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Action Ukraine Report

"UKRAINE REPORT" 2004
In-Depth Ukrainian News and Analysis
"The Art of Ukrainian History, Culture, Arts, Business, Religion,
Sports, Government, and Politics, in Ukraine and Around the World"

"Reliable sources in Ukraine had reported to Western and international
authorities allegations that people associated with the Ministry of Health
had attempted to skim large sums of money from [AIDS] funds already
disbursed. Specifically, there were allegations about the Health Ministry's
drug procurement and contracting for treatment services.

The investigation is reported to have at least partially confirmed
allegations that there had been a blatant attempt to offer [AIDS] project
funds to contract service providers based on very substantial kickbacks.
It was, however, questionable drugs procurement practices that led to
the [Global] Fund's demand for immediate return of monies already
disbursed." [article one]

"UKRAINE REPORT" 2004, Number 18
U.S.-UKRAINE FOUNDATION (USUF)
www.ArtUkraine.com Information Service (ARTUIS)
morganw@patriot.net, ArtUkraine.com@starpower.net
Kyiv, Ukraine and Washington, D.C., Monday, February 2, 2004

INDEX OF ARTICLES

1. UKRAINE LOOSES CONTROL OF MAJOR AIDS FUNDS
Number of Major Management and Governance Issues Cited
Including Lack of Clarity of Internal Processes and Procedures
Inside Ukraine (IU) Newsletter, February 1, 2004

2 . THE GLOBAL FUND ACTS TO SECURE RESULTS FOR ITS
HIV/AIDS PREVENTION AND CARE PROGRAMS IN UKRAINE
Global Fund, Geneva, Switzerland, January 30, 2004

3. GLOBAL FUND TO FIGHT AIDS SUSPENDS PAYMENTS
IN UKRAINE CITING POOR MANAGEMENT
By David Brown, Washington Post Staff Writer
The Washington Post, Washington, D.C., Sat, Jan 31, 2004

4. US-UKRAINE RELATIONS ONCE AGAIN ON THE BRINK:
SENIOR STATE DEPARTMENT OFFICIAL
Agence France Presse (AFP), Washington, D.C., January 29, 2004

5. HARASSED BY GOONS
By Peter Byrne, Kyiv Post Staff Writer
Roman Olearchyk, Kyiv Post Staff Writer
Kyiv Post, Kyiv, Ukraine, Jan 29, 2004

6. STALKED AND HARASSED IN LVIV
EDITORIAL, Kyiv Post, Kyiv, Ukraine, Jan 29, 2004

7. ALLIES OF UKRAINIAN PRESIDENT KUCHMA REJECT
EUROPEAN UNION AND COUNCIL OF EUROPE CRITICISM
Blast the parliamentarians from Denmark and Liechtenstein who drafted
the resolution, calling them "crazy dames", "biased" and "incompetent".
By Tom Warner in Kiev, Financial Times, London, UK, January 30 2004

8. UKRAINIAN PRESIDENT'S AIDE SAYS EUROPEAN
BODY IMPOSES NEW LEADER ON UKRAINE
The resolution was drafted "by two crazy ladies who do
not understand Ukrainian developments at all".
UNIAN news agency, Kiev, in Ukrainian, 30 Jan 04
BBC Monitoring Service, UK, in English, Jan 30, 2004

9. OPPOSITION RALLY "DIRTY HANDS OFF SILSKI VISTI"
SUPPORTS EMBATTLED NEWSPAPER IN CENTRAL UKRAINE
Korrespondent.net web site, Kiev, in Russian 1 Feb 04
BBC Monitoring Service, UK, in English, Feb 01, 2004

10. POOR UKRAINIAN GIRLS TRICKED INTO SEX TRADE
Agence France Presse (AFP), Kiev, Ukraine, Jan 31, 2004

11. UKRAINIAN OFFICIAL TELLS USA ODESSA-BRODY PIPELINE
WILL BE USED TO TRANSPORT OIL TO EUROPE
Interfax-Ukraine news agency, Kiev, in Russian, 30 Jan 04
BBC Monitoring Service, UK, in English, Jan 30, 2004

12. UKRAINE'S PRESIDENTIAL ADMINISTRATION WANTS TO
PERMIT SALE AND PURCHASE OF AGRICULTURAL LAND IN 2005
Interfax-Ukraine, Kyiv, Ukraine, 30.01.2004
=========================================================
UKRAINE REPORT-2004, No. 18: ARTICLE NUMBER ONE
=========================================================
1. UKRAINE LOOSES CONTROL OF MAJOR AIDS FUNDS
Number of Major Management and Governance Issues Cited
Including Lack of Clarity of Internal Processes and Procedures

Inside Ukraine (IU) Newsletter, February 1, 2004

On Friday, January 30, 2004, The Global Fund to fight AIDS, Tuberculosis
and Malaria in Geneva issued a press release in which it said that, because
of a failure to perform, Ukraine was being directed to immediately return
all remaining monies disbursed to it for AIDS treatment programs.

While the Global Fund made no statement as to how long the direct control
of funds by Fund headquarters would last, the announcement brings into
question the Ukraine governments ability to effectively and honestly manage
funds provided to it by international organizations for AIDS treatment.

However, the suspension of the Ukraine governments control of funds
disbursed to it is believed by some to be only the tip of an iceberg of
doubt and serious questions in regards to Ukraine's management of its
AIDS program.

The Fund announcement, which quoted in part strong letters to Vice Prime
Minister Dmytro Tabachnyk and Minister of Health Andriy Pidayev,
followed consideration at Fund headquarters of the results of an intensive
field investigation in Ukraine led by senior Fund officials.

The announcement only mentioned Ukraine's failure to perform in a
timely fashion in regard to AIDS drug procurement. However, the issues
under investigation are reported to have been much broader and more
troubling issues.

Reliable sources in Ukraine had reported to Western and international
authorities allegations that people associated with the Ministry of Health
had attempted to skim large sums of money from funds already disbursed.
Specifically, there were allegations about the Health Ministry's drug
procurement and contracting for treatment services.

The investigation is reported to have at least partially confirmed
allegations that there had been a blatant attempt to offer project funds to
contract service providers based on very substantial kickbacks. It was,
however, questionable drugs procurement practices that led to the Fund's
demand for immediate return of monies already disbursed.

Based on their investigation in Ukraine, the Global Fund's level of concern
was so high that on January 27 the Global Fund's executive director faxed a
letter stating the Fund's concerns to Vice Prime Minister Dmytro Tabachnyk.

This was the first of two letters. The second, to Minister of Health Andriy
Pidayev, specifically stated in part, ".the Global Fund hereby temporarily
suspends the Grant Agreement........we expect the Ministry of Health to
immediately refund all funds dispursed to the Ministry by the Global Fund
that were intended to finance procurement of drugs and other health
products, plus interest earned on such funds."

The Fund's major immediate complaint was that the Ministry had engaged in
procurement of anti-retroviral drugs (ARVs) in a fashion that was not only
inefficient but also led to the conclusion that the Ministry may have been
engaged in questionable procurement practices.

The Fund was concerned that in spite of boasts that 4,000 AIDS victims
would be receiving ARVs, in reality less than five percent of that number
were being served. The Fund's letter to Pidayev pointed out that the Fund
is making arrangements with Medecins Sans Frontieres (MSF) for emergency
supplies of ARVs because of the Ministry's failure to meet its commitments.

Sources also reported that the Ministry staff is engaged in a frantic effort
to construct a response to the Global Fund that will spin the story by
attempting to place the blame for the problems on the Global Fund itself.

However, these same sources indicate that the greatest worry of many of the
mid to top level Ukraine Health Ministry officials is that the Presidential
Administration will be so furious about the Ministry's loss of control of
the monies that any number of heads are likely to roll. (END) (ARTUIS)
========================================================
UKRAINE REPORT-2004, No. 18: ARTICLE NUMBER TWO
=========================================================
2. THE GLOBAL FUND ACTS TO SECURE RESULTS FOR ITS
HIV/AIDS PREVENTION AND CARE PROGRAMS IN UKRAINE

Global Fund, Geneva, Switzerland, January 30, 2004

Geneva, Switzerland - Concerned with the slow progress of the HIV/AIDS
prevention and care programs it supports in Ukraine, the Global Fund to
Fight AIDS, Tuberculosis & Malaria has temporarily withdrawn its support for
the three principal recipients of its grants in Ukraine.

The Global Fund will ask a reliable organization to take over implementation
of the programs for several months, to give Ukraine the opportunity to
address concerns of slow implementation, management and governance issues.
The decision was communicated to the chair of the Global Fund's in-country
counterpart, the Country Coordinating Mechanism, Ukraine's Deputy Prime
Minister Dmytro Tabachnik, this week.

After being alerted to potential problems with implementation of its grants
to Ukraine, the Global Fund secretariat has over the past three weeks
undertaken a full review of the process leading from grant approval to
today. It has sent a mission to Ukraine to address specific issues
surrounding implementation bottlenecks and at the conclusion of this
mission, the Global Fund decided that firm action was needed to ensure that
ambitious targets for treatment and prevention of HIV/AIDS in Ukraine are
reached within the two-year grant period.

"The primary responsibility of the Global Fund is to achieve results and to
turn back the HIV/AIDS pandemic," says Dr Richard Feachem, Executive
Director of the Global Fund. "We have taken action with our colleagues in
Ukraine in order to ensure that our money flows, that the epidemic does not
spread further and those who need treatment will receive treatment. We will
take action of this kind in the future on any occasion that it is necessary
to ensure that the results are achieved in any of the programs we finance."

The Global Fund has approved three grants worth a total of $25 million over
two years to Ukraine. Of this, roughly $7.5 million has been disbursed, but
only $740,000 has been spent to date. Ukraine so far lags substantially
behind its targets to prevent the spread of HIV and provide treatment to
people living with the virus. Among the programs' targets is the expansion
of the number of people receiving AIDS treatment from less than 60 to 4,000
within two years.

"We do not believe the programs can be successful if we stay with the
current structure," says Dr Feachem. "Yet, we do not wish to stop Global
Fund funds from flowing. The Ukraine needs the money and needs it now. The
issue, therefore, is to secure operations in the short term to ensure that
in the medium term we are able to get the program back on track."

In a related development, the Global Fund has stepped in to ensure the
country's stock of AIDS medicines which was in danger of running out.

The Global Fund is a unique global public-private partnership dedicated to
attracting and disbursing additional resources to prevent and treat AIDS,
tuberculosis and malaria. This partnership between governments, civil
society, the private sector and affected communities represents a new
approach to international health financing. The Fund works in close
collaboration with other bilateral and multilateral organizations to
supplement existing efforts dealing with the three diseases. The Global Fund
has so far committed $2.1 billion to 225 programs in 121 countries.

The Global Fund has been established as an independent private foundation
governed by an international Board. Apart from a high standard of technical
quality, the Global Fund attaches no conditions to any of its grants. It is
not an implementing agency. It relies on local ownership and planning to
ensure that new resources are directed to programs on the frontline of this
global effort, reaching those most in need.

Its performance-based approach to grant-making - where grants are only
disbursed if progress has been measured and verified - is designed to ensure
that funds are used efficiently and create real change for people and
communities. All programs are monitored by independent organizations
contracted by the Global Fund to ensure that its funding has real impact in
the fight against the three pandemics. (END)(ARTUIS)
[The Global Fund to Fight AIDS, http://www.theglobalfund.org/en/]
=========================================================
UKRAINE REPORT-2004, No. 18: ARTICLE NUMBER THREE
=========================================================
3. GLOBAL FUND TO FIGHT AIDS SUSPENDS PAYMENTS
IN UKRAINE CITING POOR MANAGEMENT

By David Brown, Washington Post Staff Writer
The Washington Post, Washington, D.C.
Saturday, January 31, 2004; Page A16

The Global Fund to Fight AIDS, Tuberculosis and Malaria has suspended
payments of about $6.7 million to organizations fighting AIDS in Ukraine,
saying the groups are poorly managed.

The move, announced yesterday, is the first time in its 18-month
existence that the Global Fund has stopped the flow of money to a
program it supports. The fund is financing 225 disease prevention and
treatment programs in 121 countries.

Officials said the fund is negotiating with a nongovernmental
organization to take over delivery of AIDS services it supports in
Ukraine. The fund will bring in outside experts to help improve and
reorganize local management of the programs.

The Global Fund, an independent entity based in Geneva, seeks to
become the main conduit for moving money from rich countries to poor
countries for use against the three main diseases of poverty.

"Ukraine has a very rapidly growing AIDS epidemic, and we have
invested $25 million in stopping it. This money is not working at the
moment," fund spokesman Jon Liden said. He said there is no evidence
that money is being stolen or embezzled. Instead, the problem is that
the programs are poorly managed and far behind in their scheduled
work.

The Ukrainian health ministry -- the designated recipient of a grant
to expand AIDS treatment -- was supposed to increase the number of
people on antiretroviral therapy from less than 100 to about 4,000 in
two years.

"They are nowhere near that," Liden said. He added that the transition
to a new program administrator would not interrupt treatment for the
relatively few people on antiretroviral therapy.

About $7 billion to $10 billion is needed each year for care and
prevention of AIDS in the developing world, according to some
estimates. The fund has been able to raise only a fraction of that
amount. To date, it has committed itself to providing $2.1 billion to
projects around the world.

Government agencies, charitable organizations and civic groups apply
to the fund for grants, which are awarded on merit. They are then
reviewed for performance while underway.

Some large donors -- including the United States government -- have
been reluctant to give more to the fund until they see evidence the
money is being put to good use. The fund is in the difficult position
of needing to ensure its donations are not wasted while at the same
time responding urgently to the AIDS epidemic by getting money to
treatment and prevention organizations, many of which are newly
created and have no track record.

Anil Soni, adviser to the fund's executive director, Richard G.A.
Feachem, said yesterday's action is evidence the system is working as
planned.

"From Day One, our donors and we said we will have failures. It's the
consequence of having a broad portfolio," he said. "Part of being
accountable is not turning your back on those cases that stall or
don't succeed."

In Ukraine, the fund approved grants worth $25 million, for use over
two years. About $7.5 million has been disbursed, but only about
$740,000 has been spent, Liden said.

Besides the health ministry, the other two recipients of the grants
are a charitable organization called the Ukrainian Fund to Fight HIV
Infection and AIDS and the United Nations Development Program (UNDP).

The Ukrainian fund is supposed to create a broad public education
program on AIDS prevention. The UNDP is overseeing several small
organizations designing prevention programs for injection drug users,
prostitutes, soldiers and other high-risk groups. (END) (ARTUIS)
=========================================================
UKRAINE REPORT-2004, No. 18: ARTICLE NUMBER FOUR
=========================================================
4. US-UKRAINE RELATIONS ONCE AGAIN ON THE BRINK:
SENIOR STATE DEPARTMENT OFFICIAL

Agence France Presse (AFP), Washington, D.C., January 29, 2004

WASHINGTON (AFP) - Recent political developments in Ukraine have so
alarmed the United States that relations between the two countries are
teetering on the brink once again after a period of rapprochement last year,
a senior State Department official said Thursday.

The official said Kiev's heavy-handed tactics against the opposition
threatened to bring US-Ukraine ties to their lowest point since Washington
alleged in 2002 that President Leonid Kuchma had personally approved the
sale of early warning radar equipment to Iraq in violation of UN sanctions.

Since then and until October 2003, the official said that relations had
improved, notably with Ukraine's participation in Iraqi stabilization, but
that they had now relapsed due to a growing trend of political repression.

"I'd like to say that the relationship has moved onward and forward since
then," the official said, referring to a brief September meeting between US
President George W. Bush and Kuchma at the United Nations.

"I can't do that," the official told reporters on condition of anonymity.
"The relationship has once again been troubled by Ukrainian indiscretions
in the area of democracy. And that's putting it politely."

The official slammed government-sponsored harassment of opposition
demonstrations in Ukraine, a proposed amendment to radically alter the
constitution just months ahead of October presidential elections and signs
that Kuchma may seek a third term which is prohibited by the current
constitution.

"We think it would be a very good thing for there to be a new president
after the next election," the official said.

Pointing to highly critical remarks made by US ambassador to Ukraine, John
Herbst, in December the official also took issue with Kuchma's subtle
accusations that Washington was behind the ouster of former Georgian
president Eduard Shevardnadze.

Shevardnadze was forced to resign in November after massive protests against
rigged parliamentary polls and Kuchma and others authoritarian leaders in
the former Soviet Union watched warily as Georgia's "rose revolution" saw a
pro-western president overwhelmingly elected in January.

The US official denied any US role in Georgia's revolution but pointedly
recalled Herbst's December 23 speech in Kiev in which the envoy said
Shevardnadze had failed to heed Washington's advice about free and fair
polls.

"Long in advance of the run-up to Georgia's elections, we conferred with
President Shevardnadze and others in the country on the need to hold free
and fair elections," Herbst said in his speech. "That obviously did not
happen."

The official also said Washington shared the opinion of the Council of
Europe, a pan-European human rights and democracy body, which this week
censured the proposed constitutional amendment that would scrap direct
elections of the president.

Kuchma responded by accusing the council of interfering in the internal
affairs of the former Soviet republic.

Last month, a bill to amend the constitution and have the president elected
by parliament rather than by universal suffrage passed its first reading
after a stormy session where opposition parties boycotted the vote.

Shortly after the bill passed its first reading, Ukraine's Constitutional
Court ruled that a two-term limit did not apply to Kuchma, since his first
term began in 1994, before the constitution was adopted in 1996.

The US official noted with irony that the same court had previously ruled
the opposite way in a case involving other senior Ukrainian officials, an
inconsistency not addressed by the judges in the latest decision.

The official said that unless the October election is deemed to meet
international standards, US-Ukraine relations will be severely damaged but
that the converse was also true.

"Our relationship will get much better if the elections are free and fair,"
the official said. "They will get complicated if they proceed the way
they've begun." (END) (ARTUIS)
=========================================================
UKRAINE REPORT-2004, No. 18: ARTICLE NUMBER FIVE
=========================================================
5. HARASSED BY GOONS

By Peter Byrne, Kyiv Post Staff Writer
Roman Olearchyk, Kyiv Post Staff Writer
Kyiv Post, Kyiv, Ukraine, Jan 29, 2004

If you grew up in the West during the Cold War, the Soviet Union and its
satellites were a sort of collective dark enigma, generating shadowy tales
of state security services stalking dissidents and tracking opposition
political movements.

Some in the West may be surprised to learn these types of activities are
still prevalent in independent Ukraine, where teams of agents routinely tap
phones, trail suspected foes and expel would-be enemies of the state. This
over a decade after the Berlin Wall came down.

Just ask Brian Mefford, who has been in Ukraine since 1998 managing programs
for the International Republican Institute, a Washington-based non-profit
organization funded by the U.S. government to encourage more active
participation among the population in politics through more developed and
professional political parties.

Like many associated with pro-democracy advising and watchdog groups,
Mefford and his IRI associates are routinely followed by what appear to be
undercover Ukrainian agents when they travel to cities outside Kyiv to
perform seminars on politics and democracy.

A reporter for Kyiv Post who was giving Mefford a tour of Lviv on Jan. 17
noticed precisely such surveillance.

"As we went from cafe to cafe, we noticed we were being followed by a
medium-built guy in a black hat and black leather jacket," the reporter
said. "As we tried to shake him, we noticed he was not alone - there was a
team of about five or six individuals following us for nearly five hours.
They waited outside cafes we visited and diligently foiled our attempts to
dodge them."

The intrepid duo tried for hours to lose the tail, dashing down streets and
in and out of doorways only to realize they were being followed from both
the front and the back.

"I tried talking to one of them, but he shunned the attempt, quietly keeping
a safe distance away," the reporter said.

The bizarre incident didn't end that day. IRI representatives were followed
by a team of individuals during practically their entire visit to Lviv,
which lasted until Jan. 21.

IRI representatives consider their shadows to be agents of some kind. In
fact, Chris Holzen, the resident director of the IRI's program in Ukraine,
told the Post on Jan. 27 that it is not uncommon for IRI representatives to
be followed, especially if they are conducting seminars in a region they
have not been to before. He added that IRI seminars are often attended by
individuals who do not identify themselves.

IRI is not the only U.S.-government funded NGO to apparently undergo
surveillance.

Ihor Popov, who chairs the Committee of Voters of Ukraine (CVU) an
indigenous non-governmental organization which, with the help of foreign
donors, including the U.S. government, has promoted fair elections since
1994 - also claims to have been trailed and closely watched.

"I have every reason to believe that our activities to promote a free and
fair vote are being closely monitored," said Popov, who refused to
speculate what, if any, state agency had been assigned the task. Yet
Popov insisted that representatives of CVU are occasionally observed
and followed by unidentified individuals who resemble agents of some
kind.

It is not clear who exactly is following these organizations.

Marina Ostapenko, spokeswoman for the State Security Services (SBU),
told the Post on Jan. 27 that no one employed by the SBU was trailing
IRI employees in Lviv.

"We have made inquiries and can state for the record that the SBU was
not following Mefford in Lviv," Ostapenko said. It could be some other
state agency, she added.

The U.S. Embassy in Kyiv refused to comment, referring the Post to the
office of the United States Agency for International Development, which
also did not comment.

Chris Holzen, who has been in Ukraine for more than seven years, said
he has not made major attempts to make contact with those shadowing
his organization's representatives, and doesn't feel threatened by the
surveillance. "If someone is following us, I think they will be bored by
what they find," Holzen said.

"There are times when we think we are being listened to, like when the
phones click and you hear a third person coughing in the background, but
again, it would only bother us if we had something to hide. Actually, it can
be quite comical sometimes," Holzen added.

"[These incidents] really don't affect our work, but there may be people who
might have attended a seminar but chose not to because they feel insecure.
That isn't really something we can quantify, but it probably is the case in
some instances."

The CVU has recently been portrayed by some pro-presidential mainstream
media as a tool of the West, said Popov. He anticipates that the pressure
will increase as Election Day nears. "We've been through this before and
know what to expect," he said.

In December foreign-funded NGOs engaged in democracy-building activities
fell under the prying eye of parliament.

On Dec. 11, 2003 the Rada created an ad hoc commission to probe allegations
that foreign organizations were interfering in domestic political matters in
an attempt to manipulate the outcome of the October presidential elections.

The resolution creating the committee won the support of 289 deputies,
including Communists and members of the factions of the pro-presidential
majority. Our Ukraine and Socialist Party members abstained, as did most
deputies in the Yulia Tymoshenko bloc.

As the Post went to press on Jan. 28, sources said that the leaders of some
parties in the Rada have asked their faction deputies to provide detailed
information about their contacts with foreign-funded NGOs.

The U.S. government is clearly watching these developments closely.
Speaking via a satellite link from Washington, DC, on Jan. 23, U.S Assistant
Secretary of State for Europe and Eurasia Elizabeth Jones told Kyiv
reporters that the U.S. is "anxious" about Ukraine's investigation into the
activities of non-government organizations.

"NGOs play a very important role in the development of democracy and civil
society," Jones said, adding that attempts to restrict opportunities for
NGOs or reduce their number "may hamper Ukraine's rapprochement with
Europe." (END) (ARTUIS)
========================================================
UKRAINE REPORT-2005, No. 18: ARTICLE NUMBER SIX
========================================================
6. STALKED AND HARASSED IN LVIV

EDITORIAL, Kyiv Post, Kyiv, Ukraine, Jan 29, 2004

Right when it seemed to us that, this crucial election year, life in Ukraine
couldn't get stranger, we received evidence that hoodlums, presumably
associated with the government, have been stalking westerners working here
for more than one western-funded NGO.

As a Post cover story this week relates, people associated with the
Washington-based International Republican Institute claim to be trailed
regularly - particularly outside of Kyiv, in the regions where the IRI and
organizations like it do much of their pro-democracy and pro-civil society
work - by goons, who maintain a coy distance as they trail their prey
through the streets of Lviv and other cities outside the capital.

That's all it has come to, so far: low-grade harassment, as IRI affiliates
find themselves being stared at from behind corners or across rooms as they
attempt, say, to window-shop, stroll, or eat in restaurants. There has also
been, possibly, wiretapping. There have been no threats of violence, and
when a Post reporter - accompanying an IRI employee in Lviv - tried to talk
to a stalker, the gentlemen had the grace to seem ashamed. But it's still no
good; and we assume that this unnerving tactic should be understood as a
promise of intensified unpleasantness for western meddlers in the event
that, a presidential election actually materializing in Ukraine this year,
the work of the various NGOs becomes a threat to the authorities.

This spooky, Belorussian-style behavior on the government's part is yet
another indication that the entrenched interests are playing for real this
election year. If they win, we fear, morons trailing westerners will be
among the least of a newly authoritarian Ukraine's problems. And they will,
of course, do anything it takes to win.

Any of our readers in the NGO community who have experienced similar
harassment should tell us all about it by dropping a line to
editor@kyivpost.com. (END) (ARTUIS)
=========================================================
UKRAINE REPORT-2004, No. 18: ARTICLE NUMBER SEVEN
=========================================================
7. ALLIES OF UKRAINIAN PRESIDENT KUCHMA REJECT
EUROPEAN UNION AND COUNCIL OF EUROPE CRITICISM
Blast the parliamentarians from Denmark and Liechtenstein who drafted
the resolution, calling them "crazy dames", "biased" and "incompetent".

By Tom Warner in Kiev, Financial Times, London, UK, January 30 2004

Supporters of Ukrainian president Leonid Kuchma on Friday rejected criticism
from the European Union and the Council of Europe and vowed to press
ahead with a plan to change Ukraine's constitution before a presidential
election in October.

Stepan Havrish, the leader of Mr Kuchma's bloc in parliament, said his group
was ready for "dialogue" with the Council of Europe's parliamentary
assembly, which adopted a scathing resolution on Thursday warning Ukraine
that its membership in the group could be suspended if the changes are
adopted illegally.

But Mr Havrish said his group would not withdraw the proposed amendments,
which would shift executive power to the prime minister and give parliament
the power to choose the prime minister. That would ensure that Mr Kuchma's
group, which holds a majority in parliament, retains power until the next
parliamentary elections in 2006.

The rebukes from Europe will put Mr Kuchma in an awkward position as he
pushes for a final vote on the amendments after parliament returns from a
winter break in mid-February. Until recently, Mr Kuchma had argued that the
changes were needed to bring Ukraine's political system in line with
European standards and to prepare for EU membership.

But at a summit in Yalta last October, EU leaders urged him to put aside the
changes until after the presidential election. The EU reiterated that
message in a statement published on Friday, which was also backed by the 10
countries that will be joining the EU this year.

The EU statement said that changing the constitution before the presidential
election "will have an adverse impact on the trust and confidence of voters.
The legitimacy of constitutional change should be derived from genuine
public support for its aims."

"We feel as a union that this is something where we have to put down a clear
marker," said Joe Hayes, the Irish ambassador in Prague who helped organise
the EU statement. Ireland, which has no embassy in Kiev, holds the rotating
EU presidency.

"Of course it's Ukraine's sovereign right to modify its constitution as it
pleases, but it's the fact that it's doing it during an election year that
raises concerns," Mr Hayes said.

The Council of Europe resolution said Ukraine's parliament had already acted
illegally when it gave the amendments preliminary approval last month. In
that vote, after rowdy opposition deputies occupied the speaker's tribunal,
Mr Kuchma's group gathered in a corner of the session hall and voted by
raising their hands.

The Council of Europe also criticised a recent ruling by Ukraine's
Constitutional Court that allows Mr Kuchma to run for a third term as
president despite a two-term limit in the current constitution. A report by
the resolution's authors pointed out that the court's judges had recently
been given Euro 100,000 (£68,229, $123,713) benefit allowance.

Alexander Zadorozhny, a spokesman for Mr Kuchma, blasted the
parliamentarians from Denmark and Liechtenstein who drafted the resolution,
calling them "crazy dames", "biased" and "incompetent". (END)(ARTUIS)
=========================================================
UKRAINE REPORT-2004, No. 18: ARTICLE NUMBER EIGHT
=========================================================
8. UKRAINIAN PRESIDENT'S AIDE SAYS EUROPEAN
BODY IMPOSES NEW LEADER ON UKRAINE
The resolution was drafted "by two crazy ladies who do
not understand Ukrainian developments at all".

UNIAN news agency, Kiev, in Ukrainian, 30 Jan 04
BBC Monitoring Service, UK, in English, Jan 30, 2004

Kiev, 30 January: The permanent representative of the Ukrainian president
[Leonid Kuchma] in parliament, Oleksandr Zadorozhniy, has described recent
actions by the Parliamentary Assembly of the Council of Europe [PACE] as an
ultimatum, "so that [popular right-of-centre Our Ukraine bloc leader] Viktor
Yushchenko should become the Ukrainian president already today". Zadorozhniy
was commenting to journalists on yesterday's decision by the Parliamentary
Assembly of the Council of Europe [threatening suspension of the Ukrainian
delegation from the PACE if Ukraine's ruling elite continues pushing
constitutional reform through parliament].

The people's deputy believes that the PACE made it clear that it would
guarantee quiet life and international dialogue to us only on the condition
that Yushchenko becomes president. "The head of the PACE monitoring
committee said that they would continue monitoring until after the
presidential election. If you elect Yushchenko, there will be no
monitoring," Zadorozhniy said.

The permanent representative of the Ukrainian president in parliament
believes that the PACE resolution was absolutely absurd and that it was not
adequate to the situation in either factual or legal sense. He said that the
resolution was drafted "by two crazy ladies who do not understand Ukrainian
developments at all".

Zadorozhniy said that the 46 PACE deputies who voted in favour of the
resolution did not reflect the PACE's opinion. "And Mrs [PACE rapporteur on
Ukraine, Renate] Wohlwend , who works in an absolute monarchy, believes that
she is entitled to teach us," Zadorozhniy said. (Wohlwend represents
Liechtenstein in the PACE - UNIAN.)

As UNIAN reported earlier, on 29 January the PACE discussed the issue of
"Political crisis in Ukraine". The deputies upheld a report on Ukraine by
the rapporteurs Renate Wohlwend and Hanne Severinsen. Forty-six deputies
voted in favour of the resolution and 13 voted against it.

In the resolution, the PACE, among other things, said that the voting [in
parliament] on 24 December 2003 on the introduction of amendments to the
Ukrainian constitution "was in violation of Ukraine's obligations in
accordance to Article 3 of the Council of Europe's statute". [Passage
omitted: earlier reported wording of the resolution]

[The amendments, which were preliminarily passed by parliament on 24
December, despite the opposition's protests, provide for presidential
elections by parliament, rather than universal suffrage, starting from 2006.

Our Ukraine believes the draft amendments are aimed at preventing the
popular Yushchenko from coming to power.] (END) ARTUIS)
=========================================================
UKRAINE REPORT-2004, No. 18: ARTICLE NUMBER NINE
=========================================================
9. OPPOSITION RALLY "DIRTY HANDS OFF SILSKI VISTI" SUPPORTS
EMBATTLED NEWSPAPER IN CENTRAL UKRAINE

Korrespondent.net web site, Kiev, in Russian 1 Feb 04
BBC Monitoring Service, UK, in English, Feb 01, 2004

POLTAVA......The opposition in Poltava has held a rally to warn the
authorities against the closure of the Silski Visti newspaper, Ukrayinski
Novyny news agency reported.

Some 300 supporters of the Our Ukraine [opposition bloc], Yuliya Tymoshenko
Bloc and the Socialist Party of Ukraine held a warning rally called "Dirty
hands off Silski Visti" against the ruling of Kiev's Shevchenkinskyy
district court to close the newspaper [for allegedly publishing anti-Semitic
articles]. [Passage omitted: details of the rally]

Those who took the floor stressed that it was a warning rally and that
protest actions would continue if the paper is persecuted, because this is
unconstitutional and breaches media freedom.

The rally adopted a resolution demanding that the Supreme Court override the
ruling of the Shevchenkivskyy district court and put an end to persecution
of the newspaper by the presidential administration. The rally demanded that
the Supreme Council [parliament] defend the newspaper's staff and that
law-enforcement bodies thoroughly investigate the situation with the
newspaper. {Passage omitted: background]

[On 28 January the court in Kiev upheld a suit filed by a Jewish NGO and
ruled to close the paper down - see Interfax-Ukraine news agency, Kiev, in
Russian 1832 gmt 28 Jan 04] (END) (ARTUIS)
=========================================================
UKRAINE REPORT-2004, No. 18: ARTICLE NUMBER TEN
=========================================================
10. POOR UKRAINIAN GIRLS TRICKED INTO SEX TRADE

Agence France Presse (AFP), Kiev, Ukraine, Jan 31, 2004

KIEV - It seemed like an offer too good to be true: Tetiana, a young
Ukrainian, was offered 10 times her usual salary for working as an au pair
in the Italian sun. But she found herself trapped in a grubby Istanbul
room - a sex slave.

Lured by promises of earning good money, Ukrainian women find themselves
sold into prostitution instead. More than 100,000 young Ukrainian women have
suffered a similar fate since the collapse of the Soviet Union in 1991.

They dream of Eldorado but end up in the clutches of a pimp somewhere in
Europe, Turkey, the Balkans or the Middle East, with their passports stolen,
the Ukrainian branch of the international non-governmental organisation,
Strada, said.

'Most of the victims are unemployed women from the countryside aged between
18 and 28, tricked by small ads offering them work as house-cleaners or
waitresses in western Europe,' Strada-Ukraine director Katerina Cherepakha
said. 'It's hard to resist an offer of US$2,000 (S$3,400) a month when in
your own country you're earning barely US$100 a month.'

In some cases the young women have been deceived by a neighbour, a friend or
even a family member. Last year Ukrainian police investigated 300 cases of
human trafficking, twice as many as in 2002, but 'only a tiny number of
these were brought to court because of a lack of evidence', said Ms Alla
Taran.

She heads the state committee that is coordinating the fight against
trafficking with the police and non-governmental organisations. For the
victims of the trade in sex slaves, the torment does not end even after they
return home. They bring with them psychological scars, and in some cases
serious diseases such as Aids, Ms Taran said. (END) (ARTUIS)
==========================================================
UKRAINE REPORT-2004, No. 18: ARTICLE NUMBER ELEVEN
==========================================================
11. UKRAINIAN OFFICIAL TELLS USA ODESSA-BRODY PIPELINE
WILL BE USED TO TRANSPORT OIL TO EUROPE

Interfax-Ukraine news agency, Kiev, in Russian, 30 Jan 04
BBC Monitoring Service, UK, in English, Jan 30, 2004

Kiev, 30 January: Deputy Prime Minister Andriy Klyuyev has informed the
USA about Ukraine's intention to use the Odessa-Brody pipeline to
transport Caspian oil to Europe, and to legally ensure its commercialization
by adopting a law on concession.

Klyuyev was speaking at the consultations on the Eurasian oil transport
corridor which were held in Washington yesterday, the Ukrainian embassy in
the USA said. During the negotiations, the two sides discussed the current
state of implementation of the project for a Ukrainian route to transport
Caspian oil to Europe.

Klyuyev informed the audience about the project implementation. He said an
agreement had been reached with Poland to continue the pipeline construction
to Plock in Poland.

The Ukrainian side stressed that real steps should be made to provide for
the Odessa-Brody pipeline use in the near future.

The US representatives said that the USA supports the European direction for
the use of the Odessa-Brody pipeline and the Pivdennyy [oil] terminal.

Yesterday, the first meeting of the Ukrainian-US working group on the
Eurasian oil transport corridor was held in Washington. It was co-chaired by
Klyuyev and US Assistant Secretary of Energy For Policy and International
Affairs Vicky Bailey. The Ukrainian delegation also had a meeting with the
US assistant secretary of state, Alan Larson. [Passage omitted: general
details of meetings, background]

For several months, Ukraine has been living through a debate regarding
variants for the use of the pipeline - either in the European direction to
transport Caspian oil, or to the Black Sea coast to transport Russian oil.

The Russian company TNK-BP had said it was ready to supply 380,000
-420,000 tonnes of technological Russian Urals oil as a loan for three
years to fill the Odessa-Brody, as well as to supply up to 9m tonnes of
oil each year for pumping. (END) (ARTUIS)
==========================================================
UKRAINE REPORT-2004, No. 18: ARTICLE NUMBER TWELVE
==========================================================
12. UKRAINE'S PRESIDENTIAL ADMINISTRATION WANTS TO
PERMIT SALE AND PURCHASE OF AGRICULTURAL LAND IN 2005

Interfax-Ukraine, Kyiv, Ukraine, 30.01.2004

The Presidential Administration of Ukraine believes it is necessary to allow
as of January 1, 2005 sale and purchase of agricultural land, which is now
under moratorium, and during the year to prepare the necessary legislative
base for transparent and civilized functioning of the land market. Deputy
head of the President Administration Pavlo Haidutsky disclosed this to the
agency.

"The action of the moratorium on sale and purchase of agricultural land
should not be prolonged, whereas it is necessary to develop the
corresponding legislative base this year," he said. He said it is necessary
to review the norm of the Land Code, which limits agricultural land
ownership to 100 hectares by 2010, in order to extend it to 1,000 hectares.

As reported earlier, the Our Ukraine parliamentary factions is initiating
prolongation of the moratorium on sale and purchase of agricultural land.
According to it, hasty sale of agricultural land in terms of the existing
system will finally deprive Ukrainians of the right to be owners of their
land. The government opposes the prolongation of the moratorium.

The new Land Code that became effective as of January 1, 2002 offers to
transfer land into private ownership to legal entities and individuals -
residents of Ukraine, however there is a moratorium on sale and purchase of
agricultural land until 2005.

Ukraine has 33 million hectares of tillage worth UAH360 billion. According
to the State Committee for Land Resources, during the first years without
moratorium about 10 million hectares of agricultural land will be offered
to the land market. (END)(ARTUIS)
=========================================================
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