"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"
BREAKING NEWS: Secretary of the National Security and Defense
Council (NSDC) Petro Poroshenko and Deputy Prime Minister for
Humanitarian Affairs Mykola Tomenko have resigned.
"THE ACTION UKRAINE REPORT - AUR" - Number 553
E. Morgan Williams, Publisher and Editor
Published in Kyiv, Ukraine, THURSDAY, September 8, 2005
--------INDEX OF ARTICLES--------
"Major International News Headlines and Articles"
1. PROFILE OF UKRAINIAN STATE SECRETARY OLEH RYBACHUK
BBC Monitoring research in English 7 Sep 05
BBC Monitoring Service, United Kingdom, Wed, Sep 07, 2005
2. UKRAINIAN PAPER PROFILES PRESIDENT'S NEW CHIEF OF STAFF
"The president's man" published Feb 5, 2005
By Tetyana Silina, Zerkalo Nedeli, Kiev, in Russian 5 Feb 05
BBC Monitoring Service, UK, in English, Wed, Sep 07, 2005
3. UKRAINIAN PRESIDENT SAYS HE WILL SHORTLY TAKE ACTION
AIMED AT IMPROVING HIS TEAM'S WORK
Interfax-Ukraine news agency, Kiev, in Russian 1545 gmt 7 Sep 05
BBC Monitoring Service, UK, in English, Wed, Sep 07, 2005
4. UKRAINIAN PROSECUTOR PISKUN PROMISES HONEST PROBE
INTO CORRUPTION ALLEGATIONS MADE BY ZINCHENKO
Interfax-Ukraine news agency, Kiev, in Russian 1337 gmt 7 Sep 05
BBC Monitoring Service, UK, in English, Wed, Sep 07, 2005
5. UKRAINE'S EX STATE SECRETARY ALEXANDER ZINCHENKO
HOPING FOR UNBIASED REVIEW IN COURT
Itar-Tass, Kiev, Ukraine, Wed, Sep 9, 2005
6. ZINCHENKO WANTS TO SET UP NON-GOVERNMENTAL
ANTICORRUPTION COMMITTEE IN UKRAINE
Ukrainian News Agency, Kyiv, Ukraine, Wed, September 7, 2005
7. THE UKRAINE-U.S. BUSINESS COUNCIL HOLDS MEETING WITH
UKRAINIAN JUSTICE MINISTER ROMAN ZVARYCH AND U.S. AMB
JOHN HERBST IN FIRST MEETING EVER HELD IN UKRAINE
The Action Ukraine Report (AUR)
Kyiv, Ukraine, Thursday, September 8, 2005
8. WORLD BANK READY TO DEEPEN COOPERATION WITH UKRAINE
IF UKRAINIAN GOVERNMENT IS CONSISTENT IN IMPLEMENTING
POLITICAL AND ECONOMIC REFORMS
Ukrinform, Kyiv, Ukraine, Tue, Sep 6, 2005
9. UKRAINE: PRES YUSHCHENKO FOR REVISION OF COOPERATION
PROGRAMS WITH WORLD BANK
Ukrainian News Agency, Kyiv, Ukraine, Wed, September 7, 2005
10. GOVT URGES PARLIAMENT TO ADOPT WTO BILL PACKAGE BY
SEPTEMBER 28 WHEN WTO GROUP CONVENES IN GENEVA
Olena Kryvenko, Ukrinform, Kyiv, Ukraine, Wed, Sep 7, 2005
11. UKRAINIAN PARLIAMENT RATIFIES SEVERAL ACCORDS,
INTERNATIONAL TREATIES, CONVENTIONS
Interfax-Ukraine news agency, Kiev, in Russian 1129 gmt 7 Sep 05
BBC Monitoring Service, UK, in English, Wed, Sep 07, 2005
12. GERMANY'S COMMERZBANK OPENS CREDIT LINE OF EUR
25 MILLION FOR LARGE UKRAINE POULTRY AND EGG PRODUCER
Ukrainian News Agency, Kyiv, Ukraine, Wed, Sep 7, 2005
13. UKRAINE: 20 INSURANCE COMPANIES SEEK FOREIGN INVESTORS
Ukrainian News Agency, Kyiv, Ukraine, Wed,September 7, 2005
14. POLAND'S CAR ACCESSORIES MAKER VARIANT PLANS TO
OPEN A SLOVAKIAN UNIT, ALSO EYEING UP A FIRM IN UKRAINE
Polish News Bulletin, Warsaw, Poland, Wed, Sep 07, 2005
15. UKRAINE'S TOP PROSECUTOR PISKUN DESCRIBES PLANS FOR
NEW NATIONAL INVESTIGATION SERVICE
Interfax-Ukraine news agency, Kiev, in Russian 1441 gmt 7 Sep 05
BBC Monitoring Service, UK, in English, Wed, Sep 07, 2005
16. MP SOLOMATIN REQUESTS TARASIUK TO CHECK INFO THAT
U.S. WANTS TO CONFISCATE USD 250 MILLION FROM LAZARENKO
Ukrainian News Agency, Kyiv, Ukraine, Wed, September 7, 2005
17. UKRAINE VOWS NO REPEAT OF PEACEKEEPER SCANDAL
Narodna Armiya, Kiev, in Ukrainian 7 Sep 05
BBC Monitoring Service, UK, in English, Wed, Sep 07, 2005
18. UKRAINIAN PRESIDENT'S RUSSIAN ADVISER BORIS NEMTSOV SAYS
ECONOMY IN SERIOUS CRISIS BECAUSE GOVERNMENT MISTAKES
HAVE PRODUCED A HOSTILE INVESTMENT CLIMATE
Good will of private investors is disappearing
INTERVIEW: with Boris Nemtsov by Ihor Radetskyy
Invest-Gazeta, Kiev, in Russian 6 Sep 05; p 13
BBC Monitoring Service, UK, in English, Wed, Sep 07, 2005
19. STATE OF THE EUROPEAN UNION: A FAILURE OF LEADERSHIP
Door must be kept open for both Turkey and Ukraine
COMMENTARY: By Mart Laar, former prime minister of Estonia
The Wall Street Journal, New York, NY, Thu, September 8, 2005
20. WORLD NEWS: RUSSIA'S RADICALS FEEL HEAT
Kremlin, Fearing Ukraine Rerun, Is Accused of Repressing Rivals
By Alan Cullison, Staff Reporter, The Wall Street Journal
New York, New York, September 8, 2005; Page A16
21. BURN VICTIM NASTIA OVCHAR GOES TO ONE OF KYIV'S SCHOOLS
Accompanied by first lady Kateryna Yushchenko
Ukrinform, Kyiv, Ukraine, Wed, Sep 7, 2005
22. UKRAINIAN NUCLEAR OPERATOR SAYS TERMS MEET
STANDARDS FOR EUROPEAN LOANS
Excerpt from report by Interfax-Ukraine news agency
BBC Monitoring Service, UK, in English, Wed, Sep 7, 2005
23. OIL PRODUCT PRICES IN UKRAINE MAY RISE 11% IN SEPT
Interfax, Kyiv, Ukraine, Wed, Sep 7, 2005
=============================================================
1. PROFILE OF UKRAINIAN STATE SECRETARY OLEH RYBACHUK
BBC Monitoring research in English 7 Sep 05
BBC Monitoring Service, United Kingdom, Wed, Sep 07, 2005
Ukrainian President Viktor Yushchenko appointed Oleh Rybachuk state
secretary on 7 September 2005. Rybachuk replaced in this position
Oleksandr Zinchenko, who resigned on 3 September, accusing
Yushchenko's inner circle of corruption.
Prior to this appointment Rybachuk has been serving as deputy prime minister
in charge of European integration. Rybachuk has been one of the most
prominent Euro-optimists in Ukraine, and after the Orange Revolution, in
which he took part as an aide on foreign matters to Yushchenko, he was
quoted as saying that Ukraine would join the EU within five-seven years.
But, despite serving formally in a top position, Rybachuk has essentially
been a minister without portfolio. His influence in the government has waned
with the waning optimism about Ukraine's European prospects, and with the
growing weight of the Foreign Ministry.
A banker and administrator with extensive international political and
business contacts, Rybachuk has been one of Yushchenko's oldest and
most-trusted allies. His fluent English and combative debating style meant
that he was one of the most prominent opposition spokesmen on foreign
and Ukrainian media during the Orange Revolution.
Born in Ukraine's central Vinnytsya Region in 1958, Rybachuk studied as a
military translator at Kiev State University. He speaks English, French and
German. During the early 1990s, he studied Economics at Kiev National
Economic University.
After graduating in 1980, Rybachuk worked as a customs inspector. He later
spent four years working for a Soviet oil trading company in India. On his
return home in 1990, he worked for Kievbirzhbank, a commercial bank.
In 1992, he moved to the National Bank of Ukraine (NBU), where he ran the
department for international relations. In this post, Rybachuk developed a
close working relationship with then NBU governor Viktor Yushchenko, often
accompanying him on foreign trips.
When Yushchenko was appointed prime minister in December 1999, one of
his first appointments was to put Rybachuk in charge of his advisers, press
service, chancellery and foreign contacts. After Yushchenko's dismissal in
2001, Rybachuk became vice-president of the Black Sea Trade and
Development Bank based in Salonica.
However, Rybachuk soon broke his contract and returned to Ukraine to take
part in the 2002 parliamentary election. Entering parliament on Yushchenko's
Our Ukraine list, he headed the Razom (Together) group of businessman MPs
within the Our Ukraine faction.
In March 2003, Rybachuk resigned as Razom leader to run Yushchenko's office.
It was widely expected that after Yushchenko victory in the December 2004
presidential polls, Rybachuk would become presidential administration head,
but in February 2005 he was appointed deputy prime minister for European
integration.
Finally, he comes to the presidential administration as its head (State
Secretary), which is the post he had been predicted to eventually take.
Rybachuk does not conceal that he is on friendly terms with MP tycoon
Viktor Pinchyk, the son-in-law of former President Leonid Kuchma.
During the Orange Revolution, hostile media speculated that Rybachuk
was brokering a peace deal between Yushchenko and Kuchma. Rybachuk
is married for a second time, with two children. -30-
=============================================================
2. UKRAINIAN PAPER PROFILES PRESIDENT'S NEW CHIEF OF STAFF
"The president's man" published Feb 5, 2005
By Tetyana Silina, Zerkalo Nedeli, Kiev, in Russian 5 Feb 05
BBC Monitoring Service, UK, in English, Wed, Sep 07, 2005
Ukrainian President Viktor Yushchenko on 7 September appointed the
deputy prime minister for European integration, Oleh Rybachuk, his new
chief of staff (state secretary).
Profiling Rybachuk back in February, shortly after his appointment as deputy
prime minister, the influential Ukrainian weekly Zerkalo Nedeli described
him as an ardent proponent of Ukraine's integration with the EU. Rybachuk is
trusted by Yushchenko and his wife, the weekly added.
He is a highly talented man, a skilled banker and good PR-man, but his new
cabinet colleagues may find him difficult to get on with, it concluded. The
following is an excerpt from the profile of Oleh Rybachuk by Tetyana Silina,
entitled "The president's man" and published in the Zerkalo Nedeli weekly on
5 February:
Oleh Rybachuk has quickly broken into the group of Ukrainian European
integrators, and, to the surprise of many, immediately become its head.
Regardless of his stormy work over the last few months, presence in public
and constant presence in the country's information sphere, he still
continues to be called "a dark horse"and his work in the extraordinarily
important state post of deputy prime minister for European integration is
awaited with great interest.
The country's main European integrationist is 46 years old and has two
higher educations behind him, namely, at the Roman-German Faculty of
Languages at the Taras Shevchenko University in Kiev and the National
Economic University in Kiev. Later, whilst working at the National Bank of
Ukraine, Rybachuk underwent training in the US and Britain.
Whilst discussing his work history in published interviews, he mentions five
years of work in India under a contract with Zakordonnaftobud [Overseas Oil
Construction] and working for Kievbirzhbank. After this period his biography
can be followed in official sources.
Whilst Vadym Hetman was head of the National Bank of Ukraine, Rybachuk
headed the department for international relations at the National Bank of
Ukraine. Hetman acquainted Rybachuk with Viktor Yushchenko 13 years ago.
Since then the paths of these two men have remained virtually inseparable.
When Yushchenko was prime minister [December 1999-April 2001] Rybachuk
headed the prime minister's service, and after the sacking of the Yushchenko
cabinet he worked as the vice president of the Black Sea Trade and
Development Bank but soon returned from Salonika to Ukraine to take part in
the 2002 parliamentary elections.
In the Ukrainian parliament the unaffiliated Rybachuk was elected on the Our
Ukraine bloc list at no 29. He headed the Razom [Together] group in the Our
Ukraine bloc, worked in the parliamentary Committee for Finance and Banking
as the head of the sub-committee for banking activity and currency
regulation.
During the recent presidential election he was the head of Yushchenko's
office and carried out a lot of work in the area of ties with the Western
world. In the heat of the orange revolution he was rarely seen at
Independence Square in Kiev, though he was noticed on the street among
ordinary orange protesters whilst actively helping people to organize the
passage of columns of blue and white opponents [supporters of presidential
candidate Viktor Yanukovych].
Rybachuk is very communicative, erudite, self-confident, democratic, liberal
in his views and outspoken in his public statements. Sometimes even overly.
This gives grounds to suspect that he does not yet fully understand that in
his new, high-ranking post every single word is received a lot more
seriously and with greater weight.
Those who know him confirm say there is very little which is Soviet about
him but a great of deal of him is European. Just one example: people say
that he was the first in the cabinet to switch off the loud ring of his
mobile phone and began to walk around with an ear-piece so as not to
disturb other people around him from working.
He is a born PR-man - that is him, but a good manager - well, you'd be
talking about someone else. However, his dislike of organizational issues is
completely compensated for by his extraordinary creativity. If we take into
account the fact that the new cabinet has at least two other creative people
with broad powers - Yuliya Tymoshenko and Mykola Tomenko - then we can
expect a few surprises in the near future.
Rybachuk is not connected to any party and does not belong to any financial
and political group. At the present time he does not have his own strong
team. He is not a person of the "president's entourage"but rather the
president's man.
He is a family friend: Rybachuk is trusted very highly by Viktor Yushchenko
as well as by Kateryna Chumachenko [Yushchenko's wife]. The fact that
Rybachuk himself named his future post a long time ago is grounds to believe
that (and Zerkalo Nedeli has written about this in the past) in the
Tymoshenko government he will not only be a deputy prime minister but the
"cabinet's eye".
Having created, as he plans, a department for European integration in every
ministry, Rybachuk shall remain at the information crossroads and will have
quite complete information as to what is happening in each ministry.
It is unlikely that he will have warm ties with his cabinet colleagues. He
does not feel any pietism towards any of the members of his team and can
harsh and stubborn. And, if he is certain that he is right, then he will
stick to his guns right to the end. And his main argument will be: "That is
what the president said". [Passage omitted: two experts comment]
=============================================================
3. UKRAINIAN PRESIDENT SAYS HE WILL SHORTLY TAKE ACTION
AIMED AT IMPROVING HIS TEAM'S WORK
Interfax-Ukraine news agency, Kiev, in Russian 1545 gmt 7 Sep 05
BBC Monitoring Service, UK, in English, Wed, Sep 07, 2005
KIEV - Ukrainian President Viktor Yushchenko has announced that he
will shortly take a number of important decisions aimed at improving his
team's work.
This was discussed today at a meeting between the head of state,
newly-appointed State Secretary Oleh Rybachuk, Prime Minister Yuliya
Tymoshenko and NSDC [National Security and Defence Committee]
Secretary Petro Poroshenko, the president's press service reports. It
adds that a number of government members and the leadership of the
presidential secretariat were also invited to the meeting.
During the meeting Yushchenko stressed the need for the team to work
smoothly and for cooperation between government bodies to be established.
The press service reported that the president said that personal conflicts
between certain members of his team had had serious political consequences
and "caused serious damage not just to the reputation of the team, but also
to the image of the state".
"Responsibility for this lies with each of us," Yushchenko stressed. He
believes that the issue of a political culture "is currently felt very
keenly". "It is time to stop fighting each other. We need to work for the
country," Yushchenko said.
He stressed that he would shortly take a number of important decisions
aimed at improving his team's work. "These conclusions will be based
on the results of officials' work and on their ability to work as a team,"
Yushchenko said.
Following the meeting Yushchenko instructed Rybachuk to present his vision
of how to optimize the work of the presidential secretariat as soon as
possible. He said that he would make extremely high demands on the quality
of the work of each employee of the secretariat. -30-
============================================================
4. UKRAINIAN PROSECUTOR PISKUN PROMISES HONEST PROBE
INTO CORRUPTION ALLEGATIONS MADE BY ZINCHENKO
Interfax-Ukraine news agency, Kiev, in Russian 1337 gmt 7 Sep 05
BBC Monitoring Service, UK, in English, Wed, Sep 07, 2005
KIEV - Ukrainian Prosecutor-General Svyatoslav Piskun has declared that the
investigation into statements made by former State Secretary Oleksandr
Zinchenko will be honest and unbiased.
"The investigation will be honest and unbiased, and if any facts are
uncovered, they will be made public and the Ukrainian people will find out
about them," Piskun told journalists on Wednesday [7 September].
He said that "the prosecutor-general is in a position in which the Ukrainian
president and the law have given him the right to investigate any official
in the country".
"If we discover that there are indications of illegal activities in relation
to any top official, the president will be informed as will the Ukrainian
people through the media," Piskun stressed.
He said that at a meeting of the NSDC [National Security and Defence
Council] on Tuesday [6 September] President Viktor Yushchenko instructed
the law-enforcement agencies and Interior Ministry to organize an
investigation into Zinchenko's statements.
"Naturally, this will not be done without the Prosecutor-General's Office
and the prosecutor-general," Piskun said. However, he stressed that so far
"the Prosecutor-General's Office has not yet received anything officially".
"I hope that such requests will be received today by the evening or first
thing tomorrow morning," Piskun added. [Passage omitted: previously
reported details of Zinchenko's allegations] -30-
=============================================================
5. UKRAINE'S EX STATE SECRETARY ALEXANDER ZINCHENKO
HOPING FOR UNBIASED REVIEW IN COURT
Itar-Tass, Kiev, Ukraine, Wed, Sep 9, 2005
KIEV - Ukraine's former state secretary Alexander Zinchenko said he is
hoping for "an objective review in court" of his accusations against several
close associates of President Viktor Yushchenko. He also said he was ready
to testify. Zinchenko said so in an interview with the Tonis television
channel on Wednesday.
He said Security Council Secretary Pyotr Poroshenko and leader of the Our
Ukraine faction Nikolai Martynenko are hoping that the complaints over his
accusations would be handled in the court they control.
"This scenario won't succeed," Zinchenko said. Law-enforcement bodies
have information about abuse of power by officials from the upper echelon of
power, he stated.
"I was not the only one who passed documented proofs of my accusations to
the Prosecutor General's Office and the security service. The case is real,
correct and legal. This process should be carried through," Zinchenko said.
He made it clear that he had not quit the presidential team "empty-handed."
Immediately after his resignation, Zinchenko accused Poroshenko, Martynenko
and senior presidential aide Alexander Tretyakov of corruption and abuse of
power. In response, Poroshenko and Martynenko sued Zinchenko. -30-
=============================================================
6. ZINCHENKO WANTS TO SET UP NON-GOVERNMENTAL
ANTICORRUPTION COMMITTEE IN UKRAINE
Ukrainian News Agency, Kyiv, Ukraine, Wed, September 7, 2005
KYIV - Former president's state secretary Oleksandr Zinchenko has
announced the initiative to set up a non-governmental anticorruption
committee. His spokesman Oles Bozhko disclosed this to Ukrainian News.
The idea is to mobilize efforts of the public community in the fight against
corruption and bribery.
As Ukrainian News earlier reported, Zinchenko accused of corruption
Secretary of the National Security and Defense Council Petro Poroshenko,
First Assistant to the President Oleksandr Tretiakov, and Our Ukraine
faction leader, MP Mykola Martynenko. -30-
=============================================================
7. UKRAINE-U.S. BUSINESS COUNCIL HOLDS MEETING WITH
UKRAINIAN JUSTICE MINISTER ROMAN ZVARYCH AND U.S. AMB
JOHN HERBST IN FIRST MEETING EVER HELD IN UKRAINE
The Action Ukraine Report (AUR)
Kyiv, Ukraine, Thursday, September 8, 2005
KYIV - Over 40 representatives of the corporate members of the Ukraine-
U.S. Business Council met in their first ever meeting held in Kyiv on
Tuesday evening with Ukrainian Justice Minister Roman Zvarych and
U.S. Ambassador to Ukraine John Herbst.
Ambassador Herbst began the meeting as Minister Zvarych arrived late
as he was in a high-level government meeting called by President
Yushchenko. The presentations and discussion lasted over two hours.
The Ambassador reaffirmed the strong support for Ukraine from the U.S.
Government and outlined several of the positive actions taken by the U.S.
in recent weeks. Amb Herbst said the U.S. is working to support the
Ukraine governments programs which promote democracy, building
a civil society, the development of a private economic system and
support Ukraine's desire for Euro-Atlantic integration.
He said Ukraine has taken some important, positive actions but the US
has also pointed out to the government actions they have taken which
have had negative consequences especially in the area of economic
reform and business development such as the ongoing confusion and
delays in the area of reprivatization. The U.S. is very supportive, but not
uncritical the Ambassador stated.
Ambassador Herbst said the U.S. is presently engaged with Ukraine
in the areas of poultry imports, a bi-lateral agreement related to WTO
membership, elimination of the Jackson-Vanik restrictions, intellectual
property rights, market economy status, and other measures to support
Ukraine's movement towards Euro-Atlantic integration.
Justice Minister Roman Zvarych, in his opening remarks, outlined the
major actions he has taken and those which are in still in progress to
improve the Ukrainian court system, to abolish most of the commercial
code and integrate it into an improved civil code, improvements related
to the commercial court system, removal of corrupt judges, the fight
against corruption, making court decisions public by posting them on
a Ministry of Justice website, and the work to improve the large state
bailiff system.
Minister Zvarych said 8 million bailiff procedures were pending as
of January 2005. There are now 7,100 bailiffs in Ukraine. The previous
system was organized in a way making it easily subjected to political
pressure and corruption. Major improvements are underway in the
bailiff system.
The Justice Minister made it very clear that actions will not be taken
against state business privatizations that were legal. The number
of reprivatizations carried out by the government will not be a large
number he said.
Zvarych stated the court system the new government inherited needs
to be overhauled and his ministry is doing what they can within their
authority. A new procedural code and a new administrative code
have been adopted and he is working to see that a new criminal
code hopefully is adopted by the end of the year.
Ukraine's commercial code is a relic of the Soviet days and is
very anti-private business and must be integrated into the civil code.
The civil code also needs substantial amendments the Minister
stated.
Minister Zvarych said he wants to work closely with the private
business community to improve the business and investment
environment in Ukraine. He encouraged the Ukraine-U.S. Business
Council and its members to prepare position and action papers on
key issues and send them to him on a regular basis.
Corporate members of the Council and their company guests who
attended the meeting included AES, ALICO AIG LIFE, Cargill,
Chadbourne Parke LLP, Conlan Consulting, European Strategy
Group, International Center for Policy Studies, Kiev-Atlantic, Kodak,
Kontrakt Bank; Kraft Ukraine, Omitex, Philip Morris Ukraine, P&G
Ukraine, SASI Corp, SigmaBleyzer, The Bleyzer Foundation, Ukrainian
Legal Group, U.S.- Ukraine Foundation, Westinghouse, WJ Grain, and
Zeppelin Ukraine (CAT).
The session was moderated by Morgan Williams, Director of
Government Affairs, Washington office, SigmaBleyzer, who serves
as chairman of the Ukraine-U.S. Business Council's Executive
Committee of the Board of Directors.
The meeting was held in the Conference Room of the U.S.-Ukraine
Foundation (USUF). Food and refreshments were furnished courtesy
of the SigmaBleyzer Private Equity Investment Group.
The new President/CEO of the Ukraine-U.S. Business Council, Dr.
Susanne Lotarski, will make her first visit to Ukraine, in her new
capacity, in early October. She will be meeting with members of
the Council and a variety of government and other officials. -30-
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Send in names and e-mail addresses for the AUR distribution list.
=============================================================
8. WORLD BANK READY TO DEEPEN COOPERATION WITH UKRAINE
IF UKRAINIAN GOVERNMENT IS CONSISTENT IN IMPLEMENTING
POLITICAL AND ECONOMIC REFORMS
Ukrinform, Kyiv, Ukraine, Tue, Sep 6, 2005
KYIV -The World Bank is ready to deepen cooperation with Ukraine if the
Ukrainian government is consistent in implementing political and economic
reforms.
The World Bank's Vice President for Europe and Central Asia Shigeo Katsu
announced this at a press conference that concluded his official visit to
Ukraine on Tuesday. Mr. Katsu expressed the World Bank's readiness to
support the Ukrainian government's ambitious economic program.
He also stated the need to preserve macroeconomic stability in Ukraine,
considering the fall of the growth rate and the return of
inflation.According to him, the World Bank is ready to provide loans for
implementation of the Ukrainian government's medium-term plans, specifically
for improvement of the investment climate in Ukraine and macroeconomic
reform.
According to him, everything will depend on the actions of the Ukrainian
government and the situation on world markets. Mr. Katsu said the next few
months would be a favorable time for the Ukrainian Cabinet of Ministers to
make more intensive preparation for admission of Ukraine into the World
Trade Organization.
He also expressed concern over administrative delays in introducing World
Bank projects in Ukraine and called for acceleration and simplification of
the procedures.
According to Mr. Katsu, the World Bank is prepared to continue providing
loans to Ukraine under the 2003 agreement that provides for granting 2.3-3
billion US dollars in loans to Ukraine, if the bank's conditions are met.
An agreement on provision of loans totaling 86.59 million US dollars to
Ukraine under the program called "Early Access to Quality Education" was
signed during Mr. Katsu's visit. -30-
==============================================================
9. UKRAINE: PRES YUSHCHENKO FOR REVISION OF COOPERATION
PROGRAMS WITH WORLD BANK
Ukrainian News Agency, Kyiv, Ukraine, Wed, September 7, 2005
KYIV - President Viktor Yuschenko is speaking out in support of revision of
programs of Ukraine's cooperation with the World Bank. The presidential
press service reported this to Ukrainian News.
According to the press service, during his meeting with World Bank Vice
President for Europe and Central Asia Region Shigeo Katsu, Yuschenko
said he considers it necessary to set out priority programs, put their
implementation under proper control and define a detailed plan of their
fulfillment.
Katsu said that the World Bank is interested in coordinating the assistance
programs with Ukraine's priorities. According to him, priority programs for
Ukraine first of all concern the reform of coal industry and power
engineering. Katsu also expressed readiness to support economic program
of the government.
Yuschenko and Katsu also touched upon improvement of investment climate in
Ukraine. Deputy Prime Minister for European Integration Oleh Rybachuk also
attended the meeting.
As Ukrainian News earlier reported, Katsu arrived in Ukraine on September
4, to hold talks with officials. His visit is to last until September 7.
Katsu also met with Prime Minister Yulia Tymoshenko and Verkhovna Rada
Chairman Volodymyr Lytvyn and officials of the government and the diplomatic
corps.
The vice president was going to discuss with Ukrainian leaders main targets
of cooperation between the World Bank and Ukraine in 2004-2007. After
joining the World Bank in 1992 Ukraine received USD 4.5 billion for
implementation of 33 projects. The supervisory board appointed Katsu its
vice president to replace Johannes Linn early in August 2003. -30-
=============================================================
10. GOVT URGES PARLIAMENT TO ADOPT WTO BILL PACKAGE BY
SEPTEMBER 28 WHEN WTO GROUP CONVENES IN GENEVA
Olena Kryvenko, Ukrinform, Kyiv, Ukraine, Wed, Sep 7, 2005
KYIV - The Verkhovna Rada of Ukraine should pass the WTO bill package by
September 28, when the Working Group for Ukraine's accedence to the WTO
convened in Geneva, Deputy Economics Minister Andriy Bereznyi told a
Wednesday session of the mixed Parliamentary - Governmental Commission
for Ukraine's accedence to the WTO.
According to Mr Bereznyu, Ukraine has signed bipartite protocols toward
joining the WTO with 35 nations. Talks with six other nations (Croatia,
Egypt, Panama, Columbia, Iceland and Peru) are nearing completion, and
talks continue with Austria and the USA.
Speaking on behalf of the Government, Andriy Bereznyi called upon the
lawmakers to focus primarily on those bills which have been polished, as
will as those bills which are not immediately related to joining the WTO,
yet are very important, such as the bills on licensing laser discs and on
quality and safety of food products. -30-
=============================================================
11. UKRAINIAN PARLIAMENT RATIFIES SEVERAL ACCORDS,
INTERNATIONAL TREATIES, CONVENTIONS
Interfax-Ukraine news agency, Kiev, in Russian 1129 gmt 7 Sep 05
BBC Monitoring Service, UK, in English, Wed, Sep 07, 2005
KIEV - The Supreme Council [parliament] of Ukraine on Wednesday [7
September] ratified a number of international treaties, agreements and
conventions.
Parliament ratified the law on Ukraine's accession to a European agreement
on the work of crews of vehicles carrying out international hauliage.
Parliament ratified a treaty between the Cabinet of Ministers of Ukraine and
the Syrian government on international hauliage of cargoes and
transportation of passengers. Members of parliament also ratified a similar
accord between the Ukrainian and Norwegian governments.
The Supreme Council ratified a treaty between Ukraine and Romania on legal
assistance and legal relations in civil cases. A treaty between Ukraine and
Iran on legal relations and legal assistance in civil and criminal cases was
also ratified.
Agreements between the Cabinet of Ministers of Ukraine and the governments
of Azerbaijan, Estonia and Moldova on mutual protection of classified
information, with the government of the Republic of Korea on protection of
classified military information and with the Bulgarian government on mutual
protection and principles of exchanging classified information were
ratified.
Parliament ratified an accord between the Cabinet of Ministers of Ukraine
and the government of Tajikistan on cooperation in the area of technical
protection of information. In addition, parliament ratified a convention on
cyber crime. -30-
=============================================================
12. GERMANY'S COMMERZBANK OPENS CREDIT LINE OF EUR
25 MILLION FOR LARGE UKRAINE POULTRY AND EGG PRODUCER
Ukrainian News Agency, Kyiv, Ukraine, Wed, Sep 7, 2005
Germany's Commerzbank has opened a credit line of EUR 25 million for
Myronivskyi Khliboprodukt, a group of companies based in Kyiv.
Myronivskyi Khliboprodukt announced this in a statement, a text of which
Ukrainian News obtained.
The credit line was opened for one year for financing delivery of equipment
and provision of services from Schmidt-Seeger of Germany and Cimbria of
Denmark to enable to expand Myronivskyi Khliboprodukt its production
capacities.
The Hermes export insurance company (Germany) and EKF (Denmark) will
insure the loans provided under this agreement. The loan will be repaid in
equal half-year installments spread over 8.5 years.
Myronivskyi Khliboprodukt is the largest producer of poultry meat in Ukraine
with about 47% share of the Ukrainian market. It owns poultry farms, egg
production facilities, and facilities for production of cereals and mixed
fodder.
According to the Agency for Development of the Stock Market's
Infrastructure, the Kyiv-based Merkaba company owned 84.61% of the shares
in Myronivskyi Khliboprodukt as of March 2004. As Ukrainian News earlier
reported, Commerzbank presently has a representative office in Ukraine. It
was opened in 1993. -30-
=============================================================
Send in a letter-to-the-editor today. Let us hear from you.
=============================================================
13. UKRAINE: 20 INSURANCE COMPANIES SEEK FOREIGN INVESTORS
Ukrainian News Agency, Kyiv, Ukraine, Wed,September 7, 2005
Over 20 insurance companies are in talks with potential foreign investors on
the sale of their shares. President of the League of Ukrainian Insurance
Organizations (LUIO) Oleksandr Filoniuk made this statement to the press.
Most of interest, he said, comes from Austria, Switzerland, Germany, Poland,
the Czech Republic, the Netherlands, and Russia.
Filoniuk added that, in his opinion, the least significant investment in
insurance business today is EUR 10 million. Both life insurers and risk
insurers are in demand.
Reportedly, 60 insurance companies with foreign capital operate in Ukraine
today and their ranks may swell to 65 by the end of the year.
As Ukrainian News earlier reported, a total of 398 insurance companies were
registered in Ukraine as of July 1, including 51 life insurers. -30-
=============================================================
14. POLAND'S CAR ACCESSORIES MAKER VARIANT PLANS TO
OPEN A SLOVAKIAN UNIT, ALSO EYEING UP A FIRM IN UKRAINE
Polish News Bulletin, Warsaw, Poland, Wed, Sep 07, 2005
WARSAW - Car accessories maker Variant plans to open a Slovakian unit
shortly, and is eyeing up another firm in Ukraine. Currently the company
trains employees for its Slovakian operations. "We want to establish a wider
presence on foreign markets," said Varian shareholder and manager Wieslaw
Cholewa.
The company has modest plans for its beginnings in Slovakia, an annual
turnover of ZL1.5-2.5m in 2006. A Ukrainian arm could be formed at the
beginning of 2006. Currently the firm exports its products through
independent distributors. Thanks to both projects the share of exports in
overall revenues is expected to increase from the current 30 to 40 percent
by 2007, or ZL30-40m.
During its recent IPO, the company promised a net profit improvement of 32
percent y/y to ZL5.2m, and is now considering an increase of guidance as it
had ZL3.1m net profit after H1. "In October we will make a decision on our
guidance. An upward increase is very likely," said Cholewa. -30-
=============================================================
15. UKRAINE'S TOP PROSECUTOR PISKUN DESCRIBES PLANS FOR
NEW NATIONAL INVESTIGATION SERVICE
Interfax-Ukraine news agency, Kiev, in Russian 1441 gmt 7 Sep 05
BBC Monitoring Service, UK, in English, Wed, Sep 07, 2005
KIEV - Prosecutor-General Svyatoslav Piskun has said that the National
Investigation Service, which the National Security and Defence Council
[NSDC] decided to set up on 6 September, will be formed on the basis
of investigators from the prosecution service, and will also include
investigators from the Interior Ministry and Security Service of Ukraine
[SBU].
"We will (form it) on the basis of investigators from the prosecution
service, but it will also include investigators from the Interior Ministry
and SBU, who will work in their own areas. Operational units will be
assigned to them," Piskun told journalists today.
Piskun said that the NSDC took the decision on the National Investigation
Service on the basis of a draft law prepared by the Prosecutor-General's
Office [PGO]. "We will separate off investigation, we will determine the
status of investigators. It is likely that the investigators will be
appointed by the president himself,"
Piskun said, adding, "You can imagine what status and independence such
an investigator will have. This is an epoch-making decision for justice in
Ukraine. It will definitely have an impact on courts, the prosecution
service, the police. It is a global position, and discussions will last not
just a minute, not five, not an hour."
Piskun said that he has already begun reforming law enforcement bodies along
these lines. He said one of the stages would be the moving of the PGO's main
investigation department to Podil [district of Kiev]. "I have already begun
this reform. I took the PGO investigation department.
We have 90 investigators of exceptionally important cases. We built a
separate building for them, fixed it up, installed security, provided cars,
and they have already moved into a new building," Piskun said.
As a result of the NSDC meeting on 6 September, a plan for reforming
law-enforcement bodies was adopted, which is based on the principle of
protecting citizens' constitutional rights. In addition, plans for reforming
the Interior Ministry and for setting up a commission to reform other
law-enforcement bodies were supported.
Also, a decision was taken to set up a National Investigation Service to
which the investigative functions and the corresponding departments of the
prosecution service should be transferred. The decision foresees the
development and agreement of a corresponding bill to be presented to
parliament for adoption. -30-
=============================================================
16. MP SOLOMATIN REQUESTS TARASIUK TO CHECK INFO THAT
U.S. WANTS TO CONFISCATE USD 250 MILLION FROM LAZARENKO
Ukrainian News Agency, Kyiv, Ukraine, Wed, September 7, 2005
MP Yurii Solomatin from the Communist Party (CPU) faction has requested
Foreign Minister Borys Tarasiuk to check the report that the United States
wants to confiscate USD 250 million from former Ukrainian prime minister
Pavlo Lazarenko. Ukrainian News learned this from the press service of CPU.
According to the report, Solomatin wants Tarasiuk to confirm or deny the
report that US justice agencies and prosecutors have filed a lawsuit to US
Federal Court to claim confiscation of the sum that, as the CPU stated, has
been stolen by Lazarenko from the state budget of Ukraine with the help of
incumbent Prime Minister Yulia Tymoshenko.
Solomatin also requests Secretary of the National Security and Defense
Council Petro Poroshenko to find legal grounds for its return to Ukraine and
work out a procedure for prevention of its confiscation in favor of the U.S.
As Ukrainian News earlier reported, Prosecutor-General Sviatoslav Piskun and
Liechtenstein's Chief Prosecutor Robert Wallner had a discussion in early
September of a mechanism for returning to Ukraine the USD 240 million seized
from Lazarenko. The Prosecutor-General's Office had earlier made attempts to
return the money.
In 2001, the PGO established that Lazarenko held USD 200 million in Antigua,
USD 92 million in the Bahamas, and USD 120 million in the Channel Islands.
In late 2004, Ukraine, the United States, Antigua, and Barbuda agreed to
conduct negotiations on confiscation and return to Ukraine of USD 230
million that were illegally channeled abroad by Lazarenko.
A Californian court found Lazarenko guilty of all 29 charges leveled against
him, including extortion and money laundering, in June 2004, but dismissed
15 other charges in May 2005. Presiding Judge Martin Jenkins will make the
final decision on each of the charges.
The U.S. initially accused Lazarenko of laundering USD 114 million through
American banks. The sum is now USD 4.5-5 million. A Californian court
started hearing the case against Lazarenko in mid-March last year. Lazarenko
was placed under arrest in the U.S. in March 1999 and was released on bail
on June 14, 2003.
Lazarenko served as Prime Minister of Ukraine during the 1996-1997 period.
He moved into opposition to then-president Leonid Kuchma after his
replacement as prime minister. -30-
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17. UKRAINE VOWS NO REPEAT OF PEACEKEEPER SCANDAL
Narodna Armiya, Kiev, in Ukrainian 7 Sep 05
BBC Monitoring Service, UK, in English, Wed, Sep 07, 2005
KIEV - The Ukrainian Defence Ministry and the Foreign Ministry are taking
urgent steps to investigate violations committed by the command of the
Ukrainian peacekeeping contingent in Lebanon, which led to the UN's decision
to replace the Ukrainian peacekeepers with troops from another country, a
statement released by the Defence Ministry has said.
It has started a criminal investigation into the misuse of funds by the
Ukrainian contingent's command, and vowed to do all it to make sure such
incidents never happen again. It is also taking steps to increase the role
of the Foreign Ministry's representatives in peacekeeping deployments.
Meanwhile, Ukrainian diplomats are holding talks with the UN officials in
order to minimize the damage to Ukraine's international image.
The following is the text of the statement entitled "Ukrainian Defence
Ministry's commentary regarding events involving Ukrainian peacekeeping
contingent of UN Interim Force in Lebanon" published by Ukrainian
newspaper Narodna Armiya on 7 September:
This August, the Defence Ministry received a report from the Secretariat of
the United Nations detailing the outcome of the UN investigation of the
Ukrainian peacekeeping battalion, which is a part of the UN Interim Force in
Lebanon (UNIFL).
The document lists violations, including financial irregularities, committed
by certain officers of the Ukrainian battalion who served in Lebanon during
the previous rotation of the UN peacekeeping force. The results of the
investigation led to the UN Secretariat's decision to initiate a replacement
of the Ukrainian contingent in Lebanon.
After receiving the materials from the UN Secretariat, a group of inspectors
led by a deputy commander-in-chief of Ukraine's armed forces was sent to
Lebanon in mid August to investigate the activities of the Ukrainian
peacekeeping contingent. The outcome obtained by the group partially
supported the accusations, although certain facts required further study.
In order to resolve this issue, minimize negative consequences for Ukraine
and prevent such violations from happening in the future, the Ukrainian
Defence Ministry in coordination with the Ukrainian Foreign Ministry are
taking certain steps.
An interagency meeting involving the Defence Ministry and the Foreign
Ministry has been held. There has also been an emergency meeting of the
Defence Ministry's collegium, which analysed the Ukrainian armed forces'
peacekeeping activity and set up concrete tasks to improve management of
Ukraine's peacekeeping contingents and armed forces' personnel.
In order to enhance the influence of representatives of the Ukrainian
Foreign Ministry on peacekeeping contingents and to tighten controls over
their activity, a deputy foreign minister has held a meeting with the
Permanent Representative of Ukraine to the UN [Valeriy Kuchynskyy],
Ukrainian ambassadors to the countries where the Ukrainian peacekeepers
are stationed and representatives of the Defence Ministry who are
responsible for peacekeeping operations.
The Ukrainian Defence Ministry is studying the materials and conducting a
meticulous internal investigation seeking to come up with a deep analysis of
the violations and to prevent their recurrence in the future. A criminal
investigation has been opened. In order to prevent similar violations by the
Ukrainian peacekeepers in other countries, the Defence Ministry is
conducting inspections of other peacekeeping contingents too.
In order to hold consultations with representatives of the UN Secretariat
and to reach an amicable agreement, a group comprising representatives of
the Ukrainian Foreign and Defence ministries has been sent to the UN
Headquarters.
The United Nations Organization welcomed the timeliness and transparency of
the measures taken by Ukraine. The UN confirmed that our country will
continue to be viewed as one of the key contributors to the UN peacekeeping
operations. Other Ukrainian peacekeeping contingents and armed forces'
personnel continue to take part in UN missions. -30-
=============================================================
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=============================================================
18. UKRAINIAN PRESIDENT'S RUSSIAN ADVISER BORIS NEMTSOV SAYS
ECONOMY IN SERIOUS CRISIS BECAUSE GOVERNMENT MISTAKES
HAVE PRODUCED A HOSTILE INVESTMENT CLIMATE
Good will of private investors is disappearing
INTERVIEW: with Boris Nemtsov by Ihor Radetskyy
Invest-Gazeta, Kiev, in Russian 6 Sep 05; p 13
BBC Monitoring Service, UK, in English, Wed, Sep 07, 2005
Boris Nemtsov, a Russian adviser to President Viktor Yushchenko, has accused
the Ukrainian government of populism. He said that the economy was in a
serious crisis because the government's mistakes had produced a hostile
investment climate. The good will of private investors after the Orange
Revolution is disappearing as they see the government fighting private
property, he said.
The following is the text of the interview Nemtsov gave to Ihor Radetskyy
published in the Ukrainian business weekly Invest-Gazeta on 6 September:
Boris Nemtsov, an adviser to the president of Ukraine, has said that
government actions are popular among the people, but are leading to economic
crisis.
The famous Russian economist believes that the Cabinet of Ministers is
taking part in a corporate conflict for the Nikopol Ferroalloys Plant [NFP]
on the side of one of the financial industrial groups.
The confrontation between staff of the NFP and the enterprise's owner
[tycoon MP] Viktor Pinchuk on the one hand and the Pryvat group with the
support of Prime Minister Yuliya Tymoshenko on the other has become the
biggest corruption scandal in the history of independent Ukraine.
[Radetskyy] Mr Nemtsov, why is the Ukrainian government so insistent on
returning the NFP into state ownership?
[Nemtsov] It is no secret that the interests of state officials and
absolutely specific businessmen are interwoven around the NFP. It's very bad
that the government is occupying the position of one of the warring sides.
This must not be done. It's ridiculous.
It means strengthening one group at the expense of another. In this mess the
people cannot be the winner - it can only lose out. And if anyone thinks
that this is a fight with oligarch Pinchuk, he is being very naive.
[Radetskyy] But you surely won't deny that fighting the oligarchs is one of
the Ukrainian cabinet's basic aims?
[Nemtsov] I won't. The government indeed wants to vanquish the oligarchs.
It's a fine idea and the people like it. However, this popular idea is
turning out to be a misfortune not at all for the oligarchs - they won't get
any poorer - but for ordinary workers who work for the enterprises of those
oligarchs. The road to hell is paved with good intentions.
You can't develop the economy with populist acts. That leads to catastrophe.
Viktor Yushchenko himself has said more than once that investors must be
protected, that property must not be taken away in any circumstances, that
redistribution is impermissible and that concern must be shown for the
investment climate.
The government, unfortunately, is doing it all the other way round. As for
Pinchuk, put him in equal conditions with everyone and let him prove that he
is a more effective owner, that he is introducing the latest technologies,
that his output is developing better and that solving issues by force is not
the way.
[Radetskyy] Were you surprised when you learned that NFP workers supported
Pinchuk and went out to demonstrate in front of the plant in defence of
their enterprise?
[Nemtsov] Leave well alone. As I understand it, the plant is working in a
stable manner and the workers' wages are high. Of course they don't want any
radical changes.
Apart from that, people understand that there is some kind of dirty row
going on, a redistribution of property, and taking part in that share-out
and changing something has absolutely nothing to do with them. Actually,
what is happening now at the plant is a reflection of the general picture in
Ukraine.
[Radetskyy] What, is everything that bad?
[Nemtsov] The situation in the Ukrainian economy is very serious. The new
government started working in conditions of economic growth, but now the
country is entering a period of profound crisis. Whereas last year the
growth in GDP was 12 per cent, an industrial slump started as early as in
June. And in July it reached 2.5 per cent. Budget revenues are falling.
This is all a consequence of the hostile investment climate created by the
mistaken and extremely dangerous actions of the Cabinet of Ministers. Unless
the president draws the appropriate conclusions, the crisis will deepen. And
this is at a time when, after the Orange Revolution, there was a unique
opportunity for attracting capital.
People had enormous enthusiasm and were prepared to invest money in the
country. Now that enthusiasm is dissipating. Because the examples of what
happens to private investments in Ukraine are very indicative and wretched.
Whereas in summer the crisis was not very noticeable, it can no longer be
hidden now.
[Radetskyy] Is the lack of investments in the Ukrainian economy the fault
exclusively of the government, or do you also blame the relevant
department - the State Property Fund [SPF]?
[Nemtsov] I don't really separate them. As I understand it, the head of the
fund is, after all, subordinate to the prime minister. And in general a
unique situation has come about with the SPF in Ukraine: a department
engaged in attracting private investments is headed by Socialists [Valentyna
Semenyuk, the head of the SPF is a member of the Socialist Party]. This is
the case nowhere in the world.
Socialists can be responsible for pension provision, for maternity and child
support, for education and health care... [ellipsis as published] But in no
country in the world apart from Ukraine are Socialists responsible for share
flotation and attracting investments. This is nonsense! And millions of
workers and pensioners and education and health care staff will have to pay
for it.
[Radetskyy] Let's go back to the NFP. What is your opinion: if the plant
were to return into state ownership via the court without all these attacks
and assaults, would the situation be calmer?
[Nemtsov] Well, the main thing is not how it is being done, but what is
being done. Objectively speaking, a struggle against private property leads
to a cessation of financial flows into the country. With all the
consequences for the economy that this entails. In our case it is leading to
price rises: for sugar, petrol and food. And I have no doubt at all that
pressure was put on the court in the NFP case.
After all, previously nobody cast doubt on the right of ownership of that
enterprise. Any country has an interest in an inflow of capital. If this is
hampered - by whatever means - the consequences will be extremely
unpleasant. And the people engaging in this are enemies. I can't call them
anything else. -30-
=============================================================
19. STATE OF THE EUROPEAN UNION: A FAILURE OF LEADERSHIP
Door must be kept open for both Turkey and Ukraine
COMMENTARY: By Mart Laar, former prime minister of Estonia
The Wall Street Journal, New York, NY, Thu, September 8, 2005
While giving a speech this summer at a Center for Policy Studies conference
in Copenhagen supporting the introduction of a flat tax in Denmark, I was
asked why I would encourage other European countries to adopt a better tax
system. Would that not make my home country of Estonia, which already has a
flat tax, less competitive?
My answer was short: "I am doing this because I am European." We are all
sitting in the same boat now. "New Europe" will not succeed if "Old Europe"
isn't competitive enough to meet the challenges of the global economy. It is
in the interest of the new European Union member states is to make all of
Europe new.
During the recent EU summit, the new member states looked with astonishment
at how Old Europe fought each other on the question of the EU budget. It has
not been a problem for New Europe to give away part of their financial
supports when a compromise has been achieved. They were quite surprised to
see how, for Old Europe, national interests were put clearly above European
interests.
This is especially sad because Europe is already in the middle of a quite
serious crisis. The rejections of the EU constitution by France and the
Netherlands sent shockwaves around the Continent. Some people have even
declared that the Europe is dead.
The problem for Europe, however, is not the failed referendum but the
failure of its leaders to understand why that happened. The people did not
vote against the constitution because of Polish plumbers or Estonian
gardeners. They voted against their own unpopular governments that haven't
created jobs or economic growth.
The referendums failed not because there has been too much reform in Europe;
they failed because there hasn't been enough of it. European politicians
over the years have created bogeymen that guaranteed their success in
national politics -- bad Brussels bureaucracy, bad new member states, bad
neoliberalism. And during the referendums these ghosts came back to haunt
them.
The failure of the French and Dutch referendums showed everyone that, as in
the famous fairy tale, the emperor has no clothes. Unfortunately, European
leaders are still trying to convince everyone otherwise. They want to
continue as if nothing has happened.
It is really time to understand that there is no reason to continue
discussing whether the constitution was good or bad. The constitution is
dead, and there is no way to revive it. To try to win the referendum, France
stopped all necessary but unpopular reforms. When other European leaders
try the same, all Europe will fail.
So let's calm down and start to work, because there is enormous amount of
work to do. The coming autumn will be crucial for the future of Europe. The
people of the Europe are looking to their leaders and asking: Will they
deliver? If they don't, the trust will be completely gone.
British Prime Minister Tony Blair has set out a large and bold agenda for
his country's EU presidency. It is important that he is not left alone in
this work. During the coming year Europe must take real steps at least in
four directions:
. Continue European integration. The new constitution is not crucial for
this. Existing treaties provide enough latitude for the creation of
institutions, such as a common foreign and security policy -- when all
member states agree, of course.
. Continue with enlargement. European leaders must not scare their people,
but rather explain that the costs of not proceeding with enlargement -- both
political and economical -- are actually higher than the possible costs of
enlargement. At the same time, real criteria must be followed. Special
attention must be given to the Balkans, and the door must be kept open for
both Turkey and Ukraine.
. Continue with real reforms and forget the discussion on the "dangers of
neoliberalism." It is really interesting to see how the conservative
government of France is accusing Britain's Labour government of Britain for
being "neoliberal." It must be remembered that some of the most radical
labor-market reforms are actually made in social-democratic countries, for
example in Denmark.
So the question is not whether the governments are on the right or the
left -- the only question is whether they are delivering growth and jobs.
Europe in the coming months must pass the necessary reforms to open its
services market and stop overregulation. Without these steps -- mentioned in
Mr. Blair's presidency agenda -- all talks about real reforms will be
nonsense.
. Give real attention to Europe. The real test for a united Europe will be
the compromise on the budget. When it will be connected with the reform of
the Common Agricultural Policy, Europe will take really positive step
forward.
In other words, Europe must not stop reforms but start with real reforms;
not stop enlargement but speed it up; not disintegrate but integrate; not
build integrated Europe over the heads of people but act with the consent of
the people.
Don't blame Europe for all possible problems; give it a chance. Europeans
have for too long asked what Europe can do for them. Now it is time for them
to ask themselves what they can do for Europe. -30-
-------------------------------------------------------------------------------------------------------
Mr. Laar is a former prime minister of Estonia.
=============================================================
20. WORLD NEWS: RUSSIA'S RADICALS FEEL HEAT
Kremlin, Fearing Ukraine Rerun, Is Accused of Repressing Rivals
By Alan Cullison, Staff Reporter, The Wall Street Journal
New York, New York, September 8, 2005; Page A16
MOSCOW -- The leftist youth group's weekly gathering began and ended like
others before it: After an hour of planning for rallies, the session
adjourned. As the ragtag members trailed out of the meeting hall, they were
ambushed and beaten by men wearing ski masks and wielding baseball bats.
"They are hunting us," said Olga Bessanova, who listened to the screaming
from behind a locked door as the assailants broke both hands of one friend
and beat three others senseless.
Young people have become a top concern within Russia's ruling establishment,
after youth groups in neighboring Ukraine formed the core of mass
demonstrations last year that drove the Kremlin's favored candidate from
office. Today in Russia, they are seen not only as a threat in their own
right, but also as a stalking horse for Western interests.
In the wake of upheavals in Ukraine and Georgia, Moscow has been cracking
down on fringe leftist groups, which have risen to prominence in the vacuum
left by the Kremlin's marginalization of mainstream opposition.
The government also has been lavishing support on a pro-Kremlin group,
Nashi, meaning "Our Guys" in Russian, that has been attacking the National
Bolsheviks -- the most prominent of the leftist youth groups -- as a threat
to the country's future.
As the fight for the support of Russia's youth has heated up, tensions are
growing. Wary of any challenge to its authority, the Kremlin is lashing out
at any potential rival, opposition leaders say.
"Today, the government is trying to make an example of anyone expressing his
own opinions," said Ivan Melnikov, deputy head of Russia's Communist Party,
whose own youth organization recently teamed up with the Bolsheviks and was
chased by the bat-wielding men at last week's meeting.
Fringe groups haven't been the only targets. After former Prime Minister
Mikhail Kasyanov went public with criticism of President Vladimir Putin's
administration and hinted at a possible presidential run, he found himself
the target of a fraud probe that he insists is politically motivated.
Former chess champion Gary Kasparov, who recently declared himself a
possible presidential candidate, saw his tour of Russia's southern regions
disrupted this summer by power outages, technical problems and egg-throwing
protesters in several cities where he was scheduled to speak.
The Bolsheviks accuse Nashi supporters of staging a wave of violent attacks
against them, including the one last week. They say police and prosecutors,
who have meted out long prison terms to leftists for stunts such as
occupying government buildings, have gone easy on the bat-wielding thugs.
Nashi officials dismiss the accusations as a publicity stunt, aimed at
raising the Bolsheviks' profile among Western sponsors who they say want to
overthrow the government in a coup resembling the Orange Revolution in
neighboring Ukraine. Government officials also deny going easy on the
attackers -- though they confirm that 25 who were detained after last week's
attack were released by police within hours.
The National Bolsheviks have scant appeal in mainstream Russian society,
which is enjoying the fruits of an oil boom and the first shoots of
prosperity in decades. The party, whose flag mixes symbols of Nazi Germany
and the Soviet Union, mostly has drawn an eclectic group of punks and
college students.
The Kremlin-backed Nashi, by contrast, rallied 60,000 young people at its
first big gathering in Moscow in May and is backed by a well-funded
organization that buses supporters from Russia's outlying regions.
Echoing comments by top Kremlin officials, Nashi's leader, Vasily Yakemenko,
says the Bolsheviks, along with other radical groups that have united with
it, are a real threat to Russia. At the entrance to the group's headquarters
in Moscow, a photograph of Eduard Limonov, the Bolshevik leader, is glued to
the floor for visitors to wipe their feet on.
The Orange Revolution in Ukraine last year turned that country into a
"Western colony," Mr. Yakemenko said. Now, he says, Western sponsors are
looking to use groups to foment rebellion in Russia itself.
He denied any connection to the beatings inflicted on his political foes.
"These so-called opposition organizations are built to collect grant
money -- Western money that wants change and revolt in Russia," he said. "In
order to get grants like that, you need to attract attention to yourself."
Mr. Yakemenko previously headed another pro-Kremlin movement called Walking
Together, which became notorious for staging book-burning ceremonies. His
new group has focused on defending Russia from what he says is an external
threat.
In a July interview with a German magazine, Vladislav Surkov, a top Kremlin
political strategist, called the Bolsheviks "a danger" and vowed to defeat
any Ukrainian-style efforts to oust the government.
At a summer camp this year, pro-Kremlin youths heard speakers such as Gleb
Pavlovsky, a political consultant who frequently works for the Kremlin. He
said members need to be ready for street action to put down an
antigovernment uprising. "Young people need to understand the technology of
constitutional action. And sometimes, constitutional action involves
conflict or street action," Mr. Pavlovsky said. -30-
--------------------------------------------------------------------------------------------------------------
Write to Alan Cullison at alan.cullison@wsj.com
=============================================================
21. BURN VICTIM NASTIA OVCHAR GOES TO ONE OF KYIV'S SCHOOLS
Accompanied by first lady Kateryna Yushchenko
Ukrinform, Kyiv, Ukraine, Wed, Sep 7, 2005
KYIV - On Wednesday Nastia Ovchar went to the first form of the Kyiv
Public-Humanitarian Gymnasium Dominanta. She was accompanied by her
family, President's spouse Kateryna Yushchenko and Ukrainian Parliament
Commissioner for Human Rights Nina Karpachova, the presidential press
service told Ukrinform.
Speaking during a ceremonial meeting, Kateryna Yushchenko said that
Nastia's deed "has shown to all children and grown-ups, that courage and
self-sacrifice can bring much in life". "What this girl did is an example
for our State", the President's spouse said.
During her conversation with journalists Kateryna Yushchenko promised that
her family will continue to assist and support Nastia. She also informed
them that she is planning to be engaged in the issue of burn centers in
Ukraine in order to "care about other children, who suffered from such a
disaster". -30-
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22. UKRAINIAN NUCLEAR OPERATOR SAYS TERMS MEET
STANDARDS FOR EUROPEAN LOANS
Excerpt from report by Interfax-Ukraine news agency
BBC Monitoring Service, UK, in English, Wed, Sep 7, 2005
NETISHYN (Khmelnytskyy Region) - The Enerhoatom national nuclear energy
generating company has effectively met all conditions for receiving loans
from the European Bank for Reconstruction and Development (EBRD) and the
European Atomic Energy Community (Euratom) to improve safety at generating
set No 2 of the Khmelnytskyy nuclear power station and generating set No 4
of the Rivne nuclear power station.
"Enerhoatom has now effectively met all conditions preceding the entry into
force of the loan agreements," Enerhoatom president Yuriy Nedashkivskyy said
at a news conference in Netishyn today.
He recalled that the key demands of the international financial
organizations in order for loans to be granted were to set up and fill a
fund for withdrawing nuclear installations from service.
Nedashkivskyy also said that this year Enerhoatom would direct 283.4m
hryvnyas [56.7m dollars] to a special budget fund in accordance with changes
to the law on the 2005 budget. This money had originally been planned to go
into the fund for withdrawing nuclear installations from service. In the
future this money will be transferred from the special budget fund to the
service withdrawal fund, he said.
Nedashkivskyy said that the company had held talks on this with the EBRD and
European Commission, which had agreed that the conditions of creating and
running a fund for withdrawing nuclear installations from service could be
regarded as having been met. "I think that there is still a certain amount
of work to be done with the European creditors," Nedashkivskyy said.
He also announced that the Khmelnytskyy power station needs to increase its
nuclear risks insurance from SDR [special drawing rights] 50m to SDR 150m
in order to receive its loan. "The conditions of the agreement with the
Ukrainian nuclear insurance pool have been drawn up," Nedashkivskyy
stressed. However, he said that in order to factor funds for increasing
insurance payments into the tariff Enerhoatom had needed to ratify the
guarantee agreements.
"At the moment I do not really see any other factors that could prevent the
loan being granted," Nedashkivskyy said. He added that it would be possible
to predict the timescale in which the funds will be granted as part of the
credit agreements once the Ukrainian president has signed laws on the
ratification of the guarantee agreements.
On Wednesday 7 September the Ukrainian parliament ratified a guarantee
agreement between Ukraine and Euratom on the granting of a loan equivalent
to 83m dollars to Enerhoatom in order to improve safety at generating set No
2 of the Khmelnytskyy nuclear power plant and generating set No 4 of the
Rivne nuclear power station.
A guarantee agreement has also been ratified between Ukraine and the EBRD
on a loan of 42m dollars to Enerhoatom in order to finance a modernizing
project at the two power plants. [Passage omitted: background to loan
agreements] -30-
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23. OIL PRODUCT PRICES IN UKRAINE MAY RISE 11% IN SEPT
Interfax, Kyiv, Ukraine, Wed, Sep 7, 2005
KYIV - Prices for oil products in Ukraine will grow by 8%-11% in September
due to the price increase for Russian oil this month and the current trend
towards growth in world oil prices, said Ukrainian Fuel and Energy Minister
Ivan Plachkov.
"We cannot be isolated from the situation in Europe and the world," Plachkov
said at a press conference in Kyiv on Tuesday. He added that domestic oil
refineries bought oil for processing at $410- $420 per tonne in September,
which is nearly twice the price at the beginning of the year. -30-
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