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Action Ukraine Report

"THE ACTION UKRAINE REPORT"
An International Newsletter
In-Depth Ukrainian News, Analysis, and Commentary

"The Art of Ukrainian History, Culture, Arts, Business, Religion,
Sports, Government, and Politics, in Ukraine and Around the World"

"THE ACTION UKRAINE REPORT" Year 04, Number 144
The Action Ukraine Coalition (AUC), Washington, D.C.
Ukrainian Federation of America (UFA), Huntingdon Valley, PA
morganw@patriot.net, ArtUkraine.com@starpower.net (ARTUIS)
Washington, D.C.; Kyiv, Ukraine, SATURDAY, August 21, 2004

SEVEN OLYMPIC MEDALS NOW FOR UKRAINE

GOLD ----- Yuriy Bilonog Track & Field Shot Put
GOLD ----- Olena Kostevych Shooting 10m Air Pistol
GOLD ----- Yana Klochkova Swimming 200m Medley
GOLD ----- Yana Klochkova Swimming 400m Medley
SILVER --- Roman Gontyuk Judo 73-81kg
BRONZE -- Vladislav Tretiak Fencing Individual Saber
BRONZE -- Andriy Serdinov Swimming 100m Butterfly

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

1. EARLY KUCHMA RESIGNATION RUMOURED POSSIBLE
Inside Ukraine Newsletter, Kyiv, Ukraine, Sat, August 21, 2004

2. MICHAEL PHELPS WINS GOLD IN 100-METER BUTTERFLY
Andriy Serdinov of Ukraine takes the bronze medal
Paul Newberry, AP Sports Writer, Athens, Greece, Fri, Aug 20, 2004

3. DOCTORS WARN OF ALCOHOL EPIDEMIC IN UKRAINE
ICTV television, Kiev, Ukraine, in Ukrainian, 20 Aug 04
BBC Monitoring Service, UK, in English, Friday, Aug 20, 2004

4. UKRAINE COMPLETES REFITTING INDIA'S WARPLANES
Defense-Express web site, Kiev, Ukraine, in Russian 18 Aug 04
BBC Monitoring Service, UK, in English, Thur, Aug 19, 2004

5. BELGIUM IMPOUNDS UKRAINE ANTONOV AIRPLANE
BBC NEWS, United Kingdom, Friday, August 20, 2004

6. CHEVRON MAY GET INVOLVED IN POLISH EXTENSION
OF ODESSA-BRODY PIPELINE
Polish News Bulletin, Warsaw, Poland, Friday, Aug 20, 2004

7. ODESSA-BRODY PIPELINE MAY STILL PUMP CASPIAN
OIL DESPITE UKRAINE'S RECENT RUSSIA DEAL
AFX Europe (Focus), Baku, Azerbaijan, Friday, Aug 20, 2004

8. UKRAINIAN PRESIDENT SUSPENDS PRIVATIZATION
Associated Press, Kiev, Ukraine, Friday, August 20, 2004

9. PRIVATIZATION PUT OFF TO PREVENT ULTRA-PATRIOTS
AND NO-HOPE POLITICIANS FROM TARNISHING UKRAINE
Inter TV, Kiev, Ukraine, in Russian, 20 Aug 04
BBC Monitoring Service, UK, in English, Fri, Aug 20, 2004

10. UKRAINE: DONETSK BASED COMPANY CONTROLLED BY
RINAT AKHMETOV BUYS THREE MORE STATE PLANTS
UNIAN news agency, Kiev, Ukraine, in Ukrainian, 20 Aug 04
BBC Monitoring Service, UK, in English, Friday, Aug 20, 2004

11. UKRAINE GRAIN HARVEST BOLSTERS ECONOMIC
GROWTH AHEAD OF OCTOBER PRESIDENTIAL ELECTION
By Tom Warner in Kiev, Financial Times
London, UK, Friday, August 20 2004

12. UKRAINIAN MINISTRY: BREAD PRICES TO BE REDUCED
One Plus One TV, Kiev, Ukraine, in Ukrainian, 20 Aug 04
BBC Monitoring Service, UK, in English, Fri, Aug 20, 2004

13. UKRAINE: WJ GROUP OF COMPANIES TO OPEN
SUNFLOWER OIL EXPORT TERMINAL IN KHERSON
Khrystyna Protsiv, Ukrainian News, Kyiv, Ukraine, Wed, Aug 18, 2004

14. LVIV-BASED INDEPENDENT NEWSPAPER POSTUP
COMES UNDER ARSON ATTACK, EQUIPMENT DESTROYED
UNIAN news agency, Kiev, in Ukrainian, 19 Aug 04
BBC Monitoring Service, UK, in English, Thur, Aug 19, 2004

15. FIRE AT OFFICE OF UKRAINIAN POSTUP NEWSPAPER
IN LVIV OFFICIALLY CONFIRMED AS ACT OF ARSON
TV 5 Kanal, Kiev, Ukraine, in Ukrainian, 20 Aug 04
BBC Monitoring Service,UK, in English, Fri, Aug 20, 2004

16. UKRAINIAN TV HIGHLY BIASED IN FAVOUR OF PM
WHO IS ALWAYS COVERED IN A POSITIVE TONE
Yanukovych gets twice as much coverage as all other candidates
Era, Kiev, Ukraine, in Ukrainian, 20 Aug 04
BBC Monitoring Service, UK, in English, Fri, Aug 20, 2004

17. UKRAINE'S CENTRAL ELECTORAL COMMISSION HEAD
NOTES STRONG BIAS IN TELEVISION NEWS COVERAGE
Received many complaints about presidential campaign media coverage
UNIAN news agency, Kiev, in Ukrainian, 20 Aug 04
BBC Monitoring Service, UK, in English, Friday, Aug 20, 2004

18. TRAVEL ESSAY: TASTE OF LIFE IN UKRAINE: IT GOES
DOWN SMOOTH AS A TRADITIONAL LARD SANDWICH
By Matt Hagengruber, Special to The Seattle Times
The Seattle Times, Seattle, Washington, Thur, Aug 19, 2004

19.EASTERN APPROACHES: EXPLORING KYIV'S ART AVENUE
COMMENTARY By Scott Lewis, The Ukrainian Observer
Issue: 198/4, Kyiv Ukraine, Saturday, July 31, 2004
=======================================================
ACTION UKRAINE REPORT-04, No.144 ARTICLE NUMBER ONE
=======================================================
1. EARLY KUCHMA RESIGNATION RUMOURED POSSIBLE

Inside Ukraine Newsletter, Kyiv, Ukraine, Sat, August 21, 2004

KYIV - Rumours thought to have originated among the Russian press
suggest that Ukrainian President Kuchma may be on the verge of announcing
his pre-term resignation, to take effect almost immediately after Ukraine's
Independence Day, August 24, 2004. The rumours are so specific as to
suggest that the Kuchma announcement has already been recorded and will
be held in Presidential Administration hands until it would be broadcast by
all major television stations on Monday.

Should the rumoured Kuchma resignation come to pass, it would closely
mimic the resignation of Russian President Boris Yeltsin that brought
Vladimir Putin to power. Just as it was in Russia, Ukrainian law prescribes
that in case of the resignation of a sitting president the prime minister
would become acting president for 60 days during which time an election
would be held to elect a new president for a full term.

In Kuchma's case, with the regular presidential election slated for October
31, a resignation in late August would only shorten his term by a little
over two months and might, at the same time, prove an immense advantage
to the chances of Prime Minister Viktor Yanukovych to overcome the
strong presidential campaign of former Prime Minister Viktor Yushchenko.

With all the powers of the presidency at his disposal and with the existence
of a several billion hryvna war chest of government funds at his disposal,
allegedly secreted there in the 2004 budget process, available for what are
expected to be considerable raises in the pay of government employees and
the retirement payments of pensioners, Yanukovych would be expected to
become an almost unstoppable force for election to a full term.

The election of Yanukovych, with his known record of criminal convictions
and prison terms, and his highly authoritarian Soviet style of rule, clearly
demonstrated during his years in power as governor of the eastern Ukrainian
industrial heartland, Donetsk Oblast, will not sit well with many government
leaders in Europe and the United States.

However, opprobrium in the wider world seems to the Ukrainian power
elite to be a small price to pay for a smooth transition of power to a known
quantity like Yanukovych, particularly when the deal also almost certainly
includes certainty that neither Kuchma nor any of his close political
associates will ever be required to face court action for their alleged mis-
deeds over the past 10 years.

As Moscow Komsomolets said on August 19 in comments related to the
possibility of Kuchma's pre-term resignation, "On the whole, all this goes
the same way it did with us in Russia." (END)
=======================================================
ACTION UKRAINE REPORT-04, No.144: ARTICLE NUMBER TWO
The Action Ukraine Coalition, "Working to Secure Ukraine's Future"
=======================================================
2. MICHAEL PHELPS WINS GOLD IN 100-METER BUTTERFLY
Andriy Serdinov of Ukraine took the bronze medal
1st 51.25, 2nd 51.29, 3rd 51.36, Oh so close.

By Paul Newberry, AP Sports Writer, Athens, Greece, Fri, Aug 20, 2004

ATHENS -- Mark Spitz you've got company. Michael Phelps matched
Spitz's record of four individual gold medals in the Olympic pool with a
stirring comeback in the 100-meter butterfly, nipping rival and teammate
Ian Crocker at the wall Friday night.

In an Olympics that has become his personal showcase, Phelps pulled off
what may have been his most amazing feat of all. He had every reason to
be tired, racing for the 14th time in seven days. And he was taking on the
world record-holder, the guy who beat him at both the world championships
and the U.S. Olympic trials.

Midway through the race, it seemed as though Phelps had finally met his
match. Crocker led his teammate by a half-body length, making the turn
under world-record pace. Phelps was lagging in fifth, his quest for another
gold in serious jeopardy.

But Phelps' huge wingspan began to dig furiously into the water, leaving
behind a wake that resembled a washing machine cleaning a load of clothes.
With 20 meters to go, he had pulled up on Crocker's shoulder. At the wall,
both men lunged for the gold.

Phelps got it, beating Crocker by a minuscule four-hundredths of a second
in an Olympic record of 51.25, with Andriy Serdinov of Ukraine taking the
bronze in 51.36. It was Phelps' fifth gold overall, to go along with two
bronze medals. "I think it will be the most beautiful week of my life," he
said.

Both men spun around quickly to get a glimpse of the scoreboard. When
Phelps saw the "1" beside his name, he threw his arms in the air and
smiled - the look of a man who has dominated the Olympics and, in every
respect but one, fully lived up to the enormous expectations that were
heaped upon him in the months leading up to the Athens Games.

The 19-year-old from Baltimore fell short of Spitz's record from the 1972
Munich Games: seven gold medals. But in a swimming world that is much
more competitive than it was three decades ago, Phelps' performance
could very well be more impressive than the one he was chasing.

On Saturday, he'll have a chance to go one up on Spitz. By beating Crocker,
Phelps earned the right to swim the final of the 400 medley relay - an event
the United States has never lost. He should win his sixth gold and eighth
medal overall, which would tie Soviet gymnast Aleksandr Dityatin's record
from the boycotted 1980 Moscow Games. (END)(ARTUIS)
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ACTION UKRAINE REPORT-04, No.144: ARTICLE NUMBER THREE
A leading news source for thousands around the world
=======================================================
3. DOCTORS WARN OF ALCOHOL EPIDEMIC IN UKRAINE

ICTV television, Kiev, Ukraine, in Ukrainian, 20 Aug 04
BBC Monitoring Service, UK, in English, Fri, Aug 20, 2004

KIEV - [Presenter] Ukrainian psychiatrists believe that alcohol has become
a national threat. There are 700,000 alcoholics in the country at the
moment. These are official figures, while experts say there are over 2m of
them. Ukrainians seek in alcohol salvation from bad moods, unemployment
and lack of money.

[Correspondent] Delirium tremens or DT has acquired the signs of an epidemic
in Ukraine over the past years. The number of alcoholic psychoses increased
by 200 per cent. People seek in drunkenness salvation from depression and
stresses. [Passage omitted: Doctors say regular misuse of alcohol leads to
alcohol dependence, urge people to seek medical advice.]

[Correspondent] Half of all crimes committed in Ukraine are related to the
use of alcohol. Psychiatrists say that the dependence needs to be treated at
once, as even small doses of alcohol may cause significant problems.(END)
=======================================================
ACTION UKRAINE REPORT-04, No.144: ARTICLE NUMBER FOUR
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=======================================================
4.UKRAINE COMPLETES REFITTING INDIA'S MIG-23 WARPLANES

Defense-Express web site, Kiev, Ukraine, in Russian 18 Aug 04
BBC Monitoring Service, UK, in English, Thur, Aug 19, 2004

KIEV - Three out of six Mig-23 warplanes, which were repaired at the
Defence Ministry's Chuhuyiv aviation repair plant, have been sent to India,
a source at the plant told Defense Express. The source said that an An-
124 transport jet took the warplanes to India where they would be assembled
and pass test flights.

Defense Express reported earlier that the Chuhuyiv plant in October 2002
signed a contract to refit six Mig-23MF planes which were decommissioned
by the [Ukrainian] Defence Ministry and were to be supplied to the Indian
Air Force. These Migs are better equipped than similar warplanes built in
India.

The plant completed the refitting of six Mig-23UB planes, which was
commissioned by the Indian Air Force. All the planes passed test flights
after the refitting, and in early 2004 the plant was ready to sent them to
India.

A source at the Ukrainian aviation industry told Defense Express that India
was not happy about how long it took the Chuhuyiv plant to fulfil the
contract. The plant said that the delay was due to an agreement with a state
intermediary having been signed later that the contract proper. The Indian
Air Force has about 50 Mig-23 aircraft.

Defense Express reported earlier that the Chuhuyiv aviation repair plant was
licensed to do refitting on Mig-23MF, Mig-23MS, Mig-23ML, Mig-23MLA,
Mig-23-MLD and Mig-23UB planes in 1975. [Passage omitted: the Mig-23's
profile] (END) (ARTUIS)
=======================================================
ACTION UKRAINE REPORT-04, No. 144: ARTICLE NUMBER FIVE
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=======================================================
5. BELGIUM IMPOUNDS UKRAINE ANTONOV AN-124 AIRPLANE

BBC NEWS, United Kingdom, Friday, August 20, 2004

BRUSSELS - The Ukrainian authorities are in talks to end the standoff A
Ukrainian cargo plane chartered by Nato to deliver equipment to troops in
Afghanistan has been impounded by the authorities at a Brussels airport.

The plane was reportedly seized following a court ruling in a complex
financial dispute between a Cypriot company and the Ukrainian government.
A Ukrainian foreign ministry spokesman said talks were underway with the
Belgian government and aviation staff.

Nato said the incident would not affect its peacekeeping effort in
Afghanistan. "Nato is not party to this legal dispute, nevertheless we hope
that a negotiated settlement between the parties can be reached soon," said
spokesman Robert Pszczel. The crew, numbering about 20, have remained
aboard the massive Antonov An-124 plane at Melsbroek military airport
near Brussels.

Belgian officials reportedly acted after the ruling of an arbitration court
in Sweden in a claim brought by a Cypriot firm, which says the Ukrainian
government owes it $40m. A Ukrainian plane was detained in similar
circumstances last year in Canada, and is still there. (END)(ARTUIS)
----------------------------------------------------------------------------
LINK: http://news.bbc.co.uk/2/hi/europe/3584616.stm
=======================================================
ACTION UKRAINE REPORT-04, No.144: ARTICLE NUMBER SIX
Ukrainian Information Website: http://www.ArtUkraine.com
=======================================================
6. CHEVRON MAY GET INVOLVED IN POLISH EXTENSION
OF ODESSA-BRODY PIPELINE

Polish News Bulletin, Warsaw, Poland, Friday, Aug 20, 2004

WARSAW - Russia and Ukraine signed a deal to increase transfers of crude
oil from Russia through Ukraine to 85m tons annually, from 57m tons agreed
in 2003.

Both countries will optimize the use of the Odessa-Brody (OB) pipeline,
built by Ukraine in 2001 to facilitate oil transportation from the Caspian
Sea oil field to Europe.

Meanwhile, Russia managed to persuade Ukraine to use a part of the pipeline
to transport the Russian oil to the Caspian Sea, for subsequent sea
transportation. This was to last until Poland manages to extend the OB
pipeline to the Plock refinery, where the Caspian gas could be channeled for
further transportation westwards. The new agreement mandates that Russian
oil be transported from Brody to Odessa for the next 15 years, which may
stall the extension of the OB pipeline.

The Polish-Ukrainian company Sarmatia, responsible for its financial plan,
does not know what to think about the agreement. The US company
Chevron said it may help finance the project. (END)(ARTUIS)
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ACTION UKRAINE REPORT-04, No.144: ARTICLE NUMBER SEVEN
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=======================================================
7. ODESSA-BRODY PIPELINE MAY STILL PUMP CASPIAN
OIL DESPITE UKRAINE'S RECENT RUSSIA DEAL

AFX Europe (Focus), Baku, Azerbaijan, Friday, Aug 20, 2004

BAKU ---- Ukraine's Odessa-Brody oil pipeline could still pump
Caspian Sea crude, despite signing a deal to ship oil from Russian fields
instead, the country's chief diplomat in Azerbaijan told reporters.The
pipeline was conceived, with US backing, to export Caspian Sea oil
onward from the Black Sea to Poland and possibly Germany while at
the same time bypassing Russia.

Igor Kizima, Ukraine's charge d'affaires in Azerbaijan, which is a major
Caspian Sea oil exporter, said the deal to export Russian oil was only a
temporary stop-gap measure. "The question of Caspian Sea oil has been
very much on the agenda for Ukraine... (and) it remains on the agenda,"
the diplomat told a press conference here, adding: "Ukraine will definitely
return to this question."

He said: "Today an agreement has been reached about the pumping of
Russian oil but that was linked to short-term benefits since the Odessa-
Brody pipeline had been empty for a long time." Ukraine's pipeline
monopoly Ukrtransnafta signed a deal earlier this summer with the British-
Russian joint venture BP-TNK to export up to 9 mln tonnes a year of
Siberian oil through the pipeline.

The oil is to flow from Brody, near Ukraine's border with Poland, to the
port of Odessa on Ukraine's Black Sea coast -- the opposite direction to
the one originally intended when the pipeline was built. (END)(ARTUIS)
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ACTION UKRAINE REPORT-04, No.144: ARTICLE NUMBER EIGHT
Ukrainian Information Website: http://www.ArtUkraine.com
=======================================================
8. UKRAINIAN PRESIDENT SUSPENDS PRIVATIZATION

Associated Press, Kiev, Ukraine, Friday, August 20, 2004

KIEV - President Leonid Kuchma suspended the privatization of
communications giant Ukrtelekom and the country's second-largest state-
owned ammonia producer, officials said Friday.

Kuchma made the order to his Cabinet "considering the latest speculations
around the privatization process in Ukraine," his office said in a statement
released Thursday. It did not elaborate.

Kuchma's office did not say when the privatization of Ukrtelekom and
ammonia producer Odessa Port Factory would be restarted, leading
some experts to believe the decision would be left until after the Oct. 31
presidential elections. Kuchma, who has led this nation for 10 years, is
not running for reelection.

Earlier this summer, some of the world's biggest steel companies cried foul
after Ukraine's main steel producer Kryvorizhstal was sold to a company
controlled by Kuchma's son-in-law, Viktor Pinchuk.

U.S. Steel Corp, Anglo-Dutch LNM and Russia's Severstal criticized
what they called discriminatory tender conditions, which required bidders
to have been consumers of Ukrainian coking coal for three years. They
also said they had bid significantly higher than the winning company,
Investment and Steel Union, which was set up by Pinchuk.

Ukrtelekom's privatization has been repeatedly postponed and the
government had planned to sell a 42.86 percent stake in the company,
raising around 4.24 billion hryvnas (US$800 million; euro662.5 million),
Dow Jones Newswires reported, citing the Prime-Tass news agency.

Last week, a Kiev court rejected a lawsuit by the Prosecutor General's
Office challenging the purchase of a 51 percent stake in Ukrtelekom by
Russia's OAO Mobile TeleSystems two years ago. The court said that
Ukrainian government did not break the law when it allowed the deal.

Ukraine's state property fund planned to sell a 94.54 percent stake in the
ammonia producer in the Black Sea port of Odessa for a starting price of
900 million hryvnas ($US170 million; euro140.6 million). Over the past
three years, the manufacturer has exported some 88 percent of its products
to Europe and the United States. (am/mb/me) (END) (ARTUIS)
=======================================================
ACTION UKRAINE REPORT-04, No.144: ARTICLE NUMBER NINE
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=======================================================
9. PRIVATIZATION PUT OFF TO PREVENT ULTRA-PATRIOTS
AND NO-HOPE POLITICIANS FROM TARNISHING UKRAINE

Inter TV, Kiev, Ukraine, in Russian, 20 Aug 04
BBC Monitoring Service, UK, in English, Fri, Aug 20, 2004

KIEV - [Presenter] Ukrainian Prime Minister Viktor Yanukovych made
an important statement in Kremenchuk [Poltava Region] today.
Ukrtelekom and the Odessa port works will be privatized, but after the
election. We are in no hurry, Viktor Yanukovych said.

The head of the State Property Fund, Mykhaylo Chechetov, confirmed
to journalists that the two facilities are fully ready for sale. Ukrainian
President Leonid Kuchma decided to suspend privatization, quote, to
stop some no-hope politicians from tarnishing our state.

[Chechetov] A politician is someone who thinks about his political future.
Our president is a statesman who thinks about the future of the state.

To prevent these ultra-patriots and no-hope politicians, as I call them,
from speculating on the privatization of Ukrtelekom and the Odessa port
works yet another time, to pour dirt on the state, the president as a wise
leader, has made a patriotic decision to postpone the privatization of these
facilities and move it, maybe, until after the election and, by doing so, to
keep Ukraine's reputation untarnished. This is a very wise and patriotically
correct decision.

[The Ukrainian opposition leader, Viktor Yushchenko, said that if elected
president he would not recognize the privatization of the aforementioned
companies, see Interfax-Ukraine news agency, Kiev, in Russian 0931
gmt 30 Jul 04.] (END) (ARTUIS)
=======================================================
ACTION UKRAINE REPORT-04, No.144: ARTICLE NUMBER TEN
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=======================================================
10. UKRAINE: DONETSK BASED COMPANY CONTROLLED BY
RINAT AKHMETOV BUYS THREE MORE STATE PLANTS

UNIAN news agency, Kiev, Ukraine, in Ukrainian, 20 Aug 04
BBC Monitoring Service, UK, in English, Friday, Aug 20, 2004

KIEV - The [Donetsk-based] closed joint-stock company System Capital
Management (SCM) [controlled by Ukrainian tycoon Rinat Akhmetov] has
bought a 90.57-per-cent stake in the Dokuchayevsk Flux-and-Dolomite
Combine [in eastern Ukrainian Donetsk Region] for 114,084,755 hryvnyas.
UNIAN learnt this from the press service of the State Property Fund.

SCM also bought a 89.92-per-cent stake in the Novotroyitske Rudoupravlinnya
open joint-stock company [in Donetsk Region, which produces limestone for
metallurgy and crude dolomite] for 13,628,405 hryvnyas, and a 93.16-per-cent
stake in the industrial and production association Kryvbaspidryvprom [Kryvyy
Rih industrial blasting] for 73.27m hryvnyas. [Passage omitted: description
of the three plants] [The National Bank of Ukraine set today the
hryvnya-dollar exchange rate at 5.3125 hryvnyas per dollar.]

[Akhmetov's company bought two Kryvyy Rih-based ore enrichment combines
in July, see UT1, Kiev, in Ukrainian 1550 gmt 19 Jul 04.] (END)(ARTUIS)
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ACTION UKRAINE REPORT-04, No. 144 ARTICLE NUMBER ELEVEN
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11. UKRAINE GRAIN HARVEST BOLSTERS ECONOMIC
GROWTH AHEAD OF OCTOBER PRESIDENTIAL ELECTION

By Tom Warner in Kiev
Financial Times, London, UK, Friday, August 20 2004

KIEV - An improved grain harvest is boosting Ukraine's strong economic
growth and giving hope to the government candidate in the presidential
election due in October.

Viktor Yanukovich, prime minister, has been waging a come-from-behind
campaign ever since Ukraine's president, Leonid Kuchma, announced he
would not run for a third term early this year. Recent polls show Mr
Yanukovich trailing the main opposition leader, Viktor Yushchenko, by
about 10 points.

Mr Yanukovich had a chance to tout his economic success story during an
appearance yesterday at the Sorochinsky Fair, an annual farmers' market in
the rural Poltava region. Figures released this week show gross domestic
product up by 13.5 per cent in January to July on the back of 26.5 per cent
growth in the agriculture sector.

Mr Yanukovich said the improved harvest would allow him to lower bread
prices "but not at the expense of farmers". "[I want] a gradual reduction of
prices, so that peasants receive their money, and the people feel there is a
sufficient harvest," news agencies reported him as saying.

Ukraine's farmers have so far harvested about 29m tonnes of grain,
according to the agriculture ministry, which had forecast a total harvest of
up to 35m tonnes. Last year's harvest, damaged by terrible weather and
locusts, was a record low of 20.2m tonnes.

If Mr Yanukovich is to win the elections, scheduled for October 31, he will
need to convince rural voters that the rebound is due to more than just fair
weather. So far Mr Yanukovich is drawing most of his support from the
industrial east, where he was a regional governor until his appointment as
prime minister in 2002.

Eastern voters tend to support his moves to strengthen ties with Russia,
which he also touted yesterday after Russia announced it would no longer
charge value added tax on gasoline and heating fuel exported to Ukraine.
In a deviation from normal practice, Russia has charged VAT on most of
its fuel exports within the former Soviet Union.

Ukraine's steelmaking eastern regions have been the driving force of its
growth over the past two years. High world prices for base metals and
strong recoveries of the construction and machine-building sectors pushed
growth to 9.4 per cent last year. (END) (ARTUIS)
=======================================================
ACTION UKRAINE REPORT-04, No. 144 ARTICLE NUMBER TWELVE
The Action Ukraine Coalition, "Working to Secure Ukraine's Future"
=======================================================
12. UKRAINIAN MINISTRY: BREAD PRICES TO BE REDUCED

One Plus One TV, Kiev, Ukraine, in Ukrainian, 20 Aug 04
BBC Monitoring Service, UK, in English, Fri, Aug 20, 2004

KIEV - Bread prices are to be reduced in Ukraine within a month, the
Ministry of Agricultural Policy has said. Deputy Minister Yuriy Luzan said
bread may become 5-10 per cent cheaper. Officials explain this forecast
by a good harvest and low grain prices on the domestic market.

The State Reserve has already bought 2m tonnes grain of the 3m t necessary.
The harvesting is expected to be over by the end of this week. The ministry
expects 34m t of grain to be harvested this year. At the moment 32m tonnes
has been harvested.

It is planned to export about 7m t of grain. Last year's bad harvest caused
a grain crisis in Ukraine, which led to a price hike on flour and bread
products. (END) (ARTUIS)
------------------------------------------------------------------------
FOOTNOTE: The Ukrainian government has taken several actions
to make sure the price of bread goes down, especially right before
the presidential election. Such actions tend to lower the income of
the farms and thus farmers end up paying for most of the lower bread
prices, not the government. Farmers can ill afford to do this but
do not have any choice. (Editor)
=======================================================
ACTION UKRAINE REPORT-04, No. 144 ARTICLE NUMBER THIRTEEN
=======================================================
13. UKRAINE: WJ GROUP OF COMPANIES TO OPEN
SUNFLOWER OIL EXPORT TERMINAL IN KHERSON

Khrystyna Protsiv, Ukrainian News, Kyiv, Ukraine, Wed, Aug 18, 2004

KYIV - The WJ group of companies is going to open a sunflower oil
export terminal in Kherson late in October. This information was
obtained from the company's statement available to Ukrainian News.

The terminal is located on the territory of the Kherson port elevator and
Mill, which has been operated by WJ for several years. At the moment
the terminal is under construction and assembly works are in progress.

The terminal will be capable of the simultaneous storing of 20,000 tons
of sunflower oil. WJ is planning in the future to increase the volume of
the terminal to 30,000 tons.

Khersones, a WJ affiliate in Ukraine, will carry out the management
and technical maintenance of the terminal. The terminal was constructed
using up-to-date Russian and German equipment which utilizes modern
technology.

"The project was designed by Ukrainian authoritative design groups
and by experts from the Netherlands, France, and Italy, which allowed
WJ to optimize the entire process of raw oil unloading, storing and
loading into the vessels," the statement reads.

According to the analysis by experts, at the moment of its launch the
terminal will become the most up-to-date and best equipped enterprise
of its kind in Trans-Black Sea area. WJ did not disclose the cost of the
terminal construction project.

Created in 1989 in New York as WJ Export-Import Inc. the company
has grown into a complex of companies: WJ Grain, WJ Agro, WJ
Ukraine, WJ Interagro, WJ Trade House and WJ Holding.

Today WJ is one of the world largest firms which process and export
grain and oil-yielding crops from the Commonwealth of Independent
States (CIS) and Eastern Europe.

In Ukraine WJ works through a number of companies which deal with
grain and oil-yielding crops and the transfer, storage, and shipment of
agricultural crops.

In addition to the grain business, WJ makes sunflower oil sold under the
brands of Milora, Razdolye, Floris, Mister Cook in Russia and Moldova.
-------------------------------------------------------------------------
FOOTNOTE: When we read this article we realized the article
contained several factural and translation errors. We contacted WJ to
clarify this matter. Using the information we received from WJ we have
taken the liberty to edit the article. The article as edited appears above.
========================================================
ACTION UKRAINE REPORT-04, No. 144 ARTICLE NUMBER FOURTEEN
Ukrainian Information Website: http://www.ArtUkraine.com
========================================================
14. UKRAINE: LVIV-BASED INDEPENDENT NEWSPAPER POSTUP
COMES UNDER ARSON ATTACK, EQUIPMENT DESTROYED

UNIAN news agency, Kiev, in Ukrainian, 19 Aug 04
BBC Monitoring Service, UK, in English, Thur, Aug 19, 2004

LVIV - After 4 a.m. today, unknown people set fire to the premises of the
Lviv-based Postup newspaper on the top floor of a four-storey building at
42 Sakharov Street.

The editor of the paper's Ukrainian news department, Volodymyr
Khrushchak, told UNIAN that "criminals probably got to the fourth floor
by the internal fire escape.

A Molotov cocktail was thrown into a room where the paper's computer
layout was done. The fire completely destroyed the room and the
equipment inside: five computers, printers and scanners," Khrushchak said.
The police are currently working at the site, Khrushchak said.

Postup journalists believe that the arson attack was connected with the
activities of the paper which "has occupied an opposition niche among the
Lviv media for a long time". [Postup is an independent opposition-leaning
daily which does not identify itself with any political force.] (END)
========================================================
ACTION UKRAINE REPORT-04, No. 144 ARTICLE NUMBER FIFTEEN
Ukrainian Information Website: http://www.ArtUkraine.com
========================================================
15. FIRE AT OFFICE OF UKRAINIAN POSTUP NEWSPAPER OFFICE
IN LVIV OFFICIALLY CONFIRMED AS ACT OF ARSON

TV 5 Kanal, Kiev, Ukraine, in Ukrainian, 20 Aug 04
BBC Monitoring Service,UK, in English, Fri, Aug 20, 2004

KIEV - [Presenter] The fire at the office of the Postup newspaper in Lviv
has officially been declared an act of arson. This was reported by the
Ministry of Emergency Situations directorate in Lviv Region. The fire broke
out on the night of [Wednesday-]Thursday, and destroyed the newspaper
premises, computers and office equipment.

The Ministry of Emergency Situations put the cost of the damage at 48,000
hryvnyas [about 9,000 dollars]. The editorial board of the newspaper put it
at 300,000 hryvnyas [about 56,500 dollars]. The director of the Postup
publishing house, Andriy Bilous, is convinced that the office was set on
fire because of critical, anti-government publications in Postup.

[Bilous, captioned as director of the Postup publishing house] I do not see
a political force having an interest in this. Maybe certain persons. Can an
entire political force be interested? We provide balanced coverage of all
political forces, and therefore I see no reason to believe so. [It is a
matter of ] specific persons, specific officials, specific bureaucrats.

[Presenter] The arson at the office of Postup has found a resonance both
in Ukrainian political ranks and also in high-ranking foreign circles. US
Senator John McCain [who has been leading a delegation of US senators
examining the conduct of the presidential election campaign] described the
Lviv events as did opposition leader Viktor Yushchenko.

[McCain, captioned as US senator, in English fading to Ukrainian
translation] We have not seen equal and balanced coverage of all Ukrainian
presidential candidates in the media. But we are hoping to see it. We are
deeply disturbed at the moment by the news of the fire at the office of a
Ukrainian daily newspaper in Lviv.

[Yushchenko, captioned as presidential candidate] It is an act of the sort
we saw in Mukacheve [mayoral election that was subject to widespread
intimidation and allegations of rigging], it is an act of exactly the sort
we have just seen on Ay-Petri [ in Crimea, where a police agents was caught
tailing Yushchenko], and now we see it on Lviv. These are all the same sort
of acts. The authorities are not going to play fair. They use not only
power-wielding official organizations but also their administrative-command
system, and are at present working directly with various criminal groups.

[5 Kanal reported at 1000 gmt that the Ukrainian Union of Journalists has
appealed to the interior ministry to investigate the Postup incident
immediately] [Video shows police examining Postup office, Bilous speaking
to reporters in his office, McCain and Yushchenko speaking the previous
evening] [For initial report of fire, see - UNIAN news agency, Kiev, in
Ukrainian 0804 gmt 19 Aug 04] (END)(ARTUIS)
========================================================
ACTION UKRAINE REPORT-04, No. 144 ARTICLE NUMBER SIXTEEN
Ukrainian Information Website: http://www.ArtUkraine.com
========================================================
16. UKRAINIAN TV HIGHLY BIASED IN FAVOUR OF PM
WHO IS ALWAYS COVERED IN A POSITIVE TONE
Yanukovych gets twice as much coverage as all other candidates

Era, Kiev, Ukraine, in Ukrainian, 20 Aug 04
BBC Monitoring Service, UK, in English, Fri, Aug 20, 2004

KIEV - Coverage of the prime minister [Viktor Yanukovych] dominates
national and regional TV channels, as well as the local press and local TV,
compared to all other [presidential] candidates, according to the results of
media monitoring by the Common Space association and the Equal
Opportunities committee.

Speaking at a news conference, the head of the Equal Opportunities
committee, Oleksandr Chekmyshev, said in June, July and in the first half of
August national TV channels gave twice as much airtime to Yanukovych as
to all the other candidates. The activities of [leading opposition
candidate] Viktor Yushchenko and his entourage took the brunt of criticism,
while Viktor Yanukovych was almost always covered in a positive tone.

This summer's trend of giving Viktor Yanukovych the widest coverage in
the national media is mirrored in the election reporting of most regional TV
channels, including the west of Ukraine [traditionally Yushchenko's
stronghold]. Against this background, the press - both national and
regional - appears more balanced. For example, the two main candidates
received almost equal amounts of coverage in the western Ukrainian press.

In Chekmyshev's opinion, the media are portraying Yanukovych as a kind
of Olympic chocolate teddy bear. This, he believes, defeats the efforts of
the Yanukovych team as voters will find this sweet image hard to digest.
Daily media monitoring was conducted in 24 Ukrainian regions from a
selection of 93 regional programmes and 126 newspapers.

[The same survey found that the UT1 state channel's "Visti" news programme
devoted almost three hours to Yanukovych in July, while it gave only 17
minutes of mainly negative reporting to Yushchenko, according to
Interfax-Ukraine news agency, Kiev, in Russian 1006 gmt 20 Aug 04.
Meanwhile, the survey said, the opposition TV channel 5 Kanal's "Peak Hour"
news devoted more than an hour of reporting to Yushchenko and less than 15
minutes to Yanukovych, half of which had a negative tone. The report goes on
to say that the parliamentary newspaper Holos Ukrayiny devoted 5,000
keystrokes of mainly neutral and positive reporting and about 3,000
keystrokes of negative reporting to Yanukovych. The coverage of Yushchenko's
campaign took 3,500 keystrokes in the positive tone and about 1,500
keystrokes in the negative tone, the agency said.] (END) (ARTUIS)
=========================================================
ACTION UKRAINE REPORT-04, No. 144 ARTICLE NUMBER SEVENTEEN
Ukrainian Information Website: http://www.ArtUkraine.com
=========================================================
17. UKRAINE'S CENTRAL ELECTORAL COMMISSION HEAD
NOTES STRONG BIAS IN TELEVISION NEWS COVERAGE
Received many complaints about presidential campaign media coverage

UNIAN news agency, Kiev, in Ukrainian, 20 Aug 04
BBC Monitoring Service, UK, in English, Friday, Aug 20, 2004

KIEV - Since the beginning of the presidential election campaign, Ukrainian
television news have been giving more coverage to Prime Minister Viktor
Yanukovych than to any other of the presidential candidates. These are the
results of political news monitoring by the Ukrainian Press Academy of the
Institute of Sociology presented today by the head of the Central Electoral
Commission, Serhiy Kivalov.

In June-July, Yanukovych's activities occupied 24.6 per cent of TV news
airtime, while candidates Viktor Yushchenko [leader of opposition Our
Ukraine] was granted 8 per cent, [Socialist Party leader] Oleksandr Moroz -
5.2 per cent, Oleksandr Bazylyuk - 4.3 per cent, Oleksandr Rzhavskyy -
4.1 per cent, [Communist leader] Petro Symonenko - 3.7 per cent, Nataliya
Vitrenko - 3.1 per cent and Anatoliy Kinakh - 2.3 per cent. Other candidates
received much less coverage on television news, and some - none at all.

Kivalov added that the Central Electoral Commission had received many
complaints about irregularities in the media coverage of the presidential
campaign. The commission chairman urged media managers to do their best
to ensure proportional coverage of candidates' campaigns and to allow
candidates to speak for themselves. (END) (ARTUIS)
========================================================
ACTION UKRAINE REPORT-04, No. 144 ARTICLE NUMBER EIGHTEEN
Ukrainian Information Website: http://www.ArtUkraine.com
========================================================
18. TRAVEL ESSAY: TASTE OF LIFE IN UKRAINE: IT GOES
DOWN SMOOTH AS A TRADITIONAL LARD SANDWICH

By Matt Hagengruber, Special to The Seattle Times
The Seattle Times, Seattle, Washington, Thur, Aug 19, 2004

UZHGOROD, Ukraine - Since coming to Ukraine in March as a Peace
Corps volunteer, my culinary palate has been wiped clean and replaced
with something entirely different. I've eaten raw fish, boiled fish head,
raw pig fat, squid jerky, pickled everything and an odd assortment of
mystery meat, usually doused with ketchup.

Pizza usually includes corn and shredded, pickled carrots, and hot dogs are
covered with cabbage and mayonnaise. But I enjoy it, as do my Ukrainian
hosts, who revel in getting the American to blindly eat whatever comes out
of the cloudy, salty bowl of fish stew. And then eat it the next morning,
cold, for breakfast.

But possibly my biggest challenge, and my biggest insight into Ukrainian
culture, came at a Sunday afternoon picnic along the Uzh River in western
Ukraine. I live in the city of Uzhgorod, in a flat pocket between ridges of
the Carpathian Mountains. My host family and I left the city behind in their
Lada sedan, which still runs despite being nearly 30 years old. We met up
with friends in a field crowded with other picnickers. I had no idea what I
was in for.

We built a quick fire and settled in as my host mom, Maria, peeled small
potatoes with a knife. They were about the size of golf balls and are
currently selling for next to nothing at the local market. In summer, fresh
local vegetables are as cheap as the chocolate-colored dirt they come from.
Maria split the potatoes in half like a hamburger bun and sprinkled each
flat side with a mix of peppers and Hungarian spices. Hungary is just
across the border, less than an hour away.

After the spices came the wedge of salo, sandwiched between the two
potato halves. The best way to describe salo is to think of a hunk of bacon
the size of a small suitcase, minus the meat, with only the white, stringy
fat left behind. The raw pig fat is bought cheap in the bazaar, and a sharp
knife slices through it like, well, lard. My family has a 10-pound slab
hanging from a meat hook in its pantry, next to homemade sausage and
jars of strawberry jam.

Salo is a Ukrainian tradition that dates back centuries. It's usually eaten
raw, a few slippery slabs atop a piece of sour brown bread. It goes well
with a shot of peppered vodka, one taste canceling the other. But this was
different. This was a full-blown Ukrainian salo fest. The salo-potato
sandwiches were wrapped in foil and dumped on the smoldering fire, as
were 15 plain potatoes, which sat right in the coals until they had fully
blackened an hour later.

Yura, a longtime friend of Ivan, my host dad, pulled out a well-used
cast-iron frying pan and filled it with the remaining salo and half a dozen
sliced onions. Within a few minutes, the salo had liquefied and engulfed the
onions, which crackled and sizzled in the pan. The tough bacon skin that
remained turned brown and curled up like a pork rind. Yura took a handful
of branches from a Russian olive tree and whacked the blackened skin of the
potatoes until the ash had fallen off, leaving behind only the gold-colored
meat. He split the potatoes in half with his hand and dumped them and the
onion and salo mix into a pot, which he tossed like a salad.

At first, the idea of eating salo — pure fat — as a main course caused my
appetite to shrivel, but I'd steeled myself prior to coming to Ukraine to
take what I was offered, even if it meant a quart of pure fat over a pot of

potatoes. As with many of the delicacies I've been offered here, I ate
everything with an outward smile.

We drank spring water and homemade wine, ate foot-long green onions
and tore at thick slabs of rye bread. The families told stories about
concerts they attended and the travel hassles that marred a recent trip to
Kiev, some 400 miles to the east. Despite the somewhat shocking tastes,
this was the true experience I had come here for. I wouldn't trade it for
all the things I miss in America.

We finished the day by climbing a hill to an ancient castle that overlooks
the Uzh River valley. Looking west, over the Carpathians and into
Slovakia, we watched the sky turn a deep blue and lightning strike the
far-off hillsides. The crumbling castle stood still and silent with us,
watching over the valley and the approaching storm as it has done for
centuries. [Matt Hagengruber is from Helena, Montana] (END)(ARTUIS)
========================================================
ACTION UKRAINE REPORT-04, No. 144 ARTICLE NUMBER. NINETEEN
Ukrainian Information Website: http://www.ArtUkraine.com
========================================================
19. EASTERN APPROACHES: EXPLORING KYIV'S ART AVENUE

COMMENTARY By Scott Lewis, The Ukrainian Observer
Issue: 198/4, The Willard Group, Kyiv Ukraine, July 31, 2004

Andriyivsky Uzviz, which winds from near St. Michael's Square to Podil, is
home to art that awaits discovery by buyers able to separate the stimulating
wheat from the forgettable chaff. "There is no such thing as good art or bad
art," a pragmatic artist once said, implying that anything that might entice
someone to part with a few dollars was good art, at least in the consensual
view of an object's creator and its buyer.

Accepting the artist's premise that the value of art, like beauty, resides
solely in the eye of the beholder makes it a lot easier to stroll down
Kyiv's art avenue, Andriyivsky Uzviz, without flinching. The city's
picturesque open-air art market offers a little - a lot, actually - of
something for every taste.

Many of the paintings and prints are seascapes and still life studies that
would be at home in any inexpensive hotel room from San Francisco to
Sydney. Little about them says anything about Ukraine or about creativity,
for that matter. There are whimsical canvases devoted to knock-offs of B.
Kliban cat cartoons and improbably long, narrow paintings of dachshunds.

No imitations of Margaret Keane's soulful, saucer-eyed children or C.M.
Coolidge's Dogs Playing Poker yet, though as Ukraine adopts more of
the West's dubious taste, it shouldn't be long before these genres take
root.

The question easily morphs from "Is it good?" to "Who buys this stuff?"
A lot of people do, obviously. Ii is axiomatic that if something tasteless
appears once or twice, it can be chalked up as an anomaly, but if it
appears repeatedly, there must be a market for it. In the free market,
it's understandable that an artist won't repeatedly create what an artist
can't repeatedly sell.

Much of the Ukraine-themed art lacks originality: Many of the artists have
swapped fruit for sunflowers as the focus of still life paintings. There are
countless copies of national icon Taras Shevchenko's 1860 self-portrait
and of Ilya Repin's Zaporizhyan Cossacks Write a Letter to the Turkish
Sultan.

But that's not to say that the street, which winds its way from near St.
Michael's Square to Podil, is a creativity free zone. There are original
works on display, nuggets awaiting discovery by discerning buyers able
to separate the stimulating wheat from the forgettable chaff.

Acquiring the ability to tell the difference takes time. Discerning the
original from the pedestrian and the worthwhile from the passe` requires
several trips up and down the steep cobblestone-paved slope. In this
case, familiarity breeds at least the degree of expertise necessary to
determine what is of interest, as well as an idea of what, financially,
will be required to convince the seller to part with a desirable piece.

Some believe that having a native on hand to negotiate with the seller will
result in a lower price. Unquestionably, having a Ukrainian or Russian
speaker intercede may speed the negotiating process. Will a seller
charitably relinquish a chunk of his profit just because the buyer isn't a
tourist? Is the fabled "local discount" merely anecdotal, a fantasy fueled
by Kyivans' collective egotism?

On the uzviz, as in art markets everywhere, there is no good or bad, and
a fair price is what a buyer and seller agree it to be. Whether a canvas is
created by the next Marc Chagall or by a middling art student doomed to
lifelong obscurity is of little consequence if it strikes an emotional
chord. And with hundreds of pieces on display and stock that rotates
daily, the street is likely to offer a gem for every taste. (END)(ARTUIS)
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