"THE ACTION UKRAINE REPORT"
An International Newsletter
In-Depth Ukrainian News, Analysis, and Commentary
"The Art of Ukrainian History, Culture, Arts, Business, Religion,
Sports, Government, and Politics, in Ukraine and Around the World"
UKRAINE LAWMAKERS APPROVE NEW PRIME MINISTER
NEW CABINET ALSO APPROVED
"THE ACTION UKRAINE REPORT" - Number 424
morganw@patriot.net, ArtUkraine.com@starpower.net
Washington, D.C. and Kyiv, Ukraine, FRIDAY, February 4, 2005
-----INDEX OF ARTICLES-----
"Major International News Headlines and Articles"
1. UKRAINE LAWMAKERS APPROVE PRIME MINISTER
By Maria D. Bellaby, AP Online, Kyiv, Ukraine, Fri, Feb. 4, 2005
2. UKRAINE'S NEW CABINET APPROVED
UT1 State TV, Kiev, in Ukrainian, 4 Feb 05
BBC Monitoring Service, UK, in English, Friday, Feb 04, 2005
3. YUSHCHENKO PRESENTS YULIA TYMOSHENKO FOR PRIME
MINISTER OF UKRAINE AND PROMISES A CLEAN GOVERNMENT
By Ron Popeski, Reuters, Kiev, Ukraine, Fri Feb 4, 2005
4."WITHOUT SERIOUS REFORMS UKRAINE'S ECONOMIC GROWTH
WILL NOT BE SUSTAINABLE"
International Centre for Policy Studies (ICPS) Newsletter #3 (262)
Kyiv, Ukraine, Monday, January 31, 2005
5. "SIGNAL FOR INVESTORS"
By Vitaliy Kniazhansky, The Day
The Day Weekly Digest in English, Tue, Feb 1, 2005
6. SIGMABLEYZER MONTHLY MACROECONOMIC REPORTS
http://www.sigmableyzer.com/index.php?pid=532
SigmaBleyzer, Kyiv, Ukraine, February, 2005
7. WATCHDOG, IFC TO JOINTLY FURTHER LEASING IN UKRAINE
Interfax-Ukraine, Kyiv, Ukraine, Thu, February 3, 2005
8. DONBAS INDUSTRIAL UNION SUBMITS BID FOR POLAND'S
HUTA CZESTOCHOWA STEEL PLANT
Ukrainian News Service, Kyiv, Ukraine, Friday, February 4, 2005
9 HUNGARIAN PRIME MINISTER CALLS FOR BOOSTING
BUSINESS TIES WITH RUSSIA, UKRAINE
Kossuth Radio, Budapest, in Hungarian 1500 gmt 3 Feb 05
BBC Monitoring Service, UK, in English, Thu, Feb 03, 2005
10. UKRAINE PICKS US COMPANY TO BUILD SPENT NUCLEAR
FUEL FACILITY
Holtec International Corporation Wins Tender
UNIAN news agency, Kiev, in Ukrainian, 1 Feb 05
Provider: BBC Monitoring, UK, in English, Tue, February 1, 2005
11. GLOBAL MARKET BRIEFING ANNOUNCES NEW BUSINESS
AND LEGAL GUIDEBOOK ON UKRAINE
Released as Ukraine Stretches out Hand to Business
Business Wire, Thursday, Feb 03, 2005
12. EXPERT SAYS UKRAINE TO CONTINUE MAINTAINING
RUSSIAN MISSILES BUILT IN UKRAINE
Interfax-AVN, Moscow, Russia, Tue, January 25, 2005
13. POLAND USING NEW BOOK TO PUSH ITS CLAIM TO LOOTED ART
Both Ukraine and Poland have said they own the drawings and want them back.
By Joe Milicia, AP Worldstream, Friday, Jan 28, 2005
14. RETURN TO THE SOURCE:
10th Annual Folk Art and Culture Tour of Ukraine
Aug. 8-23, 2005, With Specialist Orysia Tracz.
Folk Art and Culture Tour of Ukraine, Orysia Tracz
Winnipeg, Manitoba Canada, Friday, February 4, 2005
15. U.S. SAYS WTO DEAL WITH MOSCOW POSSIBLE IN 2005
By Josiane Kremer, Reuters, Zurich, Switzerland, Mon, Jan 31, 2005
16. GEOPOLITICALIZATION OF THE WORLD'S OIL & GAS INDUSTRY
ECONOMIC NEWS UPDATE, By Irwin M. Stelzer
The Hudson Institute, Washington, D.C., 2 February 2005
17. UKRAINIAN BUSINESS WEEKLY NAMES DONETSK TYCOON
RINAT AKHMETOV ITS BUSINESSMAN OF THE YEAR
Article By Yevhen Dubohryz, "More-or-less Civilized"
Kontrakty web site, Kiev, in Russian 17 Jan 05; p 43
BBC Monitoring Service, UK, in English, Sun, Jan 30, 2005
=========================================================
1. UKRAINE LAWMAKERS APPROVE PRIME MINISTER
By Maria D. Bellaby, AP Online, Kyiv, Ukraine, Fri, Feb. 4, 2005
KIEV - Parliament on Friday unanimously approved Yulia Tymoshenko as prime
minister to lead Ukraine's new, Western-oriented government. The fiery ally
of new President Viktor Yushchenko was approved by a vote of 373-0, far
above the 226 votes she needed.
Tymoshenko smiled broadly after the vote, and lawmakers burst into a round
of applause. Then she walked over and hugged Yushchenko, who came to the
chamber to personally ask lawmakers to support his choice for Ukraine's No.
2 job. "I trust her to organize the work of the government," Yushchenko told
legislators before the vote, which had been delayed a day by political
horse-trading over other top positions in the new government.
"Millions of people on Independence Square put their faith in her, in us,"
he said, referring to Tymoshenko's key role in the mass protests that helped
usher the opposition to power in this ex-Soviet republic. Yushchenko called
Tymoshenko "my political partner, my political friend."
Before the vote on her nomination, Tymoshenko laid out the broad goals of
her government's program. Emphasizing the importance of "justice" in every
aspect of Ukrainian life, Tymoshenko called for raising living standards,
fighting corruption and separating business from power. "The dark doors to
the government will be closed," she said.
Tymoshenko was a widely popular figure during the mass protests that broke
out following the Nov. 21 election in which former Prime Minister Viktor
Yanukovych was declared the winner. The Supreme Court ruled that vote
fraudulent and Yushchenko won the Dec. 26 court-ordered revote. She is not
well-liked, however, in Ukraine's largely Russian-speaking east, which
supported Yanukovych. -30- [The Action Ukraine Report Monitoring Service]
=========================================================
2. UKRAINE'S NEW CABINET APPROVED
UT1 State TV, Kiev, in Ukrainian, 4 Feb 05
BBC Monitoring Service, UK, in English, Friday, Feb 04, 2005
KIEV - Ukraine's President Viktor Yushchenko has appointed the cabinet led
by Prime Minister Yuliya Tymoshenko. The appointments were announced by
Tymoshenko following the vote in parliament on her approval. President
Yushchenko signed decrees in the parliament chamber in proceedings broadcast
live by Ukrainian state UT1 TV.
Yushchenko's Our Ukraine bloc holds the majority of posts together with
Tymoshenko's Fatherland party, the Socialist Party and a few other allies in
the protest campaign that brought Yushchenko to power.
Pro-western diplomat Borys Tarasyuk has been named as foreign minister and
civilian analyst Anatoliy Hrytsenko as defence minister. The president's
close ally Oleh Rybachuk has been named as deputy prime minister for
European integration - a key post in Yushchenko's pro-EU government. A
Socialist MP and one of the leaders of the November protests, Yuriy
Lutsenko, has been named minister of interior.
The president also signed a decree appointing Oleksandr Turchynov of the
Tymoshenko Bloc as head of Security Service of Ukraine, replacing Ihor
Smeshko. Speaking after the appointments, President Yushchenko described
the cabinet as "a government of trust".
The make-up of the new cabinet is as follows:
First Deputy Prime Minister - Anatoliy Kinakh (Industrialists and
Entrepreneurs)
Deputy Prime Minister for European Integration - Oleh Rybachuk (Our Ukraine)
Deputy Prime Minister for Humanitarian and Social Issues - Mykola Tomenko
(Our Ukraine)
Deputy Prime Minister for Administrative-Territorial Reform- Roman
Bezsmertnyy (Our Ukraine)
MINISTERS: :
Agrarian Policy -Oleksandr Baranivskyy (Socialist)
Culture - Oksana Bilozir (Our Ukraine)
Defence - Anatoliy Hrytsenko (Our Ukraine)
Economics Minister - Serhiy Teryokhin (Our Ukraine)
Emergencies Minister - Davyd Zhvaniya (Our Ukraine)
Environment Minister - Pavlo Ihnatenko (Our Ukraine)
Finance Minister - Viktor Pynzenyk (Our Ukraine)
Foreign Affairs - Borys Tarasyuk (Our Ukraine)
Fuel and Energy Minister - Ivan Plachkov
Health Minister - Mykola Polishchuk (Our Ukraine)
Industrial Policy - Volodymyr Shandra (Our Ukraine)
Interior - Yuriy Lutsenko (Socialist)
Justice Minister - Roman Zvarych (Our Ukraine)
Labour and Social Policy - Vyacheslav Kyrylenko (Our Ukraine)
Science and Education - Stanislav Nikolayenko (Socialist)
Transport and Communications - Yevhen Chervonenko (Our Ukraine)
Family, Children and Youth - Yuriy Pavlenko (Our Ukraine)
=========================================================
3. YUSHCHENKO PRESENTS YULIA TYMOSHENKO FOR PRIME
MINISTER OF UKRAINE, HE PROMISES A CLEAN GOVERNMENT
By Ron Popeski, Reuters, Kiev, Ukraine, Fri Feb 4, 2005
KIEV, Ukraine (Reuters) - Ukrainian President Viktor Yushchenko, vowing to
install a clean government, asked parliament Friday to approve radical Yulia
Tymoshenko as his prime minister to lead the country into mainstream Europe.
Tymoshenko, who charmed crowds alongside the new president during protests
which helped put him in power, pledged to make government accountable and to
uphold ties with Russia while creating conditions to move "quickly and
honorably" to Europe.
There is little doubt Tymoshenko will win the required 226 votes in the
450-seat chamber. But disputes over the composition of the cabinet have
delayed the vote.
"In this country, problem No. 1 has been corruption, starting from the top,"
Yushchenko told the chamber as he introduced her.
He said he understood an honest government in the ex-Soviet state amounted
to a "fantasy" for most Ukrainians after 10 years of scandals under his
predecessor, Leonid Kuchma. "I will take no bribes, I will not steal. I
demand the same thing of my government. My government will not take
bribes.
It will bring no cash to parliament to win approval of laws." He also
restated pledges to bring order to privatizations often conducted in
suspicious circumstances, referring directly to the sell-off last year of
the giant Kryvoryzhstal steel mill.
"We will conduct honest privatization," he said. "Sites that were stolen
will be returned to the state, starting with Kryvoryzhstal." Tymoshenko said
her government wanted to depart from traditional programs and present a
"philosophy" understandable to ordinary Ukrainians.
PATH TO EUROPE
Russia, she said, was Ukraine's "first and most important partner. But our
path lies in moving toward Europe. "We must draw up and approve a national
strategy of European integration to create the basis for becoming a
full-fledged member of the European Union."
That meant launching a country-wide debate "to overcome the fears and
phobias artificially created among our people. I know that Ukraine can cover
this path both quickly and honorably."
The charismatic Tymoshenko is popular with nationalists but distrusted in
Russian-speaking eastern Ukraine and in Moscow, where bribery charges are
still being pressed against her. She won over doubters in Yushchenko's own
camp and even many of his adversaries in a week of talks. Tymoshenko's
policy goals released this week called for an overhaul of institutions,
creation of a civil society and better benefits. But there were few concrete
proposals or figures.
Yushchenko told deputies Tymoshenko had long been his political partner,
having served as deputy prime minister when he himself was premier under
Kuchma in 2000-2001. "I trust her to head my government, just as millions
of people trust her," he said.
The stumbling block in negotiations over the new government had been the
small Socialist Party, which holds about 20 seats in parliament.
The president, who embarked on a whirlwind tour of Europe in his first week
in office, says he aims to start talks by 2007 on an association agreement
with the EU. NATO membership is also being mooted and Yushchenko is
to meet President Bush and other Alliance leaders later this month in
Brussels.
Cabinet appointments are expected to include industrialist and ex-prime
minister Anatoly Kinakh as first deputy prime minister and reformist Viktor
Pynzenyk as finance minister, a job he held in the early post-Soviet years.
Borys Tarasyuk, pressing for entry to both the EU and NATO, is likely to
take on the Foreign Ministry he ran in the 1990s. -30-
========================================================
4."WITHOUT SERIOUS REFORMS UKRAINE'S ECONOMIC GROWTH
WILL NOT BE SUSTAINABLE"
International Centre for Policy Studies (ICPS) Newsletter #3 (262)
Kyiv, Ukraine, Monday, January 31, 2005
The main obstacles to balanced and predictable economic growth are
undeveloped domestic markets, an unfriendly business environment, an
underdeveloped financial services sector, and a costly economic system.
ICPS economists believe that the Government must take a number of key
steps to ensure steady economic growth. These include establishing a level
playing field for businesses, deregulation, and attracting foreign capital,
especially to the financial sector.
Although the forecast for Ukraine's mid term economic growth remains high
(7-7.5%) the authors of Quarterly Predictions write that there are a number
of serious threats to sustainable economic growth. In addition, they believe
that the likelihood of serious fluctuations in GDP dynamics is high. This is
because of underdeveloped domestic markets, an over exposed economy, an
unfavorable business environment and low competitiveness, a weak financial
sector, and a costly economic system inherited from the USSR.
OVER EXPOSED ECONOMY
In the last few years, exported goods and services constituted 50--60% of
GDP, one of the highest indicators in Europe. Moreover, steel and steel
products constitute almost a third of Ukraine's exports. This means that, as
metal prices fall, there will be a steady slowdown in Ukraine's economic
upswing-- and vice versa.
UNFAVORABLE BUSINESS ENVIRONMENT
Ukrainian business owners say that the business environment has not improved
over the last two years. Domestic businessmen list high tax pressure, low
demand, and an unfavorable regulatory environment (high regulatory pressure,
frequent and unsystematic legal changes, and corruption) among the key
barriers to doing business. As a result, the annual reports of Ukrainian
companies show a very high rate of unprofitability despite high economic and
export growth.
Although a large number of Ukrainians think of themselves as middle class,
which is a key feature in a stable market society, the contribution of SMEs
also plays an important role. Yet this remains impossibly small in Ukraine
(10 35% of GDP, according to different estimates). In European countries,
this indicator is at least at 50% of GDP.
Foreign direct investment in Ukraine continues to grow year after year, but
it remains one tenth of FDI in CEE countries. This is because of widespread
unfair competition, the powerful influence of financial and industrial
groups, and high political risk.
UNDERDEVELOPED FINANCIAL SERVICES
The opportunities for business and the general population to find financing
at a bank or other financial institutions remain inadequate, especially
given the short lending terms, high interest rates and poor range of
services.
COSTLY ECONOMIC SYSTEM
According to research data, Ukrainian plants typically consume double the
energy used in EU countries and the depreciation of fixed assets remains
high. Still, there are many areas where enterprises could save energy.
Agriculture also has a large share of GDP-- up to 15%. An intrinsic feature
of farming is the high correlation between crops and weather conditions. No
matter how fertile Ukraine's soil is, most of it lies mainly at a latitude
that represents risks for agriculture.
WHAT THE GOVERNMENT NEEDS TO DO
In the opinion of ICPS, to achieve sustainable economic growth that will
guarantee steady improvement in living standards, Ukraine must:
[1] develop domestic markets by encouraging business initiatives and by
deregulation. This would reduce vulnerability to external shocks;
[2] ensure a level playing field for business operations and transparent
requirements, cut back on tax breaks and preferential treatment, and revise
the list of priority sectors in order to concentrate state assistance in the
most promising and high tech areas;
[3] encourage the inflow of foreign capital, in particular to the financial
sector;
[4] develop both mandatory and voluntary insurance, especially in the
pension and healthcare systems.
----------------------------------------------------------------------------
The ICPS is an independent think-tank established in 1994. Among the
services provided by the Centre are regular short- and medium-term
forecasts for macroeconomic indicators and analytical support for both
public and private sector decision-makers. ICPS newsletter is a weekly
publication of the International Centre for Policy Studies, delivered by
electronic mail. To be included in the distribution list, mail your request
to: marketing@icps.kiev.ua. ICPS newsletter editor: Yevhen Shulha
(shulha@icps.kiev.ua) Phone: (380 44) 236 4477. Fax: (380 44) 236 4668.
English text editor: L.A. Wolanskyj; http://www.icps.com.ua/eng/
For more information, contact Andriy Blinov by telephone at
(380-44) 236-1292 or by e-mail at ablinov@icps.kiev.ua.
==========================================================
5. "SIGNAL FOR INVESTORS"
By Vitaliy Kniazhansky, The Day
The Day Weekly Digest in English, Tue, Feb 1, 2005
Such was the inference President Viktor Yushchenko voiced at the World
Economic Forum. He returned from Davos Sunday night after taking part in
the forum (Jan. 28-29). His highest priority was attracting foreign inland
investment and building Ukraine's positive investment image in the
international arena. "My objective was to convincingly portray Ukraine as
a country worth doing business with," said the Ukrainian head of state. He
noted that "capital, especially big-time capital, will never feel
comfortable in Ukraine's current conditions," adding that there is no
stability or an independent judiciary system, and no guarantees of property
rights.
Another serious problem is corruption; every effort must be made to put en
end to it, so government officials at all levels stop taking bribes,
stressed the president.
In Switzerland, a shadow of the Kryvorizhstal deal constantly hung over
Viktor Yushchenko. To the new Ukrainian administration the sale of this
steel giant is ripoff, so they intend to reprivatize it.
A number of Ukrainian experts, including Yuri Yekhanurov, chairman of the
pertinent VR committee, and Oleksandr Paskhaver, co-chairman of the UN-
sired Blue Ribbon Commission, believe that this approach may have a negative
effect on the Ukrainian investment image. Despite the favorable atmosphere
of Viktor Yushchenko's visit to Davos, voices expressing concern over such
reprivatization were also heard. An Indian dignitary attended not only
events organized by Yushchenko, but also a business party thrown by
ex-President Leonid Kuchma's son-in-law Viktor Pinchuk (one of
Kryvorizhstal's owners) where the noted financier George Soros was
also present.
The Indian VIP wanted to know if there could be additional clauses when
selling Kryvorizhstal, as practiced previously. He was assured there would
be none and that he could get his money ready... The observant potential
investor, however, must have noticed that there was no hidden enmity about
Viktor Yushchenko and Viktor Pinchuk shaking hands. Also, one of the
Ukrainian president's closest associates, Oleh Rybachuk, when asked by
journalists about the possibility of Kryvorizhstal's reprivatization, did
not sound explicitly resolved... Apparently, the national image is not worth
risking even over such a big deal.
While in Davos, President Yushchenko indefatigably worked to build this
image. During a meeting with ex-US President Bill Clinton, Mr. Yushchenko
stressed that he regarded the Ukrainian market as one of the most promising
in Europe; he felt sure that the new administration would secure equal rules
of the game for all businesses.
Addressing a PACE session in Strasbourg, before visiting Davos, Viktor
Yushchenko promised to provide all conditions for a foreign inland
investment influx, adding that it was worth $600 million at present,
compared to $7 billion in Poland and $6.5 billion in Russia. He said that
Europe sees Ukraine today as a sleeping elephant, but if the new
administration embarks on an effective domestic policy, in a year's time
Europe will see a most modern market in Ukraine, and that Ukraine has
every opportunity to do so.
At a press conference in Davos on Saturday, Viktor Yushchenko informed
that a meeting of businesspeople interested in Ukraine will be held in Kyiv
this year, and described the event as a miniature Davos. Addressing the
prospective investors, he said they were all welcome in Ukraine and asked
them not to give any bribes to anyone but save the money.
The Council of the European Union will consider the European Commission's
draft 10-point Ukraine-EU Action Plan. The document will be presented by
EU High Commissioner for Foreign Policy and Security Xavier Solana and
Commissioner for External Relations & European Neighborhood Policy
Benita Ferrero-Waldner.
Viktor Yushchenko discussed Ukraine's European prospects with European
Commissioner Jose Barros in Davos on Saturday. It was agreed that the
Ukrainian president will visit Brussels in February to meet with the
European Commission's leadership. Viktor Yushchenko said that problems
relating to Ukraine, particularly the possibility of its status as a
market-economy country, will be discussed during these meetings. -30-
--------------------------------------------------------------------------
LINK: http://www.day.kiev.ua/103
==========================================================
6. SIGMABLEYZER MONTHLY MACROECONOMIC REPORTS
http://www.sigmableyzer.com/index.php?pid=532
SigmaBleyzer, Kyiv, Ukraine, February, 2005
1. UKRAINE -- Macroeconomic Situation - December 2004
http://www.sigmableyzer.com/files/Ukraine_Ec_Situation_12_04fin.pdf
2. ROMANIA-- Macroeconomic Situation - December 2004
http://www.sigmableyzer.com/files/ROM_Ec_Situation_12_04.pdf
3. BULGARIA-- Macroeconomic Situation - December 2004
http://www.sigmableyzer.com/files/BLG_Ec_Situation_12_04.pdf
=========================================================
7. WATCHDOG, IFC TO JOINTLY FURTHER LEASING IN UKRAINE
Interfax-Ukraine, Kyiv, Ukraine, Thu, February 3, 2005
KYIV - The State Commission for regulation of the financial services market
and the International Finance Corporation's the Private Enterprise
Partnership have signed a protocol of intention to continue cooperation in
the development of leasing in Ukraine. The document was signed at Interfax-
Ukraine in Kyiv on Thursday.
"This protocol was signed to ensure periodization of the IFC's project for
leasing development in Ukraine," said Commission Chairman Viktor Suslov,
commenting on the signing of the document. "We undertake the commitments to
rather quickly make changes in the sphere of regulation and supervision over
financial leasing to bring it into line with international standards. This
will be the key direction of our further cooperation with the IFC." In his
words, the level of the development of leasing in Ukraine today is estimated
at no more than 10% of its potential. Suslov also noted that the Commission
had already tabled proposals at the government on ratification by Ukraine of
international conventions on financial leasing and international factoring.
Christian Grossmann, Director of the IFC's Private Enterprise Partnership,
said that the level of awareness about the advantages of leasing for private
business and the economy on the whole is very low in Ukraine so far.
Therefore, the settlement of this problem is one of the tasks of the IFC's
technical aid. In his opinion, the new law on financial leasing passed in
December 2003 has become the basis for the advancement of the leasing
market in Ukraine.
In his words, the progressive concept stipulated in this law clearly
describes grounds for the future development of leasing in Ukraine. However,
he said, additional efforts are needed to make leasing available to private
enterprises and attractive for foreign investors. In connection with the
clear-cut legislative regulation of leasing companies' activity, he
cautioned state authorities against excessive control over the sector and
extreme regulation.
We believe that the State Financial Services Market Regulation Commission
understands it clearly, he said. Today we've signed a protocol of intention
with the Commission to jointly achieve the development and growth of the
leasing market in Ukraine, he said. Grossmann stressed that the document
did not suggest that the Corporation would finance market operators. -30-
==========================================================
8. DONBAS INDUSTRIAL UNION SUBMITS BID FOR POLAND'S
HUTA CZESTOCHOWA STEEL PLANT
Ukrainian News Service, Kyiv, Ukraine, Friday, February 4, 2005
KYIV - Donbas Industrial Union (DIU), a Donetsk-based corporation,
has submitted a written bid to Poland's Infrastructure Ministry for the
country's Huta Czestochowa steel plant. A representative of the corporation
disclosed this to Ukrainian News. "We have submitted an offer," he said.
According to him, the Mittal Steel international holding has also submitted
a bid for Huta Czestochowa.
As Ukrainian News earlier reported, Poland extended the deadline for
submitting bids for Huta Czestochowa to February 3 in January. In January
2004, Poland selected the DIU corporation and LNM Holdings N.V. as
participants in the final stage of the competition for the production assets
of Huta Czestochowa, placing the DIU corporation's offer as number one on
the relevant shortlist. It declared LNM as the winner of the competition
for the plant in February. However, the DIU corporation described the
decision as discriminatory.
The Polish government cancelled the tender via which the Huta Czestochowa
steel plant was sold on April 30 and decided to invite fresh tenders. The
companies Ispat International and LNM Holdings N.V. (which were constituent
companies of the LNM Group steel holding) merged in December 2004 to for,
Mittal Steel Company N.V. Businessman Lakshmi Mittal is the founder of the
LNM Group and its successor Mittal Steel Company.
The DIU corporation engages in production and sale of steel products as well
as in supply of natural gas and electricity to Ukrainian industrial
enterprises. The Azovinteks company (Mariupol) and the Vizavi company
(Donetsk) each owns a 49.99% stake in the DIU corporation while the Oniks
Don company (Donetsk) owns 0.02%. The DIU corporation's Board Chairman
Serhii Taruta controls Azovinteks while former Ukrainian prime minister
Vitalii Haiduk controls Vizavi. -30- [Action Ukraine Report Monitoring]
==========================================================
9. HUNGARIAN PRIME MINISTER CALLS FOR BOOSTING
BUSINESS TIES WITH RUSSIA, UKRAINE
Kossuth Radio, Budapest, in Hungarian 1500 gmt 3 Feb 05
BBC Monitoring Service, UK, in English, Thu, Feb 03, 2005
BUDAPEST - [Presenter] At a forum organized by the Chamber of Trade
and Industry, Prime Minister Ferenc Gyurcsany spoke about opportunities in
developing Hungarian-Russian and Hungarian-Ukrainian economic relations.
Gabor Bankuti reports:
[Bankuti] Speaking about economic issues, Ferenc Gyurcsany said that
anti-capitalist sentiments and intentions to restrict the operation of the
market were on the rise. Instead of this attitude, Protestant ethics should
be accepted which respects increasing assets and investment [he said].
It is also harmful if foreign relations are unjustifiably politicized, [he
said]. The volume of imports from the Russian region is four times as high
as experts to the region, and this is harmful. Our trade is not balanced
with Ukraine either.
The prime minister announced that in the coming days he would visit Kiev and
meet President [Viktor] Yushchenko. Then he will hold talks with [Russian]
President [Vladimir] Putin as well. He will represent the interests of the
Hungarian economy and Hungarian businesses there, he said.
He promised that the government would never give specific figures for
exchange rates and interest rates [which are decided by the Monetary Council
recently extended by four new members], and would not put pressure on the
National Bank of Hungary. -30-
==========================================================
10. UKRAINE PICKS US COMPANY TO BUILD SPENT NUCLEAR
FUEL FACILITY
Holtec International Corporation Wins Tender
UNIAN news agency, Kiev, in Ukrainian, 1 Feb 05
Provider: BBC Monitoring, UK, in English, Tue, February 1, 2005
KIEV - At the end of December 2004, the tender committee [of the Enerhoatom
nuclear energy generating company], having assessed the bids received,
selected the winner to build a storage facility for spent nuclear fuel from
the nuclear reactors [run by] Eherhoatom, UNIAN learnt from the Enerhoatom
company.
"Having scrupulously assessed the bids submitted by participants in the
tender and having considered all the pros and cons that had to do not only
with the bids, but also with the strategy of Enerhoatom's and Ukraine's
nuclear energy industry development on the whole, the tender committee has
adopted the final decision to declare the Holtec International corporation
(USA) the winner of the tender," the company's statement reads.
Enerhoatom said that a consortium led by the Ukratomenerhobud [Ukrainian
atomic energy construction company] closed joint-stock company and the
Holtec corporation were the main rivals in the tender.
The tender in the framework of an investment project to built a storage
facility for spent nuclear fuel from the Rivne, Khmelnytskyy and
South-Ukrainian nuclear power plants with the use of the latest technology
in the area of spent nuclear fuel storage was announced in July 2003.
Under the tender's condions, the storage facility for spent nuclear fuel is
to be built on a turnkey basis. In addition, the relevant technology is to
be transferred to the user of the facility for it to be able to rebuild it.
==========================================================
11. GLOBAL MARKET BRIEFING ANNOUNCES NEW BUSINESS
AND LEGAL GUIDEBOOK ON UKRAINE
Released as Ukraine Stretches out Hand to Business
Business Wire, Thursday, Feb 03, 2005
Ukraine's newly-elected President Viktor Yushchenko made it plain to the
audience and media at the recent World Economic Forum in Davos that foreign
investment in Ukraine would find a good friend in the new government. "My
key objective in coming to Davos was to stretch out my hand to business,"
the Associated Press reported on 29 January. "It's extremely important to
ensure my hand doesn't hang unshaken."
After an historic and peaceful revolution, Ukraine is launching a new era.
With a GDP growth of just over 12% year-on-year reported in 2004, Ukraine,
one of the largest countries in Europe, now boasts one of the strongest GDP
growth rates among all transition economies and one of the best in the
world.
As Michael Maltzoff, Partner, Energy Standard Group, Kiev, Ukraine, wrote
recently in the Financial Times "One can already sense the changes to the
business climate in the country... We will now see massive investment. I
would encourage western business leaders to come here early."
Ukraine is open for business, and for western companies with little
knowledge of this important new European power, Doing Business with
Ukraine, published in January 2005 by Global Market Briefings, is
essential reading.
This authoritative new edition provides the expertise of top international
law firms, accountants, banks and consultants with first hand experience of
Ukraine. Contributors include: the American Chamber of Commerce in Ukraine,
KPMG, the law firm BC Toms & Co, Raiffeisen Bank, Munk, Andersen &
Feilberg, the International Finance Corporation, Ukrainian Mobile
Telecommunications and other businesses and experts with a detailed
knowledge of the country.
TOPICS COVERED INCLUDE: :
-- The climate for foreign investment and the background to the market
and market potential
-- Key industry and business sector profiles
-- The legal and regulatory framework
-- Finance and taxation
-- Business development: operating an enterprise
-- Investing in Ukraine's regions
Doing Business with Ukraine provides vital and informed insider information
for anyone wishing to learn about business conditions and opportunities in
Ukraine. It combines detailed analysis with practical advice. -0-
----------------------------------------------------------------------------
DOING BUSINESS WITH UKRAINE $150.00, 1 9050 5000 3, 476
pages, 6 1/4 x 9 1/2, PDF version also available. Global Market Briefings
Beatriz Ashfield, 215-928-9112 bca@solutionsforpublishers.com or Stylus
Publishing LLC Kogan Page, 800-232-0223, Fax: 703-661-1501
StylusMail@PressWarehouse.com
==========================================================
12. EXPERT SAYS UKRAINE TO CONTINUE MAINTAINING
RUSSIAN MISSILES BUILT IN UKRAINE
Interfax-AVN, Moscow, Russia, Tue, January 25, 2005
MOSCOW - The Russian-Ukrainian cooperation in rocket building will
continue in full scale, Vladimir Dvorkin, an expert on strategic weapons,
told Interfax-Military News Agency on Tuesday.
"I believe that Kyiv will go on implementing the agreement on keeping
Moscow's missiles, made in Ukraine, operational, and first of all the heavy
class," said Dvorkin, the former head of the 4th research and development
institute of the Russian Defense Ministry, involved into the research on
strategic missiles.
Commenting on media reports that close relations between NATO and
Ukraine will result in the degradation of Ukrainian rocket-building
industry, and that the enterprises of the industry would have to be either
converted or sold to the U.S. companies, he said: "It is premature to say
that the new Ukrainian leaders will grant Americans access to their
national missile technologies."
It was reported earlier that the Russian Strategic Missile Force will
establish closer relations with Ukrainian rocket-building companies.
"The government adopted a decision to allow closer cooperation of the
Strategic Missile Force with enterprises from Ukraine," force commander
Colonel General Nikolai Solovtsov told a news conference July 15, 2004
during the presentation of the book by Alexander Ryazhskikh, former
Strategic Missile Force deputy commander for armament, devoted to the
history of the force.
In response to a question from Interfax-AVN, Ryazhskikh said that the
cooperation of Russia and Ukraine in rocket-building is required to extend
assured life of strategic missiles in service with the Russian Strategic
Missile Force.
"Up to 40 percent of the enterprises that manufactured strategic missiles
in the USSR are left in Ukraine. It is next to impossible to extend assured
life of missiles without involving them into the process," he said.
According to him, a most important decision was made for the heavy Satan
ballistic missiles that will no longer be taken out of alert duty. It is
necessary to ensure close links with the Yuzhnoye design bureau in
Dnipropetrovsk in order to extend their assured life, he said, adding that
the Ukrainian enterprises will most likely provide maintenance and overhaul
of missiles at certain price. -30-
==========================================================
13. POLAND USING NEW BOOK TO PUSH ITS CLAIM TO LOOTED ART
Both Ukraine and Poland have said they own the drawings and want them back.
By Joe Milicia, AP Worldstream, Friday, Jan 28, 2005
Polish officials say that legal documents compiled in a new book bolster
their ownership claim of drawings by Renaissance master Albrecht Durer that
were looted by the Nazis during World War II. The 27 drawings were stolen
from the Ossolinski Institute in present-day Lviv, Ukraine, which was once
part of Poland, and sold on the international art market after the war
ended.
They are now owned by major museums and collections in the United States and
Europe, including the Metropolitan Museum of Art in New York, the Art
Institute of Chicago and the Nelson-Atkins Museum of Art in Kansas City,
Missouri. In 1952, the Cleveland Museum of Art bought two of the drawings:
"The Dead Christ" and "The Ascension." It purchased "Head of a Man in a Cap"
in 1963.
Harold Holzer, senior vice president for external affairs at the
Metropolitan, said Friday that the museum believes it acquired its two Durer
drawings in a fair manner, citing a 2001 ruling by a U.S. State Department
special envoy for Holocaust issues. But Holzer said the museum will examine
the book and revisit the issue.
"We believe that we owe our public and the people who took the pains to
assemble this document the courtesy of intelligent review to see if it sheds
any new light on this issue," Holzer said.
The Cleveland Museum issued a statement this week saying that it is
reviewing the book and "will respond appropriately."
The new book, "The Fate of the Lubomirski Durers," was published by the
Society of the Friends of the Ossolinski Institute with support from the
American Council of Polish Culture. "For the first time, all documents
related to the case were put together and translated from different
languages into plain English," Boguslaw Winid, deputy chief of the Polish
Embassy in Washington, said this week.
Winid said the documents, some dating back to the 19th century, track the
complicated history of the drawings, which were taken in 1941 from the
Ossolinski Institute in Lviv, which was then in Poland. After the war, the
U.S. military found the drawings in an Austrian salt mine and gave them to a
descendant of the original owner, Prince Heinrich Lubomirski, a wealthy
landowner. The descendant, Georg Lubomirski, sold them.
Polish scholars say documents in the new book show that the Ossolinski
Institute should have received the drawings, not Lubomirski. Questions about
their ownership involve the changing of national borders in Eastern Europe -
both Ukraine and Poland have said they own the drawings and want them
back.
Durer, who died in 1528 in his native Germany, combined the discoveries of
Italian painters with the tradition of his homeland in his works, which also
included engravings and paintings. Winid said he hopes the museums will
evaluate the book and reach a compromise with Poland. -30-
==========================================================
14. RETURN TO THE SOURCE:
10th Annual Folk Art and Culture Tour of Ukraine
Aug. 8-23, 2005, With Specialist Orysia Tracz.
Folk Art and Culture Tour of Ukraine, Orysia Tracz
Winnipeg, Manitoba Canada, Friday, February 4, 2005
10th annual tour. Museums, walking tours, lectures, artists, folk art,
shopping, traditional cuisine, Ukrainian hospitality. You don't have to
be Ukrainian to enjoy the trip. Interpreting into English at all times.
Places: Kyiv, Kaniv, Ternopil, Kam'ianets'-Podils'kyi, Kolomyia, Lviv,
Carpathian Mountains (Kosiv, Yaremche, other villages). Visits to
ancestral villages arranged. Opportunity to stay a week longer on your
own (accommodations) for the same cost. $3,650 Canadian. (includes
air, hotels, meals, museum admissions).
Connections from other North American and international cities arranged.
Limited number of participants. We have had travelers from across North
America, and Australia, and many repeat participants.
For reservations and details: Irena Zadravec, Thomas Cook - Regent
Travel, (204) 988-5100, sblair@thomascook.ca. For more information
re tour contact Orysia Tracz: dorohy@hotmail.com -30-
==========================================================
15. U.S. SAYS WTO DEAL WITH MOSCOW POSSIBLE IN 2005
By Josiane Kremer, Reuters, Zurich, Switzerland, Mon, Jan 31, 2005
ZURICH -- The United States and Russia could strike a deal this year
on Moscow's accession to the World Trade Organisation (WTO),
after making "excellent" progress in talks on Monday, the top U.S. trade
negotiator said.
Russia is the largest economy still outside the 148-country trade body, and
the United States and Japan are the only major powers yet to give their
approval to its membership.
The talks between U.S. Trade Representative Robert Zoellick and Russia's
Economy Minister German Gref, their first meeting in months, came some
three weeks before President George W. Bush and Russian President
Vladimir Putin hold a summit, with trade high on the agenda.
"We have had an excellent meeting today," Zoellick told journalists after
eight hours of talks, far longer than initially scheduled. "If we keep up
this momentum, we should be able to reach our bilateral agreement ... on
accession during the course of this year."
Gref was equally optimistic, saying that an agreement with the United
States should clear the way for Russia's accession to be approved by the
full WTO membership at a ministerial conference in Hong Kong in December.
"Once we have the negotiations with the U.S. completed ... we will have a
very good window of opportunity to get things done by December," he said.
Russia, which has been negotiating to join the Geneva-based body for a
decade, has already concluded bilateral deals with the European Union,
South Korea and a host of other WTO members.
INDIVIDUAL ACCORD
Entry to the WTO, which sets the rules for world trade, requires an
individual accord with any member that demands one, and negotiating a
separate overall deal with the full WTO.
The latter aims to ensure commercial rules and regulations in a candidate
country are in line with WTO practices.
Zoellick said that progress had been made on all outstanding issues, which
included differences between Moscow and Washington on farm trade,
industrial goods and services, particularly the banking and insurance
sectors. On industrial goods, Zoellick said there remained only a "small
number of issues" to resolve, including tariffs.
In banking and insurance, where the Russians were refusing to allow foreign
institutions to open branch networks, the U.S. official said the two sides
had moved "closer together," but he gave no details.
On farm issues, the two ministers agreed to set up a special group from
their agriculture and trade ministries to tackle the differences,
particularly in health regulations.
"We have been able to accelerate work across all the areas," said Zoellick,
who will shortly leave to take over as number two at the U.S. State
Department. "Both sides have a renewed sense of energy," he added.
The two ministers said there would be another ministerial meeting in March
or April, after negotiators from both sides had held a further round of
talks in Geneva later this month. -30-
==========================================================
16. GEOPOLITICALIZATION OF THE WORLD'S OIL AND GAS INDUSTRY
ECONOMIC NEWS UPDATE, By Irwin M. Stelzer
The Hudson Institute, Washington, D.C., 2 February 2005
Concentration on fluctuations in oil prices has detracted attention from the
fundamental changes that are occurring in world oil and gas markets. Start
with President Bush's inaugural address, in which he promised to support
democratic reformers in the Middle East.
"More foolish than brave," warn those who worry about the security of oil
supplies. The policy shift comes at a time when that dependence on imported
oil leaves the U.S. more vulnerable than ever to the changes that are
occurring in world energy markets. Increasingly powerful state-owned players
are putting America not only at an increasing economic disadvantage, but at
risk of losing a good deal of diplomatic leverage in Asia, Europe and the
Western hemisphere.
We are witnessing nothing less than the geopoliticalization of the world's
oil and gas industry. Governments rather than traditional commercial
enterprises are taking control. And those governments have interests quite
hostile to America's.
China is forging closer economic and political ties in the Middle East, and
not just because it needs more and more oil. Its rapidly increasing trade
with Iran is not the ordinary buying-and-selling of profit-driven companies.
China can and, according to reliable sources, does pay not only with cash
but with ballistic-missile components and components for nuclear weapons. A
new supply of oil and a chance to thumb its nose at the U.S. embargo is an
irresistible combination for this emerging superpower.
China is not confining the extension of its influence to the Middle East.
The Western Hemisphere is also in its sight. Canadian Prime Minister Paul
Martin came away from a visit to Beijing with an agreement to cooperate in a
wide variety of energy projects, including plans for a pipeline and ports
that would allow oil from Alberta's tar sands to move to Canada's West Coast
for export to China, rather than to the U.S., as American planners had
hoped.
And, as always, there was more to the deal than a mere commercial
transaction between consenting nations. According to their joint communiqué,
the Strategic Working Group set up by Canada and China, in what can only be
a shot at the U.S., "Canada and China share the view that the United Nations
and other multilateral institutions have an essential role to play in the
development of a peaceful, prosperous and sustainable world."
In Latin America, China is investing $100 billion in a series of energy
deals to extend its influence, and diminish that of the United States. Most
threatening is the $400 million investment in Venezuela's oil and gas
industry, strengthening the hand of Venezuelan president Hugo Chávez, a man
who says his country is under "a new U.S. imperialist attack." Flush with
Chinese cash, and emboldened by his new friendship, Chávez has suspended
operations of American companies ConocoPhillips, Harvest Oil, and Chevron
Texaco, hammering their shares.
Meanwhile, Vladimir Putin has been developing what Times columnist Roger
Boyes calls "a new policy instrument" to reassert Russian power. That
instrument is "the Russian gas and oil-exporting companies that already all
but dominate Europe's energy supplies.. Gazprom has woven a web of energy
dependencies from Turkey to Turkmenistan, from Berlin to Baku." According to
the International Energy Agency, by 2020 natural gas will account for 62% of
Europe's energy consumption and Russia will supply two-thirds of that gas.
This domination has more than commercial consequences. When Gerhard Schröder
told a television audience that Putin is a "dyed-in-the-wool-democrat," the
German chancellor was indicating that he is not prepared to bite the hand
that controls the valves of the pipelines that warm his country. Germany
already gets 35% of its oil and 40% of its gas from Russia, figures that
will steadily increase as Germany pursues its policy of winding down its
nuclear power industry.
Russia also plans to use its ample reserves of oil and gas to extend its
influence in Asia. It has agreed to allow Japan to finance an $11.5 billion
(some say $18 billion) oil pipeline from eastern Siberia to the Pacific,
from where crude oil can be transported to Japan and other Asian nations.
This was no mere commercial transaction: Japanese Prime Minister Junichiro
Koizumi led the lobbying team that persuaded Putin to select the route that
Japan favored. Putin is a man who knows how to accumulate IOUs.
Perhaps most important is Russia's use of oil to cement relations with
China. A few weeks ago Russian energy minister Viktor Krishtenko visited
Beijing, amid signs that Russian fuel is starting to warm historically
chilly Sino-Russian relations. Putin has offered China National Petroleum
Corporation a piece of Yukos, the Russian oil giant that produces 1% of the
world's crude oil, and effectively re-nationalized by slapping the company
with a bankrupting demand for back taxes. Since American companies would
have loved to have had a crack at an interest in Yukos, Putin's decision to
freeze them out is widely seen as an expression of his unhappiness with
American criticism of his power grabs, as well as an opportunity to cement
relations with China, with which Russia's Gazprom already has signed
agreements to cooperate in oil and gas markets.
So America finds that supplies from Canada, its largest supplier, and
Venezuela, which sells it the light, sweet crude oil that U.S. refineries
are best equipped to handle, will now be shared with China.
Meanwhile, Russia dominates the European energy market, giving Germany
and France still another reason to side with it in any dispute with the
United States, just as China can rely on Latin American countries that
benefit from billions of its investment dollars to give that fact some
weight in formulating their foreign policies.
Add the emerging relationship of China and Russia, and you have something
for American planners to worry about.
---------------------------------------------------------------------------
A version of this article appeared in The Sunday Times (London) and a longer
version was published in The Weekly Standard.
---------------------------------------------------------------------------
Irwin Stelzer is a Senior Fellow and Director of Economic Policy Studies for
Hudson Institute. He is also the U.S. economist and political columnist for
The Sunday Times (London) and The Courier Mail (Australia), a columnist for
The New York Post, and an honorary fellow of the Centre for Socio-Legal
Studies for Wolfson College at Oxford University.
==========================================================
17. UKRAINIAN BUSINESS WEEKLY NAMES DONETSK TYCOON
RINAT AKHMETOV ITS BUSINESSMAN OF THE YEAR
Article By Yevhen Dubohryz, "More-or-less Civilized"
Kontrakty web site, Kiev, in Russian 17 Jan 05; p 43
BBC Monitoring Service, UK, in English, Sun, Jan 30, 2005
A leading Ukrainian business paper has named the Donetsk-based tycoon
Rinat Akhmetov as its Man of the Year for 2004. In a profile it says that he
has deserved this title as he more than anyone personifies the trends in the
country's business world which have seen an improvement in its relations
with the state, and for the development of his System Capital Management
empire. The article ends with a list of SCM's business interests.
The following is the text of the article by Yevhen Dubohryz entitled
"More-or-less Civilized", published on the Kontrakty web site on 17 January;
subheadings have been inserted editorially:
Following deep-rooted traditions to decide which person has played the
biggest role in whatever field of activity - business, politics, arts and
literature - in the outgoing year, the journalists of the Oligarchic Studies
column decided to present their version of the Man of the Year 2004. We did
not quiz "experts", we did not compile ratings lists and we did not seek the
opinions of "business and related circles".
What we decided to do was to find the person who conformed to the most
visible trends in the country's business and political life, or not so much
conformed as individually set these trends and personified them - otherwise
there is a temptation to declare Businessman of the Year to be not Rinat
Akhmetov, but some hired manager, whose decisions may well play an important
role within the confines of his own private domain, but are merely a
derivative of the general mood that prevails in the world of big business.
GROWTH OF SCM
But why Akhmetov? One could make the point that, according to foreign media
estimates, Akhmetov is the wealthiest man in Ukraine. And the value of his
property grows every year as System Capital Management acquires its more
industrial assets. And it was only last year that SCM was established in its
present form. Its list of industrial acquisitions in 2004 is impressive -
last year the group acquired the North and Central ore enrichment works,
Skhidenerho [Eastern Energy], the Donetsk power plant and the distributor
Servis-Interest, Kryvorizhstal [Kryvyy Rih steelworks], Pavlohradvuhillya
[Pavlohrad coal] and Krasnodonvuhillya [Krasnodon coal]. And these are just
its public purchases - one can only guess what it has acquired behind the
scenes.
Incidentally, Akhmetov has also prospered in his role as a "pure" manager.
How, for example, other than by Mr Akhmetov's inspirational activity, can
one describe the unanimity of the directors of enterprises situated in
System Capital Management's orbit, in support of [defeated former Prime
Minister] Viktor Yanukovych after the second invalidated round [of the
election]?
It is hard to believe that Akhmetov personally rushed to Kryvyy Rih (Central
ore enrichment works and Kryvorizhstal), Mariupol (Azovstal and Azovmash)
and Kramatorsk (Novokramatorsk machine-building works) just to issue the
necessary instructions to the works teams of these enterprises. And that
means the phenomenon of the coordinated support for the former prime
minister cannot be explained other than by mystical power (or a desire of
the works' management to oblige their boss).
Which in itself speaks well of Akhmetov, who is feared as much as he is
revered and revered as much as he is feared. Furthermore, Rinat Akhmetov is
worthy of respect if only because, unlike other individual leading Ukrainian
businessmen (who in the summer in public interviews were enraptured by
Viktor Yanukovych, but after the invalidated second round soon turned into
faithful supporters of [President-elect Viktor] Yushchenko), he did not flee
the premier's ship.
STATE-BUSINESS RELATIONS MORE TRANSPARENT
But it was not these criteria which were determinant, but something quite
different. However paradoxical it may seem at first glance, last year was a
year of development for business, especially big business, and above all
this was evolutionary development. While politicians from the opposition and
from the authorities were fighting fierce battles for the president's chair,
relations between big business and the state structures continued to develop
pretty much as under the laws of peace time.
Although the really significant talks between the state and the business
world were for the most part held behind the scenes, the results of such
talks, unlike in previous years, at least reached the public domain. And the
privatisation of industrial facilities is conducted less and less for
bribes, and more and more often for bribes plus cash which reaches the state
treasury via the State Property Fund. It stands to reason that this is not
good enough for a civilized state (by which is implied a system built
according to the templates of ageing west European economies), but it is
quite a bit for a post-Soviet, transitional economy.
Akhmetov, by his own actions, private acquisitions and rare statements,
blends with this system almost ideally. Judge for yourself - in the past, if
one wanted to find out about deals completed by the top Donetsk
financial-industrial group, one had to learn by roundabout means from shrewd
journalists and individuals who had a direct vested interest in making such
information public. Now, the slightest degree big acquisition by SCM is
accompanied by official permission from the Antimonopoly Committee and a
report in the media.
The money going into the state purse for state enterprises purchased by
Akhmetov's empire is meticulously checked and in full measure. The fact that
Kryvorizhstal in reality could have gone for a much bigger sum than the
804bn dollars [as published, presumably should be 808m dollars] which was
paid Akhmetov does not consider a blow to his reputation - he himself has
said that the cost of a business is equal to the sum which you are prepared
to pay for that business. And it is hard to disagree with this. Moreover,
now Akhmetov does not hide the fact he is ready to pay more for the biggest
steel works in the country. And, you know, for any businessman it is not
easy to admit ones defeats in public, especially those which could stretch
for a round figure.
AKHMETOV OPENS OUT
It is worth adding a word or two about publicity - things that every manager
and property owner needs if only because the country has to know its heroes
in order to avoid demonising them unnecessarily. Last year Akhmetov finally
began to show himself in public (in other words, talk to the media) not only
as president of Shakhtar Football Club, but also as a businessman who has
his own view of the country's politics and economy. Of course, to contact
him directly is very difficult for a journalist who is not a correspondent
of the British Financial Times or his favourite TRK Ukrayina television
channel, but you know, even that is progress.
On the whole Akhmetov-2004 sees himself as a man with ambitions, but one
who operates to his own, quite high, potential and without any unnecessary
fanaticism. When matters allow - his SCM empire expands, and when they
do not - it is a time for talks, not wars. In either event he can get by
without public scandals - a successful property owner knows how to lose.
However, not much is known about Akhmetov's losses, and will hardly be
heard in the near future, either. He is not that sort of man. And it is not
that kind of year.
SCM'S HOLDINGS
The major companies which come within System Capital Management's sphere
of influence are: Kryvorizhstal, Azovstal [Azov steelworks], Yenakiyeve
steelworks, Khartsyzsk pipe plant, Northern ore enrichment works, Central
ore enrichment works, Azovmash [Azov machinery] (jointly with Vizavi),
Druzhkivka machine-building plant (jointly with IUD [Industrial Union of
Donbass]), Novhorod machine-building plant (jointly with IUD), Avdiyivka
coke-chemical plant, Markokhim [Mariupol coke-chemical], Donetsk
coke-chemical plant, Druzhkivka ore, Dongorbank [Donetsk City Bank], First
Ukrainian International Bank (FUIB), Skhidenerho [Eastern Energy],
Servis-Invest (together with Ukrpidshypnyk [Ukrainian bearing]), Donetsk
energy plant, Pavlohradvuhillya, Krasnodonvuhillya, ARS close joint-stock
company, Digital mobile phone works (DCC) closed joint-stock company,
Ukrvuhlemash [Ukrainian mining machinery] concern, Ukrainian industrial
transport company (together with Vizavi), Sarmat brewery, Donbass Palace
Hotel, Ekometan (together with IUD and Ukrpidshypnyk), Hefest and Shakhtar
Football Club. -30- [The Action Ukraine Report Monitoring Service]
==========================================================
"THE ACTION UKRAINE REPORT"
ARTICLES ARE FOR PERSONAL AND ACADEMIC USE ONLY
Articles are Distributed For Information, Research, Education
Discussion and Personal Purposes Only
==========================================================
UKRAINE INFORMATION WEBSITE: http://www.ArtUkraine.com
==========================================================
"THE ACTION UKRAINE REPORT" - SPONSORS
"Working to Secure Ukraine's Future"
1. THE BLEYZER FOUNDATION, Dr. Edilberto Segura, Chairman;
Victor Gekker, Executive Director, Kyiv, Ukraine; Washington, D.C.,
http://www.bleyzerfoundation.com.
2. BAHRIANY FOUNDATION, INC., Dr. Anatol Lysyj, Chairman,
Minneapolis, Minnesota,
3. KIEV-ATLANTIC GROUP, David and Tamara Sweere, Daniel
Sweere, Kyiv and Myronivka, Ukraine, 380 44 295 7275 in Kyiv.
4. ODUM- Association of American Youth of Ukrainian Descent,
Minnesota Chapter, Natalia Yarr, Chairperson.
5. ACTION UKRAINE COALITION: Washington, D.C.,
A. UKRAINIAN FEDERATION OF AMERICA (UFA),
Zenia Chernyk, Chairperson; Vera M. Andryczyk, President;
Huntingdon Valley, Pennsylvania.
B. UKRAINIAN AMERICAN COORDINATING COUNCIL,
(UACC), Ihor Gawdiak, President, Washington, D.C., New York, NY
C. U.S.-UKRAINE FOUNDATION (USUF), Nadia Komarnyckyj
McConnell, President, Washington, D.C., Kyiv, Ukraine.
6. UKRAINE-U.S. BUSINESS COUNCIL, Washington, D.C.
7. ESTRON CORPORATION, Grain Export Terminal Facility &
Oilseed Crushing Plant, Ilvichevsk, Ukraine
========================================================
"THE ACTION UKRAINE REPORT" is an in-depth news and
analysis international newsletter, produced as a free public service by
the www.ArtUkraine.com Information Service and The Action Ukraine
Report Monitoring Service The report is distributed around the world
FREE of charge using the e-mail address: ArtUkraine.com@starpower.net.
If you would like to read "THE ACTION UKRAINE REPORT" please
send your name, country of residence, and e-mail contact information to
morganw@patriot.net. Additional names are welcome. If you do not wish to
read "THE ACTION UKRAINE REPORT" around five times per
week, let us know by e-mail to morganw@patriot.net.
========================================================
PUBLISHER AND EDITOR
Mr. E. Morgan Williams, Director, Government Affairs
Washington Office, SigmaBleyzer Investment Banking Group
P.O. Box 2607, Washington, D.C. 20013, Tel: 202 437 4707
morganw@patriot.net, www.SigmaBleyzer.com
----------------------------------------------------------------------------
Senior Advisor; Ukrainian Federation of America (UFA)
Coordinator, Action Ukraine Coalition (AUC)
Senior Advisor, U.S.-Ukraine Foundation (USUF)
Advisor, Ukraine-U.S. Business Council, Washington, D.C.
Publisher, Ukraine Information Website, www.ArtUkraine.com
========================================================