"THE ACTION UKRAINE REPORT - AUR"
An International Newsletter
In-Depth Ukrainian News, Analysis, and Commentary
"The Art of Ukrainian History, Culture, Arts, Business, Religion,
Sports, Government, and Politics, in Ukraine and Around the World"
"THE ACTION UKRAINE REPORT - Number 465
E. Morgan Williams, Publisher and Editor
morganw@patriot.net, ArtUkraine.com@starpower.net
Washington, D.C. and Kyiv, Ukraine, TUESDAY, April 19, 2005
------INDEX OF ARTICLES------
"Major International News Headlines and Articles"
1. REMARKS BY UKRAINIAN PRESIDENT VICTOR YUSHCHENKO
TO THE U.S. CHAMBER OF COMMERCE
Remarks by Victor Yushchenko, President of Ukraine
At the U.S. Chamber of Commerce, Hall of Flags
Washington, D.C., Monday afternoon, April 4, 2005
The Action Ukraine Report, Washington, D.C., Tue, Apr 19, 2005
2. IKEA TO BUILD MEGA MALL IN KYIV, UKRAINE
Invest more than $300 million
The Moscow Times, Moscow, Russia
Tuesday, April 19, 2005. Issue 3149. Page 8.
3. IRELAND/UKRAINE RELATIONS GET TRADE BOOST
Ukraine-Ireland Business and Trade Association
The Post.IE, The Sunday Business Post
Dublin, Ireland, Sunday, 17 April 2005
4. UKRAINE: INTEGRATING WITH EUROPE THROUGH INVESTMENTS
"Ukraine's Business Potential: Europe's Emerging Tiger"
Investment conference in Frankfurt, Germany, April 28, 2005
PRWEB, Kiev, Ukraine, Mon, Apr 18, 2005
5. UKRAINE'S NEW TAX CHIEF PROMISES QUICK VAT
REFUNDS TO EXPORTERS
TV 5 Kanal, Kiev, in Ukrainian 1800 gmt 18 Apr 05
BBC Monitoring Service, in English, Monday, April 18, 2005
6. "GREEN REVOLUTION: SET TO MERGE WITH THE "ORANGE
REVOLUTION" IN LARGEST EARTH DAY EVENT IN UKRAINE
35th Anniversary of Earth Day to Highlight Ukraine
Earth Day Network, Washington,D.C. and Kyiv, Ukraine, April, 2005
7. UKRAINIAN CELEBRITIES & ROCK STARS TO ANNOUNCE
PARTICIPATION IN EARTH DAY KYIV, APRIL 23
The world's largest Earth Day celebration this year
PRESS CONFERENCE: Conference Hall at Ukrinform,
B. Khmelnitskogo Str., # 8/16, (Metro Station: Teatralna)
Kyiv, Ukraine, Tuesday, April 19th, 2005 at 3:00 PM
8. ANALYSIS OF THE EVENTS OF THE ORANGE REVOLUTION
ESSAY: Prof. Y. Petrovsky-Shtern of Northwestern University, USA
Welcome to Ukraine magazine, Kyiv, Ukraine, Issue 1, 2005
9. CLOSING IN ON STALIN
Josef Stalin preferred to be seen from afar -- larger than life,
inaccessible. In a major new biography, Robert Service tries
to cut him down to human size.
By Sheila Fitzpatrick, The Moscow Times
Moscow, Russia, Friday, April 15, 2005
=============================================================
1. REMARKS BY UKRAINIAN PRESIDENT VICTOR YUSHCHENKO
TO THE U.S. CHAMBER OF COMMERCE
Remarks by Victor Yushchenko, President of Ukraine
At the U.S. Chamber of Commerce, Hall of Flags
Washington, D.C., Monday afternoon, April 4, 2005
The Action Ukraine Report, Washington, D.C., Tue, Apr 19, 2005
EDITOR'S NOTE: Victor Yushchenko, President of Ukraine made
his first official trip to the United States in early April. Yushchenko,
during his three day trip, had meetings in Washington, Chicago and
Boston. During his U.S. visit the Ukrainian president several times
urged U.S. business and investors to take a new look at Ukraine
and said Ukraine is now open for business in a new way.
On Monday afternoon, April 4, President Yushchenko made a very
important speech to several hundred members of the U.S. business
community at a meeting sponsored by the U.S. Chamber of Commerce.
The following is the complete text of Victor Yushchenko's presentation:
REMARKS BY UKRAINIAN PRESIDENT VICTOR YUSHCHENKO
TO THE U.S. CHAMBER OF COMMERCE
PRESIDENT YUSHCHENKO: We're honored to be together and join you
today, since you are the partners of Ukraine, you are the partners of
Ukraine either right now, or you are the future partners of Ukraine.
I understand that all people who gathered here have three main questions:
how Ukraine could be interesting for us, what -- the rules of the game were
elaborated by the new Ukrainian power for the businesses, and what Ukraine
will get from this kind of development of relationships.
I'm an economist, and for me, it will be much more easier to discuss some of
the economic issues. And I would like to start my statement by saying that
I am deeply convinced that in the near future, you will see the most modern
European market. The steps that are being made by us in conducting the
reforms in Ukraine, in conducting the economic reform and fiscal reforms, in
conducting the reforms in the area of investments, and so on and so forth,
has one ultimate goal: to make that market transparent and understandable
for the players of the market.
You know, we inherited a rather complicated economy because, on the one
hand, you have a very large amount of shadow transactions. Half of the
Ukrainian GDP was generated by shadow economy until recently. Our
authorities were overcriminalized. The relationships with business
community were corrupted. And quite often we experience the hardships
in implementing the current legislation. And for businesses, it was very
difficult to find the proper judicial protection, protection from the sight
of the state authorities.
There was no freedom of speech. Every day you can watch TV and it
doesn't matter what program you are watching, you will be seeing only
one news TV channel, and most of those news were just a lie.
I'm telling you all this in order for us, my dear friends, to understand
what kind of challenges Ukrainian democracy faces right now. I don't
have any doubts, dear friends, that all the things we will be able to handle
because it is a challenge and we will be ready to resolve it because it is
a problem.
Starting from the year 2005, we are going to introduce the new budget for
Ukraine, which is a non-deficit budget. And the budget is aimed at
demonstrating to the whole Ukraine, to the Ukrainian nation, the social
progress oriented at every strata of population, every group of individuals
which seem to be forgotten. We made the budget as a budget of high-level
macroeconomic culture. On the one hand, it will be able to provide economic
fundamentals for the GDP growth at the level of 8 percent. And on the other
hand, within the framework of the budget, we are going to implement 16
special social programs.
Our goal is pretty simple; to demonstrate to every citizen that democracy is
beneficial; that it is better to live and not to steal; it is better to live
and have public relations with the budget, pay taxes, bring economy out
of the shadow sector; have freedom of press, and alongside with that,
ensure the implementation of unique social programs.
Starting from the year 2005, every woman who has children -- and it includes
the program for ladies with many children, for ladies without any shelter or
parental care, for children who do not have proper medical treatment -- we
increased the social payments for those needs. We just would like to
demonstrate the unique attention that we have paid to every individual of
our country, and at the same time we are trying to save and maintain the
unique macroeconomic culture.
Starting from April, in April we cancelled all the privileges that were
given to corporate entities, especially those people who own those entities
and had pretty good connections with politicians of high level. And we
expect that we will have quite a lot of budgetary revenues because we
cancelled those privileges and benefits.
Our program on establishing public and transparent work of customs is also
in the focus of the attention. We approached our European partners, we
approached the American government with a request to provide us the
assistance in proper Ukrainian border management. So we are going to
adjust the work of our customs offices to the standards which are used in
the United States of America or in the countries of the European Union.
We have achieved one result so far. Over the period of the last four or
five weeks, the budgetary revenues from the operation of the customs offices
went up three times. Right now we are working on providing all the customs
offices with appropriate screening equipment, scanners.
And we are going to implement the procedures that you are accustomed to.
And by doing that, we are going to provide better services to handling
commodities and handling customs duties.
The decision was made to cancel the benefits that were granted to 24
economic zones and zones of the investment development. The explanation
is pretty simple. Through these economic zones, over the period of last
years, shadow system handling services and commodities were established,
and because of that, thousands representatives of Ukrainian, not only
Ukrainian businesses, didn't have proper relations with the authorities of
the state. And that is why our government and our power is going to turn the
market into a transparent market and a competitive market without providing
preferences to anybody; that will be a pure competition, and through that
kind of competition, we will be receiving the answers who is strong and who
is weaker.
Our goal is to get the integration and get a membership of Ukraine in the
European Union. On the 21st of February this year, we signed with the
European Union the action plan, which is supposed to cover the period of
three years. The purpose of that action plan is to adjust the whole system
of rules to the norms and standards that are applicable in the European
Union.
We are currently working on a road map for 2005, in cooperation with the
European Union. For 2005, we have set a goal, clearly formulated objective,
that would underpin Ukraine's approximation to Europe and its succession to
the European and global environment.
Number one goal, to win the market-based economy status within a half year.
Objective number two, before November of this year, to acquire membership
in the World Trade Organization.
Objective number three, to ensure liberalization of a visa regime with our
strategic partners; with the European Communities, with the United States.
Four days ago, a decision was made to the effect of visa-free regime
introduction that would apply for citizens from the European Communities
and Switzerland. Today we are moving on to the active negotiations phase
with the United States to the effect of a similar step.
The free trade zone is the fourth objective on our agenda that we will be
pursuing in 2005.
2005 is expected to see the launch of EU-Ukraine negotiations on shaping
of a free trade zone.
Furthermore, we have also assigned ourselves with the objective to
implement a series of economic projects, primarily the ones that have to
do with power supply, gas transit, oil transit, electric energy transit to
new markets.
This kind of an effort is being pursued today by the Ministry of Economy,
the Ministry of Energy of Ukraine. And we are convinced that 2005 will be
focused on the challenges of the gas consortium formation or alternative
options of crude oil supply and gas supply to the European market.
I would like to make it clear that the problem that limited the business
opportunities in Ukraine was the huge administrative pressure exerted on
businesses operating in Ukraine -- the endless checks from the side of
police, security service, and other law enforcers. We made a decision
whereby, the fact of administrative pressure is a fact that will be taken
care of by a specific minister and vice prime minister of Ukraine. We'll
vouch to businesses that from now on, you will not be persecuted in
Ukraine. The power will be your number-one assistant and supporter.
An investment council is being formed under the auspices of the president.
This is a civil initiative with its own secretariat and very high-profile
status and access to cooperation with the president and the government.
This council will be seeking to ensure ultimate comfort for investors coming
into Ukraine and helping them to settle down all the issues that pop up in
business operation in Ukraine.
I would like to particularly highlight our fiscal policy. With respect to
individual incomes, a law has been passed in Ukraine that says that taxation
level that applies to these incomes will be 13 percent flat rate. Last year
we downsized corporate tax from 30 down to 25 percent reduction. A law
has been passed by the Parliament which, unfortunately, was vetoed by the
preceding president with respect to cutting tax on -- our VAT tax from 20
percent down to 17 percent.
I mean, all these examples I'm citing to manifest our understanding of the
fact that one of the conflicts that persisted in the Ukrainian economy
between power and business, it was the conflict caused by high taxes and
very narrow taxation base. Our policy is contrary; minimizing the direct
taxation burden and expanding the taxation base.
A special problem is social taxes and indirect taxes that are collected and
paid by producers. Our task is to narrow down the total of taxes to 20
percent, maybe in a single payment. That is something we've been working
on as part of our agenda, and we believe that quite shortly we can come up
with a legislative response to this challenge.
I would like to point out some of the sectors in which we are looking
forward to cooperating with you. I would like to start out with the
high-tech sectors. Ukraine is a country which is building aircraft; building
ships of all classes, essentially, except probably tankers. This is a
nation with a very well-developed military industrial complex. About 40
percent of the defense industry of the Soviet Union were concentrated in
Ukraine. I think everybody in the world knows the carrier missiles and --
rockets, rather, which are manufactured in Ukraine, and that have proved
so good in the sea- launch project.
Another highlight I would like to bring your attention to is our
agriculture. Ukraine has one of the most fertile and richest soils in the
world. We have about 40 percent of the world's black soil reserves.
Ukraine has completed land privatization. About 60 percent of citizens
have received state certificates authorizing their private ownership to
land. The projects that have to do with agricultural production and
reprocessing are of particular urgency for us today.
Ukraine is in this sort of solar intersection of routes of goods and peoples
trafficking westward and eastward. And it's very interesting for us to
examine the principles of infrastructure formation.
We have a minister of transportation of Ukraine, Mr. Chervonenko, present
here, who is negotiating, including the negotiations in the United States,
towards the end of highways and motorways infrastructure development in
Ukraine. I mean infrastructure involving all of its elements. And in this,
we have very, very high interest.
We have already argued that we are tremendously interested in alternative
construction, construction of alternative routes of oil and gas supply and
transit. We'll seek to reanimate the Odessa-Brody project. We're looking
into negotiations with the U.S. companies to the end of restoration of crude
light oil supply by these avenues -- the supply towards Brody. And further
on, we either set up joint refinement of oil, or we pump it on to Poland,
the port of Gdansk.
We have had discussions with our Turkmenian counterparts in further buildup
of gas transportation system, where we require gigantic investment support.
That will be focused on gas transportation from Turkmenistan of the
Kazakhstan Aleksandrov-Gay in Ukraine and a new type gas pipeline across
the whole Ukraine from the east to the west.
We are now working on the gas consortium project, and we would kindly
encourage you, everybody who is interested in engaging in such a project,
to offer your feedbacks or responses to such proposals.
My dear friends, I would like to draw attention to another positive feature
of Ukraine that can be efficiently used in any investment projects in the
Ukraine that is probably a kind of unique characteristic feature of
Ukraine's economy.
First of all, I mean well-qualified and well-educated manpower. Today
Ukraine, in terms of secondary education and higher education, is probably
the second country in Europe. I think this characteristic feature is
extremely for the new businesses that are going to come to Ukraine.
I would like to underline, dear friends, that Ukraine, by introducing the
new rules of the game and by providing new guarantees, new safeguards,
actually, is doing them because of your interest in Ukraine. And I would
like to clearly state that the rules of the game were changed in Ukraine;
that the law is working in Ukraine; that from now on, the Ukrainian state
and Ukrainian government are going to protect your interests.
In order for us to understand each other much better and in June this year,
in Kiev, the capital of Ukraine, we plan to conduct the so- called Eastern
mini-Davos. That will be organized together with the founders of the Davos
forum. And we invite more than 1,000 businessmen from different parts of
the world to join us at that forum.
And during that event, we're going to make the presentation on the most
topical and important economic projects and programs in Ukraine. And of
course this kind of invitation will be sent to your Chamber of Commerce.
And I would like to ask you, please, make use of this opportunity in order
to start a business in Ukraine.
And I would like to state clearly that right now we control the situation to
the macro level. The non-deficit budget was deliberated for the year 2005.
We expect the GDP growth in 2005, by the assessment of the experts,
that will be at the level of 8, 9 percent. Ukraine has strict control of our
implementation of its obligations. We finally resolved some of the cases
related to illegal privatization of some of the enterprises and entities,
including the ones of strategic importance.
I would like to say that a part of the large-scale privatization that was
held in recent years -- and in our parliament we addressed this issue many,
many times -- that privatization was not conducted transparently, it was
conducted unfairly without protecting the rights of the foreign investors.
As a rule, those standards were organized not to satisfy the interests of
one single buyer in Ukraine. And then the statement was made that
Ukrainian authorities and Ukrainian power was not interested in any
process of nationalization; Ukrainian authorities are not interested in
reprivatizing those enterprises.
I would like to emphasize that not a single penny from the national budget
is allocated for reprivatization. And that is why I would like to confirm
once again and assure you that there will be no reprivatization in Ukraine.
But in those cases where the procedures of the tenders were violated, then
those cases will be investigated and we are going to announce new tenders.
We're speaking about dozens of enterprises which were privatized with the
violation of the current legislation, national legislation, and the
procedures of the tenders. We are speaking about to close and list of the
enterprises. It is close and list. By saying that, I mean well-known list
of enterprises which will be privatized once again.
In order to do that, we are going to conduct a preparatory work among the
investors, and we are going to establish proper and transparent procedures
for those tenders. It has nothing to do difference with reprivatization,
and it has nothing to do with a kind of special control of the state over
the strategic entities and enterprises.
We are just speaking about the following. Both domestic and foreign
investors should be aware of one thing. The previous regime ignored the
law in Ukraine; for example, Kryvorizhstal, the largest- in-Europe metal and
steelworks, which was stolen, which was illegally privatized. And as the
president in my country and my colleagues in the government cannot escape
this kind of violation of privatization procedures, and this is why a couple
of months ago, we stated that these kind of entities would be sent to
undergo the secondary, so to speak, privatization, with the participation of
foreign investors. And the preparatory work in this direction is being done
right now. And we're speaking about more than a dozen strategic entities
the privatization of which was made with the violation.
My dear friends, once again I would like to reassure you that the rules of
the game are being changed in Ukraine. In Ukraine we are going to adjust
our legislation to the conditions that you get used to. And that is why, my
dear friends, as the president, as the former president of the National Bank
of Ukraine, I would like to encourage you to participate in those processes.
The time has come for you to fix in your notebooks your future activities
and when they should be done. And please, exactly state the location.
The location is Ukraine. The capital of Ukraine is the city of Kiev, the
place where EU will be always welcome.
And again, I'm the economist, and I would like to say and to reassure you
that Ukraine is waking up right now. And to my understanding, Ukraine for
many, many years was acting like a sleeping elephant with colossal
opportunities, but it didn't have the proper amount of fair politicians, and
it didn't have clear and transparent rules for the competitive market. But
today in Ukraine there are fair authorities, non-corrupted ones. And
please, do not give any bribes in Ukraine to anybody. This is my personal
request. And please, point out -- and cross out -- from your budget any
bribes. And I hope that you will be able to save enough money in order to
make the budgets profitable. (Applause.)
My dear friends, it is very important for us, for new Ukrainian authorities,
for our undertakings, and I am deeply convinced that in Ukraine you will
find a lot of partners, you will find a lot of assistance, and the most
important thing for you is to be sure that you are needed by Ukraine.
Ukraine misses you today a lot.
Please, stay with us today. God bless America, and God will save Ukraine.
Thank you. (Applause.) -30-
--------------------------------------------------------------------------------------------------------
FOOTNOTE: Our special thanks to Gary Litman, Vice President,
Europe & Eurasia International Division at the U.S. Chamber of
Commerce for providing us with a copy in English of the remarks
by Victor Yushchenko, President of Ukraine. [Editor]
=============================================================
2. IKEA TO BUILD MEGA MALL IN KYIV, UKRAINE
Invest more than $300 million
The Moscow Times, Moscow, Russia
Tuesday, April 19, 2005. Issue 3149. Page 8.
Swedish furniture giant IKEA announced Thursday that it would invest
more than $300 million into construction of its first project in Ukraine.
The 170,000-square-meter Mega Mall will be located on 49 hectares
on Boryspil Road in Kiev and will feature an IKEA store, a Ramstore
supermarket and an OBI do-it-yourself store. It will be five times the
size of Ukraine's largest existing shopping center.
The Moscow office of Colliers International is serving as project's
exclusive consultant.
IKEA has 211 stores in 32 countries, including four in Russia -- two in
Moscow, one in St. Petersburg and one in Kazan. The Mega Mall concept,
which includes numerous tenants in addition to an IKEA store, was first
tested in Moscow with the opening of the 150,000-square-meter Mega
Tyoply Stan in December 2002.
The 230,000-square-meter Mega Khimki, Russia's largest shopping mall,
was opened in December 2004. -30-
=============================================================
3. IRELAND/UKRAINE RELATIONS GET TRADE BOOST
Ukraine-Ireland Business and Trade Association
The Post.IE, The Sunday Business Post
Dublin, Ireland, Sunday, 17 April 2005
A new trade association, which will facilitate more trade between Ireland
and Ukraine, has been set up in Dublin to enable Irish firms to capitalise
on the growing eastern European economy.
The Ukraine-Ireland Business and Trade Association will operate out of
Dublin, Belfast and Kiev, and aims to provide advice and analysis to
companies that are considering investing in Ukraine.
Brendan Murphy of Abbott International Consultancy Services, which is
assisting with the venture, said the service would offer an entry into the
Ukrainian marketplace and would also enable Ukrainian businesses to
forge alliances with companies in this country.
"There is no quality advice on Ukraine available to Irish businesspeople
at the moment so we aim to give people who are looking to broaden
their horizons an insight into the Ukrainian economy," said Murphy.
He said Ukraine was growing at a dramatic rate but that businesses
needed advice on specific investment opportunities.
"Whilst property is booming, not all sectors are booming, not all cities
are booming and not all areas are going to expand," he said. "Ukraine
has a long way to travel but as it begins to get things right, there are
times when Irish businesses need to be there in order to capitalise."
The association plans a series of workshops and seminars on potential
investments for companies in the coming months and has the backing
of the Ukrainian embassy in Dublin.
Murphy said the association would be able to offer research reports,
property and industry reports, marketing and feasibility plans, procure-
ment advice and a travel and translation service. The company's Dublin
office is based in the Northside Enterprise Centre. -30-
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http://www.sbpost.ie/post/pages/p/story.aspx-qqqid=4084-qqqx=1.asp
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4. UKRAINE: INTEGRATING WITH EUROPE THROUGH INVESTMENTS
"Ukraine's Business Potential: Europe's Emerging Tiger"
Investment conference in Frankfurt, Germany, April 28, 2005
PRWEB, Kiev, Ukraine, Mon, Apr 18, 2005
KIEV - As European investors take a closer look at post-revolutionary
neighbor, Ukrainian businesses and government are taking the first steps
towards Europe by organizing an investment conference in the continent's
financial capital - Frankfurt/Main. The event organized by
PriceWaterhouseCoopers and CFC Consulting with the ambitious title
"Ukraine's Business Potential: Europe's Emerging Tiger" will be held on
April 28th [Thursday], 2005.
Jorge Intriago, vice-president of European Business Association and
conference co-organizer, considers such ambitions to have a sound basis:
"In the past years the Ukrainian economy has experienced a very rapid and
sustained growth and the reforms introduced have really transformed the
legal system. This coupled with EU enlargement, which brought the EU
borders to Ukraine and the recent political changes that have accelerated
the reform process have created fantastic opportunities for foreign
investors wishing to exploit Ukraine's untapped business potential."
Conference organizers say they plan the event to be one of the first real
steps aimed at bringing Ukraine closer to Europe as well as demonstrating a
whole new dimension of investment opportunities in Ukraine for European
businesses.
The Orange Revolution has greatly improved the political image of Ukraine
in Europe and the world. Taking into account the country's reasonable and
well-educated workforce as well as a favorable geographic location, there
is no surprise that investors' attention towards Ukraine has also soared a
great deal. The opinion of H.E. Dietmar Stuedemann, German Ambassador
to Ukraine clearly reflects the change in Europeans' attitudes towards the
country: "Ukraine is striving for predictability, transparency and
democratization. These are elementary preconditions for investors.
Ukraine deserves our trust in this situation of difficult changes. The
international economic commitment is fostering a positive development."
The event will bring together the representatives of European and Ukrainian
businesses as well as high-ranking German and Ukrainian officials.
Among them senior representatives of the Cabinet of Ministers of Ukraine,
diplomatic corps, top official of the State Commission on Securities and
Stock Market of Ukraine and others. The conference, which is being held
at such a high level, points to the need to initiate a high-profile dialogue
between Europe and Ukraine in the field of investments.
According to Dr. Bohdan Hawrylyshyn, Chairman of the International Center
for Policy Studies, selecting Frankfurt to host the conference was a wise
decision, since "Germany is a biggest European Economy and it has a great
experience of investing into post-Socialist countries like Poland, the Czech
Republic and others."
Among the key topics to be addressed at the conference are political and
macroeconomic situation in Ukraine, Ukraine's investment climate, the
impact of EU enlargement on Ukraine, legal framework for FDI in Ukraine,
privatization and Ukraine's financial sector. For additional information
visit http://cfc.com.ua/conference/. -30-
=============================================================
5. UKRAINE'S NEW TAX CHIEF PROMISES QUICK VAT
REFUNDS TO EXPORTERS
TV 5 Kanal, Kiev, in Ukrainian 1800 gmt 18 Apr 05
BBC Monitoring Service, in English, Monday, April 18, 2005
KIEV - The newly appointed head of the State Tax Administration of Ukraine,
Oleksandr Kireyev, has promised to review the system of VAT refunds to big
exporters. Speaking in an interview with the 5 Kanal television channel,
Kireyev said that VAT refunds will be "almost automatic" for companies that
work openly and transparently.
"If a producer has a daily turnover of 15m or 20m (presumably hryvnyas,
3m-4m dollars), we do not need to inspect him constantly in order to refund
two or five million," Kireyev said. "Where there are numerous middlemen or
where producers work through offshore zones, we need to conduct tax
inspections," he added. Ukrainian businessmen have long complained of
refund arrears. The government says the state budget is losing billions
through fraudulent VAT refunds.
Kireyev also said the Tax Administration would work to eliminate tax
loopholes and introduce new accounting rules for small businessmen who
use a simplified tax system and do not pay VAT. Those businessmen who
see that their annual turnover is more than 300,000 hryvnyas (56,000
dollars), must start calculating VAT in their books and register as VAT
payers, Kireyev said.
Kireyev also said that his background is in banking and that he sometimes
feels "internal protest" in his new role as tax collector. [No further
processing of Kireyev's interview is planned.] -30-
=============================================================
6. "GREEN REVOLUTION: SET TO MERGE WITH THE "ORANGE
REVOLUTION" IN LARGEST EARTH DAY EVENT IN UKRAINE
35th Anniversary of Earth Day to Highlight Ukraine
Earth Day Network, Washington,D.C. and Kyiv, Ukraine, April, 2005
Washington DC and Kyiv, Ukraine - Earth Day Network, the organization that
supports Earth Day activities around the world each year, has joined
together with a coalition of Ukrainian environmental and community activists
to organize the largest environmental event to ever take place in Ukraine.
The Earth Day event on April 23, 2005 will take place in Kiev in the same
location as many of the Orange Revolution demonstrations last December.
The event is expected to draw more than 250,000 participants and President
Victor Yushchenko has been invited to speak. Yuschenki's Minister of the
Environment Mr. Ignatenko is a confirmed speaker. Musical acts will include
the Ukrainian bands Ocean Elsy and Vv.
The Earth Day event is being called "The Green Revolution Meets the Orange
Revolution" by organizers and is expected to build upon the historic civic
action that took place this past December when hundreds of thousands of
Ukrainians took to the streets to denounce the results of the Presidential
election. After weeks of protests, Ukraine held a second vote and
Yushchenko, the first pro-democracy Presidential candidate was declared
the clear winner.
Ukrainians are facing tremendous environmental problems and are eager to
begin the process of cleaning up their country. Yuschenko has been invited
to talk about his environmental policies and where he stands on critical
issues such as municipal waste removal, which is causing ongoing health
problems in many of Ukraine's cities.
ABOUT EARTH DAY NETWORK
Earth Day Network was founded by the organizers of the first Earth Day in
1970 and promotes environmental citizenship and year round progressive
action worldwide. Our mission is to build broad-based citizen support for
sound, workable and effective environmental and sustainable development
policies. Earth Day Network's global network reaches more than 12,000
organizations in 174 countries. Earth Day is celebrated by more than half a
billion people each year making it the largest secular holiday in the world.
---------------------------------------------------------------------------------------------------------
Earth Day Network, 1616 P Street, NW, Suite 340, Washington, DC
20036, 202.518.8794 (phone), 202.518.8794 (fax)
Contact: Mary Nemick, 202.518.0044 (phone), nemick@earthday.net
=============================================================
7. UKRAINIAN CELEBRITIES & ROCK STARS TO ANNOUNCE
PARTICIPATION IN EARTH DAY KYIV, APRIL 23
The world's largest Earth Day celebration this year
PRESS CONFERENCE: Conference Hall at Ukrinform,
B. Khmelnitskogo Str., # 8/16, (Metro Station: Teatralna)
Kyiv, Ukraine, Tuesday, April 19th 2005 at 3:00 PM
KYIV - Oleg Skrypka (lead singer from VV), Alexander Yarmola
(Haydamaki), DJ Pasha, DJ Kid will hold a press conference to
announce their participation in Earth Day Kiev and to speak about
their commitment to environmental issues in Ukraine.
The press conference is sponsored by Earth Day Network and
Mama 86, the organizers of Earth Day Kiev.
Earth Day Kiev will take place on April 23rd in Kiev and is expected
to draw tens of thousands of people. It will take place in Kiev at
Krhreshchatyk str and Maydan Nezalezhnosti, the site of many of the
Orange Revolution demonstrations last year. Earth Day Kiev will start
at 11 AM, speaking program begins at 4 PM.
President Victor Yushchenko's Minister of the Environment Mr. Ignatenko
will address the audience. Musical acts include top Ukrainian performers
Ocean Elsy, Vv, Haidamaky and Katya Chilly.
President Yushchenko has also been invited to speak. Earth Day Kiev
will build upon the historic civic action that took place in the Ukraine in
December when hundreds of thousands of Ukrainians took to the
streets to denounce the results of the Presidential election. It is the
largest Earth Day celebration in the world this year. -30-
---------------------------------------------------------------------------------------------------------
Contact: Mary Nemick, 202.518.0044, nemick@earthday.net or in
Kyiv Olivia Ciobiotaru, 011-380-664-176-087, ciobiotaru@earthday.net
=============================================================
8. ANALYSIS OF THE EVENTS OF THE ORANGE REVOLUTION
ESSAY: Prof. Y. Petrovsky-Shtern of Northwestern University, USA
Welcome to Ukraine magazine, Kyiv, Ukraine, Issue 1, 2005
Yohanan Petrovsky-Shtern, formerly Assistant Professor, Department of
Comparative (Foreign) Literature, Kyiv Shevchenko University, Ukraine, and
now Assistant Professor, Department of History, Northwestern University,
USA, followed closely the recent events in Ukraine and has kindly agreed to
give his assessment of the Orange Revolution in an essay written exclusively
for Welcome to Ukraine Magazine.
The 2004 events in Ukraine challenge our understanding of Ukrainian history
and reshape our vision of Ukrainian national identity. Is it possible for a
national democratic revolution to succeed if it operates solely on the basis
of legality in a country in which the institutions of legal power are
manipulated by the government? Ukraine teaches us that it can.
The amazingly sober behavior of protesters in Ukraine forced the Supreme
Court and parliament to operate not as servile governmental puppets but as
institutions committed to legal principles that will lead the country out of
political turmoil. The peaceful tactics of the revolutionary strikers made
the speaker of the parliament and the head of the Supreme Court cut the
threads and reemerge as politicians whose decisions are based solely on
legality.
A "lawful revolution" seems to be an oxymoron that challenges our
imagination, yet this is exactly what happened in Ukraine. While victorious
Yushchenko and Tymoshenko are grappling with the burdensome heritage
of the previous regime, it is crucial to ponder on a broader meaning of the
Orange Revolution. One may want to emphasize five key messages of
the 2004 Ukrainian upheavals.
UKRAINE AND RUSSIA
While Russian pundits bend themselves backwards to prove that Ukrainian
Orange Revolution was a US-sponsored enterprise, a rational-minded
observer is advised to believe that it was an articulate Ukrainian "no" to
Kremlin-orchestrated neo-imperialism. Russia has traditionally considered
Ukraine inseparable from itself. For the last three hundred years Russia has
been absorbing Ukraine, then part of Eastern Poland, capturing one segment
after another, pushing Poland westward.
Under the tsars, Russia invented a centennial Slavic brotherhood in which
Ukraine appeared as Little Russia (Malorossia), the little sister of Great
Russia, its big brother. Patronizing its new family member, Russia
supplanted all traces of previous Ukrainian autonomy, assimilated Ukrainian
gentry, enslaved Ukrainian peasants, and obliterated Ukrainian identity. In
the 1860s-1870s Alexander II, perhaps the most liberal-minded among
Russian tsars, outlawed Ukrainian language.
Following the Russian tsars' colonial attitude toward Ukraine, the Bolshevik
and new Russian leaders considered Ukrainian identity a challenge to their
vision of the Great Russian Empire. They could not accept the loss of
abundant Ukrainian resources and the Black Sea ports. What started in
mid-1920s as a major Ukrainian national renaissance that threatened
Russian stance as a patronizing big brother of Slavic nations, was brutally
suppressed in the early 1930s when Ukrainian intelligentsia was simply
wiped out.
Ukrainian political independence achieved in 1991 was an affront to Russia,
a historical mistake that needed to be straightened out. Kremlin wanted to
see Ukraine returning into Russia's embrace, allowing it to re-emerge as a
major European Empire. Viktor Yanukovych, deaf to Ukrainian revivalism, was
a convenient puppet responsible for returning Ukrainian black sheep into the
imperial flock. Ukrainian orange color, translated into Russian, implied
that the country does not want any more to be a colony. And this was the
first message of the Orange Revolution.
UKRAINE AND EUROPE
The 1991 demise of the USSR opened up brand new opportunities for the
eastward advance of European legalism, liberalism, and democracy. For
Europe to secure democratic changes in Ukraine and to incorporate Ukraine
into the European Union signifies the actual, not formal demise of
communism.
Though in 1991 Ukraine voted for independence yet it did not exercise it
appropriately. Abandoned by Europe to the mercy of its fate, in its
post-1991 development Ukraine inconsistently but steadily followed Russia.
Europe was closely monitoring the rise of pro-Russian and non-democratic
Ukrainian oligarchs. The endemic corruption among the highest echelons of
the Ukrainian government, which seemed to imitate the corruption of Russian
authorities, turned Europe away from Ukraine and made the incorporation of
Ukraine into the European Union an unlikely scenario. The Gongadze case
signaled that for Europeans Ukraine would remain a suspicious polity on the
outskirts of Europe drifting toward Asian-like autarchy. Also, Europeans
realized that the Ukrainian president Leonid Kuchma regime was talking
legality and walking personal profit.
Therefore the events of November and December, 2004, revolutionized the
European perception of Ukraine. Once rank-and-file Europeans adorned
Warsaw skyscrapers and London squares with orange, Europe and Ukraine
established common language at least on the level of the visual. Mass
support of "orange" Kyiv during solidarity campaigns in major cities
across Europe sent a direct message to the European Union that Ukraine
was already considered as equal by its European brethren.
After December events it is only too evident that Ukrainian revolution,
among other things, hammered the last nail into the coffin of European
communism. Accepting Ukraine to European Union would not be a favour
for Ukraine. Rather it will be a de jure confirmation of what Ukraine has
proved de facto: that it is part and parcel of Europe.
NEW UKRAINIAN REVIVALISM
Ukraine appeared as a new polity on the European map only in 1991, yet
Ukrainians have fought for their cultural and political independence for
centuries. Starting from Bohdan Khmelnytsky's Cossack revolution in 1648,
the people of Ukraine - peasants and gentry of the Russian Orthodox creed
who as yet did not identify themselves as Ukrainians - fought for political
autonomy first against Poland, then against Russia and the Soviet Union.
Their fight was heavily marked by bloody attempts to change Ukraine socially
and politically. Ukrainian cultural revivalism of the 1860s, 1900s, 1920s,
and 1990s articulated ideas that shaped an independent Ukrainian polity
either as a multi-ethnic monarchy or as a nationalist state.
In November, 2004, it seemed that Kharkiv, Donetsk, and Odesa were
inherently ready to accept Russian multi-ethnic imperialism whereas Kyiv,
Lviv, and Ivano-Frankivsk preferred the nationalist model. Yet the December,
2004, events in Ukraine fit neither the previous history of Ukrainian
revolts nor Ukrainian political theories. It turned out that the so-called
Ukrainian split into East and West was an invention, manipulated by Russian
politicians and overplayed in the Western media.
The governmentally controlled Ukrainian and Russian media transformed the
alleged East-West rift into political weapons against the opposition while
Ukrainians by and large remained bilingual and Soviet-minded, the
differences between the two parts of the country being more cultural and
economic than political. The Orange Revolution triggered the awakening of
the nation bringing imaginary East and West together. Russian-speaking
industrial workers and miners from Donbas and Ukrainian-speaking students
from the western city of Lviv discovered that they belong to one and the
same nation.
Instead of the clashes between them that the government anticipated, if not
orchestrated, the two groups began to talk to one another. Their dialog
brought hopes that bridges of mutual understanding would soon emerge.
Two months of street dialogue fostered the birth of a new self-awareness
of nationhood. That self-awareness was the third most important
achievement of the Orange Revolution the ramifications of which is difficult
to overestimate.
THE PLOTTERS AND THE DIPLOMATS
Both governmentally supported Viktor Yanukovych and the acting president
Leonid Kuchma schemed an oligarchic coup in the country comparable to the
communist coup of the KGChP in Moscow in August 1991, but based on
manipulated legality. Their plan was to orchestrate the election of the
pro-governmental candidate, and after his election to appoint Kuchma (who
had already spent two terms in the presidential chair) as prime-minister,
then to pass a political reform transforming Ukraine into a parliamentary
republic with the prime-minister assuming full power. They also planned to
appoint the most notorious oligarchs to ministerial positions finalizing the
transformation of the country into a feudal neocolonial oligarchy.
To achieve this, they shuffled the opposition media, subjected the news
coverage to almost complete governmental control, and had the best Kremlin
image-makers aggressively campaigning for the pro-governmental candidate.
That most oligarchs and their governmental puppets originated in the Eastern
industrial districts of Ukraine contributed to their financial might that
seemed unbreakable. Paradoxically, the government became trapped once
Yushchenko turned the tables on it. Having incorporated most radical groups
in the opposition Nasha Ukrayina (Our Ukraine) block, Viktor Yushchenko
flatly rejected political radicalism as a means to solving the political
crisis.
Rather he preferred the golden path between parliamentary struggle and
revolutionary radicalism. Due to his double identity as a populist leader
supported by at least 17 million people in Ukraine and a parliamentary
figure unfamiliar with underground activity, Yushchenko managed to channel
the revolutionary events into a battle for legality and rule of law. His
well-balanced maneuvering was equidistant from the government's iron-clad
communist-type stance and the pioneering radicalism of his closest
associates. Yushchenko's rationalism saved the country from imminent
bloodshed. How could it happen that an opposition leader who had been
plotted against to be poisoned and removed from the political arena
emerged as a revolutionary diplomat?
The answer to this question pending, one has to underscore a brand new
revolutionary strategy unheard of in the history of European rebellions -
the strategy that constitutes the fourth novelty of the Orange Revolution.
It is clear that the opposition played to win by managing both the
revolutionary Independence Square and the Ukrainian Rada, the parliament.
Ukraine demonstrated how to transform the revolution into a parliamentary
and constitutional reform, a powerful lesson of democracy which has not yet
been entirely understood.
THE PEOPLE OF UKRAINE
While the United States, European Union, and Russia argued about how to
solve the crisis in Ukraine, thousands of people firmly stand in the main
square of Kyiv, demonstrating their stamina and astonishing commitment to
democratic values. Their warm and cheerful orange ribbons, the symbolic
color of the opposition, sharply contrasted with the frigid temperatures
they endure. In December, 2004, the future of Ukraine depended little on the
negotiations between the acting president Leonid Kuchma with the opposition
leader Viktor Yushchenko, and even less on Kuchma's talks with the Russian
and Polish presidents or the head of the European Union.
Rather it entirely depended on the will and steadfastness of the Ukrainians
protesting an ignominious election fraud orchestrated by the government.
Among those who took to the streets were students, teachers, government
workers, computer operators, engineers, small businessmen, rock and sports
celebrities, renowned writers and poets, and village and urban dwellers of
dozens of nationalities and religious beliefs. Instead of irritation,
bitterness, and well-grounded revolutionary rage, the protesters' faces
shine with happiness, friendliness, and love. Citizens of Kyiv said that the
city has never been as polite, understanding, and helpful as now.
Pensioners who could hardly make both ends meet purchased coffee and
medicine for the picketers. Small-scale restaurant owners provided hundreds
of protesters with free soup and porridge. The sense of unity was
overwhelming. "There are so many of us on the main square," exclaimed a
thirty-something literary scholar from Kyiv. "We are doing our best to help
people in the streets," said a teacher of history in her sixties. "A new
nation is being born," insisted a professor who has left the quiet of
academe for the noisy streets, "Things will never be the same in this
country."
Perhaps a Ukrainian poet captured an overwhelming feeling of people in
the streets when, as if protesting the assumed attitude to the Ukrainians,
he wrote to the author: "This is a people, this in not a riff-raff (bydlo)."
Contrary to the claims of Kremlin-sponsored political analysts, the
rank-and-file folks in the streets were not choosing between the Russian
and Ukrainian languages. The Orange Revolution was bilingual.
Nor, as European analysts have said, were they making a choice between
returning to the aegis of Russia and falling into the embrace of the
European Union. Even the most stalwart supporters of the opposition
understood that 200-year old economic ties to Russia will continue to go
along with integration into the European Union.
For the people in the streets of Kyiv the choice was simpler. Do they want
to live in a totalitarian state where the power manipulates the will of its
people or to build a democracy that respects the choices of its people?
The answer of the Maydan-dwellers emphasized what Ukrainians already
have become: citizens in their own country. -30-
-----------------------------------------------------------------------------------------------------
Contact: Yohanan Petrovsky-Shtern, yps@northwestern.edu
LINK: http://www.wumag.kiev.ua/index2.php?param=pgs20051/22
==========================================================
8. CLOSING IN ON STALIN
Josef Stalin preferred to be seen from afar -- larger than life,
inaccessible. In a major new biography, Robert Service tries
to cut him down to human size.
By Sheila Fitzpatrick, The Moscow Times
Moscow, Russia, Friday, April 15, 2005
There have been so many new biographies of Josef Stalin lately that we
may almost be reaching the point of Stalin fatigue. Not that the subject has
become fully comprehensible -- far from it -- or that any of the biographies
has the instant-classic status of Ian Kershaw's two-volume "Hitler." Simon
Sebag Montefiore's contribution from last spring, "Stalin: The Court of the
Red Tsar," added a new dimension with his lively and highly readable, but
still well-researched, portrait of Stalin in the company of his political
associates and in his social and family milieu. Service, who thanks
Montefiore in his preface and was warmly thanked by him in Montefiore's
introduction, has taken another tack. Already the author of a history of
Soviet Russia, Service sets out to give us Stalin in his historical context.
Although Service is well-equipped for this task and has done his homework
in the archives, including the newly opened Stalin papers, the dictator's
personality seems to elude him. Again and again he dutifully lays out
alternative motivations for Stalin's actions, a procedure which, fair-minded
and historiographically useful though it is, doesn't necessarily help the
reader understand what kind of man Stalin was. Still, he offers some
valuable corrections to a number of the received opinions about Stalin.
Service's Stalin is highly intelligent, even intellectual, despite what Leon
Trotsky said about him. He was never a "gray blur" or colorless organization
man, as Nikolai Sukhanov wrote. And he was absolutely not, as Trotsky liked
to claim, a mere cog in the bureaucracy, but rather someone who very
definitely ran the show.
All of these points are well taken, and it is particularly useful to have
the ghost of Trotsky's interpretation, once hegemonic in leftist as well as
Sovietological circles, chased away. No one who has looked at the new
archival materials could doubt Stalin's intelligence. Moreover, it's clear
that he thought like an intellectual (that is, analytically), read
prodigiously and widely, and had the habit when faced with a new political
task -- thinking about Soviet diplomatic options in Europe in the 1930s, for
example, or directing the Soviet military effort in World War II -- of
systematically researching the topic in preparation. It turns out that not
only was he an intellectual, he was a compulsive and professional editor
who corrected any manuscript that crossed his desk for style and grammar
as well as for ideology.
Stalin's sense of national identification has been the subject of much
speculation. In Service's version, Stalin was not particularly hung up on
this question, being neither a passionate and absolute convert to
Russianness, as Robert C. Tucker argued, nor, as others have suggested, an
unreconstructed Georgian whose bloodthirstiness as a ruler can be explained
in terms of age-old Caucasian patterns of machismo and revenge. Service's
sensible comment is that, like many other people who live somewhere other
than their birthplace, Stalin had a sense of himself as both Georgian and
Russian, the balance between the two changing according to circumstance.
In addition, he was a serious Marxist, whose commitment to internationalism
effectively ruled out any form of passionate nationalism.
Service's take on Stalin's relations with Vladimir Lenin, especially in the
difficult years of Lenin's last illness, when Lenin became increasingly
critical of Stalin and finally pronounced him unfit to be general secretary,
is particularly interesting. This is a topic Service knows well from his
work on "Lenin: A Biography," in which he showed clearly how much Lenin's
intellectual coherence and emotional balance were affected by his strokes.
Telling the story from the other side, Service presents Stalin as largely a
victim of Lenin's unreasonableness and his own obligations as a Central
Committee go-between. This applies not only to the famous "rudeness to
my wife" incident, in which Lenin, already seriously ill, rebuked Stalin for
his behavior to Nadezhda Krupskaya, but to Lenin's criticism of Stalin's
interpretation of Soviet nationalities policy, which many historians have
taken to be rational and justified, rather than the confused intervention by
a sick and angry man.
This interaction between Stalin and a dying Lenin is a comparatively rare
example in Service's biography of an episode in which Stalin appears more
sinned against than sinning. The only other similar case is Stalin's
relations with his second wife, Nadezhda Alliluyeva, where Service, like
Montefiore, foregrounds her difficult personality and psychological
fragility. Stalin may have been a neglectful husband, like many another man
in public life, but their correspondence when he was absent shows him as
the more affectionate and conciliatory partner in what was clearly a
volatile marriage. Understandably, Stalin had a sense of betrayal, as well
as grief and loss, when she committed suicide in 1932.
Any biography of Stalin must try to explain key episodes in his career,
including the dramatic initiatives of the Great Break at the end of the
1920s, when Stalin embarked on all-out collectivization and
industrialization; the Great Purges of the late 1930s; the ups and downs of
wartime leadership; and the swing into anti-Semitism of the postwar years.
Service sees the purges as an intensification of rather than departure from
Stalin's earlier patterns, pointing out what many other scholars have
missed -- that Stalin distinguished himself by ruthlessness and indifference
to the scale of casualties as early as the Civil War. (This may be another
occasion where Trotsky's picture was misleading. As the other great
Bolshevik proponent of bloodshed from this period, he presumably had
little interest in identifying this as one of Stalin's notable
characteristics.)
In his new book, Robert Service attempts to go beyond previous portraits
of Stalin as an intellectual fraud or a gray bureaucrat.
On other big issues, however, Service has fewer insights to offer. What
propelled Stalin into the wildly ambitious gambles of the Great Break and
the First Five-Year Plan remains obscure, as does the mechanism by which
he gathered his team of devoted executants. Vyacheslav Molotov appears
suddenly in the narrative as a totally reliable No. 2 to Stalin, though all
the reader has previously heard of him is that he and Stalin clashed in 1917
before Lenin's return from exile. As for the postwar period, the biography
really trails off here. Service doesn't regard Stalin as a dyed-in-the-wool
anti-Semite, probably correctly, but leaves the reader uncertain as to why
he made the lurch into covertly state-supported anti-Semitism in the late
1940s and early 1950s. Stalin's striking retreat from hands-on leadership
in the last years of his life, apart from a few favored issues which almost
certainly included the anti-Semitic demarche of the Doctors' Plot, gets
only perfunctory discussion.
Service had the laudable intention of writing a biography that would show
Stalin as a human being rather than as a stereotypical personification of
evil, but he only partially succeeds. His Stalin does seem human, though
unattractive, and Service does not take the easy way out of suggesting that
his suspicious and even paranoid characteristics amounted to madness.
But Service fails to achieve the kind of vivid recreation of a personality
that leads the reader to feel he has finally understood what made Stalin
tick.
Why was he so bloodthirsty as a ruler, and why did his associates follow
him even after the debacle of the German attack in June 1941, when Stalin
clearly expected to be overthrown? Service's historical landscape is quite
precisely drawn, but the protagonist who inhabits it remains shadowy and
distant -- which is no doubt the way Stalin, a great editor of his own
personal archive as well as other people's manuscripts, intended it.
----------------------------------------------------------------------------------------------------
Sheila Fitzpatrick is the author of "Tear Off the Masks! Identity and
Imposture in Twentieth-Century Russia," to be published by Princeton
University Press this summer.
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