of security arrangement,” Oleksandr Chalyi, a foreign
policy adviser to Yushchenko, said in an interview, referring to NATO and
Russian-led alliances.

“Only we participate in neither. We don’t want to return back to the Russian
security system.” If NATO rebuffs Ukraine, he added, it would mean “the last
page of the Cold War is not turned.”

Moscow warned again Monday that even negotiations for membership for Ukraine
and Georgia would cross a “red line” for Russia. President Vladimir Putin
has threatened to target the two countries with nuclear missiles if they
join the alliance.

“We are not a source of threats,” Kremlin spokesman Dmitri Peskov told
foreign journalists in a conference call. But “membership to NATO will in no
way contribute to stability in the country. To the contrary, it will lead to
additional tension.”

What Ukraine and Georgia want out of the Bucharest summit are “membership
action plans,” known as MAPs, that would lead eventually to full status in
the alliance. The MAP process can take years — it took nine years for
Albania, for example — and forces applicants to meet NATO standards for
democratic institutions and military capabilities.

Although Canada and nine NATO members in Eastern Europe also support
road maps for the two aspirants, Germany and others say they are not ready,
especially given Ukraine’s internal divisions and Georgia’s struggles with
two breakaway republics. Because NATO operates by consensus, opposition
would nix any move in Bucharest.

Bush still hopes to finesse the issue. “We think it’s very, very, very
important that Georgia and Ukraine, that we welcome their aspirations to be
part of NATO,” national security adviser Stephen J. Hadley told reporters on
Air Force One. “And the president has made clear we think the best way to do
that is to offer the MAP at Bucharest, and that’s what the president is
pushing hard for.”

Putin plans to go to Bucharest and has sway with European nations that rely
on Russian gas and oil. His advisers have suggested Russia would help NATO
in Afghanistan by allowing planes to cross Russian airspace if Georgia and
Ukraine are not put on the membership path.

“We are ready to cooperate,” Foreign Minister Sergei Lavrov told the
newspaper Izvestia. “But we shall speak out firmly against any tendencies
that are damaging to our interests.”

Ukraine, a country long fractured between its Russian-influenced eastern
regions and its European-oriented western areas, remains torn over NATO.

A February poll found that 50 percent of Ukrainians oppose membership
compared with 24 percent in favor, nearly the reverse of public sentiment
before the Orange Revolution of 2004. But proponents take heart from the
fact that opposition has fallen by 10 percentage points since last year.

“We’re leading the protest to demonstrate to the world and to Ukraine that
not everybody is happy about the idea of joining NATO,” said Socialist Party
leader Oleksandr Moroz, a former parliament speaker. “The NATO issue
creates a big problem for us with Russia. That’s the main worry.”
————————————————————————————————
Correspondent Peter Finn in Moscow contributed to this report.
http://www.washingtonpost.com/wp-dyn/content/article/2008/03/31/AR2008033100702.html
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[return to index] [Action Ukraine Report (AUR) Monitoring Service]
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13. PRESIDENT BUSH & PRESIDENT YUSHCHENKO OF

UKRAINE EXCHANGE LUNCHEON TOASTS

Presidential Secretariat, Kyiv, Ukraine, Tuesday, April 1, 2008

PRESIDENT YUSHCHENKO: Dear Mr. President, dear Mrs. Bush, dear

guests and ladies and gentlemen. It is with great pleasure that I express my
feelings of utmost respect for His Excellency, President George Bush. The
active cooperation between our countries extends from the idea of a partnership
focused on the future.

And I’m especially impressed that this philosophy forms the basis of the
primary document we signed today, the road map of relations between Ukraine
and the United States of America, and in other documents signed during your
visit.

Common values and concepts for strengthening democracy, peace and security
unite our countries, enlarging our joint agenda and posing new tasks before
us. I am convinced that the widest political, civil and business circles of
both our countries will actively contribute to strengthening the foundation
of our partnership, which has withstood the test of time.

Dear ladies and gentlemen, Ukrainians highly value the support by the United
States of our aspirations to honor the memory of the victims of the
Holodomor of 1932 to ’33 in Ukraine. We will be immeasurably grateful for
the United States’ recognition of this crime by the totalitarian regime as
an act of genocide directed against our nation.

Ukraine shall always remember the honored names of American researchers
James Mace, Robert Conquest, and others whose work to introduce a tragic
truth about the famine to the world was invaluable.

Dear ladies and gentlemen, we sincerely thank the United States for its
support of Ukraine along the way to membership in the World Trade
Organization. With the conclusion of this process, before us lies an open
road to the fundamental expansion of our relations in the trade and
investment areas.

We are delighted to invite our American partners to focus joint efforts in
the areas of high technology, energy conservation, developing alternative
energy sources, and agriculture.

I am convinced that in the nearest future, we can anticipate new goals and
promising ideas and joint projects. We especially highly value the support
and assistance of the United States in Ukraine’s advance along the path of
Euro-Atlantic integration.

Today we look forward to a specific and clear signal from NATO, which will
attest to the transition of our relations to a qualitatively new level. I am
firmly convinced that the accession of our country to the NATO Membership
Action Plan will benefit both parties.

This shall be a formidable contribution to the creation of a new European
security architecture, extending and strengthening freedom, democracy and
human rights in the Euro-Atlantic states.

I am sincerely grateful to the United States, and personally to President
Bush, for the consistent and persistent support of Ukraine’s aspirations to
become an integral part of the collective security system in Europe.

 Dear friends, I am certain that we will use the chance we have been given
to benefit today’s and future generations of the people of our countries. I
believe in our joint success. The United States’ support as a partner
strengthens my determination.

I raise my glass to the future of our cooperation, to the health of the
President and Mrs. Bush, and for our nations and our friends.
(A toast is offered.)

PRESIDENT BUSH: Mr. President, Mrs. Yushchenko; Prime Minister; Mr.
Chairman; distinguished guests, thank you for your warm welcome. Laura and I
are honored to sit with you on Ukrainian soil, and we bring the greetings of
the American people, or as you’d say, “Vitaiyu Vas.” (Laughter and
Applause.)

The people of Ukraine have made great contributions to the history of human
freedom. During World War II, Ukrainian soldiers helped defeat the armies of
fascism and end the deadliest conflict in history. And at the end of the
Cold War, Ukrainians formed an independent nation and declared her desire to
live in freedom and peace.

In 2004, Ukrainians inspired the world with the Orange Revolution, using
peaceful demonstrations to protect your right to choose your leaders. Today,
Ukrainians are showing courage in helping to advance freedom in many parts
of the world. You’re helping to train security forces in Iraq, supporting a
provincial reconstruction team in Afghanistan.

Ukrainians are part of the U.N. Mission in Kosovo. Last month in Kosovo a
Ukrainian police officer gave his life, and many others were wounded helping
to defend the ideals of freedom.

Ukraine is contributing to every mission of the NATO Alliance, and honoring
the ideals that unite the transatlantic community. This week, Ukraine seeks
to strengthen its transatlantic ties through a NATO Membership Action Plan.
The United States strongly supports your request. We are proud to stand with
you in Bucharest and beyond.

Mr. President, our two nations share a common vision for the future. We seek
to advance a cause of freedom, and help all peoples of Europe live together
in security and peace. With great confidence in that future, I offer a toast
to you, to your gracious wife, and to a free and sovereign people of
Ukraine. END 12:09 P.M. (Local)
————————————————————————————————-

LINK http://www.whitehouse.gov/news/releases/2008/04/20080401-4.html
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[return to index] [Action Ukraine Report (AUR) Monitoring Service]
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14. U.S., UKRAINE SIGN TRADE, INVESTMENT
COOPERATION PACT IN KYIV

Reuters, Washington, D.C., Tuesday April 1 2008

WASHINGTON – The United States has signed an agreement to boost trade

and investment ties with Ukraine, which is on the verge of joining the World
Trade Organization this year after a lengthy period of economic reform, U.S.
trade officials said on Tuesday.

“Ukraine is making important strides to modernize its economy and attract
foreign trade and investment,” U.S. Trade Representative Susan Schwab said
in a statement. “The agreement … will assist Ukraine’s efforts to expand
its economy and diversify its markets.”

The new Trade and Investment Cooperation Agreement was announced while
President George W. Bush was in Kiev. Bush later left to attend a NATO
summit in Romania.

The agreement was signed by Schwab in Washington and Ukraine’s Economy
Minister Bohdan Danylyshyn in Kiev. It creates a forum to discuss ways to
boost two-way trade, which totaled about $2.56 billion last year, to
encourage stronger bilateral investment flows.

Ukraine is set to beat its bigger neighbor, Russia, into the WTO, which came
into existence about four years after the collapse of the Soviet Union in
1991.

WTO members voted in February to approve the terms of Kiev’s entry into

the world trade body. Ukraine will become a WTO member 30 days after its
parliament ratifies the accession agreement, which is expected by July 4,
the U.S. trade representative’s office said.

Russia has hoped to finish its long-time bid to join the WTO this year.
However, U.S. officials say they are still waiting for Moscow to fulfill
commitments it made in 2006 to improve protection of U.S. intellectual
property rights.

The European Union also has not given final approval to Russia’s application
to join the WTO.

Bush will meet on Sunday with outgoing Russian President Vladimir Putin at
Putin’s Black Sea residence. The leaders are expected to sign a document
outlining the framework for strategic relations between the two countries.

Relations between Washington and Moscow have been strained over issues
including U.S. plans to deploy elements of its missile shield in Europe and
NATO moves to bring ex-Soviet Ukraine and Georgia closer to the alliance.

Two-way trade between the United States and Russia totaled about $26.7
billion in 2007, or about 10 times the level of U.S.-Ukraine trade. (Writing
and reporting by Doug Palmer; Editing by Bill Trott)

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[return to index] [Action Ukraine Report (AUR) Monitoring Service]
========================================================
Ukraine Monthly Macroeconomic Report From SigmaBleyzer:
http://www.sigmableyzer.com/index.php?action=publications 
========================================================
15.  NATO SHOULDN’T ADVANCE TOO FAR EAST

OP-ED: By Malcolm Rifkind, MP was Defence Secretary, 1992-95
Telegraph, London, United Kingdom, Wednesday, April 2, 2008

When President Bush, Gordon Brown and other Nato leaders meet in Bucharest
today they must ensure that they do not, inadvertently, destroy Nato’s
supreme role as a mutual defence alliance. It is not the quarrel over
Afghanistan to which I am referring, vital though that is. President
Sarkozy’s pledge of additional French forces will be gratefully received.

Much more dangerous will be the issue of Nato enlargement. There are two
aspects to this. Three Balkan countries – Croatia, Albania and Macedonia –
are likely to be given a welcome. While they will make only a very modest
contribution to Nato’s military capability, their membership could help
contribute to the Balkans’ further integration into the Western world.

It is difficult to be as optimistic about Ukraine’s and Georgia’s
aspirations for membership. In many respects they have been amongst the
most impressive of the successor states of the old Soviet Union.

Ukraine and Georgia are light years ahead of the rest of the old USSR. They
have real elections, where their electorates actually decide who should be
their rulers. In Ukraine, no one knew until polling day whether Yuschenko,
Tymoshenko or Yanukovich would emerge triumphant..

In Georgia, too, Mikhail Shakashvilli has been a breath of fresh air.
Compared to the citizens of Azerbaijan, Uzbekistan and Kazakhstan, Georgians
have been able to pass their verdict on their rulers and elections have had
substance, not merely form.

So Ukraine and Georgia deserve our support and deserve more than they are
currently getting. That is not the same, however, as saying that they should
be made full members of Nato.

The crucial point, often overlooked, is that Nato is not just a political
association of friendly states with common values, like the Council of
Europe. Nor is it only concerned with the promotion of security, stability
and economic prosperity, like the EU.

Nato was devised as, and still is, more than anything else, a defence pact,
with its member states committed to collective security. These are more than
words. Under Article 5 of the Nato Treaty, every member state is committed
to come to the aid of any other member state, including by the use of armed
force, if such a state is subject to armed attack.

If Ukraine or Georgia become full members, Britain and other members could
find themselves required to contemplate war or other forms of military
intervention if either of these countries faced armed attack.

This cannot be considered a hypothetical concern. For some years, Georgia
has been unable to enjoy full territorial integrity because of the de facto
secession of Abkhazia and South Ossetia. Both secessionist regions enjoy
strong Russian support and there have already been clashes between Georgian
troops and those of the two breakaway regions.

Would it really be wise for Nato member states to accept a legal obligation,
not just an option, to come to the aid of Georgia if either or both of these
secessionist regimes, with or without the support of Moscow, continued to
use armed force against the Georgian government?

The situation is not so serious as regards Ukraine. Its government is in
full control of its territory and armed attack from any quarter is highly
unlikely. But the issue of Nato membership deeply divides the population,
with opinion surveys suggesting a substantial majority against Ukraine
joining.

Ukraine has a large Russian-speaking minority and Crimea is an ethnic
Russian territory that was only joined to Ukraine in the 1950s. Relations
between Ukraine and Russia remain tense, and the question of Ukraine’s
orientation towards the West is the seminal issue of Ukrainian politics,
with the population almost equally divided.

Against that background, one has to ask again whether it would be wise for
America, Britain and other Nato members to enter into a treaty obligation to
protect Ukraine when that commitment might involve the use of our armed
forces. Nato membership does not just give us the option to become involved:
it obliges us to become involved, a quite different matter.

There are ways in which we can give substantial help to Ukraine and Georgia
without the risks involved in full Nato membership. In part, this should be
through closer association with the EU with the prospect, one day, of full
membership.

So far as Nato is concerned, consideration should be given to the creation
of a new status of associate member, which would give Ukraine and Georgia
many of the benefits of membership, including the right for their forces to
train with Nato members and to serve alongside Nato states in international
operations. What it would not do would be to apply Article 5 of the treaty.

George W Bush and other Nato leaders must show caution in Bucharest. The
issue is not about trying to avoid annoying the Russians. Moscow has no
right to say who will be, or will not be, a member of Nato. The issue is the
preservation of Nato as a real defence pact and not merely as a political
alliance. The stakes are high and rightly so.
————————————————————————————————–
http://www.telegraph.co.uk/opinion/main.jhtml?xml=/opinion/2008/04/02/do0204.xml
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[return to index] [Action Ukraine Report (AUR) Monitoring Service]
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16.  PUTIN’S LAST STAND

VIEW: By Anders Aslund, Daily Times,

Lahore, Pakistan, Wednesday, April 2, 2008

In the early 1990s, many westerners and Russians wanted Russia to become a
full-fledged member of both the European Union and NATO, on the condition
that Russia became a full-fledged democracy. Unfortunately, the West never
made that offer, and Russian democracy went astray

On April 2-4, NATO will hold its biggest summit ever in Bucharest, the
capital of its new member, Romania. Incredibly, NATO has invited its
fiercest critic, Russian President Vladimir Putin, to attend. For the first
time since 2002, he will. His presence is an embarrassment to NATO, but

an even greater disgrace for Russia.

The two biggest issues in Bucharest will be whether to invite Albania,
Croatia, and Macedonia to join NATO, and whether to offer applications to
Ukraine and Georgia to start so-called “membership action plans”. These
questions should be decided by NATO’s members, not outsiders.

In February 2007, Putin, in an anti-Western tirade delivered in Munich,
declared: “I think it is obvious that NATO expansion does not have any
relation with the modernisation of the Alliance itself or with ensuring
security in Europe. On the contrary, it represents a serious provocation
that reduces the level of mutual trust.”

So Putin’s views about NATO are clear. He will scandalise the summit by
seeking to intimidate the former Soviet clients in the room.

Such an aggressive attitude benefits a country’s foreign policy only up to a
point – one that Putin passed long ago. Initially, he acted as an able
diplomat and accommodator, but since his Munich speech, Putin has begun
uniting the West against Russia.

In his speech on May 9, 2007, commemorating Russia’s victory in World War
II, Putin compared the United States with Nazi Germany: “We have a duty to
remember that the causes of any war lie above all in the mistakes and
miscalculations of peacetime, and that these causes have their roots in an
ideology of confrontation and extremism. It is all the more important that
we remember this today, because these threats are not becoming fewer, but
are only transforming and changing their appearance. These new threats, just
as under the Third Reich, show the same contempt for human life and the same
aspiration to establish an exclusive dictate over the world.”

Serious politicians do not speak like that. These are the rants of Putin’s
few remaining friends – Venezuela’s Hugo Chavez, Iran’s Mahmoud Ahmadinejad,
and Belarus’s Alyaksandr Lukashenka. At home, awareness is rising that Putin
is damaging Russia’s interests by insulting and intimidating everybody. He
is isolating his country among the world’s pariahs; worse yet, he has
achieved little.

When Putin became president in 2000, he named accession to the World Trade
Organisation as his foreign policy priority. He failed, because he gave in
to petty protectionist interests, imposing a timber embargo against Finland
and Sweden, a fish embargo against Norway, and various agricultural embargos
against Lithuania, Ukraine, Moldova, Georgia, and others.

Russia’s foreign policy is focused on the interests of its state-dominated
corporations, notably Gazprom, which has concluded agreements with many
foreign countries and companies for monopolistic deliveries.

But a Gazprom pipeline typically costs three times as much per kilometre as
a similar Western pipeline, because of “leakage” (kickbacks and waste). The
primary purpose of Russia’s foreign policy seems to be to tap Russia’s state
companies for the benefit of Kremlin officials.

But customers do not trust suppliers who cut deliveries, raise prices
unpredictably, expropriate competitors, and let production decrease in the
way Gazprom and Russia’s other state companies have done. As a result,
Russia’s gas exports to Europe have started declining.

Putin’s foreign policy also is evidently intended to whip up populist
chauvinism. Beating up on foreigners may boost his authoritarian rule, but
this, too, has a price. Not only the US and Europe, but all former Soviet
republics feel alienated by Putin’s aggressive tactics. Many are seeking to
shield themselves from Russia’s capricious embargos – for example, by
seeking alternative energy supplies.

Russia’s nationalists are also outraged by Putin’s foreign policy, because
it has alienated former Soviet republics and weakened Russia’s military. The
nationalist Council for National Strategy published a devastating report on
the decay of Russia’s military under Putin. Russian military procurement, it
claims, has plummeted. For example, only three new military aircraft have
been purchased since 2000.

True, armaments costs have risen sharply, but only because Putin’s KGB
friends, who monopolise weapons production, have stolen inordinate amounts.
Yet, despite this spending shortfall, Putin seems obsessed with making
pointless and provocative gestures, such as resuming long-range nuclear
bomber flights off the American coast.

In the early 1990s, many westerners and Russians wanted Russia to become a
full-fledged member of both the European Union and NATO, on the condition
that Russia became a full-fledged democracy. Unfortunately, the West never
made that offer, and Russian democracy went astray.

Russia should be given a new chance, but only after Putin has departed.
Russia is no enemy of the West; Vladimir Putin is.
—————————————————————————————————–
Anders Aslund, a senior fellow at the Peterson Institute for International
Economics, is the author of Russia’s Capitalist Revolution: Why Market
Reform Succeeded and Democracy Failed
————————————————————————————————-
http://www.dailytimes.com.pk/default.asp?page=2008%5C04%5C02%5Cstory_2-4-2008_pg3_6

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[return to index] [Action Ukraine Report (AUR) Monitoring Service]
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17.  THE PRICE RUSSIA MUST PAY FOR BEING HYSTERICAL

OP-ED: By Yevgeny Kiselyov, Political Analyst
Hosts a radio program on Ekho Moskvy
Moscow Times, Moscow, Russia, Wednesday, April 2, 2008

Will Russia’s fierce opposition to possible NATO membership for Ukraine and
Georgia force the alliance to withhold its official invitation to these two
current members of the Commonwealth of Independent States when the NATO
summit opens in Bucharest on Wednesday?

And what will President Vladimir Putin say during his speech at the summit?

He could do a repeat of his speech from Munich last year, which was full of
grievances and ridiculous accusations leveled at the West. Or, as the
Kremlin has indicated, Putin, in his last personal address before Western
leaders, could seize the historic opportunity by making positive proposals
for improving relations between Russia and NATO countries.

I think Putin feels torn because, on the one hand, he would like to continue
lambasting the West, but, on the other hand, he understands that Western
countries are not Russia’s enemies, but its partners.

Since the country’s presidential elections are over, what purpose would it
serve now to continue frightening voters about a fifth column and supposed
enemies who have encircled Russia because they do not want to see it get up
off its knees?

The average Russian actually cares little about NATO expansion. But if you
stop him on the street and ask him, “Are you for or against Ukraine joining
NATO?” he will probably answer “against.”

That is how he has been taught to think. This is not surprising considering
that state propaganda has hammered into his head for decades that NATO is an
aggressive bloc that once menaced the Soviet Union and now threatens Russia?

But if you were to ask him to list his fears and concerns, I would guess
that NATO membership for Kiev and Tbilisi would never enter his mind.
Instead, he would mention inflation, rampant corruption, abuse of power by
the police, a lack of justice, traffic jams and a host of other issues
without ever mentioning NATO.

Russians have already heard Putin cry wolf with regard to NATO’s eastward
expansion. The former Warsaw Pact countries of Poland, the Czech Republic
and Hungary all joined the alliance without any terrible consequences for
Russia. Following that, Latvia, Lithuania, Estonia, Romania and Bulgaria
joined its ranks, bringing NATO up to Russia’s border. Nothing frightening
came of that either.

During a recent meeting with German Chancellor Angela Merkel, Putin made an
extremely important statement. “Under modern conditions, when there is no
longer confrontation between two hostile systems, an endless expansion of
the military and political alliance is not only impractical, but
counterproductive,” he said.

In other words, Putin admitted that NATO did not represent a military threat
to Russia. What is actually bothering him then? His further comments provide
the answer: “It would seem that attempts are being made to create an
organization to take the place of the United Nations. NATO is already going
beyond the scope of its mandate. We have nothing against helping
Afghanistan, but … this is not a NATO problem.”

So that is the chip Putin been carrying around on his shoulder. He is
worried that the entire framework of international relations is changing — 
that alongside the United Nations, where Russia enjoys the privilege of
being a permanent Security Council member with veto power, NATO is

rivaling its global influence. And because this organization requires member
countries to observe basic democratic values and procedures, Moscow might
find itself on the sidelines.

Also looming on the horizon is the threat by U.S. presidential candidate
John McCain –whose chances of taking the White House are increasing with
every day — to exclude Russia from the Group of Eight for revanchism,
staging cyber attacks against other states and backtracking on democracy.
Some would say this is nothing but pre-election rhetoric from the McCain
camp, but it appears that the Russian elite are not interested in taking
that chance.

The elite seem to understand that continually irritating the West is a
luxury they can no longer afford. An example: Once Russia spoiled its
relationship with Britain, even Russians who regularly traveled to London on
official business and who used to receive long-term multiple-entry visas on
a regular basis are shocked to find out that they are now granted visas just
long enough to conduct their affairs and go home. If your meeting in Britain
will last one day, you will get a one-day visa — maybe a two- or three-day
visa if you are lucky.

That news had a disquieting effect on this country’s higher-ups. It is no
secret that Russia’s economy is integrated into the world economy and that
the lives of its ruling elite are linked to the West because of their vast
financial interests there. As a rule, Russia’s richest business moguls own
major shares in leading Russian companies through foreign offshore financial
structures.

In the West, they have their bank accounts, real estate, wives, children,
soccer teams, seaside villas and mega-yachts anchored at marinas in Sardinia
and the Cote d’Azure. This explains why many politicians are trying to lower
the temperature in relations with the West.

The problem of Russia’s political and economic legitimization is still on
the authorities’ agenda. Solving that problem will only be possible in the
context of a completely different atmosphere in international relations.
This is what has motivated leaders to step back from the policy of
confrontation and look for another approach.

Extremely indicative of this was President-elect Dmitry Medvedev’s decision
to give his first big interview following his election to the Financial
Times, a newspaper based in Britain, a country that has been Russia’s enemy
No. 1.

In the interview, Medvedev said he respected Prime Minister Gordon Brown

and declared that he was prepared to restore full cooperation with Britain with
no preconditions. Imagine if the next U.S. president were to give his or her
first official interview as president to Izvestia or Kommersant.

A direct flight between Moscow and Tbilisi has already been reinstated, and
Georgian wines and Borjomi are expected to make their reappearance any day
now. In addition, talks are under way to smooth out disagreements over
Russian gas shipments to Ukraine.

What’s more, U.S. Secretary of State Condoleezza Rice and Defense Secretary
Robert Gates, who recently came to Moscow for talks with their counterparts
and with Putin and Medvedev, were left speechless by the outpouring of
friendship shown by their Russian hosts.

They even appeared willing to look for a solution to the European
missile-defense deployment stalemate.

It could be, however, that all of this goodwill is coming too late and that
Russia will still have a price to pay for their earlier hysterics. And this
price could come in the form of NATO membership for Ukraine and
Georgia.
———————————————————————————————-
LINK: http://www.themoscowtimes.com/stories/2008/04/02/008.html
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========================================================
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18.  UKRAINIAN INVESTORS UNDETERRED BY CREDIT SQUEEZE

By Roman Olearchyk, Financial Times
London, United Kingdom, Wednesday, April 2 2008

Ukrainian companies have a big appetite for debt after seven years of strong
economic growth. Gross external debt swelled by 56 per cent last year to
$84.5bn, with much of the acceleration attributed to the banking sector.

Borrowing costs are expected to rise this year in connection with the global
credit crunch. But bankers and analysts in the country are upbeat, showing
little concern for potential shocks that may follow if banks tighten their
lending criteria and hedge funds pull back from investments in the Ukrainian
stock market.

The fear is that borrowers in some East European countries could be next to
fall victim to the credit squeeze – particularly those where foreign bank
credits account for 50-70 per cent of gross domestic product such as
Ukraine, Hungary and Romania.

Ukrainians are borrowing in record numbers but the ratio of total loans to
gross domestic product stood at 61 per cent at the end of 2007, which Oleg
Pronin, analyst at Kiev-based investment bank Dragon Capital, describes as a
“quite comfortable level for a country posting rather high GDP and
disposable income growth”.

The Ukrainian banking sector has “zero exposure to any derivative
instruments and, in particular, those relating to the subprime bubble in the
US,” he adds. “Consequently, Ukrainian banks have nothing to do with the
heavy losses being widely posted by financial services industry in the US
and EU countries.”

A flurry of acquisitions in recent years has tripled the presence of foreign
players in Ukraine such as Raiffeisen, Intesa Sanpaolo, Unicredit, Swedbank
and PNB Paribas.

Currently, foreign banks control about a third of the banking sector in
terms of net assets having purchased the largest and most solvent of the 170
registered banks. Their financial muscle is expected to cushion any shocks
as they fight for valuable market share, says Mr Pronin.

Less certain is how many Ukrainian-owned banks will survive. With access to
borrowing tightening, owners may sell out to larger foreign rivals.

Delta Bank, a fast-growing consumer lending group founded in 2006 by 35-year
old entrepreneur Mykola Lagun, is not panicking. He sees the need for a
strategic partner to help fund Delta’s expansion, but he does not expect the
credit crunch to influence his decision.

“The market doubled last year and the trend should continue this year even
if access to foreign borrowing is limited,” he says.
Peter Vanhecke, head of Investment Banking for Renaissance Capital in
Ukraine, says the credit crunch will “undoubtedly” affect Ukraine, but that
the “impact is expected to be more tangible for debt instruments than for
equity products.”

Last year, net foreign direct investment surged by 61 per cent to an
all-time high of $9.2bn, bringing total foreign direct investment to
$38.5bn. Net inflows of portfolio investments reached $5.8bn.

Spiralling inflation, which reached 17.6 per cent last year, is a major
point of concern. But GDP growth rates have remained high for the past eight
years, enough to keep wages and consumption on the rise. Dragon Capital
expects 6.9 per cent year-on-year GDP growth this year.

“We have seen some recent instances of capital switching from mature markets
to emerging markets – including Ukraine – and all indicators are that 2008
will be another record year for direct foreign investment in Ukraine,”
Vanhecke adds.

Anton Khmelnitski, director of Eastern European Equities at UK-based Polar
Capital Holdings, is very upbeat. This year, Polar moved its regional office
from Russia to Ukraine, where it sees more upside. Currently, the firm has
about $100m invested in Ukrainian equity, and plans to boost this to about
$500m in the next few years.

“If you look at the first credit crunch shock from August, both the
petro-dollar driven Russian and Kazakhstan economies lost capital, but the
fast growing economy of Ukraine actually attracted additional foreign direct
investment,” he says.

“If the investment inflows into Ukraine continue, the credit crunch will not
affect Ukraine’s growth that much. The bigger concern is the possibility
that world prices sink for steel, Ukraine’s top export and source of foreign
currency.”

“Ukraine is no different from Poland in the mid-1990s,” says Mr Khmelnitski.
“I’m looking for a repeat of what happened in Poland but on a much larger
scale because the country is much larger.

If the cost of borrowing does become more expensive for Ukrainian companies
due to the credit crunch as everyone expects, then this will only open up
opportunities for us to fill the gap by investing into these companies. It
is probably the best opportunity for those companies like ours offering to
provide capital,” he adds.
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19.  MJA ASSET MANAGEMENT, LLC, JOINS THE U.S.-

UKRAINE BUSINESS COUNCIL  (USUBC)
                          
U.S.-Ukraine Business Council (USUBC), Wash, D.C., Mar, 2008
 
WASHINGTON, D.C. – The executive committee of the U.S.-Ukraine
Business Council (USUBC) is pleased to announce that MJA Asset
Management, LLC, a U.S. company who invests in under performing
historic property, with offices in New York, Connecticut and New Jersey,
has been approved for membership in the U.S.-Ukraine Business Council
(USUBC).
 
MJA is the 57th member, the 5th new member for 2008 and the 35th new
member since January 2007. MJA Asset Management, LLC was founded
to fill the needs of a niche real estate market, represented by Historic
Landmark properties.   

USUBC been working with Irena Holiat, founder of MJA Asset
Management, LLC.  Irena has over 30 years of real estate investment
experience and felt Landmark properties were under served due to a lack
of expertise in understanding their unique investment value, preservation
and management. 
 
Irena is a Ukrainian-American and her family has been leaders in the
Ukrainian-American community for many years.
 
Morgan Williams, SigmaBleyzer, president of the USUBC, asked Irina
about her interest in now expanding her unique business to work in Ukraine.
She explained, “It is my Heritage that motivates me to give back to the
country my parents had to leave as political refugees.  I saw their undying
love for Ukraine, one parent from the west the other from the east. 

“My father became the Superintendent of Ukraine language schools here in
the states, in his retirement he was head of the Free Ukrainian University in
Munich. 

“My mother set her own milestones, she was the only female student in her
graduating class and she graduated Magna Summa Cum Laude from Graz
medical school, in a foreign language no less.  She went on to become an
anesthesiologist at a time were this was not the specialization of choice for
women MD’s.

“The capacity of Ukraine’s people, was exemplified to me by my parents,
there was never any doubt in my mind that Ukraine would never give up
until it was free and democratic!  

“My parents always asked me not to forget Ukraine, and if at all possible
when the opportunity presented itself to step up to the plate and help. I
am thrilled that  my company is in a unique position to be of service, and
humbled to be able to fulfill my parents legacy.”
 
Combining real estate knowledge and a deep commitment to preserving
historic properties for the next generation, MJA Asset Management,
LLC invests in under performing historic property, and land. 

MJA Asset Management’s business model seeks to create added value
and investment interest in Historic structures through creative new uses
and upgrades, while retaining or restoring the Historic Landmark integrity
of the property.
 
In addition to investing and managing its own portfolio of Historic
Landmark properties MJA Asset Management, LLC serves as a
consultancy resource. 
 
It promotes Historic Landmark property investment to high net worth
individuals seeking to diversify their real estate portfolio holdings via
rare property acquisition.  

As a consultancy resource MJA Asset Management, LLC removes the
impediment to investing in these high maintenance properties due to a lack
of competent management resources. MJA Asset Management, LLC
becomes that resource, facilitating the ongoing stewardship of these
properties.
 
MJA Asset Management, LLC staff with a combined 75 years of real
estate experience,  adds additional value to its properties by implementing
forward looking and innovative improvements, such as greening or
creating property uniqueness by planting rare tree species, such as the
American Chestnut.   

MJA Asset Management, LLC property stewardship seeks to develop
new cash flow opportunities through creative new uses of the property,
government or philanthropic grants, tax abatements for Historic
preservation and/or upgrades.
 
In 2006 in recognition of its contribution to the preservation of Historic
Landmark Properties, active participation in developing public policy for
Historic Landmark preservation, and the unique entrepreneurship of its
founder, Irena M. Holiat, the U.S. State Department invited MJA Asset
Management, LLC to be one of six American businesses founded by
women, to join Under Secretary Karen Hughes as part of her delegation
to the Middle East North African Partnership Initiative in Abu Dhabi. 

The delegation was to meet with 250 top women leaders of the Middle
East and North Africa for a Women’s Economic Initiative Summit 

The delegation’s mission was to help develop economic hubs, create
economic empowerment for women, and identify and foster the
development of entrepreneurial training so that the region could produce
exceptional business and civil society leaders.   The initiative was hugely
successful and remains an active initiative to this day.
 
MJA Asset Management, LLC has offices in New York, Connecticut
and New Jersey, and looks forward to offering their unique expertise
and skill set to Ukraine.
 
The five new USUBC members in 2008 are: MaxWell USA, Baker &
McKenzie, Och-Ziff Capital Management Group, Dipol Chemical
International, Inc. and MJA Asset Management.

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20.  BANKS: BENIGN FORECAST HIDES NASTY SURPRISES
International Banks Expanding in Romania, Ukraine, and Russia

By Stefan Wagstyl, Financial Times,

London, United Kingdom, Tuesday, April 1 2008

Business has never been better for the international banks that dominate in
much of central and eastern Europe. But the upheavals in international
financial markets could presage more difficult times, even if the region is
spared the worst of the turmoil.

Bankers say growth in central and eastern Europe is sufficiently strong for
the region to weather the storm, but individual countries and companies have
run into difficulties – and they may be joined by others before stability
returns to world markets.

As Andreas Treichl, chief executive of Austria’s Erste Bank, says: “People
say things will improve in the second half of 2008 but I am not so sure
because I don’t know all the bad news is out.”

Most banks have been celebrating record results for 2007. Italy’s Unicredit,
the biggest bank in central and eastern Europe, reported a 9 per cent
increase in net profits to nearly Euro6bn ($9.4bn); Erste, with extensive
central and south east European investments, reported a rise of 26 per cent
to Euro1.2bn net; and US-owned GE Money, a division of General Electric,
reported $944m net for its east European business, with profits growing at
an annual average of more than 60 per cent in the past three years.

Of the leading international financial groups which are big in the region,
only France’s Société Générale and Citibank of the US have been seriously
affected by the global credit squeeze. Whether by luck or judgment, the rest
have mostly been too busy investing in central and eastern Europe to put
much money into exotic instruments.

With most big banks in central and south-east Europe already in the hands of
international owners, the focus of acquisitions in the past year has been on
the less familiar markets further east.

MOST SIGNIFICANT DEALS OF 2007 HAVE BEEN IN UKRAINE
If the biggest banking acquisition of 2006 was Erste’s Euro3.75bn
acquisition of BCR – Romania’s largest bank – the most significant deals of
2007 have been in Ukraine, where Sweden’s Swedbank bought TAS-Kommerzbank
for $735m, plus future performance-linked payments of up to $250m, while
Unicredit paid $2.1bn for Ukrsotsbank.

Banks are also looking hard at Russia and Kazakhstan, where they think the
liquidity problems experienced by some local banks creates buying
opportunities. Unicredit has, for example, dived into the choppy Kazakh
market and agreed to buy control of ATF Bank for $2.2bn.

On top of acquisitions, banks are investing heavily in the expansion of
networks and product lines, notably in Ukraine, Romania and Russia. Herbert
Stepich, chief executive of Raiffeisen International – in asset terms the
third-largest bank in the region behind Unicredit and Erste – says:
“Conditions for expanding our business remain very good.”

Bankers argue that because the global credit squeeze coincided with a period
of very strong growth in central and east Europe, the moderate economic
slowdown now taking place is not unwelcome in reducing the dangers of
over-heating. Some central banks were in any case acting to slow credit
growth even before last summer.

Raiffeisen forecasts moderate declines in credit growth from high levels: in
Russia from more than 50 per cent last year to 26 per cent in 2008, in
Ukraine from 76 per cent to 24 per cent and in Romania from 53 per cent to
24 per cent. Mr Stepich says: “We see some air coming out of over-heated
economies of the past few years.”

Of course, even if the general outlook is benign, there is scope for
significant nasty surprises. The region’s banking sector is by no means
uniform. In central and south-east Europe, the industry is dominated by
international groups, which mostly have bigger operations elsewhere.

Unicredit, for example, has about 20 per cent of its total assets in the
region. These groups generally finance their east European operations from
their own resources.

But in Russia and Kazakhstan, markets are dominated by locally-owned banks
raising large amounts of money from the international market.

Some of these institutions are now vulnerable, as is reported elsewhere in
this report. The oil-rich Russian and Kazakh authorities are supporting
banks that have run into trouble. But, especially in Kazakhstan, that is not
enough to put confidence back into the banking market.

Jean Lemierre, president of the European Bank for Reconstruction and
Development, says his government-owned institution stands ready to play a
role in easing fund-raising problems. “The challenge we have for 2008 is to
help some companies and some banks to go back to the market.”

Manfred Schepers, the EBRD’s vice-president for finance, says local currency
markets the EBRD assisted in establishing in Russia and Ukraine can
contribute support. “Our role as a stabiliser in these economies in 2008
will be a very important role.”

For the region’s policymakers, one comfort from the financial turmoil is
that local financial markets are small in relation to total economic output.
According to Raiffeisen, bank assets are the equivalent of 235 per cent of
Gross Domestic Product in the eurozone, but just 75 per cent in central
Europe, 74 per cent in south east Europe and 53 per cent in the former
Soviet Union.

For mortgages, which have caused so much trouble in the US, the figures are
even lower – just 11 per cent of GDP in Poland, 2 per cent in Romania and
1.2 per cent in Russia.

At these low levels, the danger of a financial shock having a big
macro-economic effect is smaller than in more financially-developed
economies. But it is far from negligible. The impact of a financial crisis
on economic confidence could still be considerable, as it was in Russia in
1998.
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21.  GENERAL DYNAMICS JOINS U.S.-UKRAINE BUSINESS

COUNCIL (USUBC) IN WASHINGTON
A World Leader in Aerospace, Combat Systems,
Marine Systems, Information Systems & Technology
 
U.S.-Ukraine Business Council (USUBC), Washington, D.C, Mar, 2008
                       
WASHINGTON, D.C. – The executive committee of the U.S.-
Ukraine Business Council (USUBC) is pleased to announce that
General Dynamics has been approved for membership in USUBC.
 
General Dynamics is a world leader in business aviation; land and
expeditionary combat vehicles and systems, armaments, and
munitions; shipbuilding and marine systems; and mission-critical
information systems and technologies. 
 
General Dynamics is the 58th member, the 6th new member for
2008 and the 36th new member for USUBC since January of 2007,
according to Morgan Williams, SigmaBleyzer, who serves as
USUBC president.
 
Patrick Sweet, President, Sweet Analysis Services, Inc. (SASI), a
long-time member of USUBC and a member of the USUBC
executive committee made the introduction to General Dynamics.
We express our appreciation to Patrick for his support.
General Dynamics employs approximately 83,500 people and has
a global presence. Headquartered in Falls Church, Virginia, the
company reported 2007 revenues of $27.2 billion.

General Dynamics has four main business segments:

 
(1) Aerospace designs, develops, manufacturers and services a
comprehensive offering of advanced business-jet aircraft. 

(2) Combat Systems is a global leader in producing, supporting and

sustaining land and expeditionary combat systems for the U.S.
military and its allies.

(3) Marine Systems designs, builds and supports submarines and a

variety of surface ships for the U.S. Navy and commercial customers. 

(4) The Information Systems and Technology group offers a breadth

and depth of technology and service capabilities that support a wide
range of government and commercial needs, including systems
integration expertise; hardware and software products; and
engineering, management and support services.

More information about the company is available on the Internet at

 
Information about the U.S.-Ukraine Business Council (USUBC)
can be found at www.usubc.org.
————————————————————————————-

U.S.-UKRAINE BUSINESS COUNCIL (USUBC) MEMBERS
Washington, D.C. (http://www.usubc.org/members.php)

March, 2008, Fifty-Eight Members

 

1.  AES Corporation
2.  ALICO/AIG

3.  American Continental Group

4.  Archer Daniels Midland Company (ADM)
5.  Atlantic Group
6.  Baker & McKenzie
7.  The Boeing Company
8.  Bracewell & Giuliani LLP
9.  Bunge North America
10. Charles H. Camp, Attorney
11. Cardinal Resources
12. Cargill
13. Case New Holland
14. Chadbourne & Parke LLP
15. Cisco Systems, Inc.
16. The Coca-Cola Company
17. Deere & Company
18. Dipol Chemical International Inc.
19. ECdata, Inc.
20. ESSI/TAMSCO
21. The Eurasia Foundation

22. General Dynamics
23. Heller & Rosenblatt
24. Holtec International
25. Horizon Capital Advisors,
      LLC-Emerging Europe Growth Fund
26. International Environmental Trading Group
27. International Tax and Investment Center (ITIC)
28. Kennan Institute, Woodrow Wilson
      International Center for Scholars
29. Kraft Foods Ukraina
30. Kyiv-Atlantic Group of Companies
31. Marathon Oil Corporation
32. Marks & Sokolov LLC
33. MaxWell USA

34. MJA Asset Management, LLC,
35. Northrop Grumman
36. Och-Ziff Capital Management Group
37. Open World Leadership Center,
      U.S. Library of Congress
37. The PBN Company
39. Procter & Gamble
49. Russian-Ukrainian Legal Group, PA
41. Salans, international law firm
42. Shell Oil Company
43. SigmaBleyzer Private Equity Investment Group
44. Siguler Guff & Co, LLC
45. Softline Company

46. Sweet Analysis Services, Inc. (SASI)
47. TD International, LLC
48. The State Export-Import Bank of Ukraine
49. The U.S. Civilian Research & Development Foundation
50. U.S.-Ukraine Foundation (USUF)
51. Ukrainian American Bar Association (UABA)
52. Ukrainian-American Environmental Association (UAEA)
53. Ukrainian Federation of America (UFA)
54. Ukrainian Development Company (UDC)
55. UPS
56. Vanco Energy Company
57. Westinghouse
58. WJ Export-Import Agricultural Group
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McConnell, President; John Kun, Vice President/COO; Markian
Bilynskyj, VP/Director of Field Operations; Kyiv, Ukraine. Web:
http://www.USUkraine.org
13. WJ GROUP of Ag Companies, Kyiv, Ukraine, David Holpert, Chief
Financial Officer, Chicago, IL; http://www.wjgrain.com/en/links/index.html
14. EUGENIA SAKEVYCH DALLAS, Author, “One Woman, Five
Lives, Five Countries,” ‘Her life’s journey begins with the 1932-1933
genocidal famine in Ukraine.’ Hollywood, CA, www.eugeniadallas.com.
15. ALEX AND HELEN WOSKOB, College Station, Pennsylvania
16. SWIFT FOUNDATION, San Luis Obispo, California
17. TRAVEL TO UKRAINE website, http://www.TravelToUkraine.org,
A program of the U.S-Ukraine Foundation, Washington, D.C.
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A program of the U.S.-Ukraine Foundation, Washington, D.C.
19. DAAR FOUNDATION, Houston, Texas, Kyiv, Ukraine.

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AUR#894 Apr 1 President Bush in Kyiv Today; Ukraine, The Main Battlefield of Cold War II; Germany Blocks Ukraine & Georgia; Bush & Putin Clash

========================================================
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       
                        
ACTION UKRAINE REPORT – AUR – Number 894
Mr. E. Morgan Williams, Publisher and Editor, SigmaBleyzer
WASHINGTON, D.C., TUESDAY, APRIL 1, 2008
 
INDEX OF ARTICLES  ——
Clicking on the title of any article takes you directly to the article.               
Return to Index by clicking on Return to Index at the end of each article
1.  PRESIDENT BUSH IN KYIV, SCHEDULE FOR TUESDAY, APRIL 1
Action Ukraine Report (AUR), Kyiv, Ukraine, Tuesday, April 1, 2008
 
2BUSH STARTS EUROPE TOUR IN NATO ASPIRANT UKRAINE
By Nick Coleman, Agence France-Presse (AFP)
Kiev, Ukraine, Monday, March 31, 2008

3BUSH’S TOUR OF EASTERN EUROPE TO FOCUS ON DIPLOMACY
By Brian Knowlton, International Herald Tribune (IHT)
Paris, France, Monday, March 31, 2008

4UKRAINE TREADS CAREFUL DIPLOMATIC PATH
By Roman Olearchyk in Kiev and Stefan Wagstyl in Moscow
Financial Times, London, UK, Monday, March 31 2008

5U.S. AMBASSADOR WILLIAM TAYLOR: BUSH VISIT WILL
BOLSTER UKRAINE’S CASE FOR NATO

The Associated Press, Kiev, Ukraine, Monday, March 31, 2008

6PRO-RUSSIA ENEMIES OF NATO GIVE BUSH A MIXED
RECEPTION IN UKRAINE

By Tony Halpin in Kiev, London Times, London, UK, Mon, Mar 31, 2008

7BUSH SEES UKRAINE’S MEMBERSHIP OF NATO AS POSITIVE
FOR THE ALLIANCE 

Ukrainian News Agency, Kyiv, Ukraine, Monday, March 31, 2008

8BUSH RECOMMENDING UKRAINE DIVERSIFICATION OF
ENERGY DELIVERIES FOR MAINTENANCE OF STABILITY 
Ukrainian News Agency, Kyiv, Ukraine, Monday, March 31, 2008

9UKRAINE, U.S. SIGN INTERGOVERNMENTAL AGREEMENT

ON SPACE COOPERATION
Interfax Ukraine, Kyiv, Ukraine, Monday, March 31, 2008

10UKRAINE, UNITED STATES SIGN INTERGOVERNMENTAL

Interfax Ukraine, Kyiv, Ukraine, Monday, March 31, 2008
 
11ECONOMY MINISTER AND U.S. AMBASSADOR DISCUSS
PROBLEM OF U.S. OVERSEAS PRIVATE INVESTMENT
CORPORATION (OPIC) BEING CLOSED FOR UKRAINE
Ukrainian News Service, Kyiv, Ukraine, Saturday, March 15, 2008

12UKRAINE, THE MAIN BATTLEFIELD OF COLD WAR II
Geopolitical Diary: Stratfor, Strategic Forecasting, Inc.
Austin, Texas, Friday, March 28, 2008

13OUTSIDE VIEW: OLD, NEW EUROPE CLASH
By Taras Kuzio, UPI Outside View Commentator
United Press International (UPI), Wash, D.C., Mon, Mar 31, 2008

14GERMANY BLOCKS UKRAINE & GEORGIA REGARDING

NATO MEMBERSHIP ACTION PLAN (MAP)
By Hugh Williamson in Berlin, Financial Times
London, United Kingdom, Tuesday, April 1 2008

15BUSH, PUTIN SET TO CLASH AT NATO
Russia Seeks to Stop Georgia, Ukraine From Joining Group
By John D. McKinnon, The Wall Street Journal,
New York, New York, Tuesday, April 1, 2008

16NATO HOLDS KEY TO EUROPEAN CLUB FOR GEORGIA & UKRAINE
By Ron Popeski & Margarita Antidze, Reuters, Kiev/Tbilisi, Mon, Mar 31

17U.S TO RUSSIA:NATO SHOULDN’T BE “FOUR-LETTER WORD”
By James G. Neuger, Bloomberg, Kyiv, Ukraine, Friday, March 28, 2008

18NATO-RUSSIA BREAK: A SIGNIFICANT POSSIBILITY
By Georgeta Pourchot, Director, OLMA/NCR, Political Science, Virginia Tech;
Fellow, Center for Strategic and International Studies, Washington DC
Eurasian Home, Moscow, Russia, Monday, March 31, 2008

19TAKING OFF THE GLOVES
OP-ED: John Marone, Columnist, Eurasian Home website, Kyiv, Ukraine
Eurasian Home, Moscow, Russia, Monday, March 31, 2008

20100 HEAD-OFF STEPS, FIRST 100 DAYS OF NEW GOVERNMENT
Authors: Yelena Boltushkina, Inna Vedernikova, Yulia Mostovaya,
Serhii Rakhmanin, Yuriy Skolotiany, Nataliya Yatsenko
Mirror-Weekly # 12 (691), Kyiv, Ukraine, 29 March – 5 April 2008

 
U.S.-Ukraine Business Council (USUBC), Wash, D.C., Jan 2008
 
Interfax Ukraine, Kyiv, Ukraine, Monday, March 31, 2008
 
U.S.-Ukraine Business Council (USUBC), Wash, D.C., Jan 2008
 
Interfax Ukraine, Kyiv, Ukraine, Monday, March 31, 2008
 
25DIPOL CHEMICAL INTERNATIONAL INC. JOINS THE
U.S.-UKRAINE BUSINESS COUNCIL (USUBC)
U.S.-Ukraine Business Council (USUBC), Wash, D.C., Jan 2008

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1
 PRESIDENT BUSH IN KYIV, SCHEDULE TUESDAY, APRIL 1

Action Ukraine Report (AUR), Kyiv, Ukraine, Tuesday, April 1, 2008

KYIV – The reported schedule for the U.S. President and Mrs. Bush
during their visit in Kyiv on Tuesday, April 1 is as follows:

April 1, 9.00 a.m. 11 Bankova St. the yard in front of the Secretariat of
the President of Ukraine
Official meeting ceremony of the President of Ukraine Victor Yushchenko
and President of the USA George W. Bush.

According to an UNIAN correspondent, Ukrainian President’s Press
Secretary Iryna Vannikova, said the so-called “salute of nations”, which
consists of 21 salvoes, will be fired during the official ceremony of
meeting George Bush in the morning of April 1.

“It is an ancient tradition: when ships entered a friendly port, they fired
to show that they have friendly intentions, that they do not want to insult
people they visit. That is why during visits, which have a “state” status,
the artillery volley is fired”, I.Vannikova said.

She also informed that G.Bush was met at the airport on Monday by 

the President’s Chief of Staff Victor Baloha, Foreign Minister Volodymyr
Ohryzko, Kyiv Mayor Leonid Chernovetskiy, and U.S. Ambassador to
Ukraine William Taylor and Ukraine’s Ambassador to USA Oleh Shamshur.

April 1, 9.20 a.m. 10 Bankova St. Horodetsky House
Meeting between the President of Ukraine Victor Yushchenko and
President of the USA George W. Bush.

April 1, 10.10 a.m. 10 Bankova St. Horodetsky House
Ukrainian-American formal talks in expanded format headed by
the two Presidents.

April 1, 10.50 a.m. Bankova St. Horodetsky House
Ukrainian-American bilateral documents signature ceremony.

April 1, 11.20 a.m., 10 Bankova St. Horodetsky House
Joint press conference of the President of Ukraine and the President
of the USA

April 1, 12.50 p.m. 10 Bankova St. Horodetsky House
Official Lunch by the President of Ukraine for President of the USA.

U.S. President George Bush will be entertained in Ukraine with chicken
Kyiv and cherry vareniks [national curd or fruit dumpling] with cherry.
According to an UNIAN correspondent, Ukrainian President’s Press
Secretary Iryna Vannikova claimed this to a news conference in Kyiv.
 
I.Vannikova also disclosed that the Yushchenko couple is going to
present the Bush couple a big wooden plate, painted by Petrykivsky
manner masters. Members of the American delegation will also receive
Ukrainian national souvenirs.
MONUMENT TO HOLODOMOR VICTIMS

April 1, 13.35 p.m. Mykhaylivska Square
Flower laying ceremony by the two Presidents near the Monument
to Holodomor victims
(Mrs. Kateryna Yushchenko and Mrs. Laura Bush will also take part
in the ceremony)

April 1, 14.35 p.m. Sofiyvska Square
Visit by the two Presidential Couples to Kyivan Sofiya National
preserve

April 1, 15.10 p.m. 19a Prorizna St.
Visit to the School #57
(President of the USA George W. Bush and Mrs. Laura Bush)

April 1, 15.55 p.m. Park of Glory
Flower laying ceremony near the Tomb of the Unknown Soldier
(President of the USA George W. Bush and Mrs. Laura Bush)

April 1, 16.50 p.m. Boryspil airport, military transport terminal
Departure of the President of the USA from Ukraine

 
TYMOSHENKO, YATSENIUK, YANUKOVYCH

There also have been reports by the Offices of Prime Minister Yulia
Tymoshenko, the Speaker of the Parliament Arseniy Yatseniuk and
the leader of the opposition Viktor Yanukovych that these three
leaders will also be meeting with President Bush.
 
U.S. President George W. Bush and Ukrainian Prime Minister Yulia
Tymoshenko will discuss Ukraine’s plans to join NATO and deepening
bilateral trade and economic cooperation. Deputy Prime Minister
Hryhoriy Nemyria told this to journalists on Monday.
“I confirm that President Bush will meet with the Ukrainian Prime Minister
tomorrow. They will touch upon NATO issues and focus on deepening
of trade and economic cooperation between Ukraine and the United States,”
Nemyria said.
 
Verkhovna Rada Chairman Arseniy Yatseniuk will hold a tet-a-tet meeting
with U.S. President George Bush. Yatseniuk told journalists about the
meeting on Monday, asked whether the leaders of parliamentary factions
will also participate in the meeting.
“A tet-a-tet meeting with the U.S. president is foreseen. The tet-a-tet
meeting will be held in the format of the Verkhovna Rada chairman and the
U.S. president,” he said, adding that he would speak with Bush “on behalf
of the whole of the Ukrainian parliament.”
 
US President George Bush will meet with Regions Party Leader Viktor
Yanukovych on Tuesday, according to Regions Party MP Hanna Herman.
“This will be an eye-to-eye meeting,” Herman told Interfax-Ukraine on
Monday.  The times for these meetings have not been announced.
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[return to index] [Action Ukraine Report (AUR) Monitoring Service]
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2.  BUSH STARTS EUROPE TOUR IN NATO ASPIRANT UKRAINE

By Nick Coleman, Agence France-Presse (AFP)
Kiev, Ukraine, Monday, March 31, 2008

KIEV – US President George W. Bush arrived in Ukraine Monday at the start of
a tour to push NATO allies for more support in Afghanistan and to reach a
compromise with Russia on defence plans.

At talks scheduled for Tuesday with Ukraine’s pro-Western President Viktor
Yushchenko, Bush was expected to stress US support for the country’s plans
to join the NATO military alliance.

Bush will also be “pushing hard” for the alliance to embrace both Kiev and
Georgia as potential members during a NATO summit that starts Wednesday,

US National Security Advisor Stephen Hadley said.

“We think it’s very, very, very important that, Georgia and Ukraine, that we
welcome their aspirations to be part of NATO, that we have an active
engagement in helping them move in that direction,” Hadley said aboard Air
Force One as Bush flew to Europe.

“I believe that NATO benefits and Ukraine and Georgia benefit if and when
there is membership,” Bush said ahead of his visit to Ukraine, where he
touched down late Monday evening.

Analysts predicted however that neither country would be allowed to start
the formal accession procedure at the April 2-4 meeting of alliance leaders
in Romania.

Ahead of Bush’s arrival, protesters demonstrated against accession both on
Ukraine’s politically sensitive Crimea peninsula on Saturday and in Kiev on
Monday.

The protests underlined significant opposition to membership in Ukraine and
by its giant neighbour Russia, whose president Vladimir Putin has been
invited to the Bucharest meeting.

In Kiev, a few thousand protesters on Monday set up tents and hurled abuse
at Bush and NATO. “NATO is war, death and tears,” read one banner, while
another suggested Yushchenko and Prime Minister Yulia Tymoshenko leave the
country.

Amid a delicate patch in relations between Washington and Moscow, Bush is
also to hold weekend talks with Putin in Russia.

Moscow-based defence analyst Pavel Felgenhauer said wider strategic
considerations meant Georgia and Ukraine would not gain an immediate green
light from NATO.

He said Bush was seeking a softening of Russian opposition to US plans to
set up missile defence sites in the Czech Republic and Poland, as well as
Russian agreement to allow NATO supplies to transit through Russia to
Afghanistan.

In part, Bush wants to prove the success of his Republican party’s policy on
Russia and thus support the Republican candidate John McCain in the US
election period, Felgenhauer said. “It’s a grand deal that involves a lot of
things outside — not only Ukraine and Georgia.”

On the presidential plane Air Force One, Hadley expressed hope that Bush and
Putin would resolve their differences over the missile shield during their
weekend talks.

“I think we’re moving in a direction… where Russia and the United States
could have missile defence as an area of strategic cooperation,” he said.

Another theme of Bush’s tour is to persuade NATO states to commit more
troops for Afghanistan, where failure would be seen as a personal blow.
“Part of our collective mission… for the NATO meeting is to encourage
people to take our obligations seriously,” Bush said on the subject.

Hadley returned to the theme.  “We’ve been saying for some time that all of
us need to do more in Afghanistan, and I think you’re going to see countries
coming up and doing more,” he told reporters.

Ahead of Bush’s arrival here, Ukraine’s desire for NATO membership was
stressed by Yushchenko’s chief spokesman, Alexander Chaly.

“We hope the United States will clearly support our ambition to join the
membership action plan,” a formal step towards membership, Chaly said.

Georgia’s President Mikheil Saakashvili was more strident. He warned NATO
against “appeasing” Russia and drew historical comparisons with the
appeasement of Nazi Germany, in an interview with The Financial Times daily
in Britain.

Several NATO states oppose giving Georgia and Ukraine the go-ahead, notably
Germany, which has sought close ties with Putin and Russia’s president-elect
Dmitry Medvedev.

In Kiev, analyst Vladimir Fesenko said Ukraine would not be deterred by
Western hesitancy.  “Ukraine is interested in the process more than the
final result… NATO membership is a pretext for integration with Europe,”
said Fesenko, who heads the Centre for Applied Political Research.
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[return to index] [Action Ukraine Report (AUR) Monitoring Service]
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3.  BUSH’S TOUR OF EASTERN EUROPE TO FOCUS
ON DIPLOMACY

By Brian Knowlton, International Herald Tribune (IHT)
Paris, France, Monday, March 31, 2008

WASHINGTON: President George W. Bush will be battling this week at the
NATO summit meeting in Romania against Russia’s opposition to eventual
alliance membership for Ukraine and Georgia. And he will be pressing for
greater help in Afghanistan from allies who are weary of the war there and
inclined, in some cases, to put off tough decisions in hopes that the next
American president will be more flexible.

Bush left Washington early Monday for Ukraine, which has been pressing to be
included in a round of NATO accessions following the candidates leading the
queue – Albania, Croatia and Macedonia, whose applications will be decided
at the summit meeting.

He then flies to Bucharest for the NATO meeting on Wednesday and Thursday,
before traveling briefly to Croatia, and then to Sochi, a Russian city on
the Black Sea, for talks with President Vladimir Putin on U.S. plans for a
missile-defense system based in Eastern Europe.

The rancorous disputes over Ukraine and Georgia, over greater troop
contributions for Afghanistan, and over the missile-defense plan – which
Bush sees as a cornerstone of his legacy but which Putin strongly opposes –
all point to a fairly extraordinary week of diplomacy for a president who at
times has seemed almost allergic to foreign travel.

Bush signaled Monday that he was prepared to compromise on one of the
tougher aspects of the Afghan issue, even as the NATO chief executive, and
officials in Ukraine and Georgia, employed tough tones in warning that
Russia should not be allowed to dictate NATO’s membership decisions.

Asked in an interview in the German daily Die Welt whether he would ask
Berlin to send troops to southern Afghanistan, where the fighting is
toughest, Bush made a surprising concession, saying, “No, that won’t
happen.” He said it was important for the summit meeting to have outcomes
that Chancellor Angela Merkel could live with.

Opinion in Germany is strongly against the deployment in Afghanistan.

But as recently as February, Defense Secretary Robert Gates had warned that
NATO risked becoming a two-tiered alliance, with “some allies willing to
fight and die to protect people’s security, and others who are not.” He had
called for Germany to send ground troops to southern Afghanistan.

Canada, which bears much of the burden of fighting in southern Afghanistan,
has threatened to pull its troops out unless it gets help. But France, which
under President Nicolas Sarkozy has said it is considering rejoining the
military wing of NATO, has indicated that it may send an additional 1,000
troops.

The United States, with 26,000 troops in Afghanistan, plans to send an
additional 3,200 marines.

On Monday, NATO’s secretary general, Jaap de Hoop Scheffer, said that Russia
could not stop Ukraine and Georgia from joining the alliance, The Associated
Press reported from Brussels. But he added that, given Russia’s opposition,
the decision to put the former Soviet republics on a track to membership
might be delayed.

“In my opinion, it is not a matter of whether, but when” the two countries
join the alliance, he told news agencies.

De Hoop Scheffer said that Putin, who will meet with the alliance leaders in
the margins of the NATO meeting, could not veto Georgia and Ukraine’s
applications, but he did acknowledge that Russian opposition “was a factor”
affecting the debate.

Earlier, de Hoop Scheffer told the Financial Times that the “pieces are
coming together” for a bolstered Afghanistan contingent. He said he was
confident that the French would announce a fresh troop contribution and that
Canada, which had threatened to leave Afghanistan unless other countries
provided sufficient back-up, would “get the support they have asked for.”

In Georgia, President Mikhail Saakashvili warned NATO against “appeasing”
Russia. Failure to move forward on membership for Georgia and Ukraine, he
said, would be taken by the Russians “as a signal that they should act even
tougher, and they will be even tougher, and they will be even more
aggressive and provocative.”

In Kiev, where a few thousand leftists demonstrated against Bush and NATO
just hours before his arrival there, Ukrainian officials expressed
confidence on Monday that they would win approval this week for the first
step in a bid to join NATO, Reuters reported.

Ukraine and Georgia are hoping to secure a so-called Membership Action Plan,
the first step in a candidacy for full membership. Ukraine’s top foreign
policy adviser, Oleksander Chaliy, predicted a “positive reply” from NATO.

But Bush, referring to both Georgia and Ukraine, told Die Welt that he
supported their eventual membership, even though he declined a chance to
predict that their candidacies would be advanced in Bucharest.

“I believe it is in our interest to give Georgia and Ukraine a clear
perspective,” he said. His comments were translated from the German; the
White House said no English-language translation was immediately available.
Bush has seemed of late to modulate his comments on Georgia and Ukraine.

Asked about reported comments from the man set to succeed Putin in the
presidency, Dmitri Medvedev – that Medvedev opposed Ukraine’s membership in
NATO because it enjoyed little support among Ukrainians and because no
country wanted to share borders with a foreign military bloc – Bush replied
that for a country to share borders with democracies was “good and not bad.”
And people in other countries, he said, had moved from initial doubts about
NATO membership to strong support.

The president emphasized that no NATO troops would be permanently based in
Ukraine.

It remained unclear whether Bush’s bid to leave a trans-Atlantic legacy by
helping usher Albania, Croatia and Macedonia into NATO would be able to
overcome internal divisions, including a dispute with Greece over
Macedonia’s name and questions about the readiness of the three for
membership.

Bush announced Wednesday that he had accepted an invitation from Putin to
visit Russia, probably April 5 and 6, in what was seen as an effort to avoid
a public clash over NATO and missile defenses during Bush’s European
travels.

The administration wants to base parts of a missile defense system in Poland
and the Czech Republic, but Russia strongly opposes the plan. White House
advisers suggested last week that greater efforts to make the installation
“transparent” to Russia might help overcome that opposition. Bush said last
week that he was “cautiously optimistic.”
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LINK: http://www.iht.com/articles/2008/03/31/europe/kiev.php?page=1
=————————————————————————————————
[return to index] [Action Ukraine Report (AUR) Monitoring Service]

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4.  UKRAINE TREADS CAREFUL DIPLOMATIC PATH

By Roman Olearchyk in Kiev and Stefan Wagstyl in Moscow
Financial Times, London, UK, Monday, March 31 2008

When US President George W. Bush stops off in Ukraine on Tuesday he will
hope to leave a better impression than his father, George H.W. Bush, who in
1991 visited Kiev to warn the republics emerging from the collapsing Soviet
Union against “suicidal nationalism”.

Four months after he delivered what was quickly dubbed the “Chicken Kiev”
speech, Ukrainians voted for independence and the Soviet Union rapidly
passed into history.

Although Mr Bush Sr later explained that he had been trying to stop
Ukrainians from doing “something stupid”, his words were widely seen
as a futile attempt to prop up Soviet leader Mikhail Gorbachev.

Mr Bush Jr arrives in less apocalyptic times but still faces a difficult
challenge. He must demonstrate Washington’s support for Ukraine on the eve
of a Nato summit even though the summit later this week is likely to reject
or delay Kiev’s bid for a membership action plan – a Nato pre-accession
agreement.

While Washington backs Ukraine’s Map application – and a similar bid from
Georgia – leading European states are opposed for fear of provoking Russia,
which is furious about what it sees as the alliance’s advance into its
neighbourhood.

Before leaving Washington, Mr Bush made clear the US was committed to
drawing Ukraine and Georgia into Nato, even though he was unable to make
concrete announcements. He said: “I do know that one of the signals we’re
going to have to send, and must send, is there is a clear path forward for
Ukraine and Georgia.”

The Ukraine that he visits on Tuesday is quite different from the country
his father saw 17 years ago. Then, Ukraine was on the threshold of its
biggest upheaval since the second world war, with independence followed
by the disintegration of the planned economy and of communist power.

There were sighs of relief when the new country voluntarily gave up its
post-Soviet nuclear arsenal. But Ukraine suffered years of political turmoil
and economic dislocation before it recovered its stability in the late 1990s
under authoritarian President Leonid Kuchma, who tried to steer a course
between Russia and the west.

In the 2004 Orange Revolution Ukrainians revolted against Mr Kuchma’s
oppressive rule and backed the western-oriented Viktor Yushchenko for
president. The past three years have seen a ceaseless power struggle between
Mr Yushchenko and his rivals, but multi-party democracy has taken root,
bolstered by a surge in economic growth and unprecedented foreign
investment.

Mr Yushchenko has resolutely pursued membership of Nato and the European
Union, despite divisions at home and considerable caution among his would-be
western partners.

Leonid Kravchuk, chairman of Ukraine’s Supreme Soviet in 1991 and later the
first democratically elected president, said Ukraine today was a far cry
from 17 years ago.

“Bush Sr was aiming to preserve the USSR to maintain stability, his biggest
concern being the fate of the nuclear arsenal. Bush Jr has a completely
different view of Ukraine than his father.” Mr Kravchuk said the visit’s aim
was to bolster support for Nato in Ukraine, which was now recognised as a
viable independent state and partner.

However, in one respect Ukraine is still in the same position as in the
early 1990s – it remains subject to the competing pulls of Moscow and the
west. While support for future EU accession is high, public backing for Nato
is low, at about 30 per cent.

Mr Yushchenko has battled to increase support and convince Moscow his
country will not become an anti-Russian border post.

Ahead of Mr Bush’s visit, Mr Yushchenko told the Financial Times his country
would not house foreign military bases as a Nato member and, thus, pose no
threat to Russia.

Kiev had proven its dedication to collective security in giving up its
nuclear arsenal and in peacekeeping missions, Mr Yushchenko said.

Mr Kravchuk predicted Ukraine would eventually join both Nato and the EU,
despite the uncertainty on timing. “The process has been difficult, painful
and longer than expected, but we are no doubt set on this course.”

Mr Kravchuk, who has opposed swift Nato entry, was concerned about souring
relations with Moscow. He said that by joining Nato and the EU, Ukraine
would shed its role as a geopolitical chip manipulated by Washington and
Moscow. “Then nobody will be able to push Ukraine around.”

“In the past, when the US made a major decision on Ukraine, they first
looked to see what the reaction of Russia would be. This is still happening,
but now world leaders see Ukraine as a future Nato and EU member,” Mr
Kravchuk added.
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http://www.ft.com/cms/s/0/98ad23da-ff6f-11dc-b556-000077b07658.html
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[return to index] [Action Ukraine Report (AUR) Monitoring Service]
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U.S.-Ukraine Business Council (USUBC): http://www.usubc.org
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5.  U.S. AMBASSADOR WILLIAM TAYLOR: BUSH VISIT
WILL BOLSTER UKRAINE’S CASE FOR NATO

The Associated Press, Kiev, Ukraine, Monday, March 31, 2008

KIEV – U.S. President George W. Bush’s visit to Ukraine will bolster this
ex-Soviet republic’s chances of starting the process toward NATO membership,
American Ambassador William Taylor said Monday.

Bush arrived in Kiev late Monday for a two-day visit aimed at showing U.S.
support for Ukraine’s membership bid.

After Kiev, Bush travels to Bucharest, Romania, for a NATO summit that is
turning into a critical test for the alliance, which is split on the issue
of Ukraine and Georgia.

Ukrainians are also split on the prospect of joining NATO. Hours before Bush
was to arrive, several thousand protesters rallied outside the U.S. Embassy,
shouting “Yankee, go home” and burning his effigy.

The United States, Canada and Eastern European members back the two
ex-Soviet republics. Germany is leading Western European opposition and
warns that granting the membership plan would torpedo hopes of improving
relations with Russia, which fiercely opposes NATO’s further eastward
expansion and has been lobbying NATO members.

Taylor told reporters that during his visit, Bush will seek to convince
skeptics in the alliance that Ukraine deserves an initial welcome.

“Strong statements coming from the leadership, the government of Ukraine are
very useful in that regard,” Taylor said.

“President Bush is also eager to talk himself with these leaders and with
other people in this city so that he can go to Bucharest with even stronger
arguments,” he said.

Moscow has threatened to target nuclear weapons at Ukraine if it joins NATO
and accepts the deployment of anti-missile defenses on its territory. Moscow
also has warned it could recognize two Georgian breakaway provinces –
Abkhazia and South Ossetia – if Georgia is given membership.

“The sharpest problems are Georgia and Ukraine. They are being impudently
drawn into NATO. Even though, as is known, the overwhelming majority of
Ukrainians are against this and in Abkhazia and South Ossetia they won’t
even hear of it,” Russian Foreign Minister Sergey Lavrov said in an
interview published Monday in the Russian daily Izvestia.

“We honestly say that this cannot but have consequences, first of all in
geopolitics but also economically,” he said.

Meanwhile, President Mikhail Saakashvili of Georgia – a strong U.S. ally
visited by Bush in 2005 – again made his case for joining NATO. In an
interview published Monday in the Russian daily Kommersant, he said bowing
to Moscow’s threats would further destabilize the Caucasus.

“All these statements aren’t just words after all, it’s playing with fire,”
Saakashvili was quoted as saying. “In the Caucasus there isn’t much distance
between statements and automatic weapons and mortar fire. You have to
remember this.”

Even as he pushes for NATO membership, Saakashvili has struggled to bring
South Ossetia and Abkhazia back under government control. Their autonomy is
supported by Russia, which has drawn parallels between their status and that
of Kosovo.

In the interview, Saakashvili also said that during his most recent meeting
with Russian President Vladimir Putin, “it was clearly promised to me that
Russia would never recognize Abkhazia and South Ossetia.”

Kremlin spokesman Dmitry Peskov, in a conference call with journalists,
declined to say whether such a promise had been made, but said: “President
Putin has stated numerous times that he stands for the territorial integrity
of Georgia.”

Asked whether alliance membership for Georgia and Ukraine would undermine
the NATO-Russia Council, to which Putin is to speak the day after the
summit, Peskov said: “Let’s not speak of any red lines.”

Russia also has offered more cooperation with NATO in Afghanistan in
exchange for shutting Georgia and Ukraine out of the alliance.

Taylor condemned that offer, saying the two matters are unrelated. “It is
impossible to compare or bargain about the sovereignty and independence of a
country – no linkage between that and some logistical benefits having to do
with Afghanistan,” Taylor said.

More than 1,000 protesters rallied in central Kiev to protest Bush’s visit
and Ukraine’s efforts to join NATO. They waved Communist red
hammer-and-sickle flags and held anti-Bush posters, including many obscene
ones.

“People have the right to express themselves in a democracy,” Taylor said.
“If they do it in a tasteless way – that says more about them than anything
else.”

The crowd swelled to several thousand and marched to the U.S. Embassy.
Authorities closed several central Kiev streets to traffic and some 5,000
police flooded the city to ensure security during Bush’s visit.
————————————————————————————————–
Correspondents Olga Bondaruk in Kiev and Jim Heintz in Moscow

contributed to this story.
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[return to index] [Action Ukraine Report (AUR) Monitoring Service]
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6.  PRO-RUSSIA ENEMIES OF NATO GIVE BUSH A MIXED
RECEPTION IN UKRAINE

By Tony Halpin in Kiev, London Times, London, UK, Mon, Mar 31, 2008

As workmen painted fresh lines on the road from the airport to the centre of
Kiev to welcome President Bush to Ukraine yesterday, diehard opponents of
Nato were staging their own reception party.

About 3,000 Communist and Socialist party supporters rallied in Independence
Square, the scene of the pro-Western Orange Revolution in the capital,
carrying Soviet-era flags and banners that read “Ukraine against Nato” and
“Nato is worse than the Gestapo”, while an effigy of Mr Bush was set on
fire.

Mr Bush arrives for his first visit to Kiev, before tomorrow’s opening of
the Nato summit in Romania, determined to show his support for Ukraine’s
ambition to join the alliance despite strong opposition from Russia.
However, Nato membership is controversial here, with many in the pro-Russian
east of the country opposed to joining what they consider to be an enemy
organisation.

“Nato is fascism – look how they bombed Yugoslavia. They are occupying
Afghanistan, and America has destroyed Iraq,” Vasily, 70, who served in the
Soviet Army for 27 years, said. “We want nothing to do with it; we are for
Russia and Russia is for us.”

Mikhail Toporov, 70, said that he supported Nato membership. He told The
Times: “During the war I ate American bread and they helped us a lot, but
everybody has forgotten that now. Nato is not our enemy.”

President Yushchenko and Yuliya Tymoshenko, the Prime Minister and his ally
in the 2004 revolution, regard Nato membership as a key to Ukrainian
security and independence. Russia, however, views Nato expansion as a threat
and President Putin said recently that Moscow would aim its nuclear missiles
at Ukraine if it joined the alliance.

Despite Mr Bush’s support, Nato is split over offering an action plan to
Ukraine and Georgia setting out the steps necessary for membership.
President Basescu of Romania has urged members to give them “the chance to
accomplish their wish”, but invitations must be offered unanimously, and
Germany, Spain and Italy are among the opponents.

Angela Merkel, the German Chancellor, said: “A country should become a Nato
member not only when its temporary political leadership is in favour but
when a significant percentage of the population supports membership,”
Georgia has offered to send a 500-strong force to join Nato’s operations in
Afghanistan, an unnamed source in the Defence Ministry said yesterday. It
has contributed no troops to Afghanistan, although 2,000 are serving in Iraq
as part of the USled coalition.

Mr Putin will attend the Romania summit and hold further talks with Mr Bush
at the Russian resort of Sochi afterwards. Russia is offering increased
cooperation with Nato over Afghanistan provided its security interests are
taken into account
————————————————————————————————
http://www.timesonline.co.uk/tol/news/world/europe/article3656272.ece
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[return to index] [Action Ukraine Report (AUR) Monitoring Service]
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7.  BUSH SEES UKRAINE’S MEMBERSHIP OF NATO AS

POSITIVE FOR THE ALLIANCE 
 
Ukrainian News Agency, Kyiv, Ukraine, Monday, March 31, 2008

KYIV – U.S. President George Bush has said Ukraine’s membership of

NATO will benefit the alliance. Bush gave his position in an interview with
the Inter TV channel.

He said his opinion was that Ukraine’s aspiration to join NATO was good both
for Ukraine and for NATO. Ukraine’s joining NATO is a good policy, he said.

Bush said he did a lot of work so that Ukraine and Georgia would receive
specific perspectives at the NATO summit in Bucharest.

He said he really thought it was important that the future of Ukraine and
Georgia be outlined clearly after the NATO summit in Bucharest where the
decision was to be made.

Bush said he had made his intentions clear on the question and worked on the
matter and the result would be seen on the day of the summit in Bucharest.

Bush noted that the NATO Membership Action Plan was not the same as the
membership of NATO, but it would be only the right to join the process of
submission of an application for membership.

The Ukrainian people are to make a final decision whether or not Ukraine
will join NATO, Bush said.

If the Ukrainian people say “no” by the end of the process, this will be the
decision of the Ukrainian people, Bush said.

He noted, however, that NATO should consider attentively the position of
Ukrainian officials that were elected by people.

As Ukrainian News earlier reported, President Viktor Yuschenko will visit
Romania to take part in the Bucharest NATO summit on April 2-4. Yuschenko

hopes Ukraine will join the NATO Membership Action Plan at the summit.
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[return to index] [Action Ukraine Report (AUR) Monitoring Service]
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========================================================
8.  BUSH RECOMMENDING UKRAINE DIVERSIFICATION OF
ENERGY DELIVERIES FOR MAINTENANCE OF STABILITY 
 

Ukrainian News Agency, Kyiv, Ukraine, Monday, March 31, 2008

KYIV – US President George Bush is recommending that Ukraine diversify

the delivery of energy carriers for the maintenance of its stability. He said
this in interview with TV channel Inter. It is important to diversify the
deliveries in order to avoid dependence on one country, Bush said.

He exemplified the US, which receives crude oil from Canada and Mexico,

as well as from other countries. In the opinion of Bush, it is also important
for stable supplies to make relevant contracts transparent.

The US President recommended that Ukraine use different energy carriers

and show interest in new technologies enabling this country to become less
dependent on specific kinds of fuel.

Ukraine has nuclear power industry often receiving materials for it from one
source, when diversification is needed there, Bush said adding that nuclear
power industry makes one less dependent on hydrocarbons.

As Ukrainian News reported, in early February President Viktor Yuschenko
ordered the Cabinet of Ministers to start talks on diversification of
natural gas supplies to Ukraine.  In February, Yuschenko ordered the Cabinet
of Ministers to guarantee diversification of nuclear fuel supplies before
2009.

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[return to index] [Action Ukraine Report (AUR) Monitoring Service]
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9.  UKRAINE, U.S. SIGN INTERGOVERNMENTAL AGREEMENT
ON SPACE COOPERATION

Interfax Ukraine, Kyiv, Ukraine, Monday, March 31, 2008

KYIV – Ukraine and the United States have signed a new framework agreement
on cooperation in the exploration and use of space for peaceful purposes.

Head of the National Space Agency of Ukraine Yuriy Alekseev and U.S.
Ambassador to Ukraine William Taylor signed the document in Kyiv on

Monday, an Interfax-Ukraine correspondent has reported.

The document, which was signed ahead of U.S. President George W. Bush’s
official visit to Ukraine, sets out the legal base for developing space
cooperation between Ukrainian and U.S. companies.

The agreement is expected to favor the overall development of long-term
space cooperation between Ukraine and the United States and to ensure the
possibility of the proper implementation of joint projects and initiatives
representing mutual interest for the countries’ scientific, technical,
industrial and investment activities.

As reported, the new agreement was drawn up because the validity period of a
similar document, signed in November 1994, has expired, and there are also
new opportunities to extend partnership between the countries.
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10.  UKRAINE, UNITED STATES SIGN INTERGOVERNMENTAL

AGREEMENT ON TRADE, INVESTMENT COOPERATION
 
Interfax Ukraine, Kyiv, Ukraine, Monday, March 31, 2008

KYIV – Ukraine and the United States signed an intergovernmental agreement
on trade and investment cooperation at Ukraine’s Foreign Ministry on Monday,
the ministry’s press service has reported.  Ukrainian Economy Minister
Bohdan Danylyshyn and U.S. Trade Representative Susan Schwab signed

the agreement.

The main goal of the document is extending and strengthening economic
relations between the countries upon Ukraine’s accession to the World Trade
Organization.  The signed agreement will deepen trade and investment
cooperation between Ukraine and the United States.

The document also foresees the creation of the permanently operating
Ukrainian-U.S. council on trade and investment.

Representatives of the Ukrainian Economy Ministry and the Office of the
United States Trade Representative will head the council.  Another goal of
the document is a start of talks on signing a free trade agreement with the
United States.
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11.  ECONOMY MINISTER AND U.S. AMBASSADOR DISCUSS
PROBLEM OF U.S. OVERSEAS PRIVATE INVESTMENT
CORPORATION (OPIC) BEING CLOSED FOR UKRAINE
 
Ukrainian News Service, Kyiv, Ukraine, Saturday, March 15, 2008

KYIV – Economy Minister Bohdan Danylyshyn and U.S. Ambassador to

Ukraine William Taylor have discussed questions related to the revival
of the Overseas Private Investment Corporation (OPIC) in Ukraine.

Ukrainian News learned this from a statement by the press service of the
Economy Ministry, the wording of which was made available to the agency.

“Danylyshyn voiced hope that the settlement of the relations of Ukraine with
the Overseas Private Investment Corporation will improve the investment
environment in Ukraine and attract private investment,” the statement reads.

As Ukrainian News earlier reported, in 2007, the Overseas Private Investment
Corporation offered that the Ukrainian government pays USD 34 million

[USD 34 million is not correct, the number is more like USD 17 million –
AUR Editor] as reimbursement for losses of Alliant Techsystems which
with Alliant Kyiv serving as intermediary was engaged in recycling of
Ukrainian ammunition from 1993 to 1999 when it left the Ukrainian market
following business disagreements with the Ukrainian side.

The money invested by Alliant Techsystems into the project had an insurance
cover from OPIC.  OPIC has for a long time requested the Ukrainian
government to compensate for these losses.

OPIC is an independent agency of the federal government of the United States
that provides commercial services, including insurance of American companies
operating abroad against political and economic risks.
————————————————————————————————

NOTE:  Reliable sources in Kyiv say the problem of the U.S. Overseas
Private Investment Corporation (OPIC) being closed for Ukraine will not
be resolved during the visit of President Bush. This problem has existed
since 1999 and the government of Ukraine has not been willing to assume
responsibility for resolving the issue and enter into serious negotiations
to reach a settlement and then implement the agreement.  A real opportunity
to resolve the OPIC issue has now been lost.  AUR Editor
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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, THE MAIN BATTLEFIELD OF COLD WAR II

Geopolitical Diary: Stratfor, Strategic Forecasting, Inc.
Austin, Texas, Friday, March 28, 2008

Ukrainian President Viktor Yushchenko said on Thursday that no NATO
bases would be deployed in his country in the event that Kiev became a
member of that organization.

Citing Ukraine’s Constitution, which forbids the establishment of foreign
military bases in the country, Yushchenko said, “Some people are spreading
the fable that there will be a NATO military base in Sevastopol. There will
be no base.” This statement comes within three weeks of Kiev saying it had
abandoned its bid for membership in the Western military alliance.

This is not the first time Ukraine has done such a flip-flop. On the
contrary, this oscillation between aligning with the West and placating
Russian concerns has been the hallmark of the country’s behavior for some
years now – if not historically.

Structurally, Ukraine is divided between the people in the western part of
the country, who want to align with the United States and Europe, and the
people in the eastern part, who are looking eastward toward Moscow.

The ill-fated Orange Revolution of late 2004/early 2005 – which failed to
bring the country under Western influence — complicated things. It
exacerbated the divisions within the country, creating a stalemate between
the two sides.

Ukraine’s geopolitical position has failed to allow the country to break its
dependence on and past with Russia. As a result, on a larger geopolitical
scale, the United States and Russia are locked in a long-term tug-of-war
over Ukraine.

In fact, Ukraine represents the major arena in which Cold War II is being
played out between Washington and Moscow. Ukraine is of critical importance
to both sides. For the United States, a successful extraction of the country
from the influence of Moscow – not to mention NATO’s arrival on Moscow’s
doorstep – means relegating Russia to the status of a declining regional
power.

Conversely, and more importantly, for Russia, it is not just about its
efforts to revive the bipolar world, but it is an issue of survival.

The loss of Ukraine could critically weaken the Kremlin. It is not merely a
buffer separating Russia from the West; it is integrated into the Russian
industrial and agricultural base. This is why Moscow has been using the tool
of natural gas cutoffs and coercion by the FSB to keep Ukraine’s leadership
in check.

Moreover, Moscow has laid out the consequences of Kiev teaming up with
NATO, saying it will point missiles at its neighbor if it were part of the
alliance.

Moscow, however, can take comfort from the fact that there is no consensus
within the West regarding Ukraine’s entry into NATO. The Europeans,
particularly Germany, do not share Washington’s level of enthusiasm for
Kiev’s assimilation into NATO.

Uninterrupted supply of Russian gas via Ukraine is of far greater value to
the Central and Eastern Europeans than any grandiose plans to secure the
downfall of Russia. It isn’t that Germany is against Ukraine joining the
West, but that it would rather pick that fight another day – preferably when
Europe wasn’t so dependent on Russia for energy.

But it is Ukraine that is being tugged and pushed from all sides, leaving it
to balance precariously between surviving with a very aggressive Russia to
its east, ambivalence to its west and a Washington eager to use Kiev as its
pawn to stick it to Moscow.

For the next week, Ukraine will toe the line – not accepting or rejecting
the other and waiting for the United States and Russia to decide how far
this battle will go.

In short, Ukraine is not just the premier battlefield of Cold War II, but a
more-or-less permanent standoff arena — unless, of course, one side
decides to back off, which isn’t about to happen anytime soon.
——————————————————————————————
LINK: www.stratfor.com
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[return to index] [Action Ukraine Report (AUR) Monitoring Service]
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13.  OUTSIDE VIEW: OLD, NEW EUROPE CLASH

By Taras Kuzio, UPI Outside View Commentator
United Press International (UPI), Wash, D.C., Mon, Mar 31, 2008

WASHINGTON – President Bush’s two-day visit to Kiev on the eve of
NATO’s April 2-4 summit in Bucharest, Romania, is his first visit to Ukraine
and therefore long overdue. His predecessor, Bill Clinton, visited Ukraine
on three occasions. Bush’s visit to Ukraine ahead of the NATO summit is
seen as a strong show of U.S. support for NATO enlargement to Ukraine
and Georgia.

Bucharest will be dominated by two issues, NATO’s ongoing difficult military
operation in Afghanistan and NATO enlargement. Both issues divide
trans-Atlantic relations at a time when relations between Old and New Europe
have only partially recovered since their nosedive five years ago this month
during the run-up to the invasion of Iraq.

At the center of both issues is Germany’s newly assertive nationalism that
first found widespread public expression during the summer 2006 World Cup.
Divisions over Afghanistan and NATO enlargement reflect an organization
fundamentally divided between Old Europe led by Germany and New Europe
led by the United States.

Standing behind Germany is Russia in a new pact that has historic precedents
and opens up strategic questions for the future of European security. German
Chancellor Angela Merkel held two days of talks with Russian President
Vladimir Putin in Moscow on March 8, two days after NATO’s meeting of
NATO ministers of foreign affairs. Germany’s opposition to NATO
enlargement to Ukraine and Georgia perceptibly hardened.

ISAF includes 43,250 troops from 40 countries. In addition to most NATO
members, four countries seeking NATO membership (Albania, Croatia,
Macedonia, Georgia) have also contributed forces. While France contemplates
increasing its troops in Afghanistan, and even re-joining NATO’s military
arm, Germany continues to reject calls to increase its troop size and deploy
it to the south where NATO forces are battling Taliban forces.

Dwarfing Afghanistan are divisions between Old and New Europe over NATO
enlargement. While Albania, Croatia and Macedonia’s membership of NATO is
uncontroversial within Old Europe, and they are therefore likely to receive
invitations to join NATO in Bucharest, NATO enlargement to Ukraine and
Georgia has revealed deep divisions.

The United States has lobbied intensely within NATO for Membership Action
Plans, widely understood to be the preparatory stage for NATO membership, to
be offered in Bucharest to Ukraine and Georgia. A letter backing MAPs for
Ukraine and Georgia was sent to NATO last week signed by Canada and nine New
Europe members of NATO that joined the organization during two earlier waves
of enlargement in 1999 and 2004.

Germany is Old Europe’s chorus leader within NATO against inviting Ukraine
and Georgia into MAPs. Looking toward Ukraine, Merkel has argued that low
popularity is a major problem while in the case of Georgia she has pointed
to two frozen conflicts in Abkhazia and South Ossetia. Both issues are red
herrings that merely seek to mask Germany’s real motives for opposing
NATO’s fourth enlargement since the end of the Cold War.

During Ukraine’s 17 years of independence, popular support for joining NATO
has fluctuated between one-third and one-quarter. A large number of
Ukrainians remain undecided and as a swing group could be persuaded to
support NATO aspirations ahead of a referendum that is traditionally held
many years after entering a MAP on the eve of joining NATO.

Ukraine’s support for NATO membership is no lower than most post-communist
states that joined in earlier enlargements. Of NATO’s 10 new members, only
Poland and Romania had high levels of support while the remainder had levels
reminiscent of Ukraine before their governments launched information
campaigns. Georgia’s 72 percent high support for NATO membership is
therefore akin to Poland’s and Romania’s.

Ukraine’s Russian-speaking population, often touted by Old Europe as another
obstacle to Kiev’s NATO aspirations, is the same size as that of Estonia and
actually far smaller than that of Latvia. Riga, like Kiev, is a
Russian-speaking city. NATO already includes two countries with large
Russian-speaking populations and four countries that border Russia.

Ukraine’s 14-year record of cooperation with NATO is extensive. Ukraine
joined NATO’s Partnership for Peace in 1994 and has been one of the most
active members. Three years later NATO and Ukraine signed a Charter on
Distinctive Partnership in Madrid.

Ukraine outlined its intention to join NATO in July 2002, two years ahead of
the election protests that came to be known as the Orange Revolution.
President Viktor Yushchenko has relied on legislation introduced under his
predecessor, Leonid Kuchma, who together with Prime Minister Viktor
Yanukovych laid out Ukraine’s goal of achieving NATO membership by 2006.

In diplomatic language reminiscent of Old Europe’s opposition to Turkish
membership in the EU, Germany seeks to offer Ukraine and Georgia an unclear
compromise that would be allegedly less provocative to Russia than a MAP.
Germany, like France and Austria, is supportive of only offering Turkey a
vacuous “Enhanced Agreement” rather than EU membership.

Any new initiative less than a MAP will only sow further confusion as a
compromise has already been in place for the last five years, the annual
Action Plan developed by NATO for Ukraine that is little different from a
MAP.

Former U.S. Ambassador to Ukraine Steven Pifer said, “We told Ukrainian
officials in early 2003 that the NATO-Ukraine Action Plan agreed at the
November 2002 Prague summit was 90-95 percent of a MAP. The main
difference was in the title.” Ukraine has already successfully completed
five Action Plans.

Both Ukraine and Georgia are young democracies that see the future of their
countries in the Euro-Atlantic community of nations. Their democratic
progress is far greater than Romania or the three Western Balkan states when
they were invited into MAPs at the end of the 1990s.

Not extending MAPs to Ukraine and Georgia, after they have already
successfully passed most of the required stages, would be widely seen as
generating doubts over NATO’s longstanding open-door policy and would
deepen divisions within the Alliance that is still recovering from the Iraq
crisis.

In deferring a decision on MAPs for Ukraine and Georgia, NATO will have
served to move its goalposts for geopolitical ends and in doing so show that
Russia does indeed have a veto that is delivered through Berlin.
————————————————————————————————
Taras Kuzio is a research associate at the Institute for European, Russian
and Eurasian Studies at George Washington University and a former head
of the NATO Information and Documentation Office in Kiev.
———————————————————————————————–
United Press International’s “Outside View” commentaries are written by
outside contributors who specialize in a variety of important issues. The
views expressed do not necessarily reflect those of United Press
International. In the interests of creating an open forum, original
submissions are invited.
———————————————————————————————–
[return to index] [Action Ukraine Report (AUR) Monitoring Service]
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14.  GERMANY BLOCKS UKRAINE & GEORGIA REGARDING

NATO MAP

By Hugh Williamson in Berlin, Financial Times
London, United Kingdom, Tuesday, April 1 2008

Leaders of Nato were last night seeking a face-saving compromise over the
organisation’s possible enlargement after Germany insisted it was “not the
right time” to allow Ukraine and Georgia to take a significant step towards
membership.

As Nato prepares to convene for its annual summit in Bucharest tomorrow,
Angela Merkel’s government made clear that it would veto a US drive to allow
both former Soviet republics to join the defence alliance’s membership
action plan (Map).

As a result, Nato must now find a formula in its summit communiqué that does
not embarrass Georgia and Ukraine but that also avoids angering Russia,
which has made clear that it is opposed to Map being offered to the two
states.

Germany’s insistence on blocking Map status now means the 26-member alliance
will be engaged in some tricky diplomacy at Bucharest. In an interview with
the FT this week, Mikhail Saakashvili, Georgia’s president, said that he
would not accept any of the numerous compromises being drafted: “Anything
that is not Map is a great Russian victory.”

Ms Merkel’s spokesman said internal factors – political unrest in Georgia
and divisions over Nato membership in Ukraine – meant they were “not yet
ripe” to gain Map status, the final step before becoming an alliance member.

Russia’s “legitimate security concerns” regarding Nato’s possible eastward
enlargement must be considered by the alliance. He rejected suggestions by
Georgia, Estonia and others that denial of Map status would amount to giving
Russia a huge say in Nato’s internal affairs. “There is certainly no Russian
veto.”

Germany has previously signalled its concerns over Georgia and Ukraine
winning Map status, but this is the first time Berlin has explicitly ruled
out backing the two countries this week.

Ms Merkel had discussed her position with US President George W. Bush,
but had not changed her stance in spite of his opposing view. “Mr Bush
knows our position,” the spokesman said.

Among the European Union’s larger member states, Germany has been
most willing in recent years to take into account Russia’s security worries.

German officials were sceptical yesterday about the US view that Nato
membership for Georgia and Ukraine would help bring stability and added
security to the region.

“We have to weigh up how much security we will win and how much we will
lose,” one person familiar with Berlin’s stance said. Berlin fears that a
deal on Map status would lead to Russia being less willing to find accords
with the US and Nato on key missile defence and disarmament issues.

Compromises could include the upgrading of a Nato commission on Ukraine
into a Nato-Ukraine council to meet in Ukraine, according to German
officials.

Germany opposes Georgia’s Map application both because of problems
surrounding the country’s two disputed territories of Abkhazia and South
Ossetia and because of the repression of opposition movements.

In the case of Ukraine, Germany did not see the cross-party or public
support for Nato membership Berlin believed was necessary.
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http://www.ft.com/cms/s/0/b8e516c0-ff84-11dc-b556-000077b07658.html
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[return to index] [Action Ukraine Report (AUR) Monitoring Service]
========================================================

Ukraine Monthly Macroeconomic Report From SigmaBleyzer:
http://www.sigmableyzer.com/index.php?action=publications 
========================================================
15.  BUSH, PUTIN SET TO CLASH AT NATO
Russia Seeks to Stop Georgia, Ukraine From Joining Group

By John D. McKinnon, The Wall Street Journal,
New York, New York, Tuesday, April 1, 2008

KIEV, Ukraine — This week’s NATO summit is shaping up as a showdown
between President Bush and Russian President Vladimir Putin.

Mr. Putin plans to come to the meeting in Bucharest, Romania, hoping to
defeat a U.S.-backed initiative to give Georgia and Ukraine inside tracks to
membership in the North Atlantic Treaty Organization. A Russian official
suggested the plan would amount to “destroying” the strategic balance of
power in Europe.

.  The Situation: NATO leaders gather this week to consider a U.S.-backed
plan to give Georgia and Ukraine inside tracks to NATO membership.

.  The Hitch: Russia says that would upset the balance of power in Europe.

.  The Fallout: Lower expectations for Bush’s meeting this weekend at
Putin’s Black Sea resort home.Kremlin spokesman Dmitry Peskov pleaded
for flexibility from Western nations, telling reporters, “You cannot make it
a single-way road. Generally, it takes two to tango.”

The Russian comments also appeared to diminish some expectations for a
one-on-one meeting this weekend between Messrs. Bush and Putin at the
Russian president’s Black Sea resort home in Sochi.

The White House hopes to work out a framework at that meeting for resolving
a number of issues between the two countries, particularly a U.S.-designed
missile-shield system to be built in Poland and the Czech Republic.

Russia views that proposed system with suspicion, fearing it could
eventually be used to undermine its own security.

But Mr. Peskov said Russia was in no hurry to reach a deal with Mr. Bush on
missile security. “The work [on missile defense] is very complicated, and we
are not going to…set any deadlines,” he said. “We still believe the best
way to solve problems is to get rid of [the] plans… . But we appreciate
the effort…from our dancing partners.”

White House national security adviser Stephen Hadley said the Sochi meeting
might not produce an immediate agreement on the missile-shield issue. “It
may not get done by Sochi,” he conceded. “But, hey, if we don’t have it by
Sochi, we’ll keep working it.”

The NATO membership issues are to be discussed at Bucharest along with
renewed commitments to the conflict in Afghanistan. Georgia and Ukraine have
been loyal supporters of Mr. Bush, and Georgia is expected to be among the
nations adding troops to the conflict in Afghanistan later this week.

Mr. Hadley suggested that in addition to more troops, NATO would begin to
focus more on counterterrorism and economic development in Afghanistan —
in effect settling in for a long struggle.

“I think what people are recognizing is this is…going to take us a pretty
long while to get this done,” he said. Until Afghanistan can better wage its
own fight, “we’re going to have to have more of a counterinsurgency focus,
which means an issue about levels of troops, what those troops do and how
to link them up with the civilian assets — institution-building,
reconstruction, economic assistance, jobs that are required — to stabilize
that situation over the long-term. And that’s the thing I think you’re going
to see the Alliance beginning to step up and grapple with.”

Even Russia has suggested that it would be willing to consider some form of
assistance for the NATO effort. The offer has been perceived as a way of
softening its hard-line opposition to further NATO expansion.

But with Russia’s influence on the rise, many Western European countries
that are dependent on Russia for energy are reluctant to oppose it over the
NATO membership issues.
———————————————————————————————–
Write to John D. McKinnon at john.mckinnon@wsj.com
LINK: http://online.wsj.com/article/SB120700769687978677.html
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16.  NATO HOLDS KEY TO EUROPEAN CLUB FOR

GEORGIA & UKRAINE

By Ron Popeski & Margarita Antidze, Reuters, Kiev/Tbilisi, Mon, Mar 31

KIEV/TBILISI – The former Soviet republics of Georgia and Ukraine hope to
put themselves on the road to closer links with the West at a NATO summit
this week despite opposition from Moscow.

Their leaders will go to the summit, starting on Wednesday in Romania, to
join Croatia, Macedonia and Albania in asking the alliance for a Membership
Action Plan (MAP) — a roadmap to eventual entry.

But one of the crucial differences between the two former Soviet republics
and their fellow aspirants in the Balkans is that former imperial master
Russia resolutely opposes them joining and has warned of grave consequences
if they do.

That dispute could cause a distinct chill in the air at Bucharest’s vast
Parliament Palace, venue for the summit, when Russian President Vladimir
Putin arrives as guest of honour.

Putin said in February that if Ukraine joined NATO and accepted foreign
military bases which threatened Russia’s security, Moscow would re-target
its missiles at the country.

But for both Georgia and Ukraine, pursuing NATO membership is important
enough to risk incurring Russia’s wrath.

Led by pro-Western leaders, Kiev and Tbilisi see NATO as a guarantee of
their security and a badge of their progress towards integration with the
club of European democracies.

“My dream is a prosperous and united Georgia,” Georgian President Mikhail
Saakashvili said in an interview in Russia’s Kommersant newspaper on Monday.
“NATO is one of the stages to implementing that.”
BREAKAWAY REGIONS
More than that though, Tbilisi wants NATO’s security guarantees to help it
feel safer from its big neighbour Russia.

When a one-tonne missile landed in a farmer’s field an hour’s drive from
Tbilisi last year, Georgia accused Russia of an act of aggression. Moscow
said Tbilisi had staged the incident, and an international inquiry did not
apportion blame.

Tbilisi also sees Moscow’s hand behind the pro-Russian Georgian breakaway
regions of South Ossetia and Abkhazia, where separatist forces regularly
skirmish with Georgian troops.

Georgians say that Russian peacekeeping forces there provide military
assistance to separatist troops. Russia provides financial aid to the
breakaway regions, and has issued most residents with Russian passports.

“Georgia wants to join NATO because this organisation provides security
guarantees which we trust more than any other security organisation,” Georgy
Baramidze, Georgia’s state minister for European integration, told
reporters.

But the instability that is driving Georgia to seek NATO membership is also
the reason some alliance members, led by Germany, are against granting it
MAP status in Bucharest.

They say having Georgia in NATO will mean importing its separatist conflicts
too. Saakashvili’s crackdown on an opposition protest last year has also led
some members to question if Georgia has the democratic credentials to join.

“Georgian membership in NATO would mean crossing a red line for Russia,”

one Western ambassador in Moscow said. “If that happens, Russia will send
extra troops into Abkhazia and recognise its independence.”
SPLIT DECISION
For Ukrainian leaders, seeking NATO membership is part of the same drive
towards Western institutions as its long-term policy of joining the European
Union.

The letter to apply for MAP was signed in January by President Viktor
Yushchenko, Prime Minister Yulia Tymoshenko and parliamentary speaker
Arseniy Yatsenyuk — all Western-leaning politicians who see Ukraine’s
future with Europe.

“NATO membership is a political choice made by the country’s political
elite,” said Volodymur Fesenko, an analyst at Ukraine’s Penta think-tank.
“It could boost the country’s stature in international affairs.”

The challenge for the Ukrainian leadership is convincing a sceptical public
that joining NATO is a good idea. A poll released this month showed only 30
percent of Ukrainians back it, and that for most people, the issue is not a
priority.

Opposition leader Viktor Yanukovich, who draws most of his support from
Russian-speaking areas, blocked parliamentary business for three weeks in
protest at the MAP request.

Around 5,000 protesters rallied in the Crimean city of Simferapol on
Saturday to demonstrate against NATO membership.

Kiev’s leaders say they can win over voters, and promise a referendum before
committing to joining the alliance. But lukewarm public opinion — along
with Russia’s hostile stance — has cooled support for Ukraine’s bid among
some NATO states.
———————————————————————————————–
(Additional reporting by Michael Stott in Moscow; Writing by Christian

Lowe; Editing by Alison Williams)
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17.  U.S TO RUSSIA:NATO SHOULDN’T BE “FOUR-LETTER WORD”
 

By James G. Neuger, Bloomberg, Kyiv, Ukraine, Friday, March 28, 2008

KYIV- NATO’s embrace of former Soviet republics will bolster stability
in a trouble-prone region and shouldn’t be seen by Russia as a threat,
said Victoria Nuland, the U.S. ambassador to the alliance.

Russia has nothing to fear from North Atlantic Treaty Organization moves
toward closer ties with Ukraine and Georgia, including a possible
decision next week to put both countries on the path to future
membership, Nuland said in a Bloomberg Television interview in Brussels
yesterday.

“It’s time for Moscow to stop thinking of NATO as a four- letter word,”
Nuland said. “It’s based on outdated thinking about yesterday’s NATO as
the Cold War military bloc that was formed to deal with the Soviet
Union. Those days are long gone.”

Russian President Vladimir Putin has threatened to aim missiles at
Ukraine if it joins NATO and hosts bases. Russian lawmakers are using
Georgia’s bid for membership to give further encouragement to
ethnic-Russian separatist movements in two Georgian regions.

Western European countries such as Germany and France are the leading
opponents of declaring the ex- Soviet republics eligible for membership
at a NATO summit April 2-4, partly out of fear of frostier relations
with Russia.

We are not happy about the situation around Georgia and Ukraine, Putin’s
successor Dmitry Medvedev said in an interview this week with the
Financial Times, adding that their potential membership of NATO “is
extremely troubling for the existing structure of European security.”

President George W. Bush, heading for his last NATO meeting, hasn’t
indicated how hard he will push for pre- membership plans for Ukraine
and Georgia, once in the Soviet heartland.

Bush “feels quite strongly that both Ukraine and Georgia deserve a clear
path forward toward achieving their Euro- Atlantic aspirations”, Nuland
said.

Russia opposed — and was powerless to halt — the first two rounds of
NATO’s post-Cold War expansion, which brought onetime Soviet satellites
in eastern Europe and the Baltics into the alliance between 1999 and
2004.

While Russia was “not happy” when NATO moved east, the new eastern
European allies “have actually ended up over time with better relations
with their Russian neighbor,” Nuland said.

NATO expansion “is about increasing democracy and stability inside these
countries that are in fact neighbors of Russia,” Nuland said.

Putin, meanwhile, has resumed the strategic competition with the West by
restarting Cold War-era bomber patrols, modernizing the Russian missile
fleet and staging naval war games off Spain and France.

Putin has also objected to U.S. plans to build missile- defense bases in
Poland and the Czech Republic as an insurance policy against long-range
attacks by “rogue” states such as Iran.

Nuland played down concerns that Putin – set to meet the 26 NATO leaders
at the summit in Bucharest – will launch another anti-U.S. tirade. Putin
showed his interest in better cooperation by inviting Bush to a
post-summit meeting at the Russian Black Sea resort of Sochi to discuss
missile defense, she said.

The U.S. has made a “broad, forward-reaching offer of cooperation” on
the missile shield and arms control. Putin’s decision to attend his
first NATO summit and the invitation to Bush “will allow all of us to
demonstrate the strength of our relationship,” she said.

Russia has been quieter about NATO plans at next week’s summit to
broaden its reach in southeastern Europe by admitting Croatia, the
Republic of Macedonia and Albania.

U.S. and European influence in the Balkans rose, and Russia’s fell, in
the 1990s when the collapse of Yugoslavia left Russian ally Serbia
surrounded by pro-Western republics, some of them guarded by NATO
peacekeepers.

Nuland expressed confidence that the main obstacle to a three-nation
expansion in southeastern Europe – Greece’s demand that Macedonia

change its name — will be cleared away. Greece has threatened to keep
Macedonia out of NATO, saying the country’s name implies a territorial
claim on the northern Greek province that gave birth to Alexander the
Great.

“We have a strong sense that both sides do want to solve this,” Nuland
said. “But it’s going to take political effort and political will in
both of those capitals.” The United Nations is brokering talks over a
last-ditch compromise before the summit.

NATO leaders will also take stock of the war in Afghanistan, where a
47,000-strong allied force is fighting against the resurgent Taliban,
the radical Islamic movement ousted by the U.S. after the September 2001
terrorist attacks.

A summit communique will spell out the rationale for the war and set “a
three- to five-year horizon for what we plan to do next,” Nuland said.

Nuland welcomed plans by French President Nicolas Sarkozy to bolster
France’s troop strength in Afghanistan, possibly by sending French
forces to the hard-fought south or east of the country for the first
time.

France’s 1,500 troops in Afghanistan now are mainly confined to the
relatively calm Kabul area or involved in training Afghan soldiers.

“We are quite optimistic that France and a number of other countries
will answer the commanders’ calls to fill the missing gaps,” Nuland said.

“That will give a boost particularly to our operations in the east and the
south where we face the biggest challenges”.

Sarkozy has also sent a “great signal” of his intention to bring France
back into the permanent NATO military coordination structure that it
left in 1966, Nuland said.
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18.  NATO-RUSSIA BREAK: A SIGNIFICANT POSSIBILITY

By Georgeta Pourchot, Director, OLMA/NCR, Political Science, Virginia Tech;
Fellow, Center for Strategic and International Studies, Washington DC
Eurasian Home, Moscow, Russia, Monday, March 31, 2008

The Bucharest NATO summit offers a significant possibility that NATO’s and
Russia’s positions on a variety of issues will further diverge, marking the
beginning of the end of this uneven relationship.

To begin with, Secretary General Jaap de Hoop Scheffer admits that it is
unclear what to expect from President Putin only a few days before the
summit. Such unknowns are unusual at summits. These events are prepared
months in advance, negotiations are held and agendas carefully drafted.

It is not the case that major decisions are negotiated at the summit.
Summits offer the opportunity to put a stamp of approval on decisions that
have been fully vetted with all the parties well in advance of the event. To
not know the intentions of a participant such as Russia is not a usual
occurrence, and as far as the Bucharest summit is concerned, it spells
trouble.

In short, NATO floated the possibility that Ukraine and Georgia would be
offered a Membership Action Plan [MAP] at the Bucharest summit; MAP is a
precursor to actual membership in the Alliance. Russia strongly opposes this
move and in the past, threatened aiming missiles at either Ukraine or
Georgia if either dared apply for membership.

Russia also opposes the U.S. planned missile defense site in Poland and the
Czech Republic, although progress seems to have been made in recent weeks.
It is unclear how serious this reported “progress” really is, with details
not disclosed to the public.

It does appear that the U.S. promised Russia freedom to monitor the
operations of the missile defense site, a provision that will be unhappily
received in both Warsaw and Prague. Russia also holds important cards in
its hands, with the U.S. and NATO needing its help for the air transit of
personnel, munitions and equipment to Afghanistan, in the continuous
campaign against terrorist groups.

In all, the Allies seem to need Russia more than Russia needs them, and the
Kremlin leverages this influence. Add to that the nervousness of European
countries over Russia’s gas supplies, on occasion interrupted by Moscow to
“discipline” transit countries such as Ukraine or Belarus, and a picture of
increasingly uncertain relations emerges.

Recent statements indicate that even NATO’s Secretary General understands
how close to the beginning of the end the relationship with Russia may be.

The Financial Times quotes de Hoop Scheffer who called on president Putin to
avoid the “unhelpful rhetoric” that “‘[Russia] will target missiles on
nations A, B and C,'” in case they are offered MAP. Such rhetoric, de Hoop
Scheffer continued, only “makes me remember a time when I was growing up,
when there was a Berlin wall and an Iron Curtain.”[i]

He also underscored that the patience of NATO member countries for Russia’s
tough talking is running thin. “My job of keeping the NATO allies together
does not become more complicated when Moscow hardens the tone.As soon
as [Russia] crosses a certain line in the rhetoric, things for me get
easier.”[ii]

In plain English, if Russia continues to talk tough, Allies may choose to
stop listening and act, whether Russia likes it or not.

Should that happen, a new era of relations will de facto start, and it will
no longer be marked by the sides politely trying to work together. In the
long run, it may involve membership for further former Soviet republics in
NATO, when they will be ready for such responsibility.

It may involve Russia acting on some of its threats by developing and/or
installing defense capabilities aimed at European countries. It could easily
involve a new arms race. And of course, it will mean a cooling of relations
reminiscent of the Iron Curtain times, as de Hoop Scheffer underscored.

The jury is out on Russia’s intentions, but if president-elect Medvedev’s
public statements are any indication, we can expect a continuation of the
foreign policy direction of recent years. As such, both the trans-Atlantic
allies and Moscow will adjust their positions, not closer to, but further
from one another.

Should Moscow act on its threats and aim missiles at European countries in
the event of NATO membership for former Soviet republics, a second Cold War
will have started. Should Moscow choose a more subdued, “We are offended”
type of response, a Cold Peace may start.

There is a third option: That the Kremlin accepts the Allied explanations
for the positioning of the third missile defense site without considering it
a threat to its own security. Defense and procurement specialists can
demonstrate why the proposed system does not pose a threat to Russia, and
Russia may choose to request sufficient proof until it is satisfied that the
system meets a legitimate security need.

The Kremlin could also accept that Ukraine, Georgia, and other former Soviet
republics may one day join whatever international institutions they choose,
without translating that membership into a personal affront and security
threat. After all, even president Putin admits that countries have their own
choices and Russia can do nothing to stop them.

Preemptive threats only harden positions and aggravate relations. For
perspective, an ‘unhelpful rhetoric’ was also used prior to the first
post-communist enlargement of NATO, with Russia trying hard to prevent it.
Many predicted that the sky would fall if the Czech Republic, Hungary and
Poland joined the Alliance.

The sky did not fall: At that time, the Allies worked diligently to respond
to Russia’s concerns by creating various channels of communication and
institutional negotiation. Nine years after the 1999 NATO enlargement to
former communist countries, there is no war between Russia and NATO, there
is no institutional break-down in communications, Europe is more secure, and
so is Russia.

The two even work on several projects together. It behooves on Russia to
accept the third option, as it did in the nineties, drop the tough talk and
continue to work with the Allies towards common goals. The alternatives are
not helpful to anyone.
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[i] James Blitz, “NATO Tells Putin to Keep Calm at the Summit,”
Financial Times, March 28, 2008, p. 1.
[ii] James Blitz, “Man in the Middle Seeks Harmony,” Financial Times,
March 28, 2008, p. 3.
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19.  TAKING OFF THE GLOVES

OP-ED: John Marone, Columnist, Eurasian Home website, Kyiv, Ukraine
Eurasian Home, Moscow, Russia, Monday, March 31, 2008

The presidential campaign in America is still a three-way race between
Obama, Clinton and McCain. But in Ukraine, where the elections are still two
years off, it’s everyone against Yulia Tymoshenko.

Appearing before a government meeting on Wednesday, March 26, to mark
her first 100 days as prime minister, the fiery female politician said her
opponents had already begun attempts to undermine the fragile pro-Western
majority in parliament.

“They are not only talking about it, but taking steps every day to discredit
the government, to discredit the democratic coalition,” Tymoshenko said.

Tymoshenko’s adversaries include the Ukrainian parliament’s eastern-looking
opposition as well as President Viktor Yushchenko, whom she is expected to
challenge for the presidency in 2010.

Tymoshenko helped Yushchenko rise to power during the 2004 Orange
Revolution, but since then the two politicians have barely been able to mask
their enmity with the public proclamations of democratic unity that enabled
them to forge the current coalition.

More recently, rumors have abound in Kyiv that the presidential
administration is planning to marginalize Tymoshenko by creating a new
centrist party from the business elements of the opposition and the
pro-presidential elements of the Orange coalition.

On March 27, one day after Tymoshenko rang the alarm bell, the creation of
just such a party, called United Center, was announced.

The groundwork for United Center was laid by five pro-presidential lawmakers
in mid February, when they left the Our Ukraine party.

At the time, the maverick lawmakers assured Orange voters that they didn’t
plan to leave the Orange coalition in parliament.

Our Ukraine, which Yushchenko endorsed during the last parliamentary
elections along with a new party called People’s Self Defense, has long been
considered divided between the president and Ms. Tymoshenko.

Now that division might spread to the coalition. Altogether, the Bloc of
Yulia Tymoshenko and Our Ukraine-People’s-Self Defense hold only 228
out of the parliament’s 450 seat – a three-seat majority.

If Tymoshenko’s political enemies can get enough support from the business
elements of both Our Ukraine-People’s Self Defense and the opposition Party
of the Regions, they can try to create a new majority with or without new
elections.

The desired result of this plan, which analysts say originated in the
Presidential Administration, would be to push Tymoshenko, on the one hand,
and the neo-Soviet elements of the Donetsk-based Regions Party and their
Communist allies, on the other, to the fringes of Ukraine’s political
spectrum in time for the 2010 presidential elections.

The head of the new party, Ihor Kril, said during a March 28 press
conference that the head of Yushchenko’s Secretariat, Viktor Baloga, had
nothing to do with United Center.

Moreover, he denied that the new party was the brainchild of anti-Tymoshenko
oligarchs fearful of her rising popularity.

“We won’t take money from clans or [business] groups,” said Kril. However,
he added, the new party welcomes the addition of “strong people.” So far
United Center boasts only 35 members, including those who left Our Ukraine
in February.

But more influential support is on the horizon.

Yushchenko is already widely believed to have moved closer to Regions
moneybags Rinat Akhmetov, appointing one of his people to a key state post
earlier this year.

Then last week, in a rare media interview following in the wake of the
United Center announcement, Ihor Kolomoysky, one of Ukraine’s richest men
said his Privat business group supported Yushchenko “100 percent.”

The normally camera-shy Ukrainian oligarch said during the same interview to
the Internet publication Ukrayinska Pravda: “If Tymoshenko becomes president
I see myself emigrating.”

Tymoshenko blasted Kolomoysky for dirty business practices at around the
same time. Speaking to a press conference on March 28, the fiery female
premier also accused unnamed politicians of protecting Kolomoysky.

“What Private is doing today in Ukraine shows that they have the required
protection in the highest echelons of power,” Tymoshenko told reporters.

But the prime minister fell short of directly implicating President
Yushchenko, reiterating her conditional promise to support him during the
2010 elections.

“If there is normal and harmonized cooperation between the president and me,
and we are able to work like a single team and show the public results, then
I will definitely make sure there is a single candidate put forward by the
democratic parties,” she said. Instead, Tymoshenko focused her attack on

presidential chief of staff Baloga.

“I think that the president should act as he thinks best for Ukraine. If
there are advisors capable of leading him astray, it would be better if he
got rid of them before it’s too late,” she added.

During a national television interview on March 27, Tymoshenko warned her
opponents that if BYuT were forced to go through early elections they would
do even better than last time.

Last September, during snap elections called by Yushchenko to keep Regions
and their leftist allies from usurping his executive power, BYuT improved
its showing by almost a third – largely at the expense of the president’s
waning popularity.

“I am certain that this government is here for the long term,” she said on
national TV, “even if these political forces are plotting something behind
our backs.”

But it’s precisely Tymoshenko’s rising political support that has earned her
so many enemies.

Besides Yushchenko, who appears to be garnering increasing support from
Ukraine’s powerful industrialists, including those who backed his political
nemesis Viktor Yanukovych up until recently, Tymoshenko is up against the
likes of the Kremlin, whose hopes of controlling Ukraine with gas imports
have been foiled by the fiery femme fatale.

The Kremlin had also backed Yanukovych’s long battle against Yushchenko, but
could be now placing its bets on Yushchenko, who is more cooperative than
Tymoshenko and a stronger candidate than Yanukovych.

Like Tymoshenko, the president can only lose by revealing the growing
antagonism between him and the premier to the public. However, Mr.
Yushchenko could hardly keep quiet during last week’s exchanges in the
media.

On the one hand, he told an audience in Kyiv that he would do everything to
keep the democratic majority together. But on the other, he warned against
political instability and political populism (the usual charges made by
Tymoshenko’s opponents against her).

“[Our] nation and society must come to the point where any political
destabilization will be seen as a policy against Ukraine,” he said, urging
his countrymen to keep “the wave of social populism from covering us and
throwing us back to 1993.”

And as both the president and the premier prepare the public for a possible
rift in relations, there are a host of thorny issues on the horizon that
could serve as the straw that broke the camel’s back.

For one, Tymoshenko’s team has accused Kolomoysky of using his control
over a major oil refinery to raise petrol prices and thus make her
government look bad.

Another is this year’s budget, which Tymoshenko is refusing to seriously
rework despite the president’s demands.

Whatever issue serves as the prelude to a break in relations, uncovering the
fierce battle for the presidency that has been in progress since Tymoshenko
retook the government late last year, the question is whether the premier’s
growing popularity among voters will be enough to defeat Yushchenko’s
growing reliance on eastern influence and money.
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20.  100 HEAD-OFF STEPS, FIRST 100 DAYS OF THE

NEW GOVERNMENT

Authors: Yelena Boltushkina, Inna Vedernikova, Yulia Mostovaya,
Serhii Rakhmanin, Yuriy Skolotiany, Nataliya Yatsenko
Mirror-Weekly # 12 (691), Kyiv, Ukraine, 29 March – 5 April 2008

Ukrainians traditionally celebrate the first 100 days of each government
like St. Valentine’s Day or Halloween – just a nice occasion with the gist
forgotten.

In 100 days no government has ever been able to fulfill its pre-election
promises, overcome corruption, improve legislation, or even help its
sponsors recoup their contributions to the election campaign.

Yet, it is conventionally believed that in the first hundred days a new
government enjoys its highest rating of popular trust and ought to use this
circumstance for reforms and innovations – often unpopular and painful –
that yield deferred positive effects. In this sense the new Ukrainian
leadership has simply wasted its first 100 days.

The word “leadership” is used here instead of “government” because the
Tymoshenko cabinet was formed by the democratic coalition, i.e. the
parliamentary majority. This coalition has been anything but a reliable
backup for the government. Besides, half the ministers were appointed
personally by the President, making him equally responsible.

So what have the political leaders been doing? Tied in a tight knot of
mutual dependence, they have been putting out fires, tripping up one other,
and meting out alms. Exhausted by chaos, this country needed radical and
painful treatment.

The clinical picture is clear: disseminated sclerosis of the executive
vertical; corruption phlebitis; gas drug dependence; epidemic of fake
private entrepreneurship; wage anemia, judicial impotence, land kleptomania,
asthma of small and midsize businesses, law enforcement dependence on
presidential medication, and so on and so forth. How do the leaders treat
these diseases?

They hand out benefits, competing with each other on TV, promising more
benefits and accusing each other of populism. “You have diabetes?’ asks
Tymoshenko, ‘You are tired of dieting? Here’s a kilo of candies for you.”
“You have fever?’ echoes Yushchenko, “Here’s a good draft – stand in it for
a minute and you’ll feel better.” The patients take this care with earnest
gratitude and next morning they take their temperature and sugar tests.

Actually, Tymoshenko and Yushchenko are acting the way they have to: there
can be only one head physician in this clinic. Both must be thinking: when I
win the race, I’ll cure the country. But do they know that after the
presidential election in 2009 there will be strict diets, splints, and
surgeries? Do they really know what they are going to cure and how?

So far, instead of a comprehensive course of therapy, the doctors have only
stopped hemorrhage or made anesthetic injections. And whenever either of
them prescribes something more radical, the other one immediately wakes up
the patient, “Look what’s going on! It’s going to hurt!” The patients are
naturally scared.

Most of them prefer shadow kickback schemes to transparent deductions to the
budget. Most of them are ready to trade the country’s independence for cheap
natural gas. Most of them are content with the miserable UAH 1,000 [equal to
$200, the standard reimbursement for lost deposits with the USSR Savings
Bank] instead of demanding indexation, let alone demanding their $150
billion from Russia.

Ukrainians are so undemanding! Old people are content with their UAH 1,000
and a kilo of buckwheat [traditional pre-election “graft rations”]. One part
of the intelligentsia is content that the Ukrainian language is still alive
and the other part is happy to be still able to use Russian. Millionaires
are content with the “tithe” they have to deduct for arts and charity.

Doctors are content with their commissions from “cooperation” with
pharmaceutical companies [for prescribing exclusively medications produced
by those companies]. Generals are content with their posts.

The Intelligence and other special services are content with the last
mythical remnants of their omnipotence. The public is content with political
shows. NGOs are content with grants. And that is how a Citizen turns into a
“little man”.

Ukrainians demand less and less from authorities. They only want their
favorite leaders to win and then, possibly, to help them solve their
personal problems. Some pay a bottle of vodka. Others pay millions.

Everybody demands to put an end to corruption in the highest echelons but
resist any attempts to fight it at the grassroots level: taxi drivers still
drive their passengers with the meter off; draftees’ parents still pay
conscription officers for exemption from military service; marketplace
vendors still give short weight; students still “buy” their test and exam
grades.

During the Orange Revolution Ukrainians demanded “jails for bandits”. Of
course, they meant “oligarchs”, not accoucheurs who would never even enter
the prenatal ward unless palmed with $300.

Authorities will never change until each and every citizen demands rules for
all instead of personal exceptions for himself, a rod to catch enough fish
for himself and his dependants instead of regular fish rations.

Those who rule Ukraine are not from Mars, Washington, or Moscow. They are
the very flesh of the flesh of those “little Ukrainians”, only vested with
authority. The symptoms are the same. The diagnosis looks very clear from
the figures below.
100 DAYS IN FIGURES
According to the State Statistics Committee, in January and February
practically all basic economic development indices increased (except
decreased milk production). The increase, however, barely exceeded last
year’s.

· GDP totaled UAH118,600M [$1 = UAH5.05]; corrected for inflation it totals
5.8% growth vs. January-February of 2007;

· Consumer prices grew by 5.7% (in January-February of 2007 they grew by
1.1%), having exceeded half the limit set by the government for 2008; at
such a rate the annual price growth index may well total 21.9%;

· Nominally, the average wage rose by 39.9% (vs. 27.4% in January-February
of 2007), but the real increment barely exceeded that of 2007 (15.5% vs.
13.2%);

· National industries sold UAH54,100M worth of products, works, and
services; considering the price hikes, the real sum exceeded last year’s by
8.8%;

· The agricultural sector sold UAH7,100M worth of products – a mere 0.7%
more than in January-February of 2007 when the increment versus the same
period of 2006 was 5.6%;

· Construction practically remained at the same level, real growth being
0.4% – even less than in the agricultural sector (last year’s growth rate
was far more impressive – 20.1%);

· What did grow more significantly in January and February was retail trade;
stimulated by increased social welfare outlays and bank loans, it reached
UAH56,200M (28.3% of real increment vs. 2007);

· According to the Finance Ministry, national exporters received UAH4,100M
in reimbursements for VAT, which was UAH900M more than planned and

UAH1,600M more than was reimbursed in January-February of 2007;

· By March 14 the State Customs Service had fulfilled the quarterly plan by
102%, having transferred UAH15,160M to the national budget – 70% more than
in the same period of last year.
STAFF COMB-OUT CONTINUES
Political instability boomerangs on the public service sector. The political
leadership never learned the lesson of 2005 when as many as 9,600 public
servants were fired for political reasons.

According to Tymofiy Motrenko, chief of the Main Public Service Department,
due to dismissals for reasons of “political expediency” the state loses the
most experienced and qualified public servants.

He notes the dangerously increasing outflow of young public servants: in
2004 young public servants made up 68% of the total number and in 2006 their
number reduced to 51%. Motrenko insists on separating administrative and
political posts in order to retain professionals in the public service
sector, enable their career growth, and keep the institutional memory of
executive bodies.
EXTENSIBLE PROCRUSTEAN BED
When the Tymoshenko government drafted the 2008 national budget (on the
basis of the one drafted by the previous government) and the parliament
adopted it, everyone was aware of the need to revise it by April at the
latest. However, it is already clear that a new budget can be adopted in May
at the earliest.

The “pie” is not too big. Having recalculated the predicted 2008 GDP, the
government plans to increase the revenue section of the consolidated budget
by UAH20 billion – up to UAH294 billion.

The government plans to distribute that surplus among central bodies of
authority and replenish the budget by cutting some “unjustified expenses”.
At the same time, according to Finance Minister Viktor Pynzenyk, the
ministries are requesting an additional UAH80 billion.

Besides, the revision of the 2008 budget involves “the problem of political
decision-making rather than technical problems”. The President demands an
additional UAH23 billion for humanitarian projects and defense, but didn’t
he say that he would not sign the 2008 budget bill if the budget deficit
exceeded 2% of GDP?
HARMONIOUS SLIPKNOT
Yulia Tymoshenko reiterates that her relations with the President are
“harmonious”. Viktor Yushchenko says that he is working day and night to
keep the democratic coalition together.

Yet, numerous statements by both political leaders and their teams leave no
doubt that they are waging a war for power and popularity rating. Any
political leader naturally wants to raise his or her rating but uses
different methods in competing with different rivals.

Although Yushchenko had as many as seven ministers in the Yanukovych
government, he never allowed himself to meddle in its work like he meddles
in the Tymoshenko government’s work. According to official information, in
its first 100 days the Yanukovych government received 88 directives from the
President and 143 tasks from his chancellery.

The Tymoshenko government received 621 and 260 directives, instructions, and
tasks respectively, which was 881 more than the previous government did –
almost nine per day.
LAWS AND FLAWS
The slogan “One Law for All” will be just hollow words as long as Ukrainian
politicians are guided by Franco’s motto “Everything to Friends, Law to
Enemies!” and as long as they interpret and use laws to their liking instead
of abiding by them.

Article 19 of the Constitution obliges all public servants, executive
officials, and bodies of authority to act in strict compliance with the
Constitution and laws, but it has never stopped Kuchma or Yushchenko,
Yanukovych or Tymoshenko. But for the opposition’s feeble efforts to play
the controlling role, Ukraine would hold the Guinness record for the number
of constitutional violations.

Yushchenko’s impetuous lawmaking activity was deterred when the parliament
and government were controlled by Yanukovych and other opponents (who were
far from law-abiding, either).

As soon as the tide turned and Yushchenko got a loyal majority in the
parliament and a more or less compliant government, he jumped at the
opportunity. In the first 100 days since the Tymoshenko government took
office he issued about 500 acts.

Many of them were questionable in terms of constitutionality. In accordance
with Article 118 of the Constitution, the President may appoint and dismiss
heads of region and district administrations exclusively upon the
government’s relevant decision.

Since the start of this year Yushchenko has decreed nine appointments and
dismissals in defiance of this norm. Besides, he has personally appointed 22
acting heads of local administrations, even though no normative act provides
for such appointments by presidential decrees.

Like his predecessor Leonid Kuchma, Viktor Yushchenko often meddles in the
economic sphere, trying to regulate issues that are in the government’s
exclusive competence. He has tried to influence the following:

– the activity of the national company Naftogaz;
– the use of energy resources;
– privatization mechanisms;
– development of roads;
– pricing in the public utility sector;
– extraction of amber.

Some legal experts call into question the legality of his recent decree on
reforming the law enforcement structure. According to the Constitution and
the Law on the Cabinet of Ministers (which he utterly dislikes but which is
still valid), this issue is beyond the presidential competence.

The same law vests in the Cabinet of Ministers the exclusive right to adopt
regulations for all ministries and other central executive bodies. However,
most of those agencies still function on the basis of presidential decrees.
The government has repeatedly requested the presidential chancellery to
abrogate those decrees as no longer valid and is still waiting for a reply.

As we could expect, the presidential structures are now pressing the Cabinet
of Ministers in all spheres. The most effective method of pressure is using
National Security and Defense Council’s decisions, with which they try to
substitute the Cabinet’s decisions – both acting and possible.

For instance, in February 2008, the National Security and Defense Council
forbade the Cabinet of Ministers to take issue with the state concern
Aviation of Ukraine. The actual plans of the government concerning this
enterprise are a topic for a separate discussion.

However, it is a direct function of the Cabinet of Ministers to manage the
object of the state property. Thus, with the help of the decisions made by
the National Security and Defense Council in March 2008, the President has
sufficiently reduced the influence of the government on the fuel-and-energy
sector, the privatization sphere and the land market.
100 DAYS – 100 LAWS
During 100 days of co-existing with the new government, the Verkhovna Rada
managed to hold only 16 plenary sessions. During this time, about one
thousand draft laws were introduced into the parliament. More than half of
those draft laws (562) were initiated by the coalition.

According to our sources, the parliament passed 100 laws during the period
from December 18 to March 26. 89 of them were initiated by the coalition.
However, we should note that 81 of 89 coalition’s laws are concerning early
elections of cities’, towns’ and villages’ heads. The last 8 are the acts on
early mayoral elections in Kyiv and the acts on Ukraine joining NATO.

Viktor Yushchenko appeared to occupy second place in the law-making
productivity ratings: his five laws were enacted. His laws are on changing
the minimal living wage, on overall strength of the military forces and on
ratification of the agreements between Ukraine and the EU regarding simple
visa registration.

The opposition is the next in our rating with three bills – on approving the
first session’s plan and on creation of committee to investigate the
activities of the head of the Interior Ministry and the head of Kyiv city
administration.

The Cabinet of Ministers of Ukraine is the last in our rating: it introduced
only one law – the law on the 2008 budget of Ukraine.

We should note that during these 100 days, our law-makers didn’t please us
with any bills which could sufficiently improve our lives today or in the
future. From this point of view, the productive capacity of the ruling
coalition is, to put it mildly, not very high.
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LINK: http://www.mw.ua/1000/1550/62561/
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21.  BAKER & MCKENZIE, A LEADING GLOBAL LAW FIRM,
JOINS THE U.S.-UKRAINE BUSINESS COUNCIL (USUBC)
 
U.S.-Ukraine Business Council (USUBC), Wash, D.C., Jan 2008
 
WASHINGTON, D.C. – The executive committee of the U.S.-
Ukraine Business Council (USUBC) is pleased to announce that
Baker & McKenzie, a large, leading global law firm has been
approved as the second new member for 2008 and as the 54th
member of USUBC.

Baker & McKenzie was the first foreign law firm to open an office
in Ukraine and currently assist over 350 multi-national companies,
financial institutions and major Ukrainian enterprises in their
domestic and international operations.

USUBC has been working with James T. Hitch, Managing Partner,
Baker & McKenzie – CIS, Limited in Kyiv and Richard N. Dean,
Attorney at Law in Washington regarding the membership.

Baker & McKenzie has around 55 professional staff in Kyiv. A
majority of them have been trained in the United States or Great Britain.
They specialize in finance, corporate law, real estate and competition
law.

They have a network of more than 3,400 locally qualified, internationally
experienced lawyers in 38 countries and have more than 10,000 lawyers,
supporting professionals and staff worldwide. More information can be
found on their website: www.bakernet.com/.

 
“USUBC is most pleased to welcome the Baker & McKenzie law firm
into its rapidly growing membership,” said Morgan Williams,
SigmaBleyzer, who serves as USUBC president..
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22.  ENERGOATOM’S WESTINGHOUSE DEAL POLITICAL,
MEANT TO DRIVE DOWN TVEL’S PRICES – EXPERTS
 
Interfax Ukraine, Kyiv, Ukraine, Monday, March 31, 2008

KYIV – The deal between Ukraine’s Energoatom, a nuclear monopoly,

and the U.S.’ Westinghouse on possible supplies of fuel for Ukrainian
nuclear power plants in 2011-2015 signed on March 30 has as its aim to
force Russia’s state nuclear corporation TVEL, a traditional nuclear fuel
supplier to Ukraine, to reduce its price, experts believe.

“Talks are under way between Russia and Ukraine over a long-term contract
for fuel supplies. We have already submitted our proposals to the
Ukrainians. Energoatom probably wants to drive our prices down,” head of

the nuclear fuel safety department at the Kurchatov Institute Alexei Ivanov
said, commenting on the above deal.

“From a technical viewpoint, it’s absolutely unclear why the Ukrainians have
decided to do this and why they need the Americans, since Ukraine’s nuclear
power units have been using our fuel for decades without complaints,” he
said.

“The signing of a contract between Energoatom and Westinghouse looks

like a purely political game,” the expert said. Head of the Scientific-Research
Institute of Electric Power Engineering (NIKIET) Boris Gabarayev shares
the same view.

“I have a feeling that this is more about politics than economics. Clearly,
our Ukrainian colleagues want to diversify sources of nuclear fuel, but
diversification should not be an end in itself,” Gabarayev said.

————————————————————————————————
NOTE:  Westinghouse is a long-time member of the U.S.-Ukraine
Business Council (USUBC).
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U.S.-Ukraine Business Council (USUBC): http://www.usubc.org
========================================================
23.  OCH-ZIFF CAPITAL MANAGEMENT GROUP,
INSTITUTIONAL ALTERNATIVE ASSET MANAGERS,
JOIN U.S.-UKRAINE BUSINESS COUNCIL (USUBC)
 
U.S.-Ukraine Business Council (USUBC), Wash, D.C., Jan 2008
 
WASHINGTON, D.C. – The executive committee of the U.S.-Ukraine
Business Council (USUBC) is pleased to announce that the Och-Ziff
Capital Management Group, headquartered in New York City, has been
approved for membership. Och-Ziff is the third new member for 2008
and USUBC’s 55th member.

Och-Ziff is one of the world’s largest and most recognized institutional

alternative asset managers with offices in New York, London, Hong Kong,
Tokyo, Bangalore and Beijing.

Och-Ziff’s fund seeks to deliver consistent positive, risk-adjusted returns

with a strong focus on risk management and capital preservation.

Och-Ziff’s multi-strategy approach combines global investment strategies,
including merger arbitrage, convertible arbitrage, equity restructuring, credit
and distressed credit investments, private equity and real estate.

Och-Ziff has approximately $33.2 billion of assets under management for

over 700 fund investors as of January 1, 2008.

More information about Och-Ziff is available on the firm’s web site at
http://www.ozcap.com

 
Morgan Williams, SigmaBleyzer, who serves as USUBC president said,
“USUBC is pleased to welcome Och-Ziff into its rapidly expanding
membership.”
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24.  MAXWELL CANCER & CARDIOLOGIC CENTER
OPENED IN KYIV
 
Interfax Ukraine, Kyiv, Ukraine, Monday, March 31, 2008
 
KYIV – The Maxwell cancer and cardiologic center has been opened in
Kyiv. The company’s president, Kenneth Alibek, said during the opening
of the center that the major goal of the institution is to prolong the life of
Ukrainians.
“Unfortunately, life expectancy in Ukraine is not so high as we wish it to
be,” he said, adding that Ukrainians live 10-15 years less than the world
average life expectancy.
 
The Maxwell center is the first such center in Ukraine and the most
specialized complex in the former-Soviet countries, uniting a clinic to
diagnose and cure cancer and cardiologic diseases, and a facility to
produce medicine. The center’s main office is located in the United States.
U.S. Ambassador to Ukraine William Taylor, who also attended the opening
ceremony, said this is an additional U.S. investment in Ukraine, as well as
a large contribution to developing the country’s healthcare sector.
———————————————————————————————-
NOTE:  Maxwell USA is a member of the U.S.-Ukraine Business
Council (USUBC).
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25. DIPOL CHEMICAL INTERNATIONAL INC. JOINS THE
U.S.-UKRAINE BUSINESS COUNCIL (USUBC)
 
U.S.-Ukraine Business Council (USUBC), Wash, D.C., Jan 2008
 
WASHINGTON, D.C. – The executive committee of the U.S.-Ukraine
Business (USUBC) is pleased to  announce that the Dipol Chemical
International Inc., a U.S. company, has been approved as the fourth new
member for 2008 and as the 56th member of USUBC.
 
Dipol was established in 1994 in the United States as a chemical-consulting
firm. One year later, they expanded their activities to include plastics distribution,
chemical distribution with polystyrene and polyurethanes, and toll processing.
Dipol is now the leader in polymers and specialty chemicals distribution in the
Former Soviet Union (FSU).
 
USUBC has been working with Alfred Roth, Chief Executive Officer and
Dr. Irene Zaks-Roth, Chief Operational Officer of Dipol. They attended the
USUBC meeting held recently with U.S. Ambassador William Taylor in
Washington, D.C.
 
In 1996 Dipol established a presence in Ukraine and own a warehousing
facility there.  Today Dipol is a leading plastics distributor in Ukraine, where
they serve a variety of industries.
 
Dipol has three offices and warehouses in Kyiv, Riga and St. Petersburg
covering their distribution network in Ukraine, Belorussia, Moldova, Latvia,
Lithuania, Estonia and Russia.
 
Dipol’s customs bonded warehouse in Kyiv is a ISO 9001:2000 – certified
chemical warehouse. Its activity is strongly supported through long-term
consignment agreements with the supplies. In many cases it serves as a “one
stop shop” for the major Ukrainian packaging, civil construction, home
appliances and detergent manufactures.

As a leading plastics and chemicals distributor, Dipol represents the highest

quality plastics and chemicals manufacturers and their products.

Their supplier list includes: Dow Chemical; Innovene; Nova-Innovene; DSM;
Solway; DuPont; Cray Valley; Grain Processing; Surface Specialties; and

Stepan.

Dipol provides warehousing for the producers which wish to maintain a part of
inventory of chemicals and plastics in Ukraine, but who do not want to distribute

it themselves. Because Dipol owns the custom bonded warehouse the importers
can defer duties until time of sale. Dipol provides warehousing for both chemicals
and plastics, including temperature-sensitive, food-grade and flammable goods.

Dipol also provides customs and distribution services and have  compounding and
blending facilities. The offices in Kyiv are at: 42-44 Shovkovychna St. Horizon

Tower. More information about Dipol can be found on their website:
 
“USUBC is pleased to welcome Dipol International into its rapidly expanding
membership,” said USUBC president Morgan Williams.
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7. VOLIA SOFTWARE, Software to Fit Your Business, Source your
IT work in Ukraine. Contact: Yuriy Sivitsky, Vice President, Marketing,
Kyiv, Ukraine, yuriy.sivitsky@softline.kiev.ua; Volia Software website:
http://www.volia-software.com/ or Bill Hunter, CEO Volia Software,
Houston, TX  77024; bill.hunter@volia-software.com.
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For information about USUBC please write to mwilliams@usubc.org 
or check on the USUBC website: http://www.usubc.org.

10. UKRAINIAN ORTHODOX CHURCH OF THE USA, Archbishop
Antony, South Bound Brook, New Jersey, http://www.uocofusa.org
11. UKRAINIAN AMERICAN COORDINATING COUNCIL (UACC),
Ihor Gawdiak, President, Washington, D.C., New York, New York
12. U.S.-UKRAINE FOUNDATION (USUF), Nadia Komarnyckyj
McConnell, President; John Kun, Vice President/COO; Markian
Bilynskyj, VP/Director of Field Operations; Kyiv, Ukraine. Web:
http://www.USUkraine.org
13. WJ GROUP of Ag Companies, Kyiv, Ukraine, David Holpert, Chief
Financial Officer, Chicago, IL; http://www.wjgrain.com/en/links/index.html
14. EUGENIA SAKEVYCH DALLAS, Author, “One Woman, Five
Lives, Five Countries,” ‘Her life’s journey begins with the 1932-1933
genocidal famine in Ukraine.’ Hollywood, CA, www.eugeniadallas.com.
15. ALEX AND HELEN WOSKOB, College Station, Pennsylvania
16. SWIFT FOUNDATION, San Luis Obispo, California
17. TRAVEL TO UKRAINE website, http://www.TravelToUkraine.org,
A program of the U.S-Ukraine Foundation, Washington, D.C.
18. BUYUKRAINE.ORG website, http://www.BuyUkraine.org.
A program of the U.S.-Ukraine Foundation, Washington, D.C.
19. DAAR FOUNDATION, Houston, Texas, Kyiv, Ukraine.

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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 (USUBC)
1701 K Street, NW, Suite 903, Washington, D.C. 20006
Tel: 202 437 4707; Fax 202 223 1224
mwilliams@usubc.org; www.usubc.org
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