US-Ukraine Business Council

"THE ACTION UKRAINE REPORT - AUR"
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"

"A NATION BORN IN ORANGE"

The government needs to listen closely to what the people say. And I want
a stable and predictable business and legal environment where local and
foreign investors feel secure deploying new capital without surprises and
sudden shifts.

The government needs to take care of the bulging budget deficit left by the
previous government's efforts to get re-elected at any cost, the overgrown
and unruly government bureaucracy that needs reform; strengthening the
rule of law, deregulating businesses to further liberalize the economy,
promoting internationally a strong image for the nation to attract foreign
direct investment that will help sustain and accelerate economic growth.

"THE ACTION UKRAINE REPORT - AUR" - Number 488
E. Morgan Williams, Publisher and Editor
morganw@patriot.net, ArtUkraine.com@starpower.net
Washington, D.C. and Kyiv, Ukraine, FRIDAY, May 20, 2005

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

1. "A NATION BORN IN ORANGE"
By Michael Bleyzer, President and CEO, SigmaBleyzer
Member, Thunderbird Global Council
Thunderbird Magazine, Spring 2005 Issue
Thunderbird, The Garvin School of International Management
Campus located in Glendale, Arizona

2. UKRAINE'S PM TYMOSHENKO UNDER FIRE OVER FUEL CRISIS
By Natasha Lisova, Associated Press Writer
AP, Kiev, Ukraine, Thursday, May 19, 2005

3. UKRAINE SAYS DEAL MADE WITH RUSSIAN FIRMS TO END OIL CRISIS
Market should alone regulate prices, no administrative regulation of prices
Interfax-Ukraine, Kyiv, Ukraine, Thu, May 19, 2005

4. YUSHCHENKO SUGGESTS OIL TRADERS AGREE ON MEASURES
TO PREVENT SEASONAL FUEL CRISES
President declares that Ukraine will work on the market
using market instruments only.
Ukrainian News Agency, Kyiv, Ukraine, Thu, May 19, 2005

5. YUSHCHENKO CRITICIZES SITUATION IN UKRAINIAN COAL SECTOR
Ukrainian News Agency, Kyiv, Ukraine, Thu, May 19, 2005 (18:09)

6. KEMPINSKI HOTELS GROUP TO BUILD FIVE-STAR HOTEL IN YALTA
German group owns and runs over 40 hotels
Interfax- Ukraine, Kyiv, Ukraine, Thu, May 12, 2005

7. MINISTER PYNZENYK CALLS ON UKRAINIAN BUSINESSES TO
COME OUT OF THE SHADOW
Interfax - Ukrayina, Kyiv, in Ukrainian, May 19, 2005
Ukrayinska Pravda, Kyiv, Ukraine, in English, Thu, May 19, 2005

8. UKRAINE MACROECONOMIC SITUATION - APRIL 2005
REPORT: by Iryna Piontkivska, Ediberto L. Segura
SigmaBleyzer Private Equity Investment Group
Kyiv, Ukraine, May, 2005

9. UKRAINE VIOLATES DEMOCRACY, SAYS RUSSIAN PARLIAMENT
TO POINT MATTER OUT TO PACE
RIA Novosti, Moscow, Russia, Thu, May 19, 2005

10. POLISH FIRMS COMPLAIN ABOUT INVESTING IN UKRAINE
Polish News Bulletin, Warsaw, Poland, Thu, May 19, 2005

11. LETTER TO THE EDITOR RE: "BETRAYING THE REVOLUTION"
LETTER TO THE EDITOR
From Lidia Wolanskyj, Ukraine (lidia@ln.ua)
The Action Ukraine Report #488, Article Eleven
Washington, D.C., Fri, May 20, 2005

12. UKRAINIAN PRESIDENT WELCOMES BBC OFFICE OPENING IN KIEV
Interfax-Ukraine news agency, Kiev, in Russian, 19 May 05
BBC Monitoring Service, UK, in English, May 19, 2005

13. RADIO FREE EUROPE/RADIO LIBERTY BACK ON FM RADIO IN KYIV
Dramatic change in the media climate in Ukraine
Radio Free Europe/Radio Liberty (RFE/RL)
Prague, Czech Republic, Thu, May 19, 2005)

14. EUROVISION: DODGY TUNES, DUBIOUS COSTUMES, A SYMBOLIC
FERN AND A LITTLE BIT OF POLITICS
Neil Perry looks forward to Saturday's Eurovision song contest in Kiev
By Neil Perry, Guardian
London, United Kingdom, Thursday May 19, 2005

15. REBEL CHECHEN GOVERNMENT HOPES FOR BETTER
FUTURE FOR TATARS IN UKRAINE
Appeal by Chechen Republic of Ichkeria to Crimean Tatar people
Government of the Chechen Republic of Ichkeria,
Chechenpress, official information department
Chechenpress web site, in Russian 19 May 05
BBC Monitoring Service, UK, in English, Thu, May 19, 2005

16. UKRAINE-NATO TALK ANNOYS RUSSIA
As Ukraine makes steady progress towards joining NATO, Russia's
grumblings grow more threatening and some observers warn the US
against provoking the "Russian bear" unnecessarily.
By Jeremy Druker for ISN Security Watch
International Relations & Security Watch (ISN)
Zurich, Switzerland, Thursday, 19 May 2005

17. EXCHANGE OF EMPIRES: WHO WILL DARE TO FILL THE BLACK
HOLES LEFT BY RUSSIA'S LONG RETREAT?
By Timothy Garton Ash in Tiraspol, Transnistria
The Guardian, London, United Kingdom, Thur, May 19, 2005

18. BUSH PROPOSES CORPS TO AID NEW DEMOCRACIES
President Cited Rose in Georgia, Orange in Ukraine, Purple in Iraq
By Deb Riechmann, Associated Press Writer
Associated Press, Washington, D.C., Wed, May 18, 2005

19. "IMPLEMENTING BUSH'S VISION"
To Effectively Spread Democracy, We Must Balance Values
and Geopolitical Challenges
OP-ED By Henry A. Kissinger
The Washington Post, Washington D.C.
Monday, May 16, 2005; Page A17

20. YUSHCHENKO TO TAKE PART IN SHEVCHENKO DAY MAY 22 IN KANIV
Taras Shevchenko: Artist, Poet, National Bard of Ukraine
UNIAN, Kyiv, Ukraine, Thursday, 19 May, 2005
===============================================================
1. "A NATION BORN IN ORANGE"

Thunderbird Global Council member Michael Bleyzer was in Kyiv,
Ukraine, in November and witnessed, and here reports on, the
beginning of the Orange Protest and the birth of a true democracy.

By Michael Bleyzer, President and CEO, SigmaBleyzer
Member, Thunderbird Global Council
Thunderbird Magazine, Spring 2005 Issue
Thunderbird, The Garvin School of International Management
Campus located in Glendale, Arizona

NOVEMBER 23 [2004] -----

LED BY OPPOSITION presidential candidate Viktor Yushchenko, as
many as 1 million people march on parliament, turning the narrow brick
streets into a ea of orange flags and ribbons. The protest springs up as a
result of the outcome of the second round of the presidential elections,
held November 21, which declared the Russian-speaking Prime Minister
Victor Yanukovich the narrow winner. Exit polls indicate widespread fraud,
and international observers call the election results tainted.

We are in the middle of the Orange Revolution in Kyiv. It is an incredible
experience to be here. We have been spending a lot of time on the streets
and on the main square, Maidan Nezalezhnosti, Independence Square. No
news footage can do justice to the feeling of being surrounded by a million
people. It is amazing how incredible this crowd is.

Think of an unhappy crowd-cheated by politicians, betrayed by the system-
and you expect angry, agitated people. Think again! This is the happiest,
friendliest, most incredibly loving and supportive group I have encountered,
and there are a million of them! People smile, sing, laugh and offer help
and support to each other. There are no police in sight. Imagine that! There
are not even any reports of crime in this huge metropolitan area. Everyone
is a friend, everyone is a neighbor, everyone is a brother.

We are in the middle of a miracle. The people of this country came out on
the streets to say, "We have had enough! Enough of criminals running the
country, enough of corruption, enough of lawlessness. We want to be free,
we want to be clean and civilized, we want to be a part of Europe and the
World."

NOVEMBER 24 -----

Tens of thousands of Orange Protesters vow to stay camped in
Independence Square until reports of election fraud are examined.

It is cold out here. Most nights the temperature goes well below freezing.
But the tent city that has gone up in the middle of Kyiv, now with thousands
of tents, is very warm. There are mountains of warm clothes everywhere on
Khreshchatyk, the main street of the city, donated by Kyivites. Food, hot
coffee and hot tea are abundant and free everywhere. But you do not see
any alcohol. This is the most sober one million Ukrainians you will ever
meet.

The crowd is completely self-organizing and is improving its collective
behavior continuously. Every new day brings better organization, improved
conditions and communications, and good behavior. Where are the
sociologists? We are living one of the finest examples of crowd behavior
in history.

NOVEMBER 25 -----

Despite freezing temperatures and worsening living conditions, protesters
remain in Independence Square, saying they'll only leave when a new
presidential election is held and Yanukovich agrees to step down.

It is clear to any observer that this crowd will win. There's no way to stop
it without a massive blood bath, which cannot happen in Europe in this new
century, with all the world's TV cameras turned on Ukraine. Over the last
five days, the opposition has been winning continuous victories. The crowds
are growing bigger, and demonstrations are all over the country. Famous
athletes, actors, artists and high ranking military and police officers are
joining the opposition.

When Ruslana, the most famous Ukrainian singer and the 2004 Eurovision
contest winner, and Vladimir Klitchko, the heavyweight champion, joined
Victor Yushchenko on the podium three days ago, the crowd went wild.
The following day brought Lech Walesa, senior officers of SBU (formerly
the KGB) and the police and several formerly neutral "oligarchs" to the
podium.

NOVEMBER 27 -----

The Ukrainian Supreme Court declares the presidential election null until it
considers the claims that the vote was rigged.

The media are free once again in Ukraine. Until now, only one channel was
covering the events from Maiden Nezalezhnosti 24 hours a day. Our Volia
Cable also was delivering its signal to some 1.5 million viewers in Kyiv
despite the pressure, including 10 days in July when some of our managers
went to jail. All the other channels have been ignoring the people on the
streets and instead showing cartoons, music concerts and travel
destinations.

Most TV journalists had been fired or had gone on strike because they
refused to continue broadcasting lies, so almost all stations had ceased
operations. For three days, most of Ukraine had no TV news, for there
was no staff left to produce the news.

Last night it all changed. The owners of the major channels gave in to the
demands of their journalists and allowed honest news reporting for the first
time in the history of independent Ukraine. Some ran their evening news
broadcast with a group shot of all journalists standing together, with one
of them reading a statement in which they swore to report honest news only.

It was an unbelievable and inspiring sight. And then the miracle happened:
They showed a direct feed of a million proud Ukrainians on Maidan
Nezalezhnosti in Kyiv to the whole country. If there was a defining moment
in the birth of this nation, that was it!

NOVEMBER 28 -----

In a day of tension and loud protests both on the street and in parliament
chambers, the democratically-elected body declares the election results
invalid. Three days later, the parliament votes to fire the entire
presidential staff.

Today was another exciting day with the extraordinary session of the
Ukrainian Rada, or parliament. It started four hours ago and is being shown
live on television all over the country. We are all glued to our television
screens. The Rada already voted to consider the runoff elections invalid,
and it expressed no-confidence in the Central Election Committee, along
with other important actions. They are still debating, but they are
progressing well. Things are looking up! The Orange Revolution continues!

DECEMBER 23 -----
The Ukrainian Supreme Court invalidates the presidential election results
and orders a new election to be held Dec. 26.

DECEMBER 26 -----
Election results show that Viktor Yushchenko has won with 52 percent of
the vote to just 44 percent for Victor Yanukovich.

JANUARY 23 -----
Yushchenko is sworn in as president. Inauguration balls are held through
Kyiv.
NOW WHAT?

The Orange "revolutionaries" are in charge, but will they lead with
transparency and honesty, and bring stability to the country?

I wrote these diary entries in the last days of November 2004 at the height
of the Orange Revolution in Kyiv. It was the most exciting time of my life.
I did not know what the final outcome would be, or if violence would erupt
despite the optimism, or how power would be transferred if the revolution
did succeed. But I knew that I was witnessing one of the most incredible
events of recent years.

Now, many months later, we know that the Orange Revolution was a
resounding success, greater than even the most optimistic expectations
in November. The long term consequences for Ukraine and the world now
depends on what the Orange revolutionaries do with their new power. Many
challenges lie ahead, not least of which is the difficult legacy of 10 years
of slow and painful transition to a market economy.

The "revolutionaries" are in charge of all government institutions and
agencies. It is amazing to realize that the revolution was accomplished
without any violence nor a single shot fired. The largest peaceful
revolution in history had a quick and victorious end, with power
transferring to the Orange team with little resistance. It took less than
three months in all.

The Orange Revolution was exciting and full of energy and color despite
the cold, dreary days of Ukraine's winter. Even a revolution staged by MTV
would not have seemed hipper, happier, nor more photogenic. The chants
razom nas bahato, nas ne podolaty (together we are many, we cannot be
defeated) and svobodu ne spynyty (freedom can't be stopped) should be
taught in every school. These incredibly powerful chants were turned into
inspiring songs by bands during the revolution.

The three months of the Orange Revolution was the great awakening of
the Ukrainian nation and an incredible cleansing of its civil society. A
democratic nation was born. The new rulers were anointed by the street,
and Ukrainians are better off now because they can always remember nas
bahato, nas ne podolaty! What happened was even better for Ukraine than if
Yushchenko were simply elected cleanly and transparently in the first round.

People came out in the streets and said, "We do not want these guys any
longer. We want those guys!" And they got them! What can be more
democratic?

The Ukrainian people and the world expect a lot from the new government:
Simplicity. Transparency. Predictability. As an investor, I want simple and
effective solutions that can be explained to the Ukrainian people. I want
frequent and open communications between the new government and the
people.

Yes, there are challenges ahead, but there is also a new government with
lots of young, dedicated, energetic and patriotic people. I am optimistic
about the future in Ukraine. The Orange Revolution was a beautiful and
heroic movement. It will not go to waste. Ukraine will succeed! -30-
-----------------------------------------------------------------------------------------------------------
Michael Bleyzer is the founder of SigmaBleyzer and the developer of its
business model, which blends the best of Western business acumen
with extensive regional experience in former Soviet block countries.

Born in Kharkiv, Ukraine in 1951, Mr. Bleyzer graduated from the Kharkov
Institute of Radioelectronics with a Master of Science in digital
electronics and quantum physics. His career took him to Russia, Ukraine,
Uzbekistan and Turkmenistan, before coming to the US in 1978 where he
became an American citizen. He then embarked on a career in finance
and management eventually holding senior positions at Exxon and later
Ernst & Young.

Mr. Bleyzer has appeared on CNBC and CNNfn as an expert on investment
in the region and frequently speaks at investment conferences around the
world. Mr. Bleyzer serves on the Board of Directors of the Houston
Holocaust Museum and as a member of the Thunderbird School of
International Management’s Global Council.

SigmaBleyzer is a multinational fund manager focusing on private equity
in Southeast Europe. It is headquartered in Houston, Texas with offices
in Sofia, Bulgaria, Bucharest, Romania, and in Kiev and Kharkiv, Ukraine.
SigmaBleyzer has over $100 million under management in its three
Ukrainian Growth Funds (UGF)
-----------------------------------------------------------------------------------------------------------
LINK to Thunderbird Magazine Online with color photographs:
http://www.thunderbird.edu/wwwfiles/publications/magazine/spring05/s05-orange-pg32.asp
======================================================================
2. UKRAINE'S PM TYMOSHENKO UNDER FIRE OVER FUEL CRISIS

By Natasha Lisova, Associated Press Writer
AP, Kiev, Ukraine, Thursday, May 19, 2005

KIEV - Ukraine's tough-talking prime minister Yulia Tymoshenko came
under fire Thursday for her handling of a fuel crisis involving neighboring
Russia last week. A senior Cabinet colleague, First Deputy Prime Minister
Anatoly Kinakh, criticized Tymoshenko's policies as an attempt to resolve
a "difficult situation ... through simplistic moves."

Kinakh, who is the leading pro-business member of Ukraine's new
Western-oriented government, has long had difficult relations with the prime
minister, a controversial figure who has had to deny rumors of a split
between her and the president. "The events on the oil market showed that
the government must improve its work and make decisions taking economics
into account," Kinakh told reporters.

The acute fuel shortages erupted last week after major Russian oil
exporters, who control 80 percent of the Ukrainian market, reduced supplies
to this country of 48 million.

Last month, Tymoshenko accused Russian oil companies of conspiring to
raise the price of gasoline and ordered them to keep fixed prices, which the
companies reluctantly agreed to after being threatened with court action.

In an apparent rebuke to Tymoshenko, President Viktor Yushchenko pledged
Thursday that Ukraine "will (now) operate exclusively along market rules."
After meeting representatives of the Russian oil exporters, he described the
crisis on the Ukrainian oil market as "an example of how things were not
supposed to be done."

Tymoshenko, who also attended the meeting, had accused the Russian oil
exporters of retaliating for the enforced price caps through sabotage,
leaving the government scrambling to secure additional imports of oil
products.

To alleviate the crisis Yushchenko endorsed a law that canceled customs
duties and taxes on fuel, and allowed Ukraine to reduce its energy
dependence on Russia.

Kinakh, who headed the Ukrainian Cabinet between 2001 and 2002, joined
Yushchenko's camp during last year's tumultuous presidential race won by the
former opposition leader. On Wednesday, Kinakh and his allies from the Party
of Private Entrepreneurs and Industrialists lashed out at Tymoshenko in the
parliament, accusing her of "unpredictable actions that are aggravating the
crisis."

Volodymyr Saprykin, an analyst with Kiev's Razumkov think tank, said "almost
everybody recognized Tymoshenko's failure with the oil market."
Tymoshenko was a central figure in Yushchenko's "Orange Revolution," the
mass protests over election fraud that brought him to power, and is seen as
a key political ally of the president despite her sometimes combative style.

The president had to step in to reassure businesses after Tymoshenko said
that thousands of state selloffs might be reviewed -- setting off a massive
shock wave among investors who were just beginning to view Ukraine with
interest again after last year's political turmoil.

The new government is to re-examine the sale of 29 companies that it says
were illegally privatized. It claims that many key industries were sold off
to cronies of former President Leonid Kuchma at rock-bottom prices.
===============================================================
3. UKRAINE SAYS DEAL MADE WITH RUSSIAN FIRMS TO END OIL CRISIS
Market should alone regulate prices, no administrative regulation of prices

Interfax-Ukraine, Kyiv, Ukraine, Thu, May 19, 2005

KYIV - The Ukrainian government and Russian oil companies have reached
an agreement on how to settle the oil crisis in Ukraine, Oleksandr
Tretiakov,first aide to the Ukrainian president, said on Thursday.

"We were able to see that they are our partners, they are people who
represent business, who are upset by the situation that has taken shape in
Ukraine. They are absolutely not indifferent toward it," Tretiakov told a
news conference in Kyiv after a meeting between the Ukrainian leadership
and top Russian oil figures.

But the market should alone regulate prices, he said. "If they [producers]
are not satisfied with this price, the supply of any product is simply
suspended," the aide said. "Today we have come to an agreement on
principles to use for the market. Let me stress that it is a market and
there cannot be any administrative regulation of prices," he said.

It is also "untrue" that oil companies, "from some political motives, came
to an agreement among themselves" to undermine the Ukrainian market,
Tretiakov said.

The president and chief executive of the TNK-BP oil company, Robert
Dudley, confirmed that the Ukrainian leadership and Russian oil companies
had made an agreement to use market prices only.

He said TNK-BP fully supported measures prescribed in a decree by the
Ukrainian president on Wednesday to stabilize the Ukrainian market and
make it transparent. Dudley said TNK-BP would keep investing in the
Ukrainian economy. -30-
===============================================================
4. YUSHCHENKO SUGGESTS OIL TRADERS AGREE ON MEASURES
TO PREVENT SEASONAL FUEL CRISES
President declares that Ukraine will work on the market
using market instruments only.

Ukrainian News Agency, Kyiv, Ukraine, Thu, May 19, 2005

KYIV - President Viktor Yuschenko suggests Russian and Kazakh petroleum
traders working on the Ukrainian market to agree on measures for prevention
of seasonal crises.

He made this suggestion at a meeting with top managers of Russian and
Kazakh companies, which was also attended by Prime Minister Yulia
Tymoshenko, President's State Secretary Oleksandr Zinchenko, Fuel and
Energy Minister Ivan Plachkov, First Deputy Minister for Fuel and Energy
Sector Oleksii Ivchenko, and Russian Ambassador Viktor Chernomyrdin.

"It is a shame when you are waiting for spring, and get an oil and energy
crisis along with snowdrops... It is disgusting, it is incorrect," the
president said. He asked the traders why 2-3 oil refineries were suspended
for repair in the first quarter at the time the spring field campaign
begins.

"You put your partners in an awkward position," Yuschenko said and added
that his wants the critical situation be solved after the meeting. "So that
that crisis remain a history," he said.

In his opening statement the president requested oil companies to join
people who want to make Ukraine an attractive country in terms of oil
transit. "We, the Ukrainian side, are doing our best to make Ukraine an
attractive territory for transit," Yuschenko said.

Analyzing the current petroleum market, he admitted that the parties did not
behave appropriately and called on them to turn over this page.

"It was an example of what you should not do either alone or together with
someone. Something has not been said, something has not been fulfilled,
someone has failed to meet his commitments. Today I suggest and request
to turn over this page," Yuschenko said.

The president declared that Ukraine will work on the market using market
instruments only.

At the President's Secretariat Yuschenko had meetings with president of
Russian oil company Lukoil Vagit Alikperov, president of Transnafta Semen
Vaishtok, chairman of Kazakhoil Ukraine Petro Myroshnykov, president of
TNK BP Ukraine Oleksandr Horodetskyi, director general of Tatneft Shafgat
Takhautdinov, and president of Alliance Group Musa Bazhaev.

As Ukrainian News earlier reported, Yuschenko ordered the Cabinet of
Ministers to regulate the situation in the market of oil and petroleum
products. Prime Minister Yulia Tymoshenko instructed the State Customs
Service and Finance Minister Viktor Pynzenyk, who is coordinating the work
of the Customs Service, to ensure customs clearance of imported petroleum
products within a timeframe of not more than one hour.

The Verkhovna Rada lowered excise duties and cancelled import duties on
high-octane types of gasoline and diesel fuel. Ukraine bought 70,000 tons
of light petroleum products in Moldova and the Baltic States in order to
normalize the situation on the market. Ukraine is also going to buy an
additional of 300,000-500,000 tons of Kazakh oil in June.

Tymoshenko had earlier accused Russia of blocking the delivery of crude to
Ukraine for five days, even though all the contracts for this crude were
paid for. Russia decided in March to increase the rates of export duties for
commodities made of crude oil by 19.4% to USD 81.4 for a ton starting from
April 21. -30- [The Action Ukraine Report Monitoring Service]
-----------------------------------------------------------------------------------------------------------
FOOTNOTE: It is great to see President Yushchenko taking charge
of economic and business policy and through his actions turning
around some previous negative government decisions and now totally
showing his support for building strong free markets and private
business in Ukraine. Most analysts in Washington also hope President
Yushchenko will quickly kill the proposed program for the Ukrainian
government to build and manage 1,000 gas service stations. [EDITOR]
===============================================================
5. YUSHCHENKO CRITICIZES SITUATION IN UKRAINIAN COAL SECTOR

Ukrainian News Agency, Kyiv, Ukraine, Thu, May 19, 2005 (18:09)

KYIV - President Viktor Yuschenko has criticized the situation prevailing in
the coal sector. Press secretary Iryna Heraschenko disclosed this to
journalists, citing the results of a meeting the president had on May 19.

Commenting on the state of affairs, Yuschenko said that there is a need to
reform the coal sector and he pointed to its substantial shadowy segment
and the criminalizing of this sector.

"Monopoly closed configurations have been created, the objective of which
is not to increase the coal extraction, not to fill the pocket of the miner,
but to launder them [funds]," Heraschenko said, citing Yuschenko's words.
Besides, Yuschenko emphasized the bad social condition of coal miners.
The president noted that all the resources, which are being invested into
the coal sector, are being siphoned off to the shadow sector and are
therefore not yielding any results.

At the end of the meeting, the president ordered the creation of a working
group comprising members of the Cabinet of Ministers, experts on this topic
and deputies of the Verkhovna Rada, which would write within a week the
draft of the decree on reform in the coal sector.

Moreover, the decree should envisaged urgent settlement of arrears on
social payments to coal miners, restructuring of the debts of coal
enterprises, resolving employment problems in this sector and price
formation.

As Ukrainian News reported previously, Prime Minister Yulia Tymoshenko
stated in March that there were plans to continue reforming the coal sector.
The Cabinet of Ministers decided in November 2004 to speed up the closure
of unprofitable coal enterprises in order to liquidate them by the end of
2005, instead of 2006-2008 as previously planned by the reform program.

The Ukrainian Coal Program, which provides for improving the running of
enterprises of the coal sector, is designed for 2001-2010 and it was
approved by the Cabinet of Ministers in September 2001. -30-
===============================================================
6. KEMPINSKI HOTELS GROUP TO BUILD FIVE-STAR HOTEL IN YALTA
German group owns and runs over 40 hotels

Interfax- Ukraine, Kyiv, Ukraine, Thu, May 12, 2005

KYIV - The European hotel group Kempinski Hotels has begun preparations
on a Yalta-based construction site for building a five-star hotel.

In addition, the Group set aside UAH 2 million for the development of the
city's infrastructure, Gianni van Daalen, the director general of
Kempinski's European Office, said at a meeting with Crimean Tourism
Minister Oleksandr Tarianyk on Thursday, the Crimean government's
press service reported.

Tarianyk in turn said that Crimea is interested in raising foreign
investments and the development of Crimean recreation infrastructure.
The minister assured entrepreneurs that the Crimean government would
comprehensively support investors.

Kempinski Hotels was founded in Germany more than a century ago.
Presently the group owns and runs over 40 hotels in Europe, Asia,
South America, and in the Middle East. -30-
===============================================================
7. MINISTER PYNZENYK CALLS ON UKRAINIAN BUSINESSES TO
COME OUT OF THE SHADOW

Interfax - Ukrayina, Kyiv, in Ukrainian, May 19, 2005
Ukrayinska Pravda, Kyiv, Ukraine, in English, Thu, May 19, 2005

KYIV = The Ministry of Finance of Ukraine made an appeal to entrepreneurs
to stop their fight for tax break renewals.

"The Ministry of Finance of Ukraine calls on some businesses to halt their
fight for subsidy renewals because under the current conditions this fight
is not a fight against the government, but against the large group of
citizens that started receiving higher payments thanks to the new social
budget", said Minister of Finance of Ukraine Victor Pynzenyk during his
address.

"We appeal to Ukrainian entrepreneurs to legalize their businesses, to pay
taxes, and to stop trying to come up with various schemes that would
exclude them from taxation", was stated in the document.

Government policy of tax breaks elimination is aimed at balancing the tax
conditions and improving the investment climate, noted in the address.

In addition, the Minister announced that the government is making strides in
creating a new liberal system of relationship between business and state
government, as well as developing measures directed towards de-regulation
and promoting businesses.

"Businesses started to come out of the shadow. And we want to thank
everyone who already made this step. We want to thank everyone who is
just getting ready to make it. And we appeal to those that are still
struggling with this decision, those that still live with the weight of the
past. There will be no going back. Step by step we will break down the
old system", stated Pynzenyk in his address.

He also called on businesses to believe in government intentions and to
be patient. "We would like to discontinue the practice of overprotective
business assistance and state regulatory function as it serves as a breeding
ground for breaking the law and limits entrepreneurial activity".

The Minister of Finance recognized that entrepreneurs still continue to
encounter bureaucracy, indifference, incidents of bribery and extortion.
Additionally, tax reimbursement decisions for honest exporters take months.

"We know these issues, we understand them and we will be partners in
finding the solutions. It is necessary for our whole society. There is the
will of the President, there is a government taskforce to solve specific
painful issues for our business and society ", - noted the address.

Pynzenyk promised to give special reception for those who will agree to
work with the government. Additionally, the Ministry of Finance will create
a "hotline" where entrepreneurs will be able to direct their requests.

The Ministry of Finance will start recognizing businesses with the highest
quarterly increase in tax payments, by publishing a quarterly list of the
ten leading companies in its financial reports and the media. -30-
(translated by Yana Rathman)
===============================================================
8. UKRAINE MACROECONOMIC SITUATION - APRIL 2005

REPORT: by Iryna Piontkivska, Ediberto L. Segura
SigmaBleyzer Private Equity Investment Group
Kyiv, Ukraine, May, 2005

SUMMARY:
1. In February, real GDP growth slowed to 4.5% yoy, bringing the
cumulative figure to 5.5% yoy in the first two months of 2005.

2. On March 25th, Parliament adopted amendments to the 2005 State
Budget envisaging a 1.86% of GDP deficit. Taking into account very
ambitious increases in pensions and the minimum wage as well as
optimistic revenue growth, the new deficit target may be hard to achieve.

3. Inflationary pressures continue to grow; the consumer price index
increased 13.3% yoy in February.

4. The banking system seemed to fully recover from the liquidity crisis
that took place at the end of 2004. Commercial banks managed to restore
their deposit base as deposit growth sped up to 42% yoy in February.

5. On the path to foreign currency market liberalization, the National Bank
of Ukraine (NBU) abandoned its regulation requiring the mandatory sale of
50% of exports proceeds starting April 1, 2005.

6. Good export performance allowed the NBU to replenish its gross inter-
national reserves to $10.94 billion by the end of February.

To read the entire report with several illustrated charts in color click on:
http://www.sigmableyzer.com/files/Ukraine_Ec_Situation_04_05.pdf
===============================================================
9. UKRAINE VIOLATES DEMOCRACY, SAYS RUSSIAN PARLIAMENT
TO POINT MATTER OUT TO PACE

RIA Novosti, Moscow, Russia, Thu, May 19, 2005

MOSCOW - There are violations of democratic standards in Ukraine.
The State Duma, Russia's lower parliamentary house, is determined to
highlight the issue at the Parliamentary Assembly of the Council of
Europe. The Duma will order the Russian PACE delegation to pose
it at an Assembly session.

The house also intends to call on international institutions to pay
attention to alarming trends in Ukrainian domestic policies, which run
counter to the principles of the OSCE -- Organization for Security and
Cooperation in Europe. Involved parliamentary committees have drafted
a related statement, to be offered to the Duma at tomorrow's session.

The draft points out profound Duma concern with numerous instances of
Ukrainian political opposition activists persecuted by the recently
established regime. These activists are dismissed en masse not only from
civil service but from educational, research and cultural establishments, as
well.

A number of prominent political and public activists have made public
pronouncements against the regime's policies. These people are now under
arrest, says the draft statement. The new regime is out to grab political
and ideological control of the mass media, non-government outlets included.
Journalists who dare to criticize authorities are pressured.

The regime has launched a selective re-privatization of Ukrainian-based
corporate majors with Russian capital participation. That, too, alarms
Russian parliamentarians. "Such moves as that make one doubt whether
Ukrainian authorities really mean it when they announce their intention to
promote a law-based market economy.

These moves threaten to result in bad political hazards for overseas capital
investors, Russians being no exception. "All that is out of compliance with
a line the new Ukrainian authorities have declared, aimed at a democratic
political system, guaranteed human rights, and a latter-day market economy,"
warns the statement. -30- [Action Ukraine Report Monitoring Service]
===============================================================
10. POLISH FIRMS COMPLAIN ABOUT INVESTING IN UKRAINE

Polish News Bulletin, Warsaw, Poland, Thu, May 19, 2005

WARSAW - Despite warm political relations between Poland and Ukraine,
Polish investors are complaining about moves by the new Ukrainian govern-
ment, which has recently stripped foreign investors in special economic
zones of previously granted exemptions.

"This will bring destabilisation and constitutes a warning to all those who
are planning to invest in the country," says Janusz Palikot, owner of
Polmos Lublin spirits company.

There are also other obstacles, including widespread corruption, which
starts right at the border. According to Palikot, it is impossible to cross
it quickly without paying a bribe.

In addition, Polish companies complain about VAT, which is practically
un-returnable in Ukraine, problems with land acquisition, dishonest
competition and problems with raw material supplies. The Ukrainian
government has not yet addressed these problems. -30-
===============================================================
UKRAINE INFORMATION WEBSITE: http://www.ArtUkraine.com
===============================================================
11. LETTER TO THE EDITOR RE: "BETRAYING THE REVOLUTION"

LETTER TO THE EDITOR
From Lidia Wolanskyj, Ukraine (lidia@ln.ua)
The Action Ukraine Report #488, Article Eleven
Washington, D.C., Fri, May 20, 2005

Re: "Betraying A Revolution" Op-Ed by Anders Aslund,
The Washington Post, Wednesday, May 18, 2005
The Action Ukraine Report #487, Article One
Washington, D.C., Thu, May 19, 2005

While I generally appreciate and respect his views, I think Mr.
Aslund's claims are a little wild in this article, and it's disappointing
to see such a reputed professional write like this.

Ukraine's economy began to slow sharply last August and September,
when Mr. Yanukovych suddenly increased pensions and began to
deplete the Budget and stimulate high inflation. Meat has not
disappeared off any shelves to the best of my knowledge, at least
not in western Ukraine where it is now mostly well below the Hr 20
mark per kilo. As to businesses shutting down, that also does not
appear to be true.

Yes, some companies scrambled to re-organize themselves in
anticipation of a higher tax burden, but most of them are still
functioning. Other tax changes that were potentially nasty, such as
freelancers paying full payroll taxes rather than a flat tax after
more than 30 days of working for an organization, are still under
development and have not been instituted.

There is supposed to be a large conference with SMEs shortly to
work out a better approach precisely to this issue. Ms. Tymoshenko
is doing a lot of strange things, but it makes no sense to exaggerate
the fallout at this time.

Sincerely, Lidia Wolanskyj (lidia@ln.ua)
Journalist; Founder, The Eastern Economist
===============================================================
12. UKRAINIAN PRESIDENT WELCOMES BBC OFFICE OPENING IN KIEV

Interfax-Ukraine news agency, Kiev, in Russian, 19 May 05
BBC Monitoring Service, UK, in English, May 19, 2005

KIEV - Ukrainian President Viktor Yushchenko has welcomed the opening
of a representative office of the BBC television company in Ukraine.
"The opening of a BBC representative office is an important event in the
Ukrainian media field. I sincerely congratulate the Ukrainian TV viewers and
BBC staff," the president's letter said.

"The BBC was the first company to answer my call to foreign media to expand
their presence in Ukraine. I am convinced that we have much interesting and
fruitful work to come in Kiev," Yushchenko said.

Yushchenko said that Ukraine is opening itself to the world, which has seen
the Ukrainian people as real Europeans, who above all value freedom and
democracy. "We want the interest in Ukraine to grow so that we are known
and understood. I believe that the BBC will help us reach this goal,"
Yushchenko said.

He added that it is just as important for Ukrainian people open an
information window to Europe. "This is very much needed for Ukraine's
successful integration into the European Union. The more we know about
each other the shorter the distance between us becomes," Yushchenko
stressed.

"The [BBC's] decision to expand its presence in Ukraine is the best sign
of positive changes in the field of media freedom and journalists' rights
in our country," Yushchenko said. -30-
===============================================================
13. RADIO FREE EUROPE/RADIO LIBERTY BACK ON FM RADIO IN KYIV
Dramatic change in the media climate in Ukraine

Radio Free Europe/Radio Liberty (RFE/RL)
Prague, Czech Republic, Thu, May 19, 2005)

PRAGUE - Radio Free Europe/Radio Liberty Ukrainian-language broadcasts
can again be heard on FM in Kyiv, after a break of nearly a year. The
Ukrainian capital's most popular radio station, "Voice of Kyiv" began
rebroadcasting RFE/RL Ukrainian service programs on FM 98 on May 9.

RFE/RL president Thomas A. Dine welcomed the launch, saying "this is
good for Voice of Kyiv and good for RFE/RL, but above all it is good for
Ukrainian listeners to have access to another source of independent news
and analysis."

Dine also noted that "the revived interest of Ukrainian media in carrying
RFE/RL programs reflects a dramatic change in the media climate in Ukraine
under the presidency of Viktor Yushchenko." Ukrainian Service programs of
RFE/RL were previously rebroadcast on FM by Ukraine's Dovira national
network, but dropped under pressure from the Kuchma regime in February
2004, prior to the contentious Fall 2004 presidential elections.

"Voice of Kyiv" airs RFE/RL's Ukrainian Service programs two hours daily in
prime time. A live morning show, "Morning Liberty," produced in RFE/RL's
Kyiv bureau is on the air from 0600 to 0655 [0300-0355 UTC]. "Evening
Liberty," a nightly, call-in talk show is broadcast five times a week from
2000 to 2055 hours (1700-1755 UTC).

The show is moderated from RFE/RL's Prague operations center and features
two guests of opposing views in Ukraine. RFE/RL's Ukrainian Service Director
Alexander Narodetsky says" the impact of "Voice of Kyiv" is already
significant, with many listeners from Kyiv calling in comments, whereas
previously we had no calls from Kyiv listeners."

Outside of Kyiv, RFE/RL Ukrainian-language broadcasts can be heard on
shortwave and satellite and, in Kharkiv and several other cities, on FM, AM,
UKW and cable radio frequencies. The Ukrainian Service is actively working
to expand partnerships with other radio stations, in an effort to achieve
nationwide FM coverage for RFE/RL Ukrainian language broadcasting.

RFE/RL's Ukrainian Service broadcasts nearly 7 hours of programming a day
Monday through Friday, and 3 hours every Saturday and Sunday, with programs
produced in Prague and the service's Kyiv Bureau. Ukrainian Service
programming is available via the Internet, at the service's website
www.radiosvoboda.org and at www.rferl.org.

Radio Free Europe/Radio Liberty is a private, international communications
service to Central, Eastern and Southeastern Europe; the Caucasus; and
Central and Southwestern Asia funded by the U.S. Congress through the
Broadcasting Board of Governors. -30-
---------------------------------------------------------------------------------------------------------------
CONTACT: Donald Jensen +1-202-457-6947; Radio Free Europe/
Radio Liberty, 1201 Connecticut Ave NW, Washington, DC 20036
tel: 202-457-6900, fax: 202-457-6992; http://www.rferl.org
===============================================================
14. EUROVISION: DODGY TUNES, DUBIOUS COSTUMES, A SYMBOLIC
FERN AND A LITTLE BIT OF POLITICS
Neil Perry looks forward to Saturday's Eurovision song contest in Kiev

By Neil Perry, Guardian
London, United Kingdom, Thursday May 19, 2005

'Lies be the weapons of mass destruction' ... Ukraine's Eurovision entrants
Greenjolly

From revolution to Eurovision in a matter of months, Ukraine's journey from
gloomy former Soviet republic to leading democratic light has been both
swift and timely. Ukrainian Ruslana's win in Istanbul last year has meant
that it falls to capital Kiev to host the annual festival of pop kitsch.

What better way to celebrate the nation's new-found freedom than to have
all your new Euro-friends come over and have a bit of a sing-song, with the
whole world looking on and smirking - sorry, nodding - approvingly?

As the Swedish entrant, Martin Stenmarck, enthuses: "There's going to be
lights and all kinds of different stuff everywhere!" Not to mention the
prospect of spectacularly dodgy tunes, dubious costumes, Terry Wogan at
his acerbic best and Norway receiving nul points. They were the first nation
to achieve nul points three years in a row, but then what do you expect if
you write songs about hydro-electric power stations, as they did in 1980?

According to a Ukrainian Eurovision website: "Bright green, light blue and
orange will be the most popular colours during Eurovision 2005 in Kiev.
These colours are the key elements of the contest design along with a fern
which symbolises awakening and anticipation of a miracle."

It continues: "Some other projects have been considered as well. One of them
is the project created by Boris Krasnov, a well-known designer from Moscow,
who came up with the idea to use flowers and national Ukrainian towels."

Of course, the key word here is... no, not towels, but orange. This year's
Ukrainian Eurovision hopefuls, Greenjolly, were cheerleaders for Ukrainian
opposition leader Viktor Yushchenko during the country's recent Orange
Revolution.

Days before Ukrainian TV viewers were due to choose their Eurovision
candidate, it was realised that the favourite to win, Ani Lorak (officially
Ukraine's sexiest woman) had stood on the wrong side of the barricades
during last November's revolution. Lorak had made the mistake of performing
at concerts in support of losing presidential candidate - and according to
his detractors, Russian stooge - Viktor Yanukovich.

"Together we are many, we will not be defeated!" went Greenjolly's original
lyrics to their winning song Razom Nas Bahato. "No falsifications, no lies,
no machinations, yes Yushchenko!" The Eurovision committee tried to ban
their 'political' song, but Greenjolly tweaked the lyrics and came up with
the equally snappy, and definitely apolitical, "Revolution is on! 'Cos lies
be the weapons of mass destruction!"

"Is this a song contest or a vote-for-your-neighbour-contest?" Terry Wogan
once asked after certain geographically-close nations started cosying up to
each other. No chance of that happening with Ukraine.

Not that a little bit of politics hasn't flared up elsewhere. Lebanon has
withdrawn from the contest altogether, as the national broadcaster
Télé-Liban could not guarantee that it would air the Israeli entrant's
performance. Russia, meanwhile, risks incurring the wrath of Condy Rice
with its US-bashing Nobody Hurt No One, which begins, "Hello sweet
America, where did our dream disappear?" Lyrics provided by one V
Putin, presumably.

Happily, Turkey, with their entry Rimi Rimi Ley, continues a grand tradition
of Eurovision songs with daft titles and babytalk lyrics. Begun by France in
1959 with Oui Oui Oui Oui - and continued by them two years later with Binge
Bong, Binge Bong, the baton was picked up in the 1960s by Spain with La La
La (repeated 138 times during the song) and our very own Lulu's Boom Bang
A Bang (which scandalously had to share first place with three other
nations).

In 1975 the Dutch won with Ding Ding Dong, a year later the Finns offered up
Pump Pump, and in 1984 Sweden took the honours with Diggi-Loo Diggi-Ley
(apparently Terry Wogan's least favourite Eurovision winner ever, which is
saying something).

Our favourite Eurovision losers must be the bland and tuneless Jemini, who
took the UK to new lows with their nul points in 2003. So who will win nul
points this year? How about the Cypriot entrant, Constantinos Christoforou,
who sings "My persistence is outrageous/You'll be mine 'cos I'm contagious"?

How about Javine, flying the flag and flashing a bit of thigh for Blighty,
who might find herself the unwitting victim of tactical voting by our still
pissed-off European neighbours determined to make the UK pay, in some
small way, for Iraq? Nah. My money's on Wig Wam, four guys in white leather,
lipstick, fake fur and shades, with a singer called Glam and ... can you
guess where they're from yet?

Over to John in Oslo. "These guys are the best we can come up with as a
country. It is indeed embarrassing to be a Norwegian, and cool too... The
pastiche is somewhat muffled by the fact that these old men don't have an
'agenda', the irony - the irony - it is indeed confusing." -30-
===============================================================
15. REBEL CHECHEN GOVERNMENT HOPES FOR BETTER
FUTURE FOR TATARS IN UKRAINE
Appeal by Chechen Republic of Ichkeria to Crimean Tatar people.

Government of the Chechen Republic of Ichkeria,
Chechenpress, official information department
Chechenpress web site, in Russian 19 May 05
BBC Monitoring Service, UK, in English, Thu, May 19, 2005

Dear brothers and sisters,

The most tragic date in the history of the Crimean Tatars, the deportation
of the entire Tatar people from the Crimean Peninsula to Central Asia on
accusations of support for Germany, which was fighting the Soviet empire,
turned 61 on 18 May. Shortly before (on 23 February 1944) the Chechens and
Ingush were massively deported to Kazakhstan and Kyrgyzstan exactly under
the same pretext.

In all, about 3 million people including the peoples in the North Caucasus,
Crimea, the Volga and other regions were moved to special settlements in
the eastern part of the USSR on Stalin's orders in 1943-1944, while the
autonomous entities of those peoples were abolished. [Passage omitted:
examples, further developments in USSR, restoration of some autonomies]

As is known, the Supreme Soviet of the Russian Soviet Federative Socialist
Republic adopted a law "On the rehabilitation of repressed peoples" on 26
April 1991. However, this law is actually effective only on paper and many
peoples repressed during the so-called "Great Patriotic War" again turned
out to be in the iron grip of the Russian empire, which disguises itself
under the mask of "democracy" this time.

For example, the Ingush did not only not get back their native lands in
Prigorodnyy District, which were "gifted" by Stalin to North Ossetia in
1944, but also they were not allowed to resettle in their own houses in this
district after the developments provoked by the Russian special services in
1992. Over the past 11 years, the Chechen people has had to face the
severest trials of two wars of genocide launched by the Kremlin regime,
which has claimed the lives of over 250,000 people of the Chechen Republic
of Ichkeria, not to mention the republic's entirely ruined infrastructure.

The percentage of these immense human casualties (some 25 per cent) can
be compared only with the casualties suffered by the Chechen, Ingush,
Balkar, Karachay, Kalmyk, Crimean Tatar and other peoples deported in the
years of World War II with Stalin's "eternal exile" resolution.

But the fraternal Crimean Tatar people has one advantage over other
persecuted peoples: they are somehow lucky to have the Ukrainian people,
which itself suffered severely under Moscow. It is enough to mention the
monstrous artificial famine in Ukraine in the years of the so-called Stalin
"collectivization", which claimed the lives of millions.

The Chechen people said goodbye to its mourning back on 23 February 1994
and announced the day of mourning for the victims of the genocide of 1944 as
the day of revival of the Chechen nation. The first president of the Chechen
Republic of Ichkeria, Dzhokhar Dudayev, who, God willing, became the
immortal martyr at the end of the first Russian-Chechen war [1994-1996],
said the following in a nationwide rally dedicated to the 50th anniversary
of the deportation of the Chechen people: "We will not mourn. We will not
lose heart. And we will not forget". These words by General Dudayev were
engraved on the wall of the memorial to commemorate the victims of the 1944
deportation in the Chechen capital of Dzhokhar (formerly Groznyy).

The president of the Chechen Republic of Ichkeria, Aslan Maskhadov, who, God
willing, also became a martyr during the second Russian-Chechen war [which
began in 1999], said that "the pain of losses in those remote years did not
mark the end to the bitter fate of the Chechen people. It has become part of
our tragic present day, in which the genocide of the people is still going
on in a more sophisticated and cynical manner".

We would like to hope that finally the national problems of the Tatars in
Crimea will be honestly and fairly resolved with the accession of the new
leadership to power in Kiev and "the pain of losses in those remote years
will be an end to the bitter fate" of the fraternal people of Crimea and it
will never be subjected to genocide like Stalin's deportation 61 years ago.

For the revival of the Tatar nation of Crimea! -30-
===============================================================
16. UKRAINE-NATO TALK ANNOYS RUSSIA
As Ukraine makes steady progress towards joining NATO, Russia's
grumblings grow more threatening and some observers warn the US
against provoking the "Russian bear" unnecessarily.

By Jeremy Druker for ISN Security Watch
International Relations & Security Watch (ISN)
Zurich, Switzerland, Thursday, 19 May 2005

Anyone who heard Russian President Vladimir Putin's recently grumbling
and vague threats over Ukraine's possible entry into NATO should get
used to it.

For all the grand talk about speeding up NATO integration following
Ukraine's "Orange revolution", it will still be years before Ukraine joins
the alliance. Neither Ukraine nor NATO appear in much of rush, though
Russian opposition is only partly to blame. While Ukraine's membership is
not yet on the horizon, Putin has evidently decided that he should air his
displeasure as soon as possible.

"The fact that NATO exercises a great influence on Ukraine or Georgia does
not indispose us," he said in an interview broadcast on French television on
7 May. "On the other hand, all enlargement of NATO does not [necessarily]
improve security in the world." And, he said, rather ominously, "Ukraine
could have problems, I say this frankly."

UKRAINE'S WESTWARD PROGRESS
Whatever his motivations, that Putin even deemed it necessary to express his
misgivings about Ukraine's integration represents progress in itself. Just a
few months ago, before the election to the Ukrainian presidency of the
reform-minded and pro-Western Viktor Yushchenko, Putin's words would have
seemed premature. Under the previous government of president Leonid
Kuchma, integration had stalled over continued democratic failings and
rampant corruption.

Kuchma himself was implicated in the illegal sale of the Kolchuga radar
system to Iraq, and, in response to repeated criticism from NATO, he signed
a decree changing the country's defense doctrine. The specific goals of
joining NATO and the EU were removed and replaced with the vaguely worded
intention of striving for "Euro-Atlantic integration". Kuchma had also
hand-picked a successor, then-prime minister Viktor Yanukovych, who seemed
intent on closer ties with Russia. NATO membership seemed only a dream to
a group of pro-Western reformers.

KIEV READIES ITSELF MILITARILY
Yushchenko's victory and his vow to make NATO accession a major priority
have rapidly reversed those previous calculations. Foreign Minister Borys
Tarasyuk has said that Kiev could complete the necessary military and
political reforms within just three years. Yushchenko has just celebrated
his first 100 days in office - far too early to make any judgments about
democratization - but the idea that Ukraine could be ready militarily in the
near future is not far-fetched.

Ukraine has been involved in NATO's Partnership for Peace (PfP) activities
since the program began in 1994, and in 1997 the country signed a "Charter
on a Distinctive Partnership". In December 1999, Kuchma initialed a decree
on defense reform that paved the way for NATO to monitor Ukraine's reforms
and provide regular consultations and advice. In the past few years, real
defense reform has taken place, with sharp reductions in troops, an increase
in readiness levels, and heightened transparency.

WESTERN RELUCTANCE
The real obstacles to accession may loom elsewhere, including in the West's
reluctance to upset Putin. In April, NATO foreign ministers offered Ukraine
a plan for fast-track membership, but officials stressed that Kiev would not
be offered a fixed date for entry, for fear of harming relations with
Russia. Those sensitivities may have been heightened further last week with
the signing of a partnership between the EU and Russia.

On Tuesday, the two sides initialed an agreement on boosting cooperation
in areas such as the economy and external security. The EU is Russia's
largest trading partner, with over half of Russia's exports going to the
bloc, including one-fifth of the EU's oil and gas needs. Russia is the EU's
fifth-largest trade partner, with bilateral trade totaling US$125 billion in
2004.

'POKING THE RUSSIAN BEAR'
In addition, for all the admiration and raucous applause that Yushchenko
received on his recent visit to Washington, opinion in the US also appears
split on how quickly to push for Ukraine's membership in NATO. The lead
editorial in last Wednesday's LA Times, for example, called on President
George Bush to tone down his rhetoric about NATO accession for some of
the former Soviet republics. Entitled "Poking the Russian Bear", the article
read: "Before he goes any further in emboldening Georgia and Ukraine, Bush
should reconsider and avoid needlessly antagonizing Russia.

Washington should have good relations with the former Soviet republics and
encourage their democratic evolution, but it would be counterproductive for
the US to make Russia feel increasingly encircled by NATO." The editorial
continued: "The fate of Russia's own democracy is uncertain under Vladimir
V. Putin, and Western disregard for Russian pride and security concerns
could make matters far worse by unleashing a nationalistic backlash."

A REPEAT OF NATO'S 1990'S ACCESSION
In many ways, the talk of Russian pride and a "nationalist backlash" is
remarkably similar to language used in the early 1990s before the first wave
of NATO accession. The Times' warnings that "the West needs Russia as
a friend, not an enemy" (to deal with problem areas such as Iran and North
Korea) could have been lifted verbatim from editorials opposing NATO
enlargement a dozen years ago, especially in relation to the Baltics.

Yet, over time, Russia modified its stance and understood that it could do
little to nothing to delay the process. Putin made clear in the interview on
French television that the incorporation of Lithuania, Estonia, and Latvia
still represented a sore point. "I don't see in what way enlarging to our
Baltic neighbors, for instance, can improve the security of the world," he
said. His bitterness, however, seemed just as much tied to what Russia
perceives as discrimination against the Russian-speaking minorities in
these states.

OTHER REASONS FOR WESTERN RELUCTANCE?
Yet "not upsetting" Russia may also be a convenient excuse to mask the
unwillingness of key Western allies to enlarge for different reasons. "I
suspect Western resistance to Ukraine's Western integration [into NATO and
the EU] has increasingly less to do with Russia," says Tomas Valasek, the
director of the Brussels office of the Center for Defense Information (CDI).
"Now that the Baltic states are in NATO the Rubicon has been crossed, so
to speak.

Some of the allies - mostly grouped around the key EU founding states [such
as France and Belgium] - are not too keen on seeing NATO enlarge or do
anything particularly useful, for that matter. They would like to see most
of its defense and security responsibilities gradually migrate over to the
EU. Enlargement of NATO to Ukraine goes against this strategy; it makes
NATO more useful, more relevant, more vigorous."

PRACTICAL CONCERNS
But there are a number of practical concerns that also make Ukraine's
accession unique compared with the other Central and Eastern European
states that have entered the alliance in recent years. For one thing, none
of the new member states still had Russian troops or bases on their
territories during the accession process. Ukraine does and will have for
the near future. Stationed in the port city of Sevastopol on the Crimean
peninsula since the early 19th century, the Black Sea Fleet's continued
presence on Ukrainian territory falls under a 1997 agreement that will
expire only in 2017.

Top Ukrainian officials, including President Yushchenko, have complained
numerous times in recent weeks that Russia has refused to honor key points
of the deal, including allowing Ukrainian inspectors to enter the grounds of
the Sevastopol naval base to check on the technical state of the berths. In
March, a more visible violation occurred when a Russian naval landing force
conducted a large-scale military exercise, entered Ukrainian waters, and
seized a beachhead without notifying Ukraine or asking for permission.

But despite their criticism, Ukrainian officials have said they would not
unilaterally cancel the agreement. They have also insisted that NATO has
made it clear that the Black Sea Fleet would not be a stumbling block in
accession talks. "The Black Sea Fleet is not an obstacle for NATO 'in
principle'," says James Sherr, a fellow in the Conflict Studies Research
Centre at Britain's Defense Academy and a leading authority on Ukraine and
defense reform. "Yet it will be in practice until Ukraine is happy with the
terms under which the fleet is based and with Russia's observance of those
terms."

What is needed, he says, is for the two sides to work out their differences
and for the Ukrainian parliament to approve a NATO-style Status of Forces
Agreement. "NATO will pose no obstacle so long as the basing modalities
are not a subject of dispute," he adds.

A LEGITIMATE AREA OF CONCERN
Putin may have been trying to intimidate with his talk of the "problems"
that integration would bring Ukraine, but one of the examples that he
raised - military research and development - is a legitimate area of concern
for both Russia and Ukraine. Currently, many Ukrainian companies act as
suppliers to the Russian military machine. Putin said that relationship
would end: "If there were a NATO military presence in Ukraine, I wouldn't
maintain our latest technologies and our sensitive armaments." The
cancellation of such contracts would certainly lead to a loss of jobs and
could have a serious financial impact on parts of the country that are
dependent on military production.

UKRAINE'S OWN POLITICAL WILL
Despite all these largely external obstacles, the greatest factor in slowing
down Ukraine's integration in the alliance may actually be the country's own
will. Yes, Yushchenko and others have reaffirmed Ukraine's bid and are
welcome guests in Brussels, but they have also said EU accession was more
important. Much of the political elite does, however, understand that NATO
membership will be a key step that will make the EU more obtainable. The
question remains whether the public will agree.

Yushchenko has said the issue should be put to a referendum. And, unlike
the experience in most of the new NATO member states, a "yes" vote could
be very much in doubt. "There should be no hurry with this," says Oleg
Varfolomeyev, a Kiev-based political analyst. In fact, if a NATO membership
referendum were held now, Ukrainians would most certainly reject the idea.
NATO is unpopular in Ukraine, and not only decades of the Soviet brain-
washing are to blame for this."

Varfolomeyev points to the unpopularity of the NATO-led bombing of
Yugoslavia, as well as the popular confusion that NATO played a role in the
Iraq war. "Last week, Yushchenko mentioned some sociological research that
showed that only 2 per cent of Ukrainians are sure that they know what NATO
is all about. Education will take time," he adds. -30-
----------------------------------------------------------------------------------------------------------
Jeremy Druker is the editor-in-chief of Transitions Online (www.tol.cz), an
Internet newsmagazine covering Central and Eastern Europe, the Balkans,
and the former Soviet Union. (drukerj@tol.cz)
LINK: http://www.isn.ethz.ch/news/sw/details.cfm?ID=11302
===============================================================
17. EXCHANGE OF EMPIRES: WHO WILL DARE TO FILL THE BLACK
HOLES LEFT BY RUSSIA'S LONG RETREAT?

By Timothy Garton Ash in Tiraspol, Transnistria
The Guardian, London, United Kingdom, Thur, May 19, 2005

Sitting in a cafe on Lenin Street, next to three smartly turned-out female
officers in dark green KGB uniforms, I had this wild thought: can the Soviet
Union join the European Union?

For the surreal breakaway para-state of Transnistria on the east bank of the
river Dniestr looks at first glance like a miniature version of the old
Soviet Union. In the heart of the capital, Tiraspol, a giant redstone Lenin
stands proudly before the Supreme Soviet. Across 25 October Street, named
for the Russian revolution of 1917, is the obligatory tank on a plinth. In
the House of Pioneers display boards show gnarled, bemedalled Soviet war
veterans explaining to eager youths "How Good It Is Without War!"

Not just on Lenin Street but on Soviet Street, Communist Street and Peace
Street every third person seems to be in uniform. The arm badges of those
female officers, whose elaborate make-up, brightly dyed hair and high-heeled
leather shoes nicely set off their pristine uniforms, proclaim that they
belong to the ministry of state security (MGB), but informally people still
call them KGB. In every government office there is a sullen secretary, a pot
plant and a framed portrait of the leader.

It makes me feel almost nostalgic. But look a little more closely and things
are not as they seem. In the basement of the House of Pioneers, the kids are
playing western computer games: Tomb Raider, Tank Racer. The shops on
25 October Street include Adidas and a fast-food restaurant decorated with
giant, blown-up photos of American skyscrapers. Up the road, there is a vast
new sports complex built by the biggest local company, which is called
Sheriff, a tribute to the wild west frontier marshals of the US.

At the Hotel Timoty, the receptionist, Tania, is dressed in a stretchy white
tracksuit, emblazoned Dolce e Gabbana. Not the genuine article, of course.
She explains to me that the hotel's name - Timoty - in the Russian version,
stands for TIraspol-MOscow-TIraspol, signalling the heavy involvement of
Russian capital.

Even the tank on the plinth tells a new story. It commemorates not the
Soviet Union's great patriotic war of 1941-45 but the heroic "war" of 1992,
in which the local forces of this heavily Sovietised, largely Russian-
speaking strip of land, aided by the Russian 14th army, won their de
facto autonomy from the authorities of Moldova, who had adopted the Latin
rather than Cyrillic script for their Moldovan/Romanian state language, and
were tentatively reorienting the territory west of the river Dniestr towards
Romania, Europe and the west.

Since then, the entity which in English is most conveniently called
Transnistria (ie across the Dniestr, seen from the west) and which in
Russian styles itself, literally translated, the On-the-Dniestrian Moldovan
Republic, has equipped itself with its own flag, crest (with hammer-and-
sickle), anthem, president, parliament, uniformed border guards,
security service, police, courts, schools, university, constitution - most
of the attributes of statehood, except international recognition.

Its president, Igor Smirnov, who looks like a cross between Dr Faustus
and a provincial dentist, runs a repressive, corrupt regime, sustained by
virtually free energy supplies from the Russian Gazprom, the presence of
a small number of Russian troops, some local industry - including arms
factories - and, by most accounts, a good dose of illegal trafficking in
arms and people.

While a recent offer to undercover Sunday Times reporters to sell them a
post-Soviet Alazan missile with a "dirty bomb" warhead may have been a con
job, western experts in the area believe that weapons supplies to rogue
regimes and potential terrorists do come from, or through, Transnistria.

Now, however, the Smirnov regime is under pressure. To its west, the
president of the internationally recognised Moldovan state, though himself a
communist, is trying to get closer to the European Union and the United
States. On its other three sides is Ukraine, where the orange revolution has
produced a more pro-western president with a greater interest in closing
this black hole. The EU and the US are again looking at possible negotiated
solutions. Smirnov also faces some opposition at home, which is partly
supported by the mighty Sheriff oligarchs. Even in Transnistria, there is
just the faintest smell of orange.

Sitting in the bare, cold offices of his foundation for the defence of human
rights, Alexander Radchenko tells me that Smirnov "has the powers that
Stalin had, or Saddam Hussein". He and other parliamentarians want to
change the constitution to allow them to impeach the president, strengthen
the constitutional court, and so on. He has received threatening phone
calls: "You can end up in the Dniestr."

Yet on closer questioning it emerges that what Radchenko, a stocky former
political commissar in the Red Army, would really like is less a "return to
Europe" than a return to the Soviet Union. "Of course!" he exclaims,
flashing several gold teeth as he smiles, "in the Soviet Union there was
peace, friendship among the people, and welfare. There was no unemploy-
ment, no homelessness, no drug addicts, no prostitutes, no
people-trafficking." The rot set in, he says, soon after Stalin died. This
is orange Transnistrian-style.

What does Transnistria matter to anyone who is not, as I am, a lover of the
Tintinesque and a connoisseur of obscure east European conflicts? Perhaps
not much - except to the people who live there, to the women who are
brutally trafficked from there, and to those who are killed by the weapons
coming out of there. Yet it also highlights a historical development - only
half-perceived by most of us - which has driven so many of the changes we
have witnessed in Europe over the last quarter century, and is still driving
change in Europe today.

That development is the decline and fall of the Russian empire. At first, it
was possible to believe that this was just the fall of the Soviet empire,
not the Russian one. When you reach Georgia, Ukraine and places like
Transnistria, that is no longer possible. In the centre of Tiraspol is a
giant statue of Field Marshal Alexander Suvorov. It marks the conquest of
this territory and the founding of this city by the great tsarist general,
at the end of the 18th century. Here, it's not just the Soviet but the
tsarist empire that is crumbling.

We Europeans now have three choices. We can leave places like this as
black holes. We can allow the US to become the new imperial power. Or
we can decide that the European Union, in a security partnership with the
United States, should gradually expand to bring more freedom, respect
for human rights and a long-term prospect of prosperity, even to such parts
of the former Soviet Union. Provided, of course, the people living there
want it to.

Yet the EU is the most reluctant empire in the history of humankind. The
enlargement that we have done thus far is already fuelling the no vote in
core countries like France. If the EU does not expand to take in more parts
of the former Soviet Union, places like Transnistria will remain black
holes. If it does, the European Union risks itself going the way of the
former Soviet Union. That is the dilemma we see illuminated, as by a Red
Army rocket flare, on the left bank of the river Dniestr. -30-
===============================================================
18 BUSH PROPOSES CORPS TO AID NEW DEMOCRACIES
President Cited Rose in Georgia, Orange in Ukraine, Purple in Iraq

By Deb Riechmann, Associated Press Writer
Associated Press, Washington, D.C., Wed, May 18, 2005

WASHINGTON - President Bush, seeking to put U.S. government muscle
behind a promise to support young democracies, said Wednesday the
administration is creating a special corps of federal workers that can
quickly deploy to help governments in crisis.

Citing the difficulty in establishing the U.S.-run occupation government in
Iraq after Saddam Hussein's ouster, Bush is proposing $100 million next
year for a new conflict response fund and another $24 million for a new
Office of Reconstruction and Stabilization in the State Department.

That office will coordinate U.S. government efforts to support emerging
democracies, with the new Active Response Corps of foreign and civil
service officers as a crucial tool, Bush said. "This new corps will be on
call - ready to get programs running on the ground in days and weeks
instead of months and years," Bush said, according to remarks prepared
for delivery to the International Republican Institute [IRI], a federally
funded group that promotes democracy worldwide. "If a crisis emerges
and assistance is needed, America will be ready."

The remarks, in which Bush said the United States is ramping up its ability
to aid emerging democracies, follows a European tour aimed at encouraging
nations along the path to greater freedoms and transparency.

Bush cited a series of revolutions over the past 18 months in ex-Soviet
republics and across the Middle East: the Rose in Georgia, Orange in
Ukraine, Purple in Iraq, Tulip in Kyrgyzstan and Cedar in Lebanon.

"These are only the beginning," he said. "We are seeing the rise of a
new generation whose hearts burn for freedom - and they will have it."
He aimed to encourage nations in the hard, often-disappointing times
that follow elections.

What must follow, Bush said, is the building of strong institutions, such as
a vibrant press, independent judiciary, peaceful opposition and free
economy, to support the new freedoms. Citing the example of America,
which progressed to a mature democracy through fits and starts over man
decades, Bush said those institutions can be a long time in coming.

"When people risk everything to vote, it can raise expectations that their
lives will improve immediately," the president said. "Almost every new
democracy has gone through a period of challenge and confusion." He
promised U.S. assistance on a number of fronts.

The administration has spent $4.6 billion over more than four years
supporting democratic change, and will increasingly focus future funding
on programs to help new democracies after elections are over.

Bush also promised that military forces will be rebalanced with an eye
toward making them "more effective in helping societies transition from
war and despotism to freedom and democracy," in part by adding military
police and civil affairs specialists. "Those who claim their liberty will
have an unwavering ally in the United States," Bush said. -30-
-------------------------------------------------------------------------------------------------------------
FOOTNOTE: The person in charge of the new Office of Reconstruction
and Stabilization in the U.S. State Department is former U.S. Ambassador
to Ukraine Carlos Pascual. [EDITOR]
===============================================================
19. "IMPLEMENTING BUSH'S VISION"
To Effectively Spread Democracy, We Must Balance Values
and Geopolitical Challenges

OP-ED By Henry A. Kissinger
The Washington Post, Washington D.C.
Monday, May 16, 2005; Page A17

Extraordinary advances of democracy have occurred in recent months:
elections in Afghanistan, Iraq, Ukraine and Palestine; local elections in
Saudi Arabia; Syrian withdrawal from Lebanon; the opening up of the
presidential election in Egypt; and upheavals against entrenched
authoritarians in Kyrgyzstan. This welcome trend was partly triggered by
President Bush's Middle East policy and accelerated by his second
inaugural address, which elevated the progress of freedom in the world
to the defining objective of U.S. foreign policy.

Pundits have interpreted these events as a victory of "idealists" over
"realists" in the debate over conduct of American foreign policy. In fact,
the United States is probably the only country in which "realist" can be
used as a pejorative epithet. No serious realist should claim that power is
its own justification. No idealist should imply that power is irrelevant to
the spread of ideals. The real issue is to establish a sense of proportion
between these two essential elements of policy. Overemphasis of either
leads to stagnation or overextension.

Values are essential for defining objectives; strategy is what implements
them by establishing priorities and defining timing.

Strategy must begin with the recognition that the freedom agenda does not
make geopolitical analysis irrelevant. There are issues for which crusading
strategies tend to be off the mark. The rise of China is, in essence, a
geopolitical challenge, not a primarily ideological one.

U.S. relations with India are another case in point. During the Cold War,
India saw no imperative to support the cause of democracy against
communism. Its national interest was not involved in issues such as the
freedom of Berlin. Now India is, in effect, a strategic partner, not because
of compatible domestic structures but because of parallel security interests
in Southeast Asia and the Indian Ocean, and vis-a-vis radical Islam.

In its own terms, a clear-eyed commitment to the freedom agenda should
keep these principles in mind:

· The process of democratization does not depend on a single decision and
will not be completed in a single stroke. Elections, however desirable, are
only the beginning of a long enterprise. The willingness to accept their
outcomes is a more serious hurdle. The establishment of a system that
enables the minority to become a majority is even more complex.

· Americans need to understand that successes do not end their engage-
ment but most probably deepen it. For as we involve ourselves, we bear the
responsibility even for results we did not anticipate. We must deal with
those consequences regardless of our original intentions and not act as if
our commitments are as changeable as opinion polls.

· Elections are not an inevitable guarantee of a democratic outcome.
Radicals such as Hezbollah and Hamas seem to have learned the mechanics
of democracy in order to undermine it and establish total control.

As the world's dominating democratic power, we must relate values to
power, institutional political change to geopolitical necessities. In
countries where a vacuum must be filled and U.S. forces are present, the
American capacity to affect events is considerable. Even then, however, it
is not possible to automatically apply models created over centuries in the
homogeneous societies of Europe and the United States to ethnically
diverse and religiously divided societies in the Middle East, Asia and
Africa.

In multiethnic societies, majority rule implies permanent subjugation of the
minority unless it is part of a strong federal structure and a system of
checks and balances. To achieve this by negotiation between parties that
consider dominance by the other groups a threat to their very survival is an
extraordinarily elusive undertaking. It will, however, determine the degree
to which democratic goals in Iraq and, to a lesser extent, in Afghanistan
can be achieved.

Lebanon illustrates another aspect of these considerations. The upheaval
that expelled Syrian forces is a testimony to the growth of popular
consciousness but also to the changed strategic environment. Syria, too
weak to resist international pressures, may calculate that withdrawal
eventually will return the situation to the chaos that triggered Syrian
intervention in the first place.

Three times since 1958 -- the United States that year, Syria in 1976 and
Israel in 1981 -- foreign intervention held the ring in Lebanon to prevent
collapse into violence and to arbitrate among the Christian, Sunni, Shiite
and Druze groups that constitute the Lebanese body politic. The internal
conflict is made all the sharper because the established constitutional
arrangement no longer reflects the actual demographic balance.

At this point, the driving force in Lebanon is less democratic than
populist; it is a contest by which the factions organize competitive
demonstrations partially designed to overawe their opponents. The test will
be whether the United States and the international community are able to
bring about an agreed political framework and whether they can mobilize an
international presence to guarantee that the conflicting passions do not
once again erupt into violence, and that outside adventures are discouraged.

In Egypt and Saudi Arabia the vacuum is potential, not actual. A wise policy
will navigate between efforts to overcome stagnation and pressures that will
dissolve the existing political framework into a contest of radical factions
or the victory of one of them. The fundamentalist victory in the local
elections in Saudi Arabia illustrates this danger. Policies erring in either
direction could turn these countries into the Achilles' heel of the entire
Middle East policy. The United States has made clear its conviction that a
democratic evolution reflecting popular aspirations is a long-term
necessity. But it has not yet defined what it means either by that phrase or
an appropriate evolutionary process.

The revolution in Iran teaches the lesson of the risks of procrastination in
the 1960s and 1970s before the fundamentalist upheaval, but also of the
perils of pressures in the Carter administration that resulted in a system
far more autocratic than the shah's. Major strategic issues are at stake in
a sensitive handling of these concerns, including the viability of
Palestinian negotiation.

Finally, there is the challenge of how to deal with societies such as China
and Russia, which so far have relied on the Western political tradition only
to a small degree, if at all, in their transition to the globalized world.
They have used their own histories or national senses of identity as guides.

To what extent and by what means can the United States influence this
process? And in what direction? What level of understanding of domestic
context, influenced by centuries of history, is necessary to produce
confidence in desired outcomes? What price in medium-term strategic
interests are we prepared to pay?

No single nation is strong enough or wise enough to involve itself in every
political evolution around the world simultaneously. Priorities based on the
national interest are imperative. Otherwise, psychological exhaustion and
physical overextension are a real possibility, along with a global coalition
of the resentful and nationalistic resisting perceived American hegemony.

President Bush has put forward a dramatic vision. The national debate now
needs to focus on the concrete circumstances to which it must be applied.
The nongovernmental groups should participate in this process.

Having made their point about the importance of the subject, they should now
contribute to the development of a responsible substance. A strategy to
implement the vision of the freedom agenda needs consensus-building, both
domestically and internationally. That will be the test as to whether we are
seizing the opportunity for systemic change or participating in an episode.
---------------------------------------------------------------------------------------------------------
The writer, a former U.S. secretary of state, is chairman of Kissinger
Associates, New York, New York.
===============================================================
20. YUSHCHENKO TO TAKE PART IN SHEVCHENKO DAY MAY 22 IN KANIV
Taras Shevchenko: Artist, Poet, National Bard of Ukraine

UNIAN, Kyiv, Ukraine, Thursday, 19 May, 2005

KYIV - On 22 May President of Ukraine Victor Yushchenko will take part in
the traditional measures on occasion of the re-burial of Taras Shevchenko
(the most famous Ukrainian poet [and national figure]) at Chernecha mountain
in the city of Kaniv in the Cherkassy Oblast.

According to an UNIAN correspondent, Yushchenko’s spokes person
Iryna Herashchenko has disclosed this to journalists. Verkhovna Rada
chairman Volodymyr Lytvyn will take part in the Shevchenko Days together
with the President.

According to I.Herashchenko, V.Lytvyn and V.Yushchenko will take part in a
traditional march to the Tarasova mountain, will visit the museum of Taras
Shevchenko, and will lay flowers to the Monument of Glory. -30-
---------------------------------------------------------------------------------------------------------------
LINK: http://www.unian.net/eng
---------------------------------------------------------------------------------------------------------------
TARAS SHEVCHENKO, ARTIST, POET, NATIONAL BARD OF UKRAINE

The Kaniv Museum-Preserve contains the grave of Taras Shevchenko
(1814-1861) and a museum dedicated to his memory. A monument by
K. Tereshchenko was created in 1925. In 1939 a new bronze monument
by sculptor M. Manizer was erected and a museum designed by Vasyl
Krychevsky and P. Kostyrko was opened. Destroyed during the Second
World War by the German army, the museum and the monument were
rebuilt.

The Kaniv settlement is the site of an ancient Slavic settlement dating
back to the 7th-9th centuries A.D. situated along the right side of the
Dnieper River. The city of Kaniv was one of the most important cities in
Kievan Rus', it was mentioned in the Kievan Cave Patericon as existing
in the last half of the 11th century.

Taras Shevchenko was imprisoned by the Russian Czar in 1847 and
not released until 1857, two years after the death of Czar Nicholas.
Shevchenko was not allowed to live in Ukraine. He waited for half a
year in Nizhnii-Novgorod and then moved to St. Petersburg.

He was permitted to visit Ukraine in 1859 but was once again arrested
and sent back to St. Petersburg, where he remained until his under
police surveillance until his death in 1861.

Shevchenko was buried in St. Petersburg, but two months later his
remains were transferred to the Chernecha Hill, near Kaniv, in Ukraine,
a place loved by Shevchenko.

Shevchenko has a uniquely important place in Ukrainian history. He
created the conditions that allowed the transformation of Ukrainian
literature into a fully functional modern literature. His influence on
Ukrainian political thought and his role as an inspirer of a modern
democratic ideal of renewed Ukrainian statehood are without
parallel.

Shevchenko's poetry contributed greatly to the evolution of national
consciousness among the Ukrainian intelligentsia and people, and
his influence on various facets of cultural and national life is felt to
this day. (Encyclopedia of Ukraine, University of Toronto Press).
-------------------------------------------------------------------------------------------------------------
FOOTNOTE: For those of you who visit Ukraine if you are ever there
on May 22 be sure and go to Kaniv. A day to remember. [EDITOR]
===============================================================
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