"THE ACTION UKRAINE REPORT - AUR"
An International Newsletter
The Latest, Up-To-Date
In-Depth Ukrainian News, Analysis, and Commentary
"Ukrainian History, Culture, Arts, Business, Religion,
Sports, Government, and Politics, in Ukraine and Around the World"
"THE ACTION UKRAINE REPORT - AUR" - Number 549
E. Morgan Williams, Publisher and Editor
Published in Kyiv, Ukraine, TUESDAY, August 30, 2005
--------INDEX OF ARTICLES--------
"Major International News Headlines and Articles"
1. U.S. TO AID UKRAINE IN COUNTERING BIOWEAPONS
Pact Focuses on Security at Labs;
Russia Apologizes for Delay of Senate Delegation
By Joby Warrick, Washington Post Staff Writer
The Washington Post, Washington, D.C.,
Tuesday, August 30, 2005; Page A11
2. RUSSIA SORRY FOR U.S. SENATOR'S DETENTION
By Mara D. Bellaby, Associated Press Writer
AP, Kyiv, Ukraine, Monday, Aug 29, 2005
3. US SENATORS PLEDGE WORK FOR REPEAL OF JACKSON-VANICK
LAW AS IT PERTAINS TO UKRAINE AND HAMPERS TRADE
Reuters, Kiev, Ukraine, Monday, August 29, 2005
4. WASN'T THE COLD WAR SUPPOSED TO BE OVER?
In a minor spat, Sens. Lugar and Obama are
detained for three hours at a Russian airport
By Jeff Zeleny, Tribune correspondent
Chicago Tribune, Chicago, Monday, August 29, 2005
5. U.S. SENATOR RICHARD LUGAR OBTAINS NEW COUNTER
PROLIFERATION AGREEMENT WITH UKRAINE
Mark Helmke, Senior Professional Staff Member
U.S. Senate Foreign Relations Committee
United States Senate, Washington, D.C.,
Monday, August 29, 2005 6:01 PM
6. UKRAINE FAILS TO ATTRACT FOREIGN DIRECT INVESTMENT (FDI),
REKINDLE ECONOMIC GROWTH
Government's worst moves regarding investment are:
keeping VAT rate at 20% and liquidating free economic zones
ANALYSIS: Roman Bryl, Ukraine Analyst
Intellinews - Ukraine This Week
Kyiv, Ukraine, Monday, August 29, 2005
7. PRESIDENT YUSHCHENKO MEETS WITH UKRAINIAN WORLD
CONGRESS [UWC] REPRESENTATIVES
Press office of the President of Ukraine Victor Yushchenko
Kyiv, Ukraine, Thursday, August 25, 2005
8. PROBE INTO UKRAINE 'BABY THEFTS'
By Helen Fawkes, BBC News, Kiev
BBC, United Kingdom, Monday, August 29, 2005
9. LETTER OF BISHOPS OF POLAND AND UKRAINE ON RECONCILIATION
"We Have to Rise Above the Legacy of History, Forgive One Another"
ZENIT.org, Rome, Italy, Monday, August 29, 2005
10. CRISIS IN THE CONSTITUTIONAL COURT: A COURT WITHOUT JUDGES?
By Bohdan A. Futey, Legal Herald (Yurydychny Visnyk)
Kyiv, Ukraine, Friday, August 26, 2005
The Action Ukraine Report (AUR), No. 549, in English
Kyiv, Ukraine, Tuesday, August 30, 2005
11. WE OWE THEM A DEBT OF HONOUR
The Ukrainians and Turks can't be left out of the new Europe
COMMENTARY: Peter Preston, The Guardian
London, UK, Monday August 29, 2005
=============================================================
1. U.S. TO AID UKRAINE IN COUNTERING BIOWEAPONS
Pact Focuses on Security at Labs;
Russia Apologizes for Delay of Senate Delegation
By Joby Warrick, Washington Post Staff Writer
The Washington Post, Washington, D.C.,
Tuesday, August 30, 2005; Page A11
WASHINGTON - The United States and Ukraine agreed yesterday to work
jointly to prevent the spread of biological weapons, signing a pact that
clears the way for Ukraine's government to receive U.S. aid to improve
security at facilities where dangerous microbes are kept.
The agreement, the result of more than a year of negotiations, was announced
by Sens. Richard G. Lugar (R-Ind.) and Barack Obama (D-Ill.) during a visit
to the Ukrainian capital, Kiev. The senators credited Ukraine's reformist
leaders, ushered into power by last fall's Orange Revolution, with breaking
bureaucratic resistance to the pact.
One lab to receive funding is the I.I. Mechnikov Antiplague Scientific and
Research Institute, in the Black Sea port city of Odessa. The institute was
part of a Cold War network of "antiplague" stations that supplied highly
lethal pathogens to Soviet bioweapons factories.
"This agreement will allow us to begin addressing the problems faced by the
Odessa antiplague institute and places like it," said Mark Helmke, a staff
member for the Senate Foreign Relations Committee, which Lugar chairs.
Under the pact, the United States will fund security upgrades at key
Ukrainian biological institutes and support peaceful research by Ukrainian
scientists to fight the spread of natural diseases, Helmke said. The amount
of funding has not been determined.
The senators' visit to Russia and Ukraine was disrupted Sunday when local
authorities refused to allow the delegation's military plane to leave Perm,
a city in Russia's Ural Mountains. The officials demanded that they be
allowed to search the plane, then relented after several hours and allowed
the aircraft to proceed to Ukraine, a spokesman for Lugar said. Yesterday,
Russia's Foreign Ministry formally apologized for the incident. -30-
----------------------------------------------------------------------------------------------------------
FOOTNOTE: I attended the Lugar-Obama press conference in Kyiv
yesterday. It is always great to have Senator Lugar in Kyiv as he has
been a special friend of Ukraine and has been here many times.
Several members of the professional staff of the U.S. Senate Foreign
Relations Committee, who have been active on Ukrainian matters, were
traveling with the Senatorial delegation.
Professional staff members in the delegation included Kenneth Myers II,
Committee Staff Director; Kenneth Myers III, Senior Staff Member; Thomas
Moore, Staff Member; and Andy Fisher, Staff Member. Their assistance
on Ukrainian matters has been much appreciated.
I worked closely with Senator Lugar and his staff when I served as
a professional staff member of the U.S. Senate Agriculture Committee
for U.S. Senator Bob Dole, who was the ranking Republican on the
Committee at the time. Senator Lugar was a member of the Agriculture
Committee at the time and is still on the Committee. EDITOR
=============================================================
2. RUSSIA SORRY FOR U.S. SENATOR'S DETENTION
By Mara D. Bellaby, Associated Press Writer
AP, Kyiv, Ukraine, Monday, Aug 29, 2005
KIEV, Ukraine - Russia apologized Monday for keeping two U.S.
senators waiting for three hours in a Russian airport after border guards
expressed concerns about letting the U.S. military flight depart without
an inspection of the plane.
Sens. Richard Lugar, R-Ind., chairman of the Senate Foreign Relations
Committee, and Barack Obama, D-Ill., arrived in the Ukrainian capital later
than expected after the delay in Russia's Ural Mountains city of Perm on
Sunday night.
"We are not certain as to why or (what was) the particular activity that
caused that delay,'' Lugar said. ``We are pleased that our flight was able
to continue to Kiev, albeit three hours later. We still had a good
night's sleep.''
Both the Russians and Americans moved to draw a line under the incident,
which officials said was unlikely to provoke a serious uproar in relations.
The senators and their aides had spent three days in Russia visiting sites
where warheads are stored before destruction under the U.S.-funded
Comprehensive Threat Reduction program. The program provides millions
of dollars a year to help Russia destroy weapons of mass destruction.
In Ukraine, the senators announced a new bilateral agreement aimed at
countering bioterrorism. The United States will help Ukraine upgrade the
security of pathogens stored at laboratories, make it easier for the
government to evaluate disease outbreaks, and fund regional monitoring
stations.
``When it comes to issues of security against terrorist threats as well as
against infectious diseases, these threats know no borders,'' Obama said.
Similar agreements are in place with other ex-Soviet republics, but
bureaucratic hurdles had held up the signing with Ukraine. Lugar said
questions of funding would now be decided.
Ukraine still maintains numerous Soviet-era laboratories, such as the Kiev
Central Sanitary and Epidemiological Station, which the senators visited
Monday. The facility has pathogens causing diseases such as anthrax, cholera
and typhoid, and its employees often earned only $100 a month, raising
concerns about security. The laboratory will benefit under the program.
The apology for the senators' delayed flight came from the Russian Foreign
Ministry after they had visited sites where weapons of mass destruction are
stored.
We regret the misunderstanding that arose and caused an inconvenience to
the senators,'' the ministry said in a statement.
It said the delay, which "was incorrectly called a detention,'' arose
because of questions over whether the international flight en route to Kiev
had undergone the necessary procedures.
The guards had demanded to be allowed to inspect the U.S. plane, but were
refused by the Americans, U.S. officials said. After the military flight's
diplomatic status was verified, the senators were allowed to leave.
"Russia and American special government flights, on a basic principle of
reciprocality, enjoy a number of diplomatic privileges, including simplified
border and customs control,'' the Foreign Ministry said.
Earlier Monday, Lugar told journalists in Kiev that he had received no
explanation for the Russian government's actions but was pleased his flight
was allowed eventually to take off for neighboring Ukraine.
Russia's Federal Security Service, or FSB, defended the delay, saying it was
because the Perm airport isn't part of an Open Skies Agreement, which allows
certain planes to bypass inspections, Russia's RIA Novosti and ITAR-Tass
news agencies reported.
The FSB, the main successor agency to the Soviet-era KGB, said it could
comment only within a week's time.
Alexander Golts, a defense analyst with the online magazine Yezhednevny
Zhurnal, suggested that the delay could have been a rebuke for Lugar's
criticism of Russia for backsliding on democracy or an effort to bury the
Threat Reduction Program.
"If this is our strange way of ending or discrediting a program that is
crucial to us, it is really silly,'' Golts told Ekho Moskvy radio.
But Mikhail Margelov, head of the Russian upper house of parliament's
foreign relations committee, said he didn't expect a major fallout between
the two nations, and the Foreign Ministry praised Lugar's "personal
contribution'' to destroying nuclear weapons material. -30-
=============================================================
3. US SENATORS PLEDGE WORK FOR REPEAL OF JACKSON-VANICK
LAW AS IT PERTAINS TO UKRAINE AND HAMPERS TRADE
Reuters, Kiev, Ukraine, Monday, August 29, 2005
KIEV - Two prominent U.S. senators pledged on Monday to redouble efforts
to overcome resistance in Congress and repeal a 1970s law hampering
trade between the United States and former Soviet Ukraine.
Richard Lugar, Republican head of the Senate Foreign Relations Committee,
and Democrat Barack Obama, discussed the 1974 Jackson-Vanick
amendment during talks with Ukrainian President Viktor Yushchenko and
other leaders.
"I have offered legislation this year and before for a repeal of
Jackson-Vanick as it pertains to Ukraine. On this occasion we are as far
along as agreement in the Senate," he told a news conference.
"There are still some objectors in the House of representatives. I pledged
to President Yushchenko that we would work especially diligently to try to
convince the doubters and pass the bill. It's very important."
Obama said both parties supported the bill in the Senate. "We've got to
persuade some folks in the House," he said. "I think the White House
potentially can be helpful on that front."
The Jackson-Vanick amendment was passed by Congress at the height of
the Cold War with the aim of linking trade concessions to the Soviet Union
to progress on human rights, particularly the right of Soviet Jews to
emigrate.
Ukraine -- and neighboring Russia -- have long lobbied to have the
legislation removed on grounds that it no longer can apply to former Soviet
states. But a series of circumstances, mainly trade rows, have prevented its
cancellation.
Lugar, co-sponsor of a 1990s program to oversee destruction of dangerous
materials from the Soviet era, is visiting former Soviet states along with
Obama to see how the plans are being implemented.
The senators, who flew to Kiev from Russia, announced the signature of an
agreement providing for U.S. funds to help Ukraine deal with and destroy
pathogens in its laboratories.
They praised Yushchenko's administration, brought to power after mass
"Orange Revolution" protests forced a re-run of a rigged election, for
helping implement the accord. "There was a change in government after the
elections last year," Lugar said. "I had hoped the agreement might have been
signed a year ago when I visited the laboratories. That was not possible
then. It is possible now. I must congratulate the government of Ukraine."
=============================================================
4. WASN'T THE COLD WAR SUPPOSED TO BE OVER?
In a minor spat, Sens. Lugar and Obama are
detained for three hours at a Russian airport
By Jeff Zeleny, Tribune correspondent
Chicago Tribune, Chicago, Monday, August 29, 2005
PERM, Russia -- The trouble began shortly after the vodka toast.
Sens. Barack Obama (D-Ill.) and Richard Lugar (R-Ind.), chairman of the
Senate Foreign Relations Committee, had spent Sunday touring nuclear
weapon destruction sites outside this Russian town. Before boarding their
plane, they stopped at a reception at the airport to say farewell to their
hosts. "I would like to raise my glass to friendship between Russia and
the United States," Lugar said.
Victor Shmayev, who oversees nuclear warhead destruction at the Federal
Space Agency, bid his American friends a safe flight, saying, "Let the
number of takeoffs equal the number of landings."
But for more than three hours, there were no takeoffs or landings. At least
not for the plane sitting a few hundred yards away, the white and blue DC-9
with "United States of America" painted on its side in large letters. The
senators and a delegation of 12 Americans were detained in a peaceful yet
diplomatically chaotic afternoon episode.
What began as a seeming bureaucratic misunderstanding escalated into an
incident involving the White House, the State Department and several U.S.
military officials in Washington and their Russian counterparts in Moscow.
When Obama and Lugar prepared to board their plane bound for Ukraine, local
Russian border officials demanded to search the American aircraft. U.S.
military pilots refused, saying the plane is protected from searches by
international law and a joint agreement between the two countries.
"We don't search Russian aircraft in the United States. You will not search
U.S. aircraft in Russia," Ken Myers III, a senior aide to the Foreign
Relations Committee, said to three border officials, who said they were
acting on the authority of the FSB, the agency that replaced the KGB.
And with that, the standoff began.
The city of Perm, about 500 miles east of Moscow, is home to a small
airstrip that accepts international flights, which are infrequent. American
officials used cell phones to dial Washington, Moscow and points across
Europe, trying to resolve the matter.
For a time, the Americans were locked behind a glass door inside a lounge at
the Perm airport, which came equipped with the comforts of two easy chairs,
one sofa and an aquarium. Lugar took a seat in a burgundy chair and did not
become directly involved in the disagreement. Obama, meanwhile, found a
spot on a floral sofa.
The senators used the detention period to catch a brief afternoon nap, and
the doors eventually were unlocked. But local Russian officials kept the
U.S. passports.
William Burns, the U.S. ambassador to Russia, made clear to Moscow officials
that Lugar, a high-ranking Senate chairman, and Obama, a prominent newcomer,
were being detained. The supreme allied commander for Europe, Gen. James
Jones, also was apprised of the situation.
"It's unfortunate," Lugar said in an interview after boarding the plane
bound for Ukraine. "It illustrates a dysfunctional state where the left and
right hand don't know what either is doing, and people are enforcing their
whims of the day without deference to the world."
One reason for the detention, according to the discussions, was that local
border officials weren't convinced the delegation was flying in an official
military plane, which under a joint U.S.-Russian agreement does not require
inspection. "Do you have proof that this is a military plane?" a Russian
border control official asked.
One of the pilots presented documents to the official, but he was not
satisfied. All the while, two translators traveling with the delegation
tried to make sense of the back-and-forth, calmly relaying the messages.
After heated discussions and repeated calls between officials in both
countries, the situation was resolved, and Russian authorities returned the
delegation's U.S. passports. One Russian guard, distributing the documents,
apologized.
"In the wake of the collapse of the Soviet Union, now you have these
dispersed power centers," Obama said in an interview shortly before the
plane arrived at Kiev, Ukraine, on Sunday night. "They are clearly still
working out the kinks." "Finally, good prevails," said Lugar, smiling about
the incident as he flew to Kiev. "But it makes you wonder who really is
running the country." -30- (jzeleny@tribune.com)
--============================================================
5. U.S. SENATOR RICHARD LUGAR OBTAINS NEW COUNTER
PROLIFERATION AGREEMENT WITH UKRAINE
Mark Helmke, Senior Professional Staff Member
U.S. Senate Foreign Relations Committee
United States Senate, Washington, D.C.,
Monday, August 29, 2005 6:01 PM
KYIV, Ukraine - United States Senate Foreign Relations Committee Chairman
Richard G. Lugar today announced that the United States and Ukraine have
signed an agreement to counter the threat of bioterrorism and to prevent the
proliferation of biological weapons, technology, materials and expertise.
The long stalled negotiations were broken after the intervention of Prime
Minister Yuliya Tymoshenko. "We're going to cooperate in all aspects of the
Nunn-Lugar program," Tymoshenko told Lugar in a meeting.
In May, Lugar wrote to Ukrainian President Victor Yuschenko, "For several
years, the United States has sought to expand our cooperation to include
preventing the spread of biological pathogens and expertise to terrorists.
This high priority initiative includes a provision for a modern, safe and
secure diagnostic health laboratory and a national network of
epidemiological monitoring stations equipped to rapidly detect, diagnose
and respond to infectious disease outbreaks throughout Ukraine, whether
naturally occurring or as a result of bioterrorism.
Such cooperation is ongoing with Georgia, Uzbekistan and Kazakhstan, and
just last week, the government of Azerbaijan signed an agreement to
cooperate in this area. Unfortunately, bureaucratic obstacles in your
government continue to block conclusion of such an agreement between the
Ukrainian Ministry of Health and the U.S. Department of Defense."
Lugar thanked Prime Minister Tymoshenko. "You've giving us good news.
We know that your intervention made possible the signing of the cooperative
biological agreement today," Lugar responded.
Under the agreement, the U.S. will assist Ukraine to:
[1] Upgrade the security for pathogens currently stored at various health
laboratories throughout Ukraine;
[2] Significantly reduce the time required to accurately diagnose disease
outbreaks in Ukraine and asses whether they are natural or the result of a
terrorist act;
[3] Allow for cooperation to develop better diagnostic tools and treatments
to protect both U.S. and Ukrainian populations against infectious diseases.
This includes leveraging U.S. laboratory capabilities to improve detection
of endemic diseases in Ukraine.
The signing came as Lugar and U.S. Sen. Barak Obama (D-IL) visited the
Kyiv Central Sanitary and Epidemiological Station, one of the facilities
that will be covered under the agreement.
The Station maintains a pathogen collection and conducts work on many highly
dangerous infections reported in Ukraine. These include pathogens causing
diseases such as: Anthrax, Tularemia, Brucellosis, Listeriosis, Diphtheria,
Cholera, Typhoid, and others.
Previously, scientists at the Station had been paid just $100 per month.
This year, 10 employees of the Center began participating in the first
Science and Technology Center-Ukraine, affiliated with the Nunn-Lugar
program. The Science and Technology Center-Ukraine employs scientists
in peaceful work. Several other projects are being discussed.
"The Nunn-Lugar program looks forward to assisting the Central Sanitary
and Epidemiological Station in strengthening biosafety and biosecurity,
enhancing its molecular diagnostic capability and expanding research
cooperation with the United Stated under this new agreement," Lugar said.
At the Anti-Plague Institute in Odessa, Ukraine, the Nunn-Lugar program will
expand the study and capacity to diagnose the spread of avian flu in
migratory birds, a major influenza concern around the world.
"When we think of the major threats to our national security, the first to
come to mind are nuclear proliferation, rogue states and global terrorism.
But another kind of threat lurks beyond our shores, one from nature, not
humans -- an avian flu pandemic.
An outbreak could cause millions of deaths, destabilize Southeast Asia (its
likely place of origin), and threaten the security of governments around the
world," Lugar and Obama wrote in a June 6 op-ed in The New York Times.
In response to this threat, Lugar and Obama wrote, ".the Senate Foreign
Relations Committee unanimously approved legislation directing President
Bush to form a senior-level task force to put in place an international
strategy to deal with the avian flu and coordinate policy among our
government agencies. We urge the Bush administration to form this task
force immediately without waiting for legislation to be passed."
Earlier in the trip, Lugar and Obama visited the Russian Research Institute
of Phytopathology at Golitsino, a former biological weapons facility.
The Nunn-Lugar program, through the International Science and Technology
Center, has employed 58,000 scientists that were previously involved in
weapons of mass destruction programs in the former Soviet Union.
In 1991, Senator Lugar (R-IN) and former Senator Sam Nunn (D-GA) authored
the Nunn-Lugar Act, which established the Cooperative Threat Reduction
Program. This program has provided U.S. funding and expertise to help the
former Soviet Union safeguard and dismantle its enormous stockpiles of
nuclear, chemical and biological weapons, related materials, and delivery
systems.
In 1997, Lugar and Nunn were joined by Senator Pete Domenici (R-NM) in
introducing the Defense Against Weapons of Mass Destruction Act, which
expanded Nunn-Lugar authorities in the former Soviet Union and provided
WMD expertise to first responders in American cities.
In 2003, Congress adopted the Nunn-Lugar Expansion Act, which authorized the
Nunn-Lugar program to operate outside the former Soviet Union to address
proliferation threats.
In October 2004, Nunn-Lugar funds were used for the first time outside of
the former Soviet Union to secure chemical weapons in Albania, under a
Lugar-led expansion of the program.
The latest Nunn-Lugar Scorecard shows that the program has deactivated or
destroyed: 6,760 nuclear warheads; 587 ICBMs; 483 ICBM silos; 32 ICBM
mobile missile launchers; 150 bombers; 789 nuclear air-to-surface missiles;
436 submarine missile launchers; 549 submarine launched missiles; 28
nuclear submarines; and 194 nuclear test tunnels.
Beyond the scorecard's nuclear elimination, the Nunn-Lugar program secures
and destroys chemical weapons, and works to reemploy scientists and
facilities related to biological weapons in peaceful research initiatives.
The International Proliferation Prevention Program has funded 750 projects
involving 14,000 former weapons scientists and created some 580 new
peaceful high-tech jobs.
Ukraine, Belarus and Kazakhstan are nuclear weapons free as a result of
cooperative efforts under the Nunn-Lugar program. They otherwise would be
the world's the third, forth and eighth largest nuclear weapons powers,
respectively. -30- [The Action Ukraine Report Monitoring Service]
-----------------------------------------------------------------------------------------------------------------
NOTE: For more information on the Nunn-Lugar Program, visit
http://lugar.senate.gov/nunnlugar.html.
==============================================================
6. UKRAINE FAILS TO ATTRACT FOREIGN DIRECT INVESTMENT (FDI),
REKINDLE ECONOMIC GROWTH
Government's worst moves regarding investment are:
keeping VAT rate at 20% and liquidating free economic zones
ANALYSIS: Roman Bryl, Ukraine Analyst
Intellinews - Ukraine This Week
Kyiv, Ukraine, Monday, August 29, 2005
FDI in Ukraine slides 14.4% y/y in H1/05
Last year's Orange Revolution sparked hopes of massive foreign investment
inflow and new market reforms. However, the Ukrainian government so far
fails to elaborate a policy that would increase foreign direct investments
(FDI) in the country. State statistics committee data released in mid August
showed a dramatic year-to-year decline of FDI Ukraine received in H1/05.
The indicator dropped 14.4% y/y to USD 491.3mn. Accumulated FDI amounted
to USD 9.061bn or USD 192 per capita as per Jul 1, 2005, SSC informs. In Q1
foreign direct investment totaled USD 227.2mn and in Q2 it made up USD
264mn. To compare, FDI in Q1/04 amounted to USD 216mn and in Q2/05 it
stood at USD 357.3mn.
Government can improve FDI statistics only by selling large state companies
Nevertheless government has the only chance to improve FDI statistics. If
government, as it now plans, manages to sell steel producer Kryvorizhstal
and telecommunication monopoly Ukrtelecom till the end of 2005, we will
witness record FDI inflow over 2005. Now the record makes up USD 1.69bn,
attracted in 2004.
The approximate cost of the two state companies is about USD 4-6bn and there
are many foreign companies among the potential bidders. However, risk of
repeat re-privatization looms large for investors, discouraging them from
diving in.
Also, except selling large state enterprises, government does not have any
other tools to boost FDI volumes. There are no real trends promoting
investment in Ukraine. And this is the forming opinion of foreign investors
who expressed last week their disappointment toward state economic policy.
Slowdown of economic growth discourages investors
The #1 factor influencing FDI decrease is the slowdown of Ukraine's
economic growth. Merrill Lynch expert Ralph Suppel says the economic and
political situation did not improve after the presidential elections, as it
was
expected in the beginning of the year. The continuing political strife
limits progress of structural reforms, he said.
Suppel called the growth slowdown the disappointment of the year. Suppel's
declaration coincides with the official report on Ukraine's economic
development published by experts of International Monetary Fund (IMF). The
mission studied the economic situation in the country in Jul-Aug.
According to the report, Ukraine's GDP growth will make up 5.5% in 2005
and 5% in 2006. In Jan-Jul GDP rose by only 3.7% y/y to USD 42.78bn, SSC
informed earlier. In June growth amounted to a mere 1.1% y/y. To remind you,
GDP surged 12.1% y/y in 2004 and 9.4% in 2003.
Government can soon lower GDP growth forecast for 2005 from
8% y/y to 6-6.5% y/y. which we still consider too optimistic
IMF estimates are lower than even government's downward revised forecast.
In March 2005 government forecasted GDP would grow 8.2% y/y in 2005,
reaching USD 87.2bn. In July economy minister Sergey Teryokhin declared
that EconMin would revise the target for 2005 from 8.2% y/y to 8%.
Government plans to reach 9.5% y/y GDP growth in 2006.
Taking into consideration latest GDP data, we have strong doubts in
government's forecasts. We expect another decrease of GDP growth
forecasts by authorities in the nearest future. In August, director of
EconMin's economic and social department Vadim Pischenko informed
the GDP forecast could soon be revised down by the government from
8% y/y to 6-6.5%.
Even that, in our view, is too optimistic. Because in order to reach 6-6.5%,
growth in the remainder of the year (Aug-Dec) would have to hit 9.2-10.4%.
Slight acceleration can take place off a lower base (GDP growth slowed
slightly in anticipation of the presidential vote in late 2004). Also,
government can adjust downward 2004 figures or raise Jan-Jul 2005
estimates, to boost growth figures. But still, a miracle would have to
happen for growth to resurge.
Government does not agree with IMF forecasts and calculations
IMF considers that the main reason impairing GDP growth is decreasing
industrial output and accelerating inflation. This fully confirms our
observations. Thus, industrial production shrank 2.4% y/y in July, staying
up 3.9% in Jan-Jul.State statistics committee reported that industrial
production was decreasing the second month in a row.
In June 2005 it declined 0.1% y/y. As we noted on Aug 9, growth of the
indicator is slowing since March 2004 when the figure reached 18.8% y/y.
In July 2004, IP rose 8% y/y. In Jan-Jul 2004 IP was up a robust 14.7% y/y.
Earlier this year, government lowered its forecast for IP growth in 2005
from 12% y/y to just 6-7% y/y. Again, do not be surprised if this target is
undershot considerably.
Authorities, in their turn, disagree with IMF's projections. Anecdotally,
officials from EconMin asked not to believe parliament speaker Volodymir
Lytvin's words regarding the inflation rate in Ukraine. Lytvin declared on
Aug 12 that inflation made up 15% ytd in Jan-Jul, refuting the 4.4% figure
by state statistics committee.
Saying that, Lytvin referred to IMF's estimates. He declares that government
should stop hiding real macroeconomic data. Government still forecasts
inflation will reach 9.8% y/y in 2005 and 9.3% y/y in 2006. It seems SSC is
unable to properly track consumer price changes in the country.
Economic expansion in recent years created big opportunities
for foreign investors
In spite of differences in macroeconomic data, it is obvious that slower
economic expansion is a barrier for FDI in Ukraine. Over the last 2 years,
robust macroeconomic growth figured were the real drivers of FDI in spite
of high political risks. In recent years returns on investment were
extremely attractive.
For example, corporate bond issuances were regularly placed at 15-17% yield,
while some investors reported returns of 18-19%. Foreign portfolio investors
declared lately about 20-30% return on equity investments. That is why the
FSTS stock market index (in spite its small size and low liquidity) rose 40%
in 2003 and a tremendous 350% in 2004.
Now imports and real estate are most attractive sectors
But today one of the few sectors that guarantees high returns is real
estate. The market is growing 30% annually. To a lesser extent, it is
possible for a foreign investor to make money in Ukraine by importing to
various goods into the country. During the last few months, the average
customs tariffs and duties were cut from 40-50% to 10-15%.
Trade surplus declines notably in H1 due to lower customs duties
But by lowering duties, Ukraine worsened its trade balance. The trade
surplus declined by USD 1.9bn y/y in H1.According to SSC, Ukrainian exports
exceeded Ukrainian imports by USD 381.3mn in the period. But while
merchandise exports increased 9.2% y/y to USD 16.93bn, imports soared
26% to USD 16.55bn.
For comparison, in full-2004 the trade surplus increased to USD 3.62bn. The
lowering of customs duties, needed for Ukraine to enter WTO, can results in
imports exceeding exports in full-2005.
Government's worst moves regarding investment are:
keeping VAT rate at 20% and liquidating free economic zones
We should note that Ukrainian exports largely consist of only 4 kinds of
goods: steel products, energy, chemicals and agricultural products. If the
country faces a drop in world metal prices (something already taking place
now) or deterioration of political relations with Russia (that can influence
Ukraine's energy exports) the economy might collapse. Such high risks
definitely do not help attract foreign investments to Ukraine.
Besides the difficult economic situation, foreign investors generally suffer
from an unfavorable regulative environment. The FIRST factor is 20% VAT rate
and problems connected with its reimbursement. If the VAT rate is cut even
to 17%, exporters could significantly decrease their transaction costs.
The SECOND factor is cancellation of free economic zones (FEZ) in Ukraine.
Abolishment of privileges for entities operating in FEZs was aimed to stop
money laundering that was performed by some Ukrainian and Russian
companies.
But the side-effect was damage to most Western companies working in the
FEZs legally. That was a distressing signal for Western investors, who might
soon lose their patience in waiting for positive turnarounds. -30-
=============================================================
7. PRESIDENT YUSHCHENKO MEETS WITH UKRAINIAN WORLD
CONGRESS [UWC] REPRESENTATIVES
Press office of the President of Ukraine Victor Yushchenko
Kyiv, Ukraine, Thursday, August 25, 2005
KYIV - Victor Yushchenko met with representatives of Ukrainian World
Congress [UWC], particularly Askold Lozynskyj, UWC President, and
executives of UWC offices in Australia, Belgium, Brazil, Spain, Canada,
and the United States of America.
They discussed ways to develop Ukrainian organizations in the diaspora
and authorize them to more actively represent Ukraine abroad. The Head
of State assured those present that the new government spared no effort
to make Ukrainian expatriates remember Ukraine's culture, language and
history.
Yushchenko said he was convinced that all Ukrainians supported Ukraine's
democratic advancement and improved its international image through their
accomplishments.
The President congratulated his guests on Independence Day and told them
about yesterday's celebrations. Valentyn Nalyvaychenko, Deputy Foreign
Minister, attended the meeting. -30-
===========================================================
FOOTNOTE: Australia was represented at the meeting by Stefan
Romaniw OAM, Chairman of the Australian Federation of Ukrainian
Organizations from Essendon, Victoria, Australia. Stefan has been in
Ukraine now for a couple of months working on increasing the ties
between Australia and Ukraine. I met in Kyiv yesterday with Stefan
and he is to be congratulated on the outstanding work he is doing.
=============================================================
8. PROBE INTO UKRAINE 'BABY THEFTS'
By Helen Fawkes, BBC News, Kiev
BBC, United Kingdom, Monday, August 29, 2005
KIEV - An investigation into the alleged theft of newborn babies in Ukraine
is due to start on Monday. An envoy from a top European political body, the
Parliamentary Assembly of the Council of Europe, is visiting the country to
look into the issue.
The trip follows concerns from human rights groups that babies are being
trafficked from eastern Europe. They claim three babies born in eastern
Ukraine were stolen shortly after they were delivered three years ago.
The parents say they were told that the babies had died, but despite
repeated requests, doctors at the hospital in Kharkiv did not allow them to
see their bodies.
A Ukrainian campaign group working with the parents claims that the babies
may have been sold for illegal adoption, or for the use of their organs. The
hospital has denied all the accusations.
The allegations received international attention after a story appeared in
the German media. It has since been claimed that there could be as many as
300 similar cases across Ukraine.
Last year, the Parliamentary Assembly of the Council of Europe recommended
that a report should be compiled on the issue. One of its rapporteurs will
now spend the next four days investigating the cases in eastern Ukraine.
==============================================================
9. LETTER OF BISHOPS OF POLAND AND UKRAINE ON RECONCILIATION
"We Have to Rise Above the Legacy of History, Forgive One Another"
ZENIT.org, Rome, Italy, Monday, August 29, 2005
WARSAW, Poland - The text of a letter published at the close of proceedings
of the plenary meeting of the Polish bishops' conference read out on June 19
in Pilsudski Square in Warsaw is published below. The event came at the
close the 3rd National Eucharistic Congress.
The letter was read out again on June 26 in Lviv, Ukraine, and at the Greek
Catholic shrine of Zarvanytsia near Ternopil.
PEACE BETWEEN PEOPLES IS POSSIBLE.
In the Year of the Eucharist we undertake St. Paul's calling: "The appeal
that we make in Christ's name is: be reconciled with God!" (2 Corinthians
5:21). We are taking part in a historical moment and its purpose is to aim
at uniting the nations through prayer and forgiveness. We desire --
according to St. Paul's command -- to aim at reconciliation between the
faithful of the Greek Catholic and the Roman Catholic Churches.
In fulfillment of an act of mutual forgiveness -- in the name of the
justice, mercy and well-being of our nations -- we wish to take up the
inheritance of Our Holy Father John Paul II -- the Pope of peace and
reconciliation. We do this in a sense of responsibility for "raising future
generations in the spirit of reconciliation and building a future freed from
the limitations of history" (John Paul's II Message on the 60th anniversary
of the tragic events in Wolyn; Vatican, 7 July 2003).
Addressing the Ukrainian and Polish peoples he wrote: "Since God forgave
us in Christ it is necessary that believers should be able to forgive one
another's hurts and ask forgiveness for our own misdoings and thus
participate in building a world in which life, justice, peace and harmony
are respected (John Paul II's Message, as above).
Today we send fraternal greetings to the faithful in the Ukraine and Poland
as well as to our Eastern-rite brothers and all men of good will. Our
history is full of difficult and sometimes tragic events. We have been
separated by military, political and religious conflicts despite our shared
inheritance of one and the same faith and a community of baptism through
which, regardless of national identity, we were firmly rooted in our Lord's
death and glorious ascension.
1. For over 1,000 years ago our nations have opened themselves to Christ and
to his Gospel, and from the very beginning Christianity was the heart of our
culture and national identity. Faith in the Risen Christ helped us to endure
difficult times of war and enslavement. It brought with it the hope that our
nations too will rise to life in freedom.
Christianity came to Poland from Latin Europe, whereas on Ukrainian soil it
grew out of the Byzantine tradition. This was a difference which could
sometimes form an obstacle to our mutual relations, especially at times when
mutual efforts of rapprochement were neglected. The differences between us
were also often artificially exaggerated by our hostile neighbors in an
effort to sow conflict between us, or again they were caused by internal
political conflicts.
There were times in our history, however, when we experienced a common fate,
walked a common path, endured many trials together -- mutually taking
advantage of our spiritual heritage and drawing from our Christian community
the hope and strength to survive.
The 20th century brought the world tragic experiences of many wars,
political terror and the destruction of Churches by totalitarian regimes. It
also distinguished itself by joyful events: the collapse of totalitarian
systems (Nazi and Communist), the Second Vatican Council, the restoration of
religious freedom, the renaissance of Greek Catholic churches in the Ukraine
and the unification of Europe.
Standing now on the threshold of the third millennium of Christ's birth we
realize that in order to build unity among the nations and develop mutual
relations in a spirit of trust we have to rise above the legacy of history,
forgive one another any past hurts and misunderstandings, wipe the slate
clean and build a civilization of love.
2. There is a long history of attempts to reach mutual agreement between
Polish Roman Catholic and Ukrainian Greek Catholic bishops and unity between
our nations. Sixty years ago, on 22 May 1945 in the Papal College of St.
Joseph in Rome, a meeting took place between the Polish Primate Cardinal
August Hlond and Bishop Ivan Bucko.
On 8 and 17 October 1987, also in Rome, the bishops of Poland and the
Ukraine met. These meetings were held in a spirit of love and understanding
as may be confirmed by the Polish and Ukrainian members of the hierarchy who
participated.
This was when the spiritual leaders of our churches Cardinals Myroslav Ivan
Lubachivskyj and Jozef Glemp made a joint statement: "We are indebted to
each other because we have not managed to bring to life the teaching which
comes from our unity in holy baptism!"
The mutual efforts undertaken on this occasion bore great fruit. The
millennium of the christening of Rus'- Ukraine was celebrated with great
ceremony in Poland at Jasna Gora in 1988 with both Polish and Ukrainian
bishops participating. As Catholics of both denominations we were brought
together by the celebrations of the great Jubilee of 2000. In 2001 the Holy
Father John Paul II, the successor of the Apostle Peter, arrived in Ukraine.
The Holy Father's pilgrimage was a powerful influence on the process of
building understanding and overcoming distrust and the burdens of history,
which should not be an obstacle for the new generation of Ukrainians and
Poles who wish to live in a united Europe in a friendly atmosphere of
equality and respect. Under the influence of the papal pilgrimage it became
possible to pay homage together to the victims of fratricidal conflicts. The
solidarity of our two nations appeared in a very special way in autumn 2004
in Kyiv.
3. When on 2 April 2005 Pope John Paul II went to Our Heavenly Father's
house, the world lost its chief spiritual leader. These memorable days
enable us to realize even more powerfully the value of the apostolic service
of Christ's vicar on Earth -- a son of the Slav nations. One of the most
important issues of John Paul's II papacy was concern about peace between
nations.
We remember his words: "There is no peace without justice, there is no
justice without forgiveness" (the title of the Address for XXXV World Day of
Peace on 1 January 2002). The Holy Father gave us, as Christ's disciples, a
wonderful example of confessing the historical failings of the Church and
asking forgiveness, since in a Christian's heart there should be no room for
anger, injustice, or untruth.
Dear Brothers and Sisters in Christ! Celebrating the Holy Eucharist during
Eucharistic Congress in Warsaw (19 June) and in Lviv (26 June) we will be
directing our prayers to Almighty God. Before this happens let us fulfill
our holy duty of which Christ said: "If you are bringing your offering to
the altar and there remember that you brother has something against you,
leave your offering there before the altar, go and be reconciled with your
opponent first and then come back and present your offering" (Matthew
5:23-24).
The gift we are bringing is the desire to fulfill our Lord's will "that they
may be For we are all pilgrims on this earth. We walk the path of Faith to
our one heavenly Father, to our heavenly home where -- as we hope -- we
shall enjoy the full glory of God. Also from this eternal perspective of
human destiny comes the duty of reconciliation.
Once our ancestors chose the common way, opening their hearts and our
countries' borders for Christ. The distinctions of denominations and
cultural diversity are only a sign of greater richness, which is brought by
faith in God the Father, the Son and the Holy Spirit.
The Eucharistic Year that we are currently living through helps us to a
deeper understanding of the essence of the holy sacrament. What is the way
of expressing our gratitude for this Gift of Bread of Life, which is the
source of our hope for peace and love between nations? "My sacrifice, a
contrite spirit.
A humbled, contrite heart you will not spurn" (Psalm 51:19). In the past
century our nations gave witness to their faithfulness to the death! The
blood shed by the martyrs calls us to love our friends and enemies and
calls: "Make peace with one another!"
Let us rise above political views and historical events, above church
rituals, even above our national identity -- Ukrainian and Polish. Let us
remember first and foremost that we are God's children. Let us turn to our
Father: "Forgive us our trespasses as we forgive those who trespass
against us."
To make our prayer most fruitful let us address each other with the words:
"We forgive and we ask for forgiveness" -- words which already have
historical significance in the work of reconciliation between nations (see
the Letter of the Polish and German Bishops, Rome 1965).
May this act of forgiveness and reconciliation be fulfilled before the face
of One God in the Trinity and Our Lady in the places holy for our faithful:
"in Jasna Gora and in Zarvanytsia, in Warsaw and Lviv." May our mutual
prayer be the prayer of pure hearts, the prayer of men of good will.
In this spirit we send you our pastoral blessing.
Warsaw-Lviv, 19-26 June 2005. -30-
----------------------------------------------------------------------------------------------------------
[Text slightly adapted]
=============================================================
Send in a letter-to-the-editor today. Let us hear from you.
==============================================================
10. CRISIS IN THE CONSTITUTIONAL COURT: A COURT WITHOUT JUDGES?
By Bohdan A. Futey, Legal Herald (Yurydychny Visnyk)
Kyiv, Ukraine, Friday, August 26, 2005
The Action Ukraine Report (AUR), No. 549, in English
Kyiv, Ukraine, Tuesday, August 30, 2005
Since the Constitutional Court's inception, its judges have occupied a
position that occurs once in the development of a nation. The judges have
had the unique opportunity to shape the law and the legal system in the same
manner as Chief Justice Marshall did in the United States in Marbury v.
Madison two hundred years ago. [1]
Initially, the Constitutional Court lived up to the great challenge it had
undertaken, [2] but in late-2003, it issued two questionable decisions
concerning the constitutionality of the Verkhovna Rada's authority to elect
the President and the constitutionality of President Kuchma running for a
third term in office.
Those decisions, however, are not the focus of this article as they were the
subject of two previous articles which analyzed the Constitutional Court's
flawed, and at times logically inconsistent, legal reasoning.
This article discusses a different aspect of the Constitutional Court's
development - - the willingness of the Parliament and its leadership to act
in concert with the President and the Council of Judges to ensure that the
Constitutional Court continues to function without interruption.
The Constitution of Ukraine (the Constitution), adopted by the Verkhovna
Rada on June 28, 1996, established the Constitutional Court as an integral
part of the judicial branch in Ukraine. The Constitutional Court derives
its powers from Chapter XII of the Constitution, which explicitly designates
the Constitutional Court as "the sole body of constitutional jurisdiction in
Ukraine." [3]
While Chapter XII provides the basic framework for the Constitutional Court,
describing its role, structure, and authority, the principles contained
within the Constitution pertaining to the Constitutional Court are for the
most part reiterated and elaborated upon in the Law on the Constitutional
Court (the Law), which was enacted on October 16, 1996. [4]
The Law sets forth the fundamentals of the Constitutional Court,
constitutional procedure, peculiarities of constitutional proceedings, and
certain final and transitional proceedings. Pursuant to section IV4 of the
Law, the Constitutional Court began accepting constitutional appeals and
constitutional petitions, as mentioned above, on January 1, 1997.
The Constitutional Court's mandate entails providing "the official
interpretation of the Constitution of Ukraine and the laws of Ukraine." [5]
The Court is responsible for hearing and deciding issues involving
conformity of laws, presidential decrees, and other legal acts with the
Constitution. Decisions of the Court are final; Article 150 of the
Constitution establishes their authority: "On the issues envisioned by this
Article, the [Court] adopts decisions that are mandatory for execution
throughout the territory of Ukraine, that are final and shall not be
appealed." [6]
Although the Constitution does not state how many judges must agree in order
to issue a binding decision, the Law provides that a decision on the merits
of a case is considered adopted if at least ten judges vote in favor of the
decision or conclusion. Moreover, as provided in Chapter XIII, Article 159,
the Court maintains a significant role in the amendment process: "[a] draft
law on introducing amendments to the [Constitution] is considered by the
[Verkhovna Rada] upon the availability of an opinion of the [Constitutional
Court] on the conformity of the draft law with the requirements of Article
157 and 158 of this Constitution." [7
The Constitutional Court is comprised of eighteen judges with the President,
the Verkhovna Rada, and the Council of Judges each appointing or electing
six. [8] The Constitution requires candidates to the Constitutional Court
to: (1) be at least forty years old at the time of his/her appointment; (2)
possess a higher legal education and at least ten years of professional
experience; (3) reside in Ukraine for the previous twenty years; and (4)
speak the state language. [9]
Judges of the Constitutional Court are "appointed for nine years without the
right of appointment to a repeat term." [10] In addition, Constitutional
Court Judges are subject to a mandatory retirement age: "A judge is
dismissed from office by the body that elected or appointed him or her in
the event of . . . the judge's attainment of the age of sixty-five." [11]
When the Law on the Constitutional Court was adopted in October 1996,
with it came the appointment and confirmation of judges to that court. [12]
Given the Constitution's nine-year term limitation, prohibition against
serving more than one term, and mandatory retirement age, a significant
number of Constitutional Court judges will be required to step down from the
bench in October 2005.
This exodus of judges, while facially benign, could evolve into a troubling
constitutional crisis and pose serious separation of powers issues. Prior
to examining the substance of the potential constitutional conflict, it is
important to distinguish the areas where complications are not anticipated:
(1) the appointment of six judges by the President, (2) the election of six
judges by the Council of Judges, and (3) the availability of qualified
candidates.
Where the problem lies, however, is in the administration of the oath of
office and in the attendant ramifications in the event the oath is not
administered in a timely fashion. The void created by the possible absence
of replacement judges could bring the daily functions of the Constitutional
Court to an abrupt halt.
Article 46 of the Law provides that the initiation of proceedings on a
constitutional appeal or constitutional petition shall be approved by either
the Constitutional Court itself or the Collegia of Judges of the
Constitutional Court (Collegia), which is established especially for this
purpose by Article 47. [13] The provisions governing the initiation of
proceedings provide, in pertinent part, that either of the above-mentioned
entities may vote in favor or against exercising jurisdiction over the case.
A meeting of the Constitutional Court pertaining to acceptance of a case is
considered valid, i.e., a quorum exists, if no fewer than eleven judges
participate in the meeting. In order to initiate proceedings on a case, at
least six of the eleven judges must vote in favor of such a decision.
After the Constitutional Court has decided to accept a case, Article 51
directs it to resolve the dispute at a plenary meeting as provided for under
the Law. More specifically, at its plenary meeting, the Constitutional
Court is required to adopt decisions on cases envisaged by Article 13, ¶ 1,
and conclusions envisaged by Article 13, ¶¶ 2, 3, and 4.
A plenary meeting of the Constitutional Court is valid if at least twelve
judges participate in the plenary meeting. Further, a decision of the
Constitutional Court on the merits of a case is considered to be adopted,
and a conclusion is considered to be provided, at its plenary meeting if at
least ten judges vote in favor of a decision or conclusion.
From an examination of both the functions of the Constitutional Court in
determining whether to accept a case for resolution or in adjudicating the
merits of a dispute, it is apparent that a minimum number of judges are
required for certain tasks to be performed. To briefly reiterate, eleven
judges constitute a quorum at a meeting for purposes of opening or rejecting
a case (at least six judges must vote to open a case), twelve judges must
participate in a plenary meeting, and ten judges must vote in support of a
decision or conclusion on the merits during a plenary meeting.
With the upcoming expiration of appointments and growing number of
vacancies, which will make it impossible to reach the designated numbers,
the vitality of the Constitutional Court rests in the hands of the Verkhovna
Rada. Each candidate, regardless of the whether appointed by the President,
or elected by the Verkhovna Rada or the Council of Judges, must take an oath
of office before the Parliament. [14] If the Verkhovna Rada does not
schedule a session to swear-in the candidates, the Constitutional Court will
not be able to conduct proceedings.
This scenario is a distinct possibility given that the battling factions
currently within the Parliament have difficulty cooperating with each other.
Not only would the lack of consensus prevent, in the normal course of
business, the placing of a swearing-in ceremony on the Parliament's
schedule, it would also preclude the attainment of the 226 votes necessary
to schedule a swearing-in ceremony in the event a consensus was not
reached. [15]
Although leaving the Constitutional Court inoperative for any period of time
would cause concern, the timing of this shut-down would be particularly
troubling. The constitutional reform package, which was adopted prior to
and during the 2004 presidential election and contemplates a significant
shift of power from the President to the Prime Minister, is to take effect
on January 1, 2006.
Numerous legal scholars, lawyers, and politicians have questioned, on both
procedural and substantive grounds, the constitutionality of the reform
package. First, the Parliament adopted provisions in Draft Law No. 4180
which had previously been rejected in Draft Law No. 4105. Draft Law No.
4105 received a vote in the Parliament on April 8, 2004, and proponents of
that draft law were only able to muster 294 votes, six votes shy of the
constitutionally mandated 300 votes required to amend the constitution. [16]
On December 8, 2004, however, over 400 National Deputies voted in favor of
adopting the constitutional reform package, which incorporated Draft Law No.
4180 (which, in turn, included similar substantive provisions to those
contained in Draft Law No. 4105). The problem with the Verkhovna Rada's
adoption of Draft Law No. 4180, a mere eight months after rejecting Draft
Law No. 4105, is that the Constitution states that a proposed amendment
"considered . . . and not adopted, may be submitted to the Verkhovna Rada .
. . no sooner than one year from the day of the adoption of the decision on
this draft law." [17]
SECOND, the Parliament voted on the constitutional reform package as a whole
rather than holding a separate vote on each individual component (i.e., an
item-by-item vote). This single omission raises several possible corollary
complications. As an initial matter, the Constitution mandates that there
be two votes, one requiring a simple majority, the other requiring
two-thirds support, prior to passing an amendment. [18]
In addition, while the Constitution is silent with respect to the type of
session in which the first vote must be held, it does explicitly provide
that the second vote occur at a "regular session." [19] Therefore, if two
votes were indeed lacking and/or the second vote took place during an
extraordinary or special session, as opposed to a regular session, [20] the
constitutional amendment's procedural underpinnings may be infirm and may
not be able to withstand judicial scrutiny.
THIRD, although not a constitutional ground, the political comprise reached
between Mr. Yanukovych and Mr. Yushchenko following the second round of
the presidential election covered three key changes, which were to be
implemented during the repeat second round: (1) the composition of the
election commissions would be split equally between the candidates'
representatives, (2) absentee ballots would be limited to .5% of the total
number of voters registered at the polling station, and (3) home voting
would be limited to individuals considered disabled.
Prior to its implementation, Mr. Yanukovych successfully challenged the
"home voting" provision in the Constitutional Court, and the provision was
annulled one day before the repeat second round. The question which remains
unanswered, therefore, is whether a compromise agreement is still considered
binding after a party who voluntarily entered into that agreement, on his
own volition, seeks to avoid its execution by having the "benefit of the
bargain" invalidated in court.
All the above-mentioned constitutional questions should be addressed prior
to the constitutional reforms taking effect. There is only one court in
Ukraine with the "legal competence" to address the pressing constitutional
issues. As previously discussed, the Constitutional Court is designated as
"the sole body of constitutional jurisdiction in Ukraine." [21]
Without the requisite number of judges, the Constitutional Court will not be
able to accept or decline any of the constitutional issues, or issue a
decision or decisions pertaining thereto. Stated another way, the
constitutional reforms will go into effect without being subjected to
complete judicial review. [22]
Given that the constitutional reforms in essence transform Ukraine's
government from a Presidential system to a Parliamentary system by shifting
powers from the President to the Prime Minister and the Parliament, it is
inconceivable that reforms of such magnitude would be "immune" from
constitutional scrutiny.
It is, therefore, incumbent upon the Parliament, especially its leadership,
to promptly schedule swearing-in ceremonies for judicial candidates to the
Constitutional Court shortly after their appointment or election so that the
court can continue to function without any break in continuity.
The matter of reforming Ukraine's judicial system, in particular the Courts
of General Jurisdiction, including Specialized Courts, from their
association with the Soviet-style "telephonic justice" to a system based on
the Rule of Law, has been a topic of considerable discussion and debate
since Ukraine's independence.
On the one hand, the world witnessed the Ukrainian judiciary's true
potential when the Ukrainian Supreme Court issued, against intense
international and domestic political pressure, its historic decision in
Yushchenko v. CEC. This positive reaction was a warranted reprieve
following the international criticism levied upon the Constitutional Court
for its two dubious decisions.
On the other hand, while the Supreme Court's decision favorably impacted
the public's perception of the judiciary, recent polls nevertheless revealed
that a non-negligible percentage of the public still viewed the judicial
process and the judiciary with skepticism. [23]
The importance of judicial reform was highlighted on January 23, 2005, the
date Viktor Yushchenko was officially sworn-in as President of Ukraine. In
his inaugural address, attended by thousands on Kyiv's Independence Square,
President Yushchenko explained that while Ukraine has been independent
since 1991, it has only now become free. He underscored that an independent
judiciary is vital to establishing a civil society based on the Rule of Law.
President Yushchenko also emphasized that an independent judiciary was an
integral part of his pledge to protect individual rights and fight
corruption. To fulfill his promise to the citizens of Ukraine, President
Yushchenko, inter alia, appointed Petro Poroshenko to head the committee on
judicial reform. While the motivations behind the appointment were
well-intentioned, the proceedings are progressing in manner that is neither
clear nor transparent, and resinate with an exertion of undue influence and
control over the judiciary.
The committee must make critical adjustments in its own affairs so that any
suggested reforms are not undermined by the appearance of impropriety.
Whether the committee will address these shortcomings remains to be seem;
only time holds the answers to this question and an analysis of the
committee's chances for success is beyond the scope of this article.
Stay tuned, however, for it should prove to be, at a minimum, an eventful
several months in the history and development of the judiciary in Ukraine.
------------------------------------------------------------------------------------------------------------
Bohdan A. Futey is a Judge on the U.S. Court of Federal Claims in
Washington, DC, appointed by President Ronald Reagan in May 1987.
Judge Futey has been active in various Rule of Law and Democratization
Programs in Ukraine since 1991. He served as an advisor to the Working
Group on Ukraine's Constitution, adopted June 28, 1996.
--------------------------------------------------------------------------------------------------------------
FOOTNOTES:
1 See Marbury v. Madison, 5 U.S. (1 Cranch) 137, 2 L. Ed. 60
(1803) (establishing the doctrine of judicial review).
2 See, e.g., "Re Residents of City of Zhovti Vody" Visnyk
Konstytutsiinoho Sudu Ukrainy 1 (1998):34; "Re K.H. Ustymenko," Visnyk
Konstytutsiinoho Sudu Ukrainy 2 (1997):31; "Re Dual Mandates of Verkhovna
Rada Deputies," Visnyk Konstytutsiinoho Sudu Ukrainy 2 (1997):5.
3 Constitution of Ukraine (Ukr. Const.), Article (art.) 147.
4 Id., art. 153 ("The procedure for the organization and operation
of the Constitutional Court of Ukraine, and the procedure for its review of
cases, are determined by law.").
5 Id., art. 147.
6 Id., art. 150.
7 Id., art. 159.
8 Id., art. 148, 85(26), 106(22). It should be noted, for
purposes of accuracy, that, pursuant to Articles 7 and 8 of the Law on the
Constitutional Court, both the Verkhovna Rada and the Council of Judges
appoint judges to the Constitutional Court by secret vote (election).
9 Id., art. 148.
10 Id.
11 Id., art. 126. For additional information pertaining to the
Constitutional Court, see Judge Bohdan A. Futey, "Upholding the Rule of Law
in Ukraine: The Judiciary in Transition," Towards a New Ukraine II: Meeting
the Next Century (Ottawa 1998): 61-66; Judge Bohdan A. Futey, "Comments on
the Law of the Constitutional Court of Ukraine," The Harriman Review 10.1
(Spring 1997): 15-23.
12 Ukr. Const., Chap. XV, para. 6 ("The Constitutional Court of
Ukraine is formed in accordance with this Constitution, within three months
after its entry into force.").
13 The Law does not establish the number of judges that are to
comprise the Collegia.
14 Law on the Constitutional Court, art. 17.
15 Ukr. Const., art. 91 ("The Verkhovna Rada of Ukraine adopts
laws, resolutions, and other acts by the majority of its constitutional
composition . . . .").
16 See id., art. 155 (explaining that a constitutional amendment is
deemed adopted "if at the next regular session of the Verkhovna Rada [after
an initial majority vote], no less than two-thirds of the Verkhovna Rada of
Ukraine have voted in favor thereof").
17 Id., art. 158.
18 Id., art. 155.
19 Id.
20 Id., art. 82 ("The Verkhovna Rada works in sessions."); Id.,
art. 83 (distinguishing between "regular" and "special" sessions of the
Verkhovna Rada).
21 Id., art. 147.
22 Id. ("The Constitutional Court . . . decides on issues of
conformity of laws and other legal acts with the Constitution . . . ."); see
also id., art. 150.
23 Compare International Foundation for Election Systems, Attitudes
and Expectations: Public Opinion in Ukraine 2002, at 20 (2003) with
International Foundation for Election Systems, Public Opinion In Ukraine
After The "Orange Revolution," at 8 (2005).
=============================================================
11. WE OWE THEM A DEBT OF HONOUR
The Ukrainians and Turks can't be left out of the new Europe
COMMENTARY: Peter Preston, The Guardian
London, UK, Monday August 29, 2005
It's the debate that stopped dead in its tracks. One minute after the French
referendum vote came in, Tony Blair was ideological master of the EU rebels,
liberated, prescribing the course of things to come in Brussels, chortling
behind Jacques Chirac's back. And the next minute, nothing happened. Europe
went on holiday. Mr Europe went to Barbados. Six months to save the union
turned into four.
Time to track back with the first chill of autumn and relive some of the
mellow certainties that flourished before Tavistock Square.
Do you remember how the British economy brought light into continental
darkness? Do you remember why any more argument over Iraq had become
redundant? And how our vision - the Blair/Brown vision - was bound to
prevail as France changed presidents and dear Angela Merkel inherited Berlin
on September 18? Ah yes! We remember such triumphal anthems well.
But suddenly the vision thing looks tatty. For what is our distinctive dream
of a European future? It isn't old French, German or Belgian, plunging ever
deeper in search of total integration. It is broader, wider, naturally
dynamic. It seeks to create fresh markets and spread prosperity, to compete
on global terms. It is naturally hot on peace and democracy.
Good enough to turn a pretty speech at the European parliament, perhaps, but
distinctly less durable out in the real world. What do we mean by "broader
and wider"? We mean expansion, growth, ever-spreading membership: Romania
and Bulgaria in a year or two, Croatia and Macedonia and even Bosnia lining
up behind.
And then for the big ones: Turkey, where the long match of negotiation must
begin in October, and Ukraine - maybe 130 million more souls joined together
in supplication, banging at our door.
Has Britain, forward-looking Britain, concentrated much on such things to
come yet? Not in parliament or the great saloon bars of public opinion,
maybe. Expansion just happens so far as the world outside is concerned,
bringing early panics about Polish plumbers one week and satisfaction at
getting your pipes mended cheaply the next.
But in the salons of Europe, where they serve French claret, not Stella on
draft, the going is getting much tougher, much faster. France threw the
Turkish negotiations into crisis the other day when the prime minister,
Dominique de Villepin, swiftly transformed as a non-diplomatic ex-diplomat,
announced that Ankara would have to recognise Greek Cyprus as the legal
government of the island before any meaningful talks could begin (the Turks,
with extreme difficulty, having just formalised clear trading links with
Nicosia).
So, at a bound, the prospect of Turkish membership as a means of solving
the Cyprus impasse is turned on its head - and more years of UN toil go to
waste. So the Turks, reforming hard, striving to prepare for Europe, get
dealt duplicity as usual. So the prospect of a Muslim member nation,
tolerance and unity cemented, the one development al-Qaida doesn't want,
slips back into jeopardy again.
It is a grim outcome, one that will be made no better if Merkel becomes
German chancellor. (She doesn't want Turkey allowed in either.) It also has
a particular emotional resonance.
I was in Kiev a few weeks ago, talking to journalists. Kiev isn't Istanbul
or Ankara. It is stately and tree-lined and well-ordered, with cafe society
flourishing along the river bank. Go to the British ambassador's summer
party, and the brass band and cucumber sandwiches seem utterly natural.
Of course, out there in peasant country, poverty still hangs heavy - just as
it did in Poland 10 years ago. Of course, there are many years of
development and sacrifice to go before the EU is accomplished reality.
But reality began, only eight months ago, in the orange revolution, when
hundreds of thousands of Ukrainians camped out for days in the central
square until a corrupt presidency was bundled into history and a tainted
election was overturned. Ukraine defined itself on the streets of its major
cities as 2005 began. It chose Europe, not more truckling to Mother Russia.
It chose its own passionate version of freedom. It looked to Brussels, not
Moscow.
And what has Brussels offered in return? Fair words and fair action, a new
"neighbourhood policy" with 150 or so tests and reforms that clear the way
for full entry application. These tests go hell for leather after democracy
and market economics.
They mean reform, expense, pain and some electoral unpopularity - but Kiev
is gritting its teeth and ploughing on. It finds faith at the end of this
rainbow. With Warsaw's profound encouragement, it has taken Turkey's
route to defining national identity.
But, meanwhile, thwarted old Europe has sidled into a blocking role. How can
you expand and expand again in such testing circumstances if there is no
constitution to guide 30-plus members and millions more citizens through
day-to-day life? Britain wanted Turkey in, so Britain had better come up
with membership rules that work. If Poland backs Ukraine, Poland will have
to turn very helpful indeed.
It may be an argument tarnished by cynicism. It may be ruthless and
deceitful. But before we choke on the vision thing, we ought also to
acknowledge its logic. If the expansion we work for comes, the union itself
needs urgent reform. And it is a moral issue.
We helped Turkey's new government put its life in our hands. We said we were
there with the orange revolutionaries of Kiev. We owe them both debts of
honour. We can't just pack when it begins to rain this autumn. We're
leaders, aren't we? -30- [Action Ukraine Report Monitoring Service]
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http://www.guardian.co.uk/Columnists/Column/0,5673,1558571,00.html
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