US-Ukraine Business Council

"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"

PRESIDENT YUSHCHENKO SPEAKS OUT STRONGLY IN DONETSK

"I do not like the fact that 50 per cent of Ukraine's economy and two-thirds
of Donetsk's economy is in the shadow. It gives 7.7 per cent to the budget.
Please take back this 7.7 per cent. What can we do with it? How can one
look in the eyes of an invalid, a soldier, a doctor or a teacher? They are
treating our children. They are not treating or teaching the children of
some other nation. We do not want this country to be, excuse me, a
country of morons.

We want it to be a European nation. What salaries do they have? We are
humiliating our teachers and doctors. Their salaries are not European, my
friends. What salary does a teacher need to live decently? The one he is
getting today? I think that many people sitting in the audience cannot live
for 10 days on the [monthly] salary of our teachers or doctors. If we agree
to decrease the share of the shadow economy by at least 50 per cent in one
of Ukraine's criminal regions, and other regions which have about 15 to 20
per cent of the shadow economy follow suit, we can double the national
budget. Let us talk about this." [article one]

"THE ACTION UKRAINE REPORT" - Number 428
morganw@patriot.net, ArtUkraine.com@starpower.net
Washington, D.C. and Kyiv, Ukraine, FRIDAY, February 11, 2005

-----INDEX OF ARTICLES-----
"Major International News Headlines and Articles"

1. PRESIDENT YUSHCHENKO DELIVERS STRONGLY-WORDED
SPEECH TO LOCAL OFFICIALS IN DONETSK
Two-thirds of the economy is in the shadow
Ukrayina TV, Donetsk, in Russian 1900 gmt 10 Feb 05
BBC Monitoring Service, UK, in English, Thu, Feb 10, 2005

2. UKRAINIAN PRESIDENT MEETS WITH LESYA GONGADZE,
MOTHER OF MURDERED JOURNALIST
TV 5 Kanal, Kiev, in Ukrainian 1500 gmt 10 Feb 05
BBC Monitoring Service, UK, in English, Thu, February 10, 2005

3. YUSHCHENKO TO REVISE SOME EDUCATIONAL PROGRAMS
Revise the description of the events of the 1932-1933 famine
"We should say more honestly what it was."
Ukrainian News Agency, Kyiv, Ukraine, Wed, February 9, 2005

4. YUSHCHENKO PROPOSES THAT KYIV SUBMIT PROPOSALS TO
PAY TRIBUTE TO THE MEMORY OF 1932-1933 FAMINE VICTIMS
Where is the famine museum? Where is the monument to famine?
President wants 9,000 snowball trees planted in Kyiv
Subject of famine has been covered insufficiently
Ukrainian News Agency, Kyiv, Ukraine, Tue, February 8, 2005

5. PRESIDENT YUSHCHENKO CALLING FOR CREATION OF A
COMPETITIVE ENVIRONMENT IN MASS MEDIA
Ukrainian News Agency, Kyiv, Ukraine, Wed, February 9, 2005

6. PRESIDENT YUSHCHENKO PROPOSING THAT KYIV CREATE
A NEW NATIONAL UKRAINIAN HERITAGE MUSEUM
Museum to be located in the Arsenal factory
Ukrainian News Agency, Kyiv, Ukraine, Tue, February 8, 2005

7. PRES PROPOSES AMNESTY ON ILLEGALLY GAINED CAPITAL
Associated Press, Kiev, Ukraine, Tuesday, Feb 8, 2005

8. VIKTOR YUSHCHENKO AND CHAIRMAN OF CONSTITUTIONAL,
SUPREME AND HIGH BUSINESS COURTS DISCUSS JUDICIAL REFORM
"We must restore independence of the judiciary branch
of power, status, respect and lawfulness."
Ukrainian News Agency, Kyiv, Ukraine, Wed, February 9, 2005

9. UKRAINE: NEW REGIONAL GOVERNOR RESIGNS
SHORTLY AFTER APPOINTMENT
Openly backed Viktor Yanukovych for president
UNIAN news agency, Kiev, in Ukrainian 1630 gmt 9 Feb 05
BBC Monitoring Service, UK, in English, February 9, 2005

10. YUSHCHENKO ORDERS FENCE AROUND PRESIDENT'S
SECRETARIAT REMOVED
Ukrainian News Agency, Kyiv, Ukraine, February 7, 2005

11. YUSHCHENKO APPOINTS POROSHENKO AS NSDC SECRETARY
Ukrainian News Agency, Kyiv, Ukraine, Tue, Feb 8, 2005

12. YUSHCHENKO READY TO SIGN AGREEMENT WITH
JOURNALISTS ON NON-INTERFERENCE IN THEIR WORK
Ukrainian News Agency, Kyiv, Ukraine, Mon, February 7, 2005

13. YUSHCHENKO EQUIDISTANCES THE SPECIAL SERVICES
By Andrey Chernikov, Kiev; Gennady Sysoev
Kommersant, Moscow, Russia, Wed, February 9, 2005

14. "THIS IS YUSHCHENKO'S GOVERNMENT"
Interview with Mykola Tomenko, Deputy Prime
Minister for Humanitarian Policy
Interviewed by Maryana Oliynyk, The Day
The Day Weekly Digest in English
Kyiv, Ukraine, Tuesday, Febraury 8, 2005

15. YUSHCHENKO VS. PUTIN
Soviet heirs
OP-ED by Anders Aslund, International Herald Tribune (IHT)
Europe, Thursday, February 10, 2005

16. PROFOUND GENERATION SHIFT
FOLLOWS UKRAINE'S ORANGE REVOLUTION
By Taras Kuzio, Eurasia Daily Monitor
Volume 2, Issue 28, The Jamestown Foundation
Washington, D.C., Wednesday, February 9, 2005

17. YUSHCHENKO'S INSTRUCTIONS TO THE SECURITY SERVICE
----- Original Message -----
From: George Woloshyn
To: morganw@patriot.net ; ArtUkraine.com@starpower.net
Sent: Tuesday, February 08, 2005 7:56 PM
Subject: Letter to the Editor, The Action Ukraine Report
=========================================================
1. PRESIDENT YUSHCHENKO DELIVERS STRONGLY-WORDED
SPEECH TO LOCAL OFFICIALS IN DONETSK
Two-thirds of the economy is in the shadow

Ukrayina TV, Donetsk, in Russian 1900 gmt 10 Feb 05
BBC Monitoring Service, UK, in English, Thu, Feb 10, 2005

DONETSK - Ukrainian President Viktor Yushchenko has paid a visit to the
industrial city of Donetsk in eastern Ukraine, which voted overwhelmingly
for his rival, former Prime Minister Viktor Yanukovych, in the election. He
delivered a strongly-worded speech to an audience of local officials, saying
that Donetsk is one of the most corrupt regions in Ukraine with two-thirds
of its economy in the shadow. Yushchenko vowed to stamp out corruption
and review dubious privatization deals. He also said that those who made
separatist calls and put up billboards portraying him as a Nazi during the
election campaign will be punished.

The following is an excerpt from a report by the Ukrainian regional TV
channel Ukrayina on 10 February; subheadings have been inserted editorially:
[Presenter] Viktor Yushchenko is in Donetsk. [Passage omitted: Presenter
sums up the main events during the visit]

[Yushchenko, in Ukrainian throughout] I will tell you what I do not like. I
will tell you where I will put all my effort in order not to let it happen
ever again. Not in this land or in Ukraine. I do not like criminal
authorities. I give you my word, there will be no more suitcases or plastic
bags full of money coming to Kiev from Donetsk. [Applause]

CORRUPTION, SHADOW ECONOMY

I do not want to see corrupt authorities. I do not want to know how much
Donetsk's police chief costs to bribe. Because you will not pay this price
to anyone. The police chief will serve these millions of people, oppressed
people. There will be no other way.

I do not like the fact that 50 per cent of Ukraine's economy and two-thirds
of Donetsk's economy is in the shadow. It gives 7.7 per cent to the budget.
Please take back this 7.7 per cent. What can we do with it? How can one
look in the eyes of an invalid, a soldier, a doctor or a teacher? They are
treating our children. They are not treating or teaching the children of
some other nation. We do not want this country to be, excuse me, a country
of morons.

We have many generals sitting here. We obviously have the SBU [Security
Service of Ukraine] here, surveillance, bugs planted here, right? Friends,
these are public servants. Look at what you have done to this land. Hasn't
you been getting your salary over the past three years? Haven't the state
given you its last money? To maintain your troops. The tax service, the SBU,
the police. Where are you? Where are you with your service? Why have you
forgotten your oath?

I am sorry, but I am not sitting in front of you with the face of Viktor
Yushchenko. This is not my face. I am not used to it and I will never get
used to it. [referring to the poisoning which left his face disfigured] But
I wanted to tell you too. Either you have your officers' honour, protect
this country to the last drop, as the oath says, or you go work as gang
masters to criminal bosses. [Passage omitted: More on shadow economy.]

ELECTION CAMPAIGN MYTHS

I know that criminal schemes had been developed for many years. And we
are touching the interests of many people. But I simply swear to you that
soon you will see a different Donbass. Thanks to the Donetsk authorities,
including those sitting in the audience here, the ones who are not
applauding, I did not have an opportunity to address the people as
presidential candidate. Some people here were spreading a philosophy of
Yushchenko the fascist, a Nazi. They told you that the person sitting in
front of you is not spiritual, that he will close down the churches of
Moscow Patriarchate.

This person does not represent the philosophy of the third millennium.
Because he will close down Russian schools and Russian kindergartens. He
will force everyone to speak Ukrainian. Because this person allegedly does
not understand our national interests and is dragging the country to the
West. While the other side is moderate, balanced, and proposing other ways.
I will not dwell on dozens of other pathologies, foolishness, myths and
legends. But I want to answer some of them, so that you can hear it straight
from the horse's mouth.

Let us start from fascists. I remember how Donetsk met me in October.
[Asks assistants] Was it in 2003? [A male voice answering] Yes.

[Yushchenko] With placards and Nazi uniforms. I am asking the region's top
officials who ordered those placards. Who hung them up? But you are serious
people! How dare you hung SS symbols in a city, twice awarded with the
Lenin medal, in the third millennium? What guided you then? If you are sure
that I am like that, stand up and speak facts in public. But if you have no
facts,

I will do everything to make you apologize and be punished for this.
[Applause in the audience]

[Yushchenko] I am sensitive to this issue. I do not want to forgive this.
Because my father spent four years in Buchenwald and Dachau and eight
months in Auschwitz for you. [Passage omitted: Yushchenko says he will
speak about the mining sector.]

DONBASS ECONOMY NEEDS CHANGE

Where do I think the government should intervene on this market today? This
is the problem of monopolies on this market. Because of the monopolies and
intermediaries, prices of ore and coke are artificially increased by 30-80
per cent. What would I like to say to the local authorities? Friends, there
are two methods to regulate prices. Either a state committee for prices
[which existed in the Soviet Union] or competition. There is no other
option. If we speak about competition, then several participants having
equal rights should work on this market in order to keep prices down. Only
this way can we tackle the problem of wholesale inflation.

Certain structures are openly blackmailing their competitors by not
supplying raw materials. Because of this we lost 500,000 tonnes of steel
last year. Because of this. Also, products are often sold to domestic
consumers at prices 10-15 per cent higher than for export. I have a
question. Does the Antimonopoly Committee work here or not? There is
one. And there is a bloke there who manages this issue. [Voices from the
audience.]

[Yushchenko] This is the first issue that we should solve. I think that this
is also due to the previous government's miscalculations regarding the
hurried privatization of the Ukrrudprom [state ore industry] state
joint-stock company. We are returning to this issue and we will raise the
issue of Ukrrudprom.

Then the fuel and energy complex. Donetsk Region is the leader in debts for
electricity. Donetsk Region accounts for 24 per cent of all Ukrainian debts.
[Passage omitted: Yushchenko urges Donetsk Region to pay for electricity.]

A couple of days ago we appointed a new minister. I want to tell you that
nobody will take electricity for free. This is my philosophy. I will demand
that every minister, every [regional] administration head make so that there
should be no kolkhoz, nothing for free. Learn to be responsible. [A voice
from the audience] Say who does not pay! This is inadmissible.

[Yushchenko] Excuse me, why do you behave like that? Why do you behave
like that? Mind that the president talks to you, not a herdsman for geese.
My task now is to explain to you that you have to say who does not pay here.
I have a brief note here. If you need details, I will return to Kiev and
look
into details. But I do not think this is my job. No president in Europe
tackles power engineering.

But because of you the Ukrainian presidents have been tackling power
engineering since 1990. This is because 24 [free economic] zones are
functioning, from which no single kopeck goes to the budget. [Passage
omitted: more on this, speaks about Donetsk regional economy, says local
power engineering is strong]

I would like to instruct the head of the administration, who I will
introduce, and the new energy minister, that, boys, let us stop this
fornication. I give 60 days for this and I will ask you to personally report
on this.

On investment. I can say that investors are afraid of Donetsk. The
investment figure for nine months, capital growth, is 25 per cent. But this
is one third less than across Ukraine.

Donbass is the energy heart of Ukraine, the mining heart of Ukraine. We have
unique industrial capacities here and, and having such unique possibilities,
to have the speed of capital growth, of its investment part, at two thirds
of any other region, starting from Chernihiv and Sumy, is absolutely
unnatural. Absolutely. This region should lead in this indicator, it should
show the best trends, because there is something to invest in here. But it
is interesting that there is no foreign investment at all in half of Donetsk
Region's towns. [A long pause]

Hopes for the special economic zone and development zones have been in vain.
Seventy-five per cent fewer jobs were created in 2004 than during previous
years. [Pause] Friends, there are 170,000 unemployed people in the region.
[Passage omitted: more on the same]

SEPARATISTS WILL BE PUNISHED, PRIVATIZATION REVIEWED

My main message which I brought here, to this absolutely Ukrainian land, is
that pathological ideas of sick people about separatism or federalism will
not have a future. I promise you that. This is not a joke. These people will
be held accountable. I will live to see these people tried in court for that
nonsense which they brought into Ukrainian society.

Privatization. Dear friends, this should not be a secret to you that we will
re-examine every case of improper privatization. Nothing will stop me. This

will be a government programme concerning the privatized companies. We
will check whether conditions of privatization were met. Beginning with the
tender conditions, public, transparent and fair, who they attracted, who
they did not attract. Illegal privatization deals will be overturned in
accordance with the law. Then we will have new public tenders and sell
these assets. This will be the basis of our state policy.

If the state policy says that Ukrtelekom [state telecom monopoly] or the
Kryvorizhstal steelworks should be left in state ownership and bring 3bn
[hryvnyas, 566m dollars] to the state budget every year, this can be a state
policy. I am telling this in detail because Donetsk Region launched this
scheme of preferential privatization of any companies. It is said that the
state had lost 300m hryvnyas on the sale of the Dniprovskyy steelworks.

This is not right, analysts can say this figure is at least 300m. I am
convinced that the state had lost maybe 15bn hryvnyas or more on the
sale of Kryvorizhstal. In seven months we will prove to you that it is so.

It is said that the state had lost 1.5bn on the sale of Ukrrudprom. This is
privatization. But even that is not correct. You understand that this should
be multiplied by three or five and then you will have the right price. There
are about 150-200 of such companies, which are strategic assets of big
privatization. Do you know why it happened so? Because they were protected.

Who protected them? The authorities, first of all at the local level, the
SBU, the police and the tax administration. Do you understand that 50 per
cent of Ukraine's shadow economy was organized by the authorities? Or
do you not understand?

That is why I want to say one thing. The people who want to work in the
government must be separate from business. You are wise people, you want
to live honest lives. I am saying this to raise you from your knees. So that
you can feel that you have power, that we can change this, that it is better
to live honestly in freedom than to live in prison, even as a convict boss.

It is much better to live in freedom, to live honestly. [Passage omitted:
Yushchenko introduces the new Donetsk governor, Vadym Chuprun, says
he is an honest man.] -30- [Action Ukraine Report Monitoring Service]
==========================================================
2. UKRAINIAN PRESIDENT MEETS WITH LESYA GONGADZE,
MOTHER OF MURDERED JOURNALIST

TV 5 Kanal, Kiev, in Ukrainian 1500 gmt 10 Feb 05
BBC Monitoring Service, UK, in English, Thu, February 10, 2005

KIEV - [Presenter] The mother of murdered journalist Heorhiy Gongadze has
met [President] Viktor Yushchenko in his residence in Kiev on his request.

Lesya Gongadze explained to the president why she wants a repeat forensic
test on the corpse [believed to be her son's] and why she wants to sue the
Prosecutor-General's Office over its inaction. Lesya Gongadze said she hoped
that the meeting would speed up the investigation of her son's death.

[Lesya Gongadze] He is a very kind, warm-hearted person. He took my
documents, listened to me and understood what I need and what I want. He
said he would do everything in his power to bring [the investigation of] our
case to a conclusion. [Gongadze went missing in 2000.] -30-
==========================================================
3. YUSHCHENKO TO REVISE SOME EDUCATIONAL PROGRAMS
Revise the description of the events of the 1932-1933 famine
"We should say more honestly what it was."

Ukrainian News Agency, Kyiv, Ukraine, Wed, February 9, 2005

KYIV - President Viktor Yuschenko intends to revise some educational
programs and initiate amendments to them. He disclosed this to reporters in
Zhytomyr. Particularly, the President said, he will initiate amendments to
the program of secondary schools. The President said he knows the
positions of many experts who have a lot of proposals in this field.

In Yuschenko's opinion, it is necessary to make some amendments to the
school program for the history of Ukraine. Particularly, it is necessary to
revise the approach to the description of the events of the 1932-1933
famine. "We should say more honestly what it was," Yuschenko said.

As Ukrainian News reported, 51.1% of respondents polled by the Ukrainian
Center for Political and Economic Studies named after Oleksandr Razumkov on
September 9-14, 2004 said the number of educated Ukrainians had fallen since
the year Ukraine gained its independence. 45.5% said the system of education
had deteriorated over the years of independence. The Razumkov Center polled
2,012 people aged over 18. The statistical margin of error is 2.3%.
==========================================================
4. YUSHCHENKO PROPOSES THAT KYIV SUBMIT PROPOSALS TO
PAY TRIBUTE TO THE MEMORY OF 1932-1933 FAMINE VICTIMS
Where is the famine museum? Where is the monument to famine?
President wants 9,000 snowball trees planted in Kyiv
Subject of famine has been covered insufficiently

Ukrainian News Agency, Kyiv, Ukraine, Tue, February 8, 2005

KYIV - Ukrainian President Viktor Yuschenko proposes that the Kyiv city
state administration and the Kyiv city council submit proposals for paying
tribute to the memory of the victims of famine in Ukraine in 1932-33. He
expressed this idea, addressing the municipal administration on February 8.
"I am saying this for you to feel that this is our duty," Yuschenko said.

He said that now, in his opinion, the subject of famine is covered
insufficiently. "Where is the famine museum? Where is the monument to
famine?.. When will we order a film on the famine, a drama or feature
film?.. I am waiting for the capital to make its say on the famine issue,"
Yuschenko stressed.

He proposed that snowball trees be planted on one of Kyiv's hills in memory
of the famine. "It seems to me that one of the hills may be planted with
snowball trees... There may be 8,000 or 9,000 of them," Yuschenko said.

As Ukrainian News reported, the Kyiv city state administration extended
UAH 6 million for the creation of a memorial complex to famine and political
repression victims. The complex, including a scientific research center and
a museum, will open in the reconstructed uninhabited building at 4b
Triokhsviatytelska Street.

As a result of the 1932-1933 famine, according to different estimates, from
three to seven million people perished. -30-
==========================================================
5. PRESIDENT YUSHCHENKO CALLING FOR CREATION OF A
COMPETITIVE ENVIRONMENT IN MASS MEDIA

Ukrainian News Agency, Kyiv, Ukraine, Wed, February 9, 2005

KYIV - President Viktor Yuschenko is calling for the formation of
competitive environment in the mass media. He said this to journalists in
Zhytomyr. "The mass media system must receive competitive environment,"
Yuschenko said. In his words, it is inadmissible when the majority of the
media are controlled by two or three families. He noted that a concept is
being prepared for reform of the mass media system.

The President said that this is a competence of Deputy Prime Minister for
Humanitarian Issues Mykola Tomenko. The President approves the idea of
creating Public Broadcasting. At the same time, he believes it necessary to
preserve the First and the Second TV channels. "We must not lose the First
and the Second channels," Yuschenko said. As Ukrainian News reported,
Tomenko says it is necessary to reduce the financing of the mass media from
the budget.

On January 20, the Public Council for the Freedom of Speech and Information,
the Independent Association of Television and Radio Broadcasters, the
Institute of Politics, the Telekrytyka nongovernmental organization, the
Academy of Ukrainian Press, the Rivnist Mozhlyvostei (Equality of
Opportunities) committee, and the Kyiv Independent Media Trade Union
created the Public Broadcasting coalition to facilitate the creation of
public television and radio, as well as public control over the process.

Yuschenko said during his presidential election campaign in November 2004
that he intended to support the creation of Public television if elected the
President of Ukraine. -30- [The Action Ukraine Report Monitoring Service]
==========================================================
6. PRESIDENT YUSHCHENKO PROPOSING THAT KYIV CREATE
A NEW NATIONAL UKRAINIAN HERITAGE MUSEUM
Museum to be located in the Arsenal factory

Ukrainian News Agency, Kyiv, Ukraine, Tue, February 8, 2005

KYIV - President Viktor Yuschenko has proposed that the Kyiv municipal
administration and the Kyiv municipal council develop the idea of creating a
[new national] museum that would serve as [a new depository of] the national
heritage. Yuschenko made the proposal in an address at the Kyiv municipal
administration.

"I am confident that we will strengthen the issue of the national heritage,"
Yuschenko said. He expressed the belief that numerous exponents [historical
artifacts] that are stored in museum warehouses could be better used.

Yuschenko also proposed that such a museum be located in the Arsenal
factory, which is located in front of Kyiv's Pechersk Cathedral. "We need to
do everything, friends, to ensure that the factory Arsenal-2 ... becomes a
national museum," Yuschenko said.

He also expressed the view that the Kyiv authorities should reach a decision
on the existence of exhibition halls on Instytutska Street as well as on the
construction of the Desiatynna Church. "I would very much like unity around
these facilities, and not disunity," Yuschenko said.

As Ukrainian News earlier reported, Yuschenko re-appointed Oleksandr
Omelchenko as chairman of the Kyiv municipal administration on February 4.
============================================================
7. UKRAINE PRES PROPOSES AMNESTY ON ILLEGALLY GAINED CAPITAL

Associated Press, Kiev, Ukraine, Tuesday, Feb 8, 2005

KIEV (AP)--Ukraine 's President Viktor Yushchenko on Tuesday proposed
an amnesty on illegally acquired capital as part of a crackdown on the
nation's large shadow economy that has robbed government coffers of much
needed funds.

Many Ukrainian businesses downplay their profits and pay employees under
the table, while Ukrainians hide their earnings to avoid taxes. The
wealthiest often keep their savings in overseas bank accounts beyond the
authorities' reach.

"We are prepared to enter into a capital amnesty and a fiscal amnesty, in
exchange for bringing the economy into the light," Yushchenko said while
reappointing Oleksandr Omelchenko to be governor of the wealthy Kiev
region, the Interfax news agency reported. He didn't provide further
details.

Ukraine 's new government is desperate to fill a predicted 32 billion hryvna
($1=UAH5.52700) deficit in this year's budget. Yushchenko's team has
blamed a series of populist measures, such as a one-time increase in
pensions, that former President Leonid Kuchma's government used to try
to woo voters ahead of last year's presidential election.

Among the steps being considered to top up government coffers is the
re-privatization of some state-owned enterprises that were sold off for
cheap prices, often to businessmen close to the government.

Vyacheslav Astapov, spokesman for the Prosecutor General's office, said
that all regional prosecutors are currently conducting checks of the
legality of big, post-Soviet privatization deals. The regional prosecutors
have until Monday to report back to Kiev, and the results will be passed
on to the Cabinet of Ministers. "They will be focusing on the biggest
enterprises, the big deals, checking their legality," Astapov said.

Prime Minister Yulia Tymoshenko announced last weekend that the govern-
ment plans to reverse the sale of a massive steel mill that was bought cheap
by a consortium involving Kuchma's son-in-law.

Many Ukrainians consider the deal one of the most corrupt of this nation's
post-Soviet privatizations. Analysts said if the mill - one of the world's
most profitable - is put up for a transparent resale, open to foreign
bidders, the government might receive more than double the $800 million it
sold the mill for last year.

Investment bankers have urged the new government to proceed carefully as
it takes another look at privatization to avoid creating the impression that
it is on a witch hunt against supporters of the former government. -30-
==========================================================
8. VIKTOR YUSHCHENKO AND CHAIRMAN OF CONSTITUTIONAL,
SUPREME AND HIGH BUSINESS COURTS DISCUSS JUDICIAL REFORM
"We must restore independence of the judiciary branch
of power, status, respect and lawfulness."

Ukrainian News Agency, Kyiv, Ukraine, Wed, February 9, 2005

KYIV - President Viktor Yuschenko have met with the chairman of the
Constitutional Court Mykola Selivon, Supreme Court Vasyl Maliarenko and
High Business Court Dmytro Prytyka to discuss judicial reform. Ukrainian
News learned this from the press service of Yuschenko.

"We have to restore everything that have been lost in recent years. That is,
independence of the judiciary branch of power, status, respect and
lawfulness," the President said at the meeting. He informed the judges about
his visit to the Korosten penal colony on Tuesday during the tour around
Zhytomyr region.

Yuschenko said the Ukrainian penalty system does not meet European standards
and the judges agreed that it requires reformation. Selivon suggested
reviewing penalty measures provided for in the Criminal Code. He said the
penalty must be as severe as the crime and there should be no long-term
sentence for petty offence. The officials also tackled the problem of high
tuberculosis rate at penalty institutions.

As Ukrainian News earlier reported, Yuschenko left for Zhytomyr on Tuesday
to introduce there a new governor of the region, Pavlo Zhebrivskyi. During
the trip he visited a penal colony in Korosten and talked to its
administrators and convicts. [Action Ukraine Report Monitoring Service]
==========================================================
9. UKRAINE: NEW REGIONAL GOVERNOR RESIGNS
SHORTLY AFTER APPOINTMENT
Openly backed Viktor Yanukovych for president

UNIAN news agency, Kiev, in Ukrainian 1630 gmt 9 Feb 05
BBC Monitoring Service, UK, in English, February 9, 2005

KIEV - Ukrainian President Viktor Yushchenko has accepted the resignation
of the head of the Khmelnytskyy Region state administration, Vitaliy Oluyko,
Yushchenko's press secretary, Iryna Herashchenko, told journalists. On 4
February, Oluyko was appointed Khmelnytskyy Region governor at the
proposal of the People's Agrarian Party. He joined the party's faction in
parliament in December 2004 after leaving the faction of the People's
Democratic Party - the Party of Industrialists and Entrepreneurs.

Today, about 120 members of the Khmelnytskyy Region public rallied outside
the presidential administration and cabinet buildings protesting against
Oluyko's appointment. Among protesters were members of the Ukrainian
People's Party, the Our Ukraine party and the Solidarity party, as well as
non-party citizens.

An Our Ukraine [propresidential bloc] member of the Kamyanets-Podilskyy
town council, Rostyslav Yarema, said appeals by "thousands of citizens" who
do not understand the appointment are being received in the region.

During the election campaign, Oluyko "openly backed presidential candidate
Viktor Yanukovych and cynically violated the law during the second round",
Yarema said. Deputy Prime Minister Mykola Tomenko said that Oluyko had
tendered his resignation under pressure from the public. Tomenko believes
that the situation surrounding Oluyko's appointment shows that the practice
of appointments using parties' quotas of portfolios is unacceptable. -30-
==========================================================
10. YUSHCHNEKO ORDERS FENCE AROUND PRESIDENT'S
SECRETARIAT REMOVED

Ukrainian News Agency, Kyiv, Ukraine, February 7, 2005

KYIV - President Viktor Yuschenko has made an instruction to remove
the fence at the President's Secretariat on Bankova Street. Ukrainian
News learned this from the presidential press service.

The fence that barred access to Bankova from Liuteranska and Instytutska
Streets was knocked down on Saturday, February 5. Police booths that
stood on the corner of Liuteranska and Bankova have been also taken away.
Bankova is now open for street walk.

"The face of a European city is never associated with fences, walls and
barriers," the press service quoted Yuschenko as saying. "Times when the
government buildings are fenced from the people and guarded by policemen
remained history," the President declared.

Whether Bankova will be open for motorists is now being decided. As
Ukrainian News earlier reported, Yuschenko reorganized the Administration
of the President into the Secretariat. -30-
==========================================================
11. YUSHCHENKO APPOINTS POROSHENKO AS NSDC SECRETARY

Ukrainian News Agency, Kyiv, Ukraine, Tue, Feb 8, 2005

KYIV - President Viktor Yuschenko has appointed Petro Poroshenko as
Secretary of the National Security and Defense Council (NSDC). Ukrainian
News learned this from the press service of Yuschenko. Poroshenko said
Yuschenko signed the decree on Tuesday and tomorrow it will be published
on the president's website.

Poroshenko, 39, is the chairman of the Solidarity Party, a member of the
parliament of the 3rd and current convocations, and a member of the Council
of the National Bank of Ukraine. He heads the Parliamentary Committee for
Budget Affairs and is an authorized representative of the Our Ukraine
parliamentary faction. Poroshenko is also the honorary president of the
Leninska Kuznia shipyard, which builds and repairs ships.

In 1998, Poroshenko was elected to the parliament from constituency No.12
(Vinnytsia region) as a member of the Social Democratic Party (united) (he
was No.11 on the party's list of parliamentary candidates) and appointed as
the head of the Vinnytsia confectionery factory's supervisory board.
Poroshenko was a member of the SDPU(o) parliamentary faction until February
2000, after which he headed the Solidarnist parliamentary group.

He headed the Solidarnist party in November 2001 and headed the election
campaign headquarters of the "Viktor Yuschenko Election, Our Ukraine" during
the 2002 parliamentary elections. He was re-elected into the parliament from
the same constituency. Poroshenko is a "Candidate of Legal Sciences" and a
Distinguished Economist of Ukraine. He speaks English.

As Ukrainian News earlier reported, Yuschenko assumed the post of president
on January 23. He had earlier mentioned Poroshenko among the candidates for
the post of prime minister. Former president Leonid Kuchma relieved
Volodymyr Radchenko of the post of NSDC Secretary on January 20. -30-
==========================================================
12. YUSHCHENKO READY TO SIGN AGREEMENT WITH
JOURNALISTS ON NON-INTERFERENCE IN THEIR WORK

Ukrainian News Agency, Kyiv, Ukraine, Mon, February 7, 2005

KYIV - President Viktor Yuschenko is ready to sign an agreement with
journalists on non-interference in their work. He made this statement to the
press.

"We have the following idea: the authorities and mass media may conclude
a contract, sign a resolution between themselves," Yuschenko said.

The resolution will commit the authorities to not interfere in the work of
journalists, not persecute them, and not use the press for their purposes.
"Journalists must be free... Unless it is so, we will be always choosing
between the bad and the worse," the President said.

He confirmed that he personally is ready to sign such document. "I am
ready to formalize these relations to the level the journalists will find
appropriate," Yuschenko added.

As Ukrainian News earlier reported, conclusion of a public agreement
with journalists on bilateral commitments and non-interference in their
professional activity was one of the election promises made by Yuschenko.
==========================================================
13.REFORM: YUSHCHENKO EQUIDISTANCES THE SPECIAL SERVICES

By Andrey Chernikov, Kiev; Gennady Sysoev
Kommersant, Moscow, Russia, Wed, February 9, 2005

KIEV - Ukrainian President Viktor Yushchenko made a number of important
announcements yesterday about the future role and place of the Ukrainian
special services. They suggest that henceforth the influence of the special
services on Ukraine may be drastically reduced.

Yesterday, Yushchenko introduced the new power ministers to the staff of
the ministries and agencies they will be heading. The president began with
the key power agency, the Ukrainian Security Service, or SBU [the Ukrainian
successor to the KGB]. He introduced the staff to their new chief, Aleksandr
Turchinov. SBU employees probably remembered the president's advice to
the Rada deputies before he named the future head of the service: "Hold on
to your chairs."

The president immediately revealed to the Ukrainian chekists [i.e., SBU
members] what, in his opinion, were the two main taboos. The first taboo was
"You are poor politicians, so stay out of politics." He then turned to the
second, demanding that the new SBU chief keep special services personnel out
of business. "You must be separated from business. Make sure this condition
is enforced," the president ordered.

Later, Yushchenko told the Ukrainian chekists what they would be doing from
now on. He called on SBU personnel to throw all their forces into the fight
against corruption. "Criminalization and corruption must become issue number
one," the president said. "This is your holy of holies," he explained. "
Start with the customs service and the police and finish with the Treasury,
the Ministry of Finance, and the presidential administration."

Thus, the new president severely restricted the scope of activity of the
main Ukrainian special service, essentially reducing its function to the
fight against corruption. And the fact that he strictly prohibited the SBU
from getting involved in politics and messing in the affairs of business is
an almost revolutionary innovation not only for Ukraine, but also for the
entire post-Soviet area.

Yushchenko has no doubts that the SBU will be reformed according to his
instructions. The president called Truchinov "a detonator by nature" when
introducing him to SBU employees and set a specific task of having "concrete
results before December." Truchinov, who until recently was Yulia
Timoshenko's right hand in the Rada and has no experience of working in
power agencies, assured the president that the service entrusted to him
would cope with the set tasks.

One more unpleasant surprise awaited the Ukrainian special services during
Yushchenko's visit to the Ministry of Foreign Affairs, where he introduced
the new foreign minister, Boris Tarasyuk. Tarasyuk is well known to
diplomats, since he once headed this ministry but was fired by ex-president
Leonid Kuchma "for pro-Western views and aspirations." After outlining the
main aims of Kiev's foreign policy to diplomats (integration into the EU and
development of a policy with respect to Russia, necessary for Ukraine's
integration into the EU), the president turned to the main issue. He said
that "from now on, the Ministry of Foreign Affairs, not the SBU or the
president's secretariat, will have exclusive jurisdiction over foreign
policy."

But this was still not the key bit of news. President Yushchenko called on
the ministry's administration to end the practice of what he called the
"saturation of the Ministry of Foreign Affairs with specialists'." Then he
added a clarification of his intentions. "I am prepared to support the
initiatives of my colleagues in the ministry to clear it of overlapping
structures and departments."

Yushchenko's last phrase means that the Ministry of Foreign Affairs of
Ukraine will probably be cleared of local special services personnel, who
worked there under cover. Since Ukrainian embassies abroad are also a
ministry structure, we may assume that employees of overlapping structures
and departments will also be removed from there as well, in full conformity
with the president's instructions. This is also a revolutionary innovation
not only for the CIS.

In addition, it was announced the other day that the Supreme Rada had
started preparing the law On Lustration [the present meaning of lustration'
is the screening of an individual active in the public sphere for any
connection with a former dictatorial regime]. If it is passed, candidates
for management positions in government bodies, education, the armed forces,
and the media will have to undergo a mandatory check for involvement in
"tampering with the 2004 presidential elections, cooperation with the former
KGB of the USSR, and foreign intelligence after 1991." Thus, it seems that
the new Ukrainian authorities have decided to go after the special services
in earnest, both of the previous regime and of its successors. -30-
--------------------------------------------------------------------------
http://www.kommersant.com/page.asp?id=545739
==========================================================
14. "THIS IS YUSHCHENKO'S GOVERNMENT"

Interview with Mykola Tomenko, Deputy Prime
Minister for Humanitarian Policy
Interviewed by Maryana Oliynyk, The Day
The Day Weekly Digest in English
Kyiv, Ukraine, Tuesday, Febraury 8, 2005

Longtime Yushchenko ally Mykola Tomenko has been appointed deputy
prime minister for humanitarian policy. In the following interview Mr.
Tomenko discusses his vision of this policy and the humanitarian lessons
of the recent election campaign.

[Q] "What are the lessons of the Orange Revolution?"

"I am glad that one of the motive forces behind the revolution was small and
medium business. I'm certain that small and medium business owners are
beginning to think in different terms. Surviving or paying off debts is no
longer their only concern. They are thinking in terms of influencing
government policies, including humanitarian ones.

I hope that now the development of a new, contemporary Ukrainian culture
and mass culture will depend not only on those whom we call oligarchs and
representatives of big business, but also on representatives of small and
medium businesses. After all, they were the key participants of the Orange
Revolution, and these people are perfectly aware that they must influence
the situation in the country and its culture.

This is one of the advantages of the situation in which the new government
is beginning its work. These new players won't be investing millions, but
the very fact that they are interested in Ukrainian culture is important.
When I meet with representatives of this business niche, I am glad that most
of them tell me the same things. They were expected to be the first to rush
to the government's rescue, give it money with promises of continued support
as long as it didn't harass them.

Meanwhile, they are saying that during the revolution they became true
patriots, learned Ukraine's anthem, and now can sing it together with the
president and the Ukrainian people. They understood that this country can
change for the better, and they are willing to do this. Before, they were
total pessimists; now they have changed. "I was alarmed by the role played
by teachers and priests.

While business people, who had something to lose, managed to rise above
their own interests, the behavior of teachers was a sign of what I call
unbelievable economic and social dependence on the local authorities. This
was especially true of village teachers. I read their letters and petitions
in support of the government.

They contained a horrible philosophy that I want to change: 'Let's leave
everything as it is, so that things don't get any worse.' This sounds like a
continuation of the Soviet philosophy 'As long as there's no war,' a
philosophy of eternal support for an eternal government until it decides to
leave all by itself. I was shocked when people started offering toasts and
wishes for 'money, health, and for things not to get worse.' I consider this
a terrible philosophy that we have just now started to change.

"So if we speak about a worldview that was formed during the Orange
Revolution, it is the worldview of a person who has come to believe that
s/he can live in a society that respects human dignity, freedom, and
individuality regardless of position and status. I think these are the most
important conclusions. I usually add a very important geopolitical aspect to
them: the myth that the Ukrainian president was elected in Moscow or
elsewhere has been buried. Everybody has realized that now we have to
make decisions within our country's borders. Unless there is consensus in
Ukraine, we will not be able to make any decisions."

[Q] "President Viktor Yushchenko has promised to bolster freedom of speech
in Ukraine. What is the quintessence of the future reforms in the Ukrainian
mass media space? How and when will they begin?"

"I have mentioned the mandatory editorial charters that we will be
introducing into the law on television and radio broadcasts and the law on
the print media. I am referring to the clause on editorial boards, which we
are proposing to form according to the fifty-fifty principle: half of board
members will be nominated by owners and top managers and the other half
by staff journalists. These boards will resolve all issues, beginning with
editorial policy and funding, and ending with social and professional
safeguards. The nature of editorial policy and professional relations will
be jointly decided by owners, top managers, and staff."

[Q] "Are there any guarantees that the new government will change the
old approaches to the press?"

"I will put it this way. There are meaningful relations, and there are
strategic and tactical relations. Strategic relations determine if we have
freedom of speech, access to information, etc. Tactical relations refer to
everything that relates to our daily work. I don't think that, in selecting
journalists who will fly on the same plane with the president, the
presidential press service is encroaching on somebody's freedom of speech.
So far there are many organizational glitches and problems, as was the case
during the inauguration.

This is happening because the mess that characterized the relationship
between the new government and the remnants of the old one has resulted
in a lack of coordination. As soon as all status-related questions are
resolved, it will become clear in what cases the president, the state
secretary, or the presidential press secretary should be dealing with the
press. But this doesn't mean that all this should not be written about by
the press. On the contrary, I consider it a positive thing that problems in
the government are not a taboo topic but a subject of public discussion."

[Q] "There have been calls to dismiss individuals who allegedly did not rise
up against the 'criminal regime'."

"We have experienced such a tumultuous time that, despite my revolutionary
personality, I get the impression that there may be only a few ideal people
in this country who have never had any problems in life. But when I hear
that some politicians are talking about removing other politicians... All it
takes is a look at these politicians to understand that this issue is
irrelevant. The same goes for the journalistic milieu.

In reality, everything has become so confused that every politician or
journalist has his good and bad sides to a certain extent. I would not
single out as ideal people those who fought for Yushchenko or against him,
or those who preferred to maneuver. I realize that there are many people on
Yushchenko's team who have the same attitude toward the mass media as
the previous team. It will probably take a long time for these people, and
for journalists, to change their attitude and forget about politicians and
political directions for a while, and think about the people who read
newspapers or watch television.

Journalists must idolize their readers and viewers, not the new president
and the presidential administration. But they should idolize them to the
extent that is allowed, because there are things that have to remain free of
public scrutiny. The mass media must also differentiate between what can
be discussed at the kitchen table and what they can write." -30-
---------------------------------------------------------------------
LINK: http://www.day.kiev.ua/131951
==========================================================
15. YUSHCHENKO VS. PUTIN
Soviet heirs

OP-ED by Anders Aslund, International Herald Tribune (IHT)
Europe, Thursday, February 10, 2005

WASHINGTON - What a difference a year can make! A year ago, President
Vladimir Putin represented the new trend in the former Soviet Union. He had
successfully consolidated political power and won a solid parliamentary
majority. Russia had carried out comprehensive market economic reform and
judicial reform. Its international standing was high.
.
Today, Putin does not seem to get anything right. The lawless confiscation
of the Yukos oil company has jeopardized his radical tax and judicial
reforms. His handling of the bloody Beslan hostage drama showed the weak-
ness of his centralized state. His heavy-handed intervention in the
Ukrainian presidential elections provided evidence that he was not only
antidemocratic but also anti-Western. The recent popular protests against
his social benefits reform have depressed his popularity at home.
.
As one star falls, another rises. Ukraine's "orange revolution" has lifted
the democratic reformer Viktor Yushchenko to the skies. He has set off a
new democratic trend in the post-Communist world.
.
Both Russia's current malaise and Ukraine's democratic revolution are taking

place in the midst of an economic boom. Last year, Russia's economy grew
by 7 percent, Ukraine's by 12 percent. So the issue is politics, not the
economy.
.
The focus lies on the generators of the boom. In the mid-1990s, young people
took on the challenge of transforming the seemingly moribund Soviet
smokestacks. They succeeded beyond any expectations. Alas, as Herbert
Hoover once said, "The trouble with capitalism is capitalists." Some of the
new owners became hugely and conspicuously rich. Since their property
rights were weak, the "oligarchs" reinsured their property rights by buying
up politicians, judges and other officials.
.
Both Russian and Ukrainian politics are now driven by a popular urge to
defeat this corruption. The United States faced a similar challenge with the
"robber barons" of the 19th century.
.
Putin's response was to pioneer a strategy of political centralization,
enhanced state control and mild authoritarianism, relying on the secret
police. He argued this was necessary in order to restore order, reduce
corruption, boost economic growth and promote social equity.
.
Today, these policies seem to have rendered the Russian state more
dysfunctional. The reinforcement of state power and secrecy appear only to
have boosted high-level corruption. Far-reaching centralization of power has
reduced both the capacity and the quality of government decision-making.
And as the media have been muzzled, the government has become subject
to its own disinformation.
.
Although Russia's economic growth remains high, it was lower than that in
most former Soviet countries last year. Now Putin's secret-police friends
are called the new oligarchs. Putin's authoritarianism no longer looks like
a solution.
.
In Ukraine, President Yushchenko has thrown down an ideological gauntlet
with his democratic revolution. Like Putin, Yushchenko is raging against
corruption and oligarchs, but he prescribes the opposite cure. As he stated
at his inauguration, "Only a democratic state values human dignity, freedom,
equality and solidarity." Yushchenko's commitment to freedom and democracy
is being reinforced by his calls for European integration, while Putin
reminiscences about the "vast and great" Soviet Union.
.
The economic programs of the two presidents are remarkably similar. Both
advocate a free but social market economy. Both countries have a flat
personal income tax of 13 percent. Ukraine needs to catch up with Russia
in market economic legislation, but with rising authoritarianism, the role
of the state is growing in Russian business.
.
The critical issue is the property rights of the oligarchs. Putin has given
up much of his initially good economic policies by ruthlessly going after
one oligarch, leaving the property rights of others in doubt. Yushchenko
must avoid repeating his mistake. Yet he campaigned for the re-privatization
of Kryvorizhstal, the last, biggest and most controversial privatization in
Ukraine. Having been bought by Ukraine's two wealthiest oligarchs (Rinat
Akhmetov and Viktor Pinchuk), it is a palatable political target. The
challenge to Yushchenko is to limit re-privatization to the politically
necessary and then sanctify property rights. For economic growth,
Ukraine needs more privatization rather than re-privatization.
.
Ukraine's "orange revolution" has made democracy look modern again.
Yushchenko's challenge now is to balance calls for social justice with the
need for secure property rights. -30-
----------------------------------------------------------------------------
Anders Aslund is director of the Russian and Eurasian Program at the
Carnegie Endowment for International Peace [Washington, D.C].
----------------------------------------------------------------------------
http://www.iht.com/articles/2005/02/09/opinion/edaslund.html
==========================================================
16. PROFOUND GENERATION SHIFT
FOLLOWS UKRAINE'S ORANGE REVOLUTION

By Taras Kuzio, Eurasia Daily Monitor
Volume 2, Issue 28, The Jamestown Foundation
Washington, D.C., Wednesday, February 9, 2005

Now that the Ukrainian parliament has confirmed Yulia Tymoshenko as prime
minister (see EDM, February 7), the country is witnessing a radical
generational change. New people, pro-Western and not tainted by Soviet rule,
are entering the political system (Zerkalo nedeli, February 5, includes
biographies of each member). As the Wall Street Journal (February 6) wrote,
Tymoshenko "will preside over a cabinet packed with other street-protest
organizers and pro-democracy leaders."

Revolutions such as in Serbia (2000), Georgia (2003), and Ukraine create a
profoundly close, but ultimately complicated, relationship between the
younger and middle generations who are jointly battling the older. The
middle generation came to power in all three countries only with the help of
democratic revolutions that prevent election fraud.

The revolutions themselves would be impossible without the energy of young
people. Two-thirds of the Orange Revolution crowds were young people.
President Viktor Yushchenko would not be in power today without the help of
Ukraine's youth. His gratitude for this support was evident when he greeted
the crowds after his official inauguration and when he sent greetings to the
congress of the PORA! (It's Time!) youth group.

All three revolutions saw similar trends. The old guard removed by these
revolutions was born in the 1930s and 1940s. This generation -- Slobodan
Milosevic in Serbia, Eduard Shevardnadze in Georgia, and Leonid Kravchuk and
Leonid Kuchma in Ukraine -- were holdovers from the communist era. Their
formative careers took place in the 1960s and 1970s, during the Brezhnev
"era of stagnation." In Ukraine this torpor was made doubly worse by the
rule of hard-line Ukrainian Communist leader Volodymyr Shcherbytsky from
1972 to 1989.

These formative years certainly had a negative influence on Kravchuk, then
ideological secretary of the Communist Party of Ukraine, and Kuchma, then
director of Pivdenmash, the world's largest producer of nuclear weapons.
Ukraine began its post-Soviet development led by de-ideologized former
Communists, who shared a lack of vision, an inability to break with Soviet
ways of thinking and acting, and tolerance of corruption. They demonstrated
"Little Russian" inferiority complexes, favored deception, and were prone to
cynicism. Kravchuk aptly titled his memoirs, We Have What We Have.

Ukraine's neo-Soviet generation has been replaced by one that was born in
the 1950s and 1960s, whose formative careers were under Gorbachev in the
1980s and independent Ukraine in the 1990s (Ukrayinska pravda, February 4).
Their background and socialization are totally different, a factor that will
have a profound and positive impact on Ukraine's domestic and foreign
policies.

The new cabinet includes individuals who are committed to "Europeanizing"
Ukraine. Mykola Tomenko (Humanitarian Affairs), former U.S. citizen Roman
Zvarych (Justice), Serhiy Teriokhin (Economics), and Viktor Pynzenyk
(Finance) are committed to breaking with the Soviet methods that still exist
in many areas of government by introducing European standards and making
government more accountable and transparent.

Tymoshenko's cabinet includes 10 members born in the 1950s and eight born in
the 1960s. Yushchenko is himself 50 and Tymoshenko 44. The new cabinet also
includes two younger members, born in the 1970s, appropriately dealing with
the Environment and Families and Youth.

The new cabinet's most radical departure from the Kravchuk-Kuchma era
rests in placing the "power ministries" in the hands of young civilians.
Interior (MVS), probably the most corrupt of these ministries, is in the
hands of young Socialist Party activist Yuriy Lutsenko, who is committed
to rooting out corruption and resolving the murder of journalist Heorhiy
Gongadze. Lutsenko was an active organizer in the Orange Revolution.

Lutsenko replaces Mykola Bilokin, whose reputation is, according to U.S.
Ambassador to Ukraine John Herbst, "unacceptable." Lutsenko has vowed to
de-criminalize and de-politicize the MVS. When he presented Lutsenko to the
MVS, Yushchenko declared that the ministry should now serve "not the
authorities, not criminal groups, but people" (maidan.org.ua, February 7).

The Security Service (SBU) is to be run by Tymoshenko's right-hand man,
Oleksandr Turchynov. (Tymoshenko is nicknamed "the Terminator," while
Turchynov is known as "the Detonator.") Turchynov inherits a power ministry
that did play a positive role in uncovering fraud in the 2004 elections.
Presenting Turchynov to the SBU, President Yushchenko said, "In the SBU
there was much that was not undertaken in the national interest, because
individuals managed to get into it who were influenced not by state
interests, but the interests of certain groups" (Ukrayinska pravda, February
7).

Ukraine's new minister of defense, Anatoliy Grytsenko, is a former military
officer who recently led Kyiv's best think tank, the Center for Economic and
Political Studies. Commonly known as the Razumkov Center, the institute
specialized in national security issues (uceps.com.ua). Grytsenko headed the
analytical-research wing of the Yushchenko election team.

The common thread uniting these new ministers, along with Oleh Rybachuk,
Deputy Prime Minister for European Integration, as well as the returned
Foreign Minister, Borys Tarasyuk, is a real commitment to democratization,
rooting out corruption, and integration with Europe. The Kuchma-era mismatch
between un-European domestic policies combined with stated foreign policy
goals of joining the EU and NATO will no longer exist.

President Yushchenko's positive reception in the West shows that Western
leaders accept that Ukraine is finally serious about "returning to Europe."
The generation shift in Ukraine corroborates this new orientation.
-----------------------------------------------------------------------
LINK: http://www.jamestown.org/edm/article.php?article_id=2369228
==========================================================
17. YUSHCHENKO'S INSTRUCTIONS TO THE SECURITY SERVICE

----- Original Message -----
From: George Woloshyn
To: morganw@patriot.net ; ArtUkraine.com@starpower.net
Sent: Tuesday, February 08, 2005 7:56 PM
Subject: Letter to the Editor, The Action Ukraine Report

Yesterday's "Action Ukraine" article on Yushchenko's instructions to the
Security Service was almost identical to one published earlier in
"Ukrayinska Pravda" - with one important difference: you failed to include
the President's parting remarks to General Ihor Smeshko in which he
expressed his gratitude to the departing SBU security chief for "the cross
that you carried". This would not be important were it not for the fact that
the over-all thrust of the article leaves the reader with the impression
that the departing chief may have been responsible for that corruption..

Mr. Smeshko was appointed to head up the SBU a little over a year ago.
Four years earlier, while serving as head of military intelligence, he had
tried, unsuccessfully, to gain legislative support for a major overhaul of
the SBU with particular emphasis on setting up a counter-intelligence
branch to monitor its activities, including corruption and foreign
infiltration of its ranks.

During his short (one year) term in office, Mr. Smeshko made great progress
in keeping the SBU out of politics and advancing his house-cleaning agenda.
Those who knew Mr. Smeshko from his days as Ukrainian defense attache in
Washington also recognized that Mr. Smeshko was driven largely by his love
for Ukraine and deep Christian convictions.

It came as no surprise, therefore when Western media carried reports,
confirmed by Western intelligence, that Mr. Smeshko had been cooperating
closely with the Yushchenko camp, alerting his campaign staff to dangers,
and restraining the SBU from political dirty tricks on behalf of Kuchma and
Yanukovych. Those reports seem to confirm that if there is any one
individual (other than President Yushchenko) who should be credited with the
ultimate success of the Orange Revolution it is General Shmeshko. Were it
not for his leadership in encouraging and orchestrating wavering military
and police chiefs to pledge solidarity with "the people" (rather than the
authorities), it is almost certain that the Orange Revolution would have
turned blood red. Kuchma capitulated only after he was persuaded that he
had lost the backing of his military and police forces

It was Mr. Shmeshko's SBU that interdicted telephonic communications among
Yanukovych's staff - communications that convinced even the stubbornest
sceptic of massive and organized fraud in the second round of elections.
This evidence helped gain Parliamentary and court approval for the climactic
third round.

Those who suspect Mr. Smeshko of involvement in Yushchenko's poisoning
are simply naive. The head of any security service - especially one as
brilliant and careful as Mr. Shmesko - would never put himself in a position
where he would be the most "obvious" perpetrator. While it is possible that
Mr. Yushchenko was poisoned when attending dinner with Mr. Smeshko and
his deputy, it should be noted that the dinner and the meeting was at the
home of his deputy - a man who was foisted on Mr. Smeshko and who
reported directly to the Office of the President.

There are still many questions as to why Mr. Kuchma freed the deputy of his
duties right after the election and allowed him to return to Parliament
where he has immunity from prosecution. The only ones who would have
benefitted by the removal of two strong patriots such as Smeshko and
Yushchenko were the oligarchs and the Russians.....hence Mr. Smeshko's
attendance at that dinner may have appeared (to Ukraine's enemies) as a
brilliant stroke: the killing of one and compromise of the other.

Every great era has its heroes ....both sung and unsung. History will
probably record Mr. Smeshko's performance during this crucial juncture in
Ukrainian history as one that saved Ukraine's future for its people. The
"cross" that Mr. Smeshko carried during the Orange Revolution was probably
the heaviest of all.....to work deep in the "enemy's camp" on behalf of his
people and principles in the knowledge that few may ever learn of his
heroism and risk.

Sincerely,
George Woloshyn
Linden, VA
----------------------------------------------------------------------------
EDITOR'S NOTE: The article referred to by the writer of the Letter to
the Editor above was published as article number 5 in The Action Ukraine
Report #462, issued on February 8, 2005. The article was entitled
"Yushchenko Tells Security Service To Get Out Of Business And Politics
And To Fight Corruption" and was written by Natasha Lisova, AP
Worldstream, Kyiv, Ukraine.

Mr. Woloshyn refers to the article as an "Action Ukraine" article when
actually it is from the Associated Press. Mr. Woloshyn states that,
"you [Action Ukraine] failed to include the President's parting remarks to
General Ihor Smeshko.........." Action Ukraine published the article as it
was distributed by the Associated Press. We assume Mr. Woloshyn is
indicating that he feels the Associated Press failed to include Viktor
Yushchenko's parting remarks. -30-
==========================================================
"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
==========================================================
SIGMABLEYZER MONTHLY MACROECONOMIC REPORTS
http://www.sigmableyzer.com/index.php?pid=532

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
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