"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 - AUR" - Number 524
Mr. E. Morgan Williams, Publisher and Editor
morganw@patriot.net, ArtUkraine.com@starpower.net
Washington, D.C. and Kyiv, Ukraine, MONDAY, July 18, 2005
------INDEX OF ARTICLES------
"Major International News Headlines and Articles"
1. WTO - MORE THAN JUST ECONOMICS
By Oleksandr Sushko, Topic of the Week: Ukrainian Monitor
Center for Peace, Conversion, & Foreign Policy of Ukraine (CPCFPU)
Kyiv, Ukraine, Thursday, July 7, 2005
2. UKRAINE-UNITED STATES BUSINESS COUNCIL NAMES
DR. SUSANNE S. LOTARSKI PRESIDENT
Ukraine-U.S. Business Council
Washington, D.C., Monday, July 18, 2005
3. LUFTHANSA TO ADD TWO NEW UKRAINIAN CITIES
Frankfort-Dnipropetrovsk and Munich-Donetsk
Also Dusseldorf-Kiev added soon
By David Kaminski-Morrow
Reed Business Information - Air Transport Intelligence
London, United Kingdom, Sunday, July 17, 2005
4. GAZPROM SAYS GAS DISPUTE WITH UKRAINE RESOLVED
AFX Europe (Focus), Moscow, Russia, Sun Jul 17, 2005
5. UKRAINIAN CABINET PUBLISHES LIST OF 33 COMPANIES
WHOSE PRIVATIZATION IS A PRIORITY
UNIAN news agency, Kiev, in Ukrainian 1024 gmt 15 Jul 05
BBC Monitoring Service,UK, in English, Fri, Jul 15, 2005
6. DONBAS WILL DELIVER STEEL PLATES FOR POLISH SHIPYARDS
Ukraine's Donbas Industrial Union
Polish News Bulletin, Warsaw, Poland, Monday, July 18, 2005
7. LOCAL BEER BRANDS BOOM IN UKRAINE
Strong sales increase for Ukrainian brewer Sara
one of the four largest brewers in the market
By Angelina Drujinina, CEE-FoodIndustry.com
News on food in Central & Eastern Europe
Montpellier, France, Mon, July 11, 2005
8. MARKETING ARMENIAN PRODUCTS IN UKRAINE
Great demand for apricots and peaches in Ukrainian market
FreshPlaza Website, AGF Netherlands
News about the fresh produce business
The Netherlands, Friday, July 15, 2005
9. POST-SOVIET DANGER: VULNERABLE MUNITIONS DEPOTS
Soviets left huge stockpiles of arms in Ukraine
By C.J. Chivers The New York Times
New York, New York, Saturday, July 16, 2005
10. YUSHCHENKO DIRECTS CABINET OF MINISTERS TO ANALYSE
OPERATIONS OF FREE ECONOMIC ZONES BY SEPTEMBER
Ukrainian News Agency, Kyiv, Ukraine, Sunday, July 17, 2005
11. BRANCHES OF AUTHORITY CLASH IN UKRAINE
Viktor Yushchenko tries to make peace between
the Speaker and the Prime Minister
COMMENTARY: by Sergey Strokan
Kommersant, Moscow, Russia, Fri, July 15, 2005
12. SUGAR MARKET RHETORIC BOILS OVER IN THE SUMMER HEAT
Ukraine's minister of economy and minister of agrarian policy
By Oksana Bondarchuk, FirsTnews
Kyiv, Ukraine, Saturday, July 16, 2005
13. LACK OF DISCIPLINE ON ECONOMIC REFORMS MAY LEAD TO
LOWER INVESTMENT AND HIGHER INFLATION SAYS MP SUPRUM
By Aleksandra Nenadovic, FirsTnews
Kyiv, Ukraine, Friday, July 15, 2005
14. UKRAINIAN BUSINESS GROUP PRYVAT FIGHTING FOR
CONTROL OF FERROALLOYS PLANT
ANALYSIS: by Ihor Radetskyy
Invest-Gazeta, Kiev, in Russian 12 Jul 05; p 20
BBC Monitoring Service, UK, in English, Sat, Jul 16, 2005
15. UKRAINE'S ECONOMIC GROWTH SLOWS DRAMATICALLY
IN FIRST SIX MONTHS OF 2005
Associated Press (AP}, Thursday, Thu, July 14, 2005
16. THE PRESIDENT IS LOSING HIS TEMPER
ANALYSIS AND COMMENTARY: By Leonid Amchuk
Ukrayinska Pravda, Kyiv, Ukraine, Friday, July 15, 2005
17. "DOWN IN DONETSK"
COMMENTARY: By Andrew Yurkovsky
The Wall Street Journal, Europe
New York, NY, Friday, July 15, 2005
18. YUSHCHENKO VISITS RUSSIAN-SPEAKING DONETSK REGION
Associated Press (AP), Kiev, Ukraine, July 15, 2005
19. TWO BOOKS OF UKRAINIAN LITERATURE NOW IN ENGLISH
Passion's Bitter Cup and Riddles of the Heart
Sonia Morris, Business Manager
Language Lanterns Publications
Surrey, British Columbia, Canada, July, 2005
20. NO CAUSALITIES AMONG THOSE WHO TOOK PART IN THE
UKRAINIAN PRESIDENT-LED CLIMB UP HOVERLA MOUNTAIN
TV 5 Kanal, Kiev, in Ukrainian 1200 gmt 17 Jul 05
BBC Monitoring Service, UK, in English, Sun, Jul 17, 2005
21. SINGING IN UKRAINE
Huddersfield (UK) ladies choir off to Lviv, Ukraine in October
By The Huddersfield Daily Examiner
Huddersfield, United Kingdom, Jul 15, 2005
22. WINNING OVER THE PEASANTS
A young Pioneer so idealistic and fearless that he would
denounce even his own father if he stood against the people.
BOOK REVIEW: By Enda O'Doherty, Irish Times Journalist
Irish Times, Dublin, Ireland, Saturday, Jul 16, 2005
23. DREAMLAND IN UKRAINE
Ethnic festival held on Spivoche Pole
By Dmytro Antonyuk, Kyiv Weekly #27 (167)
Business & Socio-Political Weekly
Kyiv, Ukraine, Friday, July 15-22, 2005
24. DRIVE TO FORM A NEW, STRONG, INDEPENDENT UKRAINIAN
ORTHODOX CHURCH GAINS SPEED
By Mara D. Bellaby, The Associated Press
Kiev, Ukraine, Friday, July 15, 2005
=============================================================
1. WTO - MORE THAN JUST ECONOMICS
By Oleksandr Sushko, Topic of the Week: Ukrainian Monitor
Center for Peace, Conversion, & Foreign Policy of Ukraine (CPCFPU)
Kyiv, Ukraine, Thursday, July 7, 2005
Once again Ukraine has got another opportunity to access the WTO by the
end of 2005 after Verkhovna Rada adopted the most important part of the
governmental legislation package (6 law drafts finally adopted, 3 law drafts
adopted in the first reading).
Still there are no guarantees that the rest of the law drafts will be
successfully adopted later in September, if, certainly, the mistakes in
dealing with the Parliament will not be taken to the account by the
government. However, the adopted legislation will already allow Ukraine to
start negotiations about preparing a summary on Ukraine's accession to the
WTO that can be considered during the Hong-Kong WTO conference on
13-18 December this year.
Besides the economic issues, which were frequently discussed in media
during last few weeks, Ukraine's accession to WTO has an obvious political
sense.
FIRST of all, among all major foreign policy tasks of the new leadership,
the WTO accession is the only one that can be implemented before the
Parliamentary elections 2006, while the issues of accessing the EU and
NATO can be regarded as a longer perspective. Therefore, the WTO
accession comes to a realistic short-term goal that in case of success can
be reported as the main foreign achievement of this government.
SECONDLY, by its means, membership in the WTO foresees further
European integration. It is the WTO accession that could assist launching
negotiations on initiating a free trade zone with the EU, which actually is
the first stage of the European integration. If the negotiations are
successful, in the near future the integration horizons could be broadened
to creation of the customs union with the EU.
Membership in the WTO is stated as a priority in all key documents that
define issues of cooperation between Ukraine and the EU: PCA, Action
Plan signed in February and 'Road Map' of the government represented
on 22 April 2005.
THIRDLY, accession to the WTO can assist Ukraine in finding appropriate
decision in its further membership (or not membership) in the SES together
with Russia, Belarus and Kazakhstan. In a capacity of the WTO member
Kyiv would easier substantiate its current position on the fees and trade
within the SES as well as its non-acceptance of the customs union for the
framework of the forth, at least while the SES members have not joined
the WTO.
And FOURTHLY, Ukraine's accession to the WTO before Russia or at least
not after it is crucially important. We are not overestimating Ukraine's
abilities on 'dictating' conditions for WTO membership to Russia. However,
if Russia will be there earlier, then acting in a capacity of the WTO member
it will delay the process of Ukraine's accession at least for a year by
raising additional requirements.
In this case in addition to Moscow's conditions, a single external customs
toll within the framework of the SES can be proposed. Fast steps towards
membership in the WTO made by Russia in the last few months together with
the force impact of puppet pro-Russian lobby in Ukraine, that was recently
demonstrated in the Parliament, prove determination of Kremlin to prevent
Ukraine to be the first one in this informal run.
If Tymoshenko's government will succeed and facilitate Ukraine's WTO
membership before the Parliamentary elections 2006, then it will stand up
as the key success of this government in the field of foreign policy. Taking
to the account a lack of time as well as a lack of creative potential of the
governmental team something more could be hardly expected here.
----------------------------------------------------------------------------------------------------------
07.07.05 Bills submitted for Parliament's consideration are coordinated
with Verkhovna Rada Committees, Prime Minister Yulia Tymoshenko assures
All bills, which are submitted to the Parliament's consideration, are
coordinated with the Verkhovna Rada Committees. In particular, this concerns
the agrarian sector. All bills have conclusions of the Committee for the
agroindustrial complex, Prime Minister Yulia Tymoshenko noted speaking
with journalists in the Verkhovna Rada. She is convinced that the bills do
not worsen conditions for national producers in the process of joining the
WTO.
Those, who are against Ukraine's joining the WTO, are against Ukrainian
producers, in particular, against metallurgists, the Prime Minister
believes. She explained that at present there is a ban on supplies of
Ukrainian metallurgical products to other countries of Europe and the USA.
At present, anti-damping investigations continue, the Prime Minister said.
According to her "as soon as we join the WTO, all those investigations and
restrictions to exports will be removed".
According to Yulia Tymoshenko, in each of bipartite agreements, which
Ukraine should conclude with the WTO member countries during its joining
the WTO, the Government protects the national producer. According to the
Prime Minister, the opposition factions use consideration of bills'
documents, which concern joining the WTO, in the interests of raising their
ratings in the pre-election campaign.
According to the Prime Minister, it is necessary to hold a professional
discussion concerning joining the WTO. She invited the CPU leader Petro
Symonenko to an open discussion of this theme on TV live air. -30-
-------------------------------------------------------------------------------------------------
http://www.foreignpolicy.org.ua/eng/topic/index.shtml?id=4924
=============================================================
2. UKRAINE-UNITED STATES BUSINESS COUNCIL NAMES
DR. SUSANNE S. LOTARSKI PRESIDENT
Ukraine-U.S. Business Council
Washington, D.C., Monday, July 18, 2005
WASHINGTON - The Ukraine-United States Business Council announces
the election of Susanne S. Lotarski as President, effective July 1, 2005.
The Ukraine-U.S. Business Council was organized in Washington, D.C. in
1995 and will celebrate its ten years of service to the Ukraine-U.S.
business community in October of 2005.
"The victory of democratic, market-oriented forces opens new opportunities
for American companies to trade, invest and play a constructive role in
creating jobs and economic growth in Ukraine. The Ukraine-United States
Business Council will provide a strong, unified voice for U.S. businesses in
dealing with this important European economy," Dr. Lotarski told the
Council's Annual Meeting in Washington on June 14.
Dr. Lotarski comes to the Council after a distinguished career at the U.S.
Department of Commerce, where she served as Director of the Office of
Eastern Europe, Russia and Independent States (formerly Eastern Europe
and Soviet Affairs) for the last 25 years.
In that capacity Dr. Lotarski created and managed BISNIS and CEEBIC, the
business information services for this region, as well as SABIT, the Special
American Business Intern Training program which has brought over 3,500
NIS business executives and scientists for training in American companies,
including 670 from Ukraine.
Dr. Lotarski directed the development of commercial policy, programs and
advocacy on behalf of U.S. business for the 27 countries of this region. She
also served from 1995-2001 as Executive Secretary of the bilateral Business
Development Committees with Ukraine, Russia and Kazakhstan.
She was awarded the Commerce Department's Gold Medal for initiatives
supporting democracy and free markets in Eastern Europe and the former
Soviet Union and opening new markets for U.S. business.
Susanne Lotarski received her B.A. from Vassar College and Ph.D. from
Columbia University, taught at Vassar College, and was a fellow of the
Research Institute on Communist Affairs directed by Dr. Brzezinski.
The Council elected E. Morgan Williams, Director of Government Affairs,
Washington Office, SigmaBleyzer, as Chairman of the Executive Committee.
John C. Stephens, Managing Director of Cape Point Capital, was elected
Secretary-Treasurer and as a member of the Executive Committee.
Also elected to the Council's Executive Committee were Andrew Bej,
Partner, SALANS; Shannon S.S. Herzfeld, Vice President, Government
Relations, Archer Daniels Midland Co. (ADM); Michael Kirst, Vice President
for Central and Eastern European Fuel, Westinghouse; John W. Rauber, Jr.,
Director, International Affairs, Deere & Company; and Van Yeutter, Director,
Washington Operations & International Business Development, Cargill.
The Council is expanding its membership, which is composed of U.S.
corporations with long-term business interest in Ukraine. Council
activities will:
- Assure that U.S. business concerns have a strong voice in U.S.
Government policies toward Ukraine;
- Enhance understanding of U.S. business within Ukrainian
government and business circles;
- Emphasize the determination of the U.S. business community to
play a positive, constructive role in Ukraine's development;
- Facilitate efforts by the U.S. Government and American
businesses to eliminate barriers to trade and investment in Ukraine and
the United States.
- Provide members contact, informational, advocacy, and
representation services.
=========================================================
For Further Information Contact: Susanne S. Lotarski, President
Ukraine-United States Business Council, P.O. Box 42067.
Washington, DC 20230, E-mail: slotarski@boo.net
=============================================================
3. LUFTHANSA TO ADD TWO NEW UKRAINIAN CITIES
Frankfort-Dnipropetrovsk and Munich-Donetsk
Also Düsseldorf-Kiev added soon
By David Kaminski-Morrow
Reed Business Information - Air Transport Intelligence
London, United Kingdom, Sunday, July 17, 2005
LONDON - German flag-carrier Lufthansa is to add to its East European
network by introducing flights to two Ukrainian cities. It will open a
Munich-Donetsk route from 9 September, operating the flights six times per
week, and add a Frankfurt-Dnipropetrovsk route, also six-times weekly, on
30 October.
Star Alliance member Lufthansa says the services will make it the first
Western carrier to penetrate Ukraine's industrial zone. Lufthansa, which
also serves the Ukrainian capital Kiev from Munich and Frankfurt, is in
addition increasing its services to the city by opening a new connection
from Düsseldorf on 29 August. -30-
=============================================================
4. GAZPROM SAYS GAS DISPUTE WITH UKRAINE RESOLVED
AFX Europe (Focus), Moscow, Russia, Sun Jul 17, 2005
MOSCOW (AFX) - OAO Gazprom said it signed an agreement on the
disposal of nearly 8 bln cubic meters of gas in Ukraine, ending a dispute
between Moscow and Kiev.
The agreement was signed by Gazprom, the Ukrainian gas company
Naftogaz, and the gas transportation company RosUkrEnergo, it said.
Under the deal, Naftogaz will receive 2.55 bln cubic meters of gas as
partial payment for transit of Russian gas for 2005, with the remaining to
be delivered to RosUkrEnergo during 2005-2006.
The deal also provides for a rise the amount of Russian gas transported
through Ukraine, to 11.5 bln cubic meters next year from 8 bln this year.
"Today we have signed a package of documents that will resolve completely
and definitively the problem of 7.8 bln cubic meters of Russian gas located
in Ukraine," Gazprom said in a statement.
The dispute had led to angry exchanges between the country's leaders,
with Russian President Vladimir Putin earlier this month accusing Ukraine
of stealing gas.
The Russian gas had been pumped into underground storage reservoirs in
Ukraine ahead of last year's winter heating season, but Kiev said it could
not pump out the gas due to technical problems, reportedly prompting
demands for costly reimbursement from Gazprom. Russia supplies Ukraine
with nearly 90 pct of its annual oil needs. dth/rl/vs -30-
=============================================================
5. UKRAINIAN CABINET PUBLISHES LIST OF 33 COMPANIES
WHOSE PRIVATIZATION IS A PRIORITY
UNIAN news agency, Kiev, in Ukrainian 1024 gmt 15 Jul 05
BBC Monitoring Service,UK, in English, Fri, Jul 15, 2005
KIEV - The official web site of the Cabinet of Ministers of Ukraine has
reported that 33 companies have been included in the list of companies
whose privatization is a priority, according to the cabinet's decree No
256-r dated 12 July 2005. The list includes the:
[1] Odessa Portside Plant open joint-stock company (50 per cent plus
one share to be put up for sale);
[2] Severodonetsk state company Azot Association (100-per-cent
stake); the Nikopol Southern Pipe Plant open joint-stock company (96.67-
per-cent stake);
[3] Kryvyy Rih ore enrichment combine of oxide-bearing ores
(unfinished construction);
[4] Ukrahrolizynh [Ukrainian agricultural leasing] national company
(100-per-cent stake);
[5] Rosava open joint-stock company [producing car tires] (74.82-per-
cent stake);
[6] Ukrahromashinvest leasing company (50-per-cent stake);
[7] Krasytel open joint-stock company (25-per-cent stake);
[8] Izyum locomotive repair plant (100-per-cent stake);
[9] Semiconductor Plant open joint-stock company (99.99-per-cent stake);
[10] Mayak Plant open joint-stock company (100-per-cent stake);
[11] Slavutych TV set Plant open joint-stock company (96.63-per-cent
stake);
[12] Foton open joint-stock company (100-per-cent stake);
[13] Kiev Motor Cycle Plant open joint-stock company (100-per-cent
stake);
[14] Konotop Diesel Train Repair Plant open joint-stock company (100-
per-cent stake);
[15] Illichivsk Ore Repair Plant open joint-stock company (48.96-per-
cent stake);
[16] Chervonyy Metalist open joint-stock company (37.37-per-cent stake);
[17] Kharkiv Radiorele Radio Relay open joint-stock company (100-per-
cent stake);
[18] Krayan open joint-stock holding company (100-per-cent stake);
[19] Enerhobud joint-stock holding company (94.47-per-cent stake);
[20] Ukrvuhlepromtrans [Ukrainian coal industry transport] open joint-stock
holding company (100-per-cent stake);
[21] Presmash open joint-stock company (50-per-cent stake);
[22] Vinnytsya Tractor Aggregates Plant open joint-stock company (25-
per-cent stake);
[23] Mohyliv-Podilskyy Kirov Machine Building Plant open joint-stock
company (26-per-cent stake);
[24] Hranit [Granite] open joint-stock company (25.99-per-cent stake);
[25] Chervona Zirka open joint-stock company (26-per-cent stake);
[26] Hidrosyla open joint-stock company (25-per-cent stake);
[27] [Kiev-based] Sport state-owned hotel (100-per-cent stake is
planned to be put up for sale);
[28] Kiev-based Druzhba tourist hotel (26-per-cent stake);
the Oreanda Hotel closed joint-stock company (21.32-per-cent stake);
[29] Dnipro Hotel open joint-stock company (100-per-cent stake);
[30] Ukrayina Hotel closed joint-stock company (50-per-cent stake), and
[31] Ukrayina Hotel state-owned company (100-per-cent stake).
=============================================================
6. DONBAS WILL DELIVER STEEL PLATES FOR POLISH SHIPYARDS
Ukraine's Donbas Industrial Union
Polish News Bulletin, Warsaw, Poland, Monday, July 18, 2005
WARSAW - An agreement between Ukraine's Donbas Industrial Union,
Korporacja Polskie Stocznie shipyard corporation and Centrala
Zaopatrzenia Hutnictwa steel mill supplier will be signed on Monday.
According to Jerzy Konopka, the Corporation's chairman, the agreement
will regulate co-operation on the matter of supplying Polish shipyards with
materials needed for construction of ships, mainly from Huta Czestochowa
steel mill, which was taken over by Donbas this month.
According to Konopka, the agreement will ensure the security of deliveries
for Polish shipyards, but it will remain only a trade agreement, not
relating to the matters of possible investment by the Ukrainian company in
the Polish shipyard sector.
Stocznia Szczecinska Nowa shipyard Marketing Director Andrzej Zarnoch
is of the opinion that the agreement with Donbas will be profitable for
Polish shipyards, as deliveries and prices are still unstable. -30-
=============================================================
7. LOCAL BEER BRANDS BOOM IN UKRAINE
Strong sales increase for Ukrainian brewer Sarmat
one of the four largest brewers in the market
By Angelina Drujinina, CEE-FoodIndustry.com
News on food in Central & Eastern Europe
Montpellier, France, Mon, July 11, 2005
A strong sales increase for Ukrainian brewer Sarmat reveals how the
country's beer market is growing strongly in Russia's shadow and adds
new evidence to the popularity of 'local' brands, writes Angelina Drujinina.
Sarmat increased production by almost 15 per cent to around 90m litres
between January and May 2005, compared to the same period last year.
Beer sales also rose 15 per cent, enabling the group to attain a net income
of 238,943m hrivnas ($47.5 million).
"First of all, this increase was triggered by the launch of new brands -
Elle and Dnipro, which have been very much in demand," said Mikhail
Grankin, Sarmat sales manager. "This May, our Sarmat brand acquired 9
per cent of the market, and Dnipro reached 2.7 per cent.
Second of all, we began using a system of primary distribution in the key
regions. This means that a certain distributor has an exclusive right to
work in a certain region. We are now finishing restructuring sales system in
other regions as well." "We also created exclusive sales departments in
Crimea and Kiev as well as Donetsk and Lugansk oblasts," said Grankin.
Sarmat's results show how the Ukraine's beer market is rising well alongside
a notoriously fast-growing Russian market - something that may provide new
outlets for international firms as the number of independent brewers in
Russia begins to dry up.
However, analysts have long pointed to the success of local brands in many
parts of Eastern Europe, as opposed to big international brands grafted on
to the market.
And, while this may be about to change with announcements that Foster's
and Guinness are set to launch in Russia, Sarmat's results provide ample
evidence that some local brands at least are more than holding their own.
Sarmat is one of the four biggest brewers in the Ukraine. The group own
five factories across the country: Lugansk brewery, Crimea brewery, Dnipro
(Dnipropetrovs'k brewery), Firma Poltavpivo and a brewery in Donetsk.
Serhiy Kalynin, Sarmat director-general, said at a press conference recently
that beer consumption in the Ukraine's had no limit. He added that Sarmat
would try and take advantage of growth in Russia by using the close language
link to attract more Russian consumers. Sarmat plans to have an office set
up in Russia by early next year.
Sarmat has around 13 per cent of the domestic beer market and aims to post
a 25 per cent sales increase for 2005. -30-
--------------------------------------------------------------------------------------------------------------
http://www.cee-foodindustry.com/news/news-ng.asp?n=61204-local-beer-brands
==============================================================
8. MARKETING ARMENIAN PRODUCTS IN UKRAINE
Great demand for apricots and peaches in Ukrainian market
FreshPlaza Website, AGF Netherlands
News about the fresh produce business
The Netherlands, Friday, July 15, 2005
ARMENIA - There is a great demand for apricots and peaches in the
Ukrainian market but it is not Armenia that supplies the country, Grisha
Shirvanian, adviser of Armenian's Small and Average Enterprises
Development project, said when he made public yesterday the results of
a study on the possibilities to export Armenian goods to Ukraine.
The study, conducted in cooperation with the US Agency for International
Development [USAID], arrived at the conclusion that all kinds of fruits,
fresh, canned and dried, fish and cheese can be best marketed in Ukraine.
Textile goods -- bed linen, towels, socks, underwear, wool cloths -- are
also very likely to find their buyers. The study indicated there would be a
good market for travertine, tuff, granite, marble and basalt.
The terms for entering the Ukrainian market differ for the goods. To export
Armenians stones, for instance, it was suggested to establish directed
connection with Ukrainian companies engaged in building and stone
working, but for the best sale of textile goods a warehouse in Kiev is
needed.
Grisha Shirvanian informed that the only Armenian product they saw in the
Ukrainian markets while doing the study was Armenian cognac, and not only
the one of Yerevan Cognac Factory. Armenia wines, contrary to Georgia,
are not represented in the Ukrainian market at all.
He mentioned that we need to organize transportation of big amounts of
agricultural goods to that country. He thinks that even a company that is
considered a giant in Armenia cannot provide the necessary quantity alone.
Agribusiness needs to united its efforts to do that. Shirvanian noted that
the most demanded fruits in Ukraine's market after pineapple is apricot
and peach. But they are imported from Germany, China and Thailand.
He informed that trade and economy relations between the two states are
developing not evenly, as Armenia exports goods for $7 million whereas
Ukraine export amounts to $60 million. -30-
--------------------------------------------------------------------------------------------------------
http://www.freshplaza.com/2005/15jul/2_ua_apricotpeachdemand.htm
==============================================================
9. POST-SOVIET DANGER: VULNERABLE MUNITIONS DEPOTS
Soviets left huge stockpiles of arms in Ukraine
By C.J. Chivers The New York Times
New York, New York, Saturday, July 16, 2005
ICHNYA, Ukraine - The ammunition is stacked in mounds in a clearing,
exposed to rain and sun. The crates that hold it are rotting. After more
than a decade in the elements, many of them have ruptured and come
undone, exposing high-explosive rockets and mortar fins.
This is the overstuffed ammunition depot behind the security fences at
Military Unit A1479 in the Ukrainian forest. At least 5,700 tons of
ammunition, grenades and explosive powder have come to rest here,
according to an unclassified NATO inventory. Almost all of it is unwanted.
Much of it has expired, and some is considered too unreliable or too unsafe
to use.
The scenes at Unit A1479 provide a glimpse of a dangerous legacy of the
militarized Soviet state, one that has emerged as a risk to post-Soviet
states and to nations far away, endangering local environments and
communities, as well as providing a reservoir of lethal materials for
terrorists and armed groups.
Recent history has shown how fluid and dangerous the arms can be.
Huge depots of conventional weapons and ammunition remain in much of
the former Soviet borderland, many of them vulnerable to the elements,
inadequately secured or watched over by security agencies with histories
of corruption and suspicious arms sales.
Largely unaddressed while Western nations and post-Soviet states have
worked to secure and dispose of nuclear, chemical and biological
weapons, the conventional stockpiles pose problems as yet unsolved.
NATO and the Ukrainian military estimate that Soviet soldiers left 2.5
million tons of conventional munitions in Ukraine as they withdrew from
Europe, as well as more than 7 million rifles, pistols, mortars and machine
guns.
The surplus weapons and ammunition, some dating to World War I and
stored in military posts around the country, are packed in bunkers, locked
in salt mines and sitting in open air.
Shipments of the more modern munitions and equipment have departed
Ukraine in suspicious arms deals and reappeared in conflicts in Africa and
the Middle East. Western governments worry that some of the stocks,
including explosives and portable antiaircraft missiles that can down
civilian aircraft, might find homes with terrorist groups.
In one deal alone, extensively documented by the United Nations and human
rights organizations, 68 tons of munitions were transferred in 1999 from
Ukraine to Burkina Faso to Liberia, ending up in the hands of the
Revolutionary United Front, which sacked Sierra Leone. 25
Ukraine has not been alone in such circuitous deals. In a report released
July 5, Amnesty International claimed that 400 tons of surplus ammunition
were shipped from Albania and Serbia to Rwanda in 2002 and 2003, and
then channeled to armed groups in the Democratic Republic of Congo.
Allegations of illegal arms dealing have also adhered to Trans-Dniester, the
breakaway region of Moldova, which, according to estimates provided by
Russia to the Organization for the Security and Cooperation in Europe, has
42,000 small arms and 20,000 tons of munitions, including aircraft bombs,
rockets and 39,000 land mines.
Russia is thought to have the largest stockpiles, but has been less
forthcoming about them than Ukraine.
Such stockpiles endanger global security not only because they arm rebel
groups, but also because military munitions can readily be disassembled and
their explosives used to manufacture powerful makeshift bombs. This risk is
among the worries with regard to Ukraine.
"Based on the record of the Ukrainian military over the last several years,
in diverse settings, there is a certain probability that it might sell
explosives to terrorists," said Andreas Heinemann-Gruder, a senior
researcher at the Bonn International Center for Conversion, a private
organization in Germany working on demilitarization and defense conversion
that has studied the Ukrainian stockpiles. "Sectors of the Ukrainian
military have cooperated with whomever offered them money, and there have
been no moral considerations."
The concerns over accidental explosion were evident in Ichnya, where
firefighting equipment is neatly arranged near the gate and laborers hacked
at saplings and thigh-high grass, removing material that might kindle flame
or block the passage of the depot's armored fire trucks.
Throughout the depot, which consists of 47 warehouses and 47 house-sized
stacks of ammunition, the military has erected lightning rods 80 feet high
to divert lightning from ammunition stores. At least two of the rods have
been struck, said the depot commander, Colonel Oleksandr Bogdan.
Amid the mounting safety and security concerns, Western sponsors are trying
to accelerate the disposal of the Ukraine's arms burden. The efforts include
a $29.8 million, or 24.7 million, NATO program expected to start this fall
that plans to destroy 133,000 tons of munitions, 1.5 million guns and 1,000
portable antiaircraft missiles, known as MANPADS, which could be used to
disrupt air traffic world-wide.
It will be the largest effort in the world to destroy surplus small arms and
munitions, according to Michel Duray, a NATO spokesman in Ukraine. The
United States is a principal sponsor, donating more than $1.6 million for
the first phase.
Donors and Ukrainian military officials caution that it is only a start.
Ukraine has been trying to destroy its surplus inventory since 1993. At the
current pace the disposal will last another 50 to 100 years. "We will have
to spend some decades to reach a level of moderate safety," said Leonid
Polyakov, Ukraine's first deputy minister of defense, who assumed his post
this year. -30- [The Action Ukraine Report Monitoring Service]
==============================================================
11. YUSHCHENKO DIRECTS CABINET OF MINISTERS TO ANALYSE
OPERATIONS OF FREE ECONOMIC ZONES BY SEPTEMBER
Ukrainian News Agency, Kyiv, Ukraine, Sunday, July 17, 2005
KYIV - President Viktor Yuschenko has directed the Cabinet of Ministers to
analyze the appropriateness of closure or preservation of free economic
zones by September 1. Yuschenko announced this at a meeting in Donetsk.
Moreover, the Cabinet of Ministers is to draft mechanisms for compensating
the investors that operated honestly in free economic zones.
"Conceive compensatory mechanisms for those investors that operated
properly, fulfilled everything, and now have complaints against the
Ukrainian government. Their operations should be restored," Yuschenko said.
As Ukrainian News earlier reported, Economy Minister Serhii Teriokhin has
said that only four of the 626 enterprises operating in FEZs and territories
of priority development are fulfilling the obligations they undertook.
In March, the parliament adopted Cabinet Of Ministers-proposed amendments
to the state budget for 2005 that provided for abolishing the privileges
previously granted to FEZs, TPDs, and technological parks, as well as the
sectoral privileges and "Chornobyl privileges" granted to enterprises.
=============================================================
12. BRANCHES OF AUTHORITY CLASH IN UKRAINE
Viktor Yushchenko tries to make peace between
the Speaker and the Prime Minister
COMMENTARY: by Sergey Strokan
Kommersant, Moscow, Russia, Fri, July 15, 2005
A new scandal is breaking out in Ukraine, in the center of which are Prime
Minister Yulia Timoshenko and Speaker of the Supreme Rada Vladimir Litvin.
After the disagreement between the two leading Ukrainian politicians reached
the point of being newsworthy, President Yushchenko tried to mediate in the
situation, calling on them to bury the hatchet for the sake of the future of
Ukraine.
The conflict between the head of the cabinet and the head of the parliament
was unexpected. On May 22 of this year, not all that long ago, Yushchenko,
Timoshenko and Litvin visited the grave of Taras Shevchenko at Kaneva, were
they announced that the political forces they control would enter the 2006
elections together.
Observers took that political gesture as a sign that the informal trinity of
Orange Revolution leaders were coalescing into a new political bloc that
would eliminate their opponents' chances of attaining revenge in next year's
parliamentary elections.
However, the longer-range development of events has shown once again that
the face of modern Ukrainian politics changes at a whirlwind pace. At a
Wednesday Cabinet meeting, Timoshenko made a sharply-worded statement
about the Rada and its leadership, accusing it of attempting "to maintain
social and economic tension in society" in order to discredit her cabinet.
Timoshenko did not mince her words, speaking of "political savagery," "a
planned provocation," on the principle of "the worse, the better." She
called the abortive discussion in the Rada of bill on the WTO
"unprecedented," when deputies blocked the podium and "the president
was unable to address the people from the podium of the parliament."
She strongly indicated that, as the summer recess begins, the deputies
should think about their behavior and return in the fall ready to work
differently. "A normally functioning parliament after the recess is a
guarantee that the country will have the necessary legislation in the fiscal
arena and a budget for next year," she said.
Timoshenko restrained herself from mentioning Litvin by name, but a key
member of the Cabinet, Deputy Prime Minister for Humanitarian Issues
Nikolay Tomenko, did so that yesterday. On Era radio station yesterday
morning, Tomenko devoted a significant part of his appearance to Litvin,
whom he accused of having too close ties with the old elite headed by
former president Leonid Kuchma.
Indulging in sarcasm, the deputy premier noted that the speaker "spent too
much time writing speeches for Kuchma as is adviser and head of his
administration. Tomenko further opined that that was the reason why
Litvin "out of inertia, continues to make statements with a superior, almost
presidential, tone."
Tomenko spoke in favor of forming a new majority in the Rada that could
work stably, as the de facto majority of Kuchma, Litvin and [Ukrainian
Communist Party leader Petr] Simonenko does today."
The other side responded rapidly. The conciliation council of the Rada
factions and groups issued a statement yesterday saying that the Supreme
Rada is "categorically against the intervention of the administration in the
activities of the parliament, open public manipulation and insults to the
highest representational body of the Ukrainian people. We will decisively
withstand attempts to dismantle the highest representational body of the
state and will not allow politics in Ukraine to be based on conflict."
The document also accused Timoshenko of attempting to draw the president
into an artificially created political conflict, where "his authority will
be used to cover the mistakes and miscalculations in the actions of the
Cabinet of Ministers."
It also became known yesterday that Socialist party of Ukraine leader
Alexander Moroz is in solidarity with Litvin. Moroz made a harsh statement
in regard Timoshenko's cabinet, which, he said "rudely interferes in the
economy and will rapidly lose the confidence of the people, investors, and
its political partners and allies."
Moroz demanded that "the work of the Cabinet of Ministers be made ore
transparent, effective and genuinely democratic." Secretary of the Council
of National Security and Defense Petr Poroshenko thinks that the conflict
between the administration and the parliament is not of political character,
however.
"I think the reason for the crisis is the uncoordinated actions of the
team," he [Moroz] said at a press conference in Kiev yesterday. "It is a
purely technical reason, I don't see any political reasons."
Nonetheless, President Yushchenko has intervened in the situation,
understanding that the situation could get out of hand. At a press
conference yesterday in Kiev, he said that he had conducted negotiations
with both sides for several hours the day before, trying to reconcile them.
It is not clear yet to what extent he was successful.
The president admitted that, if the reconciliation is unsuccessful, "a
serious revision awaits the country at the polls in 2006." "I would like
Vladimir Mikhailovich [Litvin] and Yulia Vladimirovna [Timoshenko], who
are both wise people, to understand that their behavior today has not
enhanced the status of the branches of authority that they head."
Kommersant will follow the development of the events.
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http://www.kommersant.com/page.asp?id=590946
=============================================================
12. SUGAR MARKET RHETORIC BOILS OVER IN THE SUMMER HEAT
Ukraine's minister of economy and minister of agrarian policy
As if July didn't have enough hot air, Ukraine's economy and agrarian policy
ministries have engaged in a bit of internecine warfare that has heated the
political atmosphere. The very public quarrel has shed very little in the
way of light, and done a great deal to further escalate tensions within a
government that seems increasingly less focused and more obviously bearing
the hallmarks of an ill-conceived and perhaps unworkable coalition. Just how
soon the government gets reshuffled is unclear, but most observers believe
that sooner rather than later is probably the right answer.
By Oksana Bondarchuk, FirsTnews
Kyiv, Ukraine, Saturday, July 16, 2005
KYIV - Despite trends and indications to the contrary, prices for sugar will
go down soon, Minister of Agrarian Policy Oleksandr Baranivskyi said at a
recent news conference. Minister of Economy Serhiy Teriokhin, a close ally
of Prime Minister Yulia Tymoshenko, maintains that sugar prices in 2005
have gone up on average by 26-27 percent. APK-Information Service, using
information from market operators, confirms that prices continue to rise.
While Teriokhin wants to import sugar, the agrarian minister states that
there is enough sugar in Ukraine to satisfy customers without importing it.
The state of sugar in Ukraine has engendered a war of words between the
two ministers that has left consumers and farmers confused.
"The Minister of Economy even said himself that there is 250,000 tons of
sugar [in Ukraine]. We use 150 thousand tons per month, so it is sufficient
[until the new harvest] based on what he says," Baranivskyi said.
The deputy head of National Ukrainian Sugar Producers Association
Vyacheslav Kotkov said that the reserve is even greater claiming that until
September, the end of the market year, "we have 740 thousand tons
remaining [in Ukraine],"
Kotkov said that workers, who get sugar as partial payment for their work,
and middlemen are holding sugar now. Some amount of sugar is kept at the
processing plants. "I think that the [sugar] price should go down soon. Some
sugar plants have their golden store. They will also sell it in the
beginning of August," he said. Nevertheless, some producers denied that
they have any surplus sugar.
"We, for example, have sold all our sugar. Big companies have sold all
theirs. We did that to try to support this market. Volume of sales in June
was 1.5 times larger than the average monthly volume. It was tied to demand.
We don't hold [back sugar] from being sold," Viktor Ivanchyk, supervisory
board chairman of Tsukrovyk Poltavschyny Ltd. (a sugar enterprise), told
FirsTnews.
The State Reserve usually intervenes to purchase sugar in an effort to
stabilize prices. However, even how much sugar is in reserve turned out to
be a mystery for the minister of agriculture.
"How much sugar is in the state reserve? I don't know and I can't get this
number which shows how much sugar there is," Baranivskyi said.
Though Kotkov didn't reveal the amount of sugar stored in the State Reserve,
he did say that, in response to a decree on June 25 about releasing 55
thousand tons of sugar from the reserve, 10 thousand tons were sold on July
8 and it is starting to go on sale.
Kotkov thinks that the main problem is that most of it goes to the middlemen
and remains in their hands. Nobody seems to know the exact number of
these middlemen. Kotkov said that perhaps there are from 2000 to 6000.
Economy minister Teriokhin states that there are only six main middlemen.
"Sugar enterprises have manufactured sugar and have given it away, no
doubt, but where it is going further, it is a problem for the entire state,"
he said at the interview with FirsTnews.
Baranivskyi said he saw it in bags being sold along the road to the town of
Zhashkiv (Cherkasky oblast). "Bags of sugar are being sold along the whole
road from Zhashkiv to Kyiv," he claimed.
"In my opinion, almost all big enterprises have enough sugar. They foresaw
the situation and purchased it in advance. There is sugar in the wholesale
market. But looking at the retail market, sugar is hard to find," Ivanchyk
said.
Both producers and officials think that the tightness of the market is a
seasonal phenomenon. Price increases accompany greater demand for
preserving fruit. "When there is sugar, there is no sugar crisis,"
Baranivskyi said.
Despite such statements, Kotkov said that there is a slim possibility that a
kilogram of sugar, currently priced at UAH 4.5, would be priced at UAH 5.5
later this summer. He also said there is no need to import.
The head of Tsukrovyk Poltavschyny Ltd. said that he is not sure that sugar
will cost less in the near term, but it doesn't mean that the state will
have a sugar crisis.
"It seems to me, that even the prime minister is reacting very emotionally
to this situation. If there is really no sugar, we should intervene, first
of all, from the State Reserve and [secondly] by importing it from abroad,"
Ivanchyk recommended. -30- [Action Ukraine Report Monitoring Service]
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LINK: http://firstnews.com.ua/en/article.html?id=74515
=============================================================
13. LACK OF DISCIPLINE ON ECONOMIC REFORMS MAY LEAD TO
LOWER INVESTMENT AND HIGHER INFLATION SAYS MP SUPRUM
In an exclusive interview with FirsTnews, MP Lyudmila Suprun said that the
current government is sinking into exhaustive legal and political battles
that have a strong possibility to make fulfillment of the 2005 state budget
impossible. Suprun said this could lead to a drop in foreign direct
investment to Ukraine and fuel the inflation that has already become a
major problem.
By Aleksandra Nenadovic, FirsTnews
Kyiv, Ukraine, Friday, July 15, 2005
KYIV - Ukraine might lose potential foreign investments and sink deeply
into inflation, and revert to the red tape and cronyism that plagued the
country during former President Leonid Kuchma's tenure if the current
authorities fail to strictly implement economic reforms they pledged to
undertake when they came to power in January, Lyudmila P. Suprun, the first
deputy head of the parliament's budget committee told FirsTnews on July 15.
The key problem is the fulfillment of the country's budget, Suprun said. In
an exclusive interview with FirsTnews, Suprun said that a significant part
of budgetary income comes from the privatization process and that some 7
billion hryvnas ($1.2 billion) of that money should be spent on repayment of
foreign loans. She said however, that a problem of repaying foreign debts
could emerge because "the revenues from privatization are really low."
The government announced earlier this year that it would review suspicious
privatization deals for some key industrial assets and offer them for
renewed auction. It also pledged it would privatize a number of potentially
lucrative state-run enterprises. But, the process appears to be losing its
edge in legal battles between Prime Minister Yulia Tymoshenko's Cabinet
and Ukrainian tycoons Viktor Pinchuk and Rinat Akhmetov.
Suprun also warned the government about further increasing state debts
saying that the authorities should "use domestic income (to fulfill debt
commitments)." "But these incomes have already been distributed and
directed," she warned. She said that a draft bill related with this issue
should resolve potential problems with the budget deficit.
Suprun also criticized the methods for controlling the balance between
income and expenditures, and said that the lawmakers proposed last year
a new set of rules for budget management. The parliament passed the
related draft bill before its summer recess, and it awaits the endorsement
of President Viktor Yushchenko, she said.
Suprun warned that Tymoshenko's cabinet ignored the committee's
proposals aimed at rectifying the troubles related to cash-strapped funds
for local budgets. She described the situation as an "immense lack of
funds" and said that the "money goes only for salaries."
She said, however, that the situation could have a political pretext. "The
worse the situation is with local budgets, the higher will be ratings of the
politicians who would blame the former government."
She warned that Yushchenko and his allies are trying to "fully concentrate
financial resources under the Cabinet of Ministers," and undermine local
budgets. "It's not right. Neither the president nor the parliament has the
right to do it," Suprun said.
Many Ukrainians have bitter complaints over the rise of inflation during the
first months of Yushchenko's mandate, and Suprun stressed that "inflation
processes can simply eat up additional incomes of the population." She
urged Yushchenko to reform the legal system and reduce the population's
financial losses related to increased inflation.
"Not a single president can substantially change the situation in the
country without reforms of the legal system," she said, and added that if
the parliament adopts a government-proposed draft law that proposes
restrictive taxation policies, "small and middle-scale business would just
disappear."
At a recent two-day World Economic Forum on Ukraine held in Kyiv,
participants gave an upbeat assessment of what they'd seen from the
government's first five months in power: a balanced budget, reduced
inflation, the scrapping of some regulatory hurdles and a willingness to
listen.
But the list of changes they are still waiting to see was also long: a
commitment by authorities not to meddle in business, more success in
the fight against corruption, less bureaucracy and red tape.
Suprun also warned against what many of Yushchenko's opponents
described as a vendetta against political opponents, mainly represented
through a succession of police summons to former key officials and wealthy
businessmen. She said that such a policy as well as restrictive fiscal and
financial moves could scare away foreign investors.
"Unfortunately, now there is a tendency of withdrawing foreign investment
capital. Without a stable political situation, nobody will invest into a
lame economy," she said
Earlier this year, the National Bank of Ukraine (NBU) strengthened the
national currency, the hryvna, against the US dollar. The move caused a
surge in inflation and took a sizable chunk out of average Ukrainians'
savings. Suprun described the move as just "one of means of fighting
inflation, but not the main one."
"The best way to increase people's income is to make everybody pay
taxes. The state should get rid of its damaged psychology that believes
that everybody has to be poor, the state should say that it will give an
opportunity for everybody to have their existential, cultural,
religious .needs satisfied."
In regard to Suprun's claim that state budget money is going only sufficient
for salaries and not into other needed expenditures, FirsTnews has some
recent evidence that Suprun's claims may be correct.
A source that is known to be highly reliable reported to FirsTnews, subject
to a guarantee of anonymity, that a recent visit to a State Tax
Administration office resulted in the source's business being taken care of
quite correctly.
However, the source also said that upon leaving the STA office, the tax
officer strongly suggested that on the next visit to the office, the
source's business would be much more efficiently handled if the source
brought along a package of office supplies!
The clear implication was that STA personnel had no source for office
supplies, other than to attempt to encourage contributions from those
persons doing business with the agency - or out of their own pockets.
[Editor's Note: FirsTnews would be very interested in receiving information
from other sources concerning their experiences in being asked to pay for
supplies and services that should be state expenditures - or outright
requests for bribes, should such occur. Information may be submitted on a
strictly confidential basis to jdavis@firstnews.com.ua or by mail to
FirsTnews, PO Box 221, Kyiv 03150.]
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LINK: http://firstnews.com.ua/en/article.html?id=74307
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14. UKRAINE'S ECONOMIC GROWTH SLOWS DRAMATICALLY
IN FIRST SIX MONTHS OF 2005
Associated Press (AP}, Thursday, Thu, July 14, 2005
KIEV - Ukraine's economy grew just 4% in the first six months of 2005, the
government announced Thursday, a sharp downturn from the white-hot
growth registered by the former government over the same period a year
earlier.
The slowdown poses another hurdle for the new pro-Western government
which took power after last year's Orange Revolution amid promises to boost
living standards and create 5 million new jobs.
The State Statistics Committee said the economy grew 4% between January
and July. The committee also noted that GDP growth was slowing, down to
1.1% in June, compared with a high of 6.5% in January.
Last year, the former Soviet republic recorded growth of 12.7% in the first
six months of the year and a giant 19.1% jump in June 2004. President Viktor
Yushchenko has suggested that some of those figures -which earned Ukraine
accolades as the fastest growing economy in Europe -might have been
doctored by the previous administration.
Economists had earlier predicted a downturn in growth this year, caused in
part by falling world prices for metals and continuing investor uncertainty
after the change of power. The new government had forecast GDP growth of
up to 8.2 percent, boosting a prognosis made by the former government that
it would slip to 6.5 percent. However, Yushchenko's administration has begun
to scale back its expectations.
Dusan Vujovic, the head of the World Bank's office for Ukraine, said
officials were not concerned by the statistics, noting that the figures were
preliminary.
"We will stick to our projection of 6 to 7% of growth for this year," he
said, noting that summer is always slower because of the natural
agricultural cycle. -30- [The Action Ukraine Report Monitoring Service]
=============================================================
15. UKRAINIAN BUSINESS GROUP PRYVAT FIGHTING FOR
CONTROL OF FERROALLOYS PLANT
ANALYSIS: by Ihor Radetskyy
Invest-Gazeta, Kiev, in Russian 12 Jul 05; p 20
BBC Monitoring Service, UK, in English, Sat, Jul 16, 2005
In its battle to win control of the giant Nikopol ferroalloys plant, the
Dnipropetrovsk-based Pryvat business group has begun holding alternative
meetings of shareholders in an attempt to discourage potential Russian
buyers from concluding sales with former Ukrainian President Leonid
Kuchma's son-in-law, a Ukrainian business weekly has said. However, even
though no state officials gave the meeting credibility by attending, a
Russian buyer may still be found. It said Pryvat is trying to gain control
as it will then have a monopoly on the Ukrainian market.
The following is the text of the article by Ihor Radetskyy entitled "They
did not turn up at the meeting", published in the Ukrainian business weekly
Invest-Gazeta on 12 July; subheadings have been inserted editorially:
The four meetings of shareholders at the Nikopol ferroalloys plant,
initiated by the Pryvat group hoping for aid from the state, had a quite
specific aim - to discourage potential buyers of the enterprise (the Russian
Renova and Evrazholding) from concluding deals with [former Ukrainian
President Leonid Kuchma's son-in-law] Viktor Pinchuk. The first attempt
did not cause any obvious damage, which leaves three more.
On 7 July the first of four "alternative" meetings to the Nikopol
shareholders' meeting was held in the town of Ordzhonikidze. They were
initiated by companies close to the Pryvat financial-industrial group. By
all accounts, this was the meeting which was due to give legal substance to
Prime Minister Yuliya Tymoshenko's verbal claims to the state's ownership
of 50 per cent plus one of the shares of the Nikopol plant.
According to some media reports, a certain representative of the cabinet of
ministers, who was acting for the prime minister and was able to vote for
the "disputed" block of shares on behalf of the state, was due to attend the
shareholders meeting. What is more, the legal basis for this should have
been the verdict of the still unnamed district court which had confirmed the
legality of the government's reprivatization claims.
In the opinion of Interpipe (which controls about 74 per cent of the plant's
shares), the vote of the state representative to transfer the controlling
block of the NFP's shares over to Pryvat hands would set in motion the
forceful seizure of the enterprise.
NO STATE OFFICIALS AT MEETING ---------
However, nobody from the cabinet or the State Property Fund attended the
first meeting. Only 24 per cent of the shares were registered from all the
minorities representing Pryvat's interests. It should be pointed out that
this actual story about a representative of the cabinet attending the
shareholders' meeting has little bearing on the truth.
The point is that only authorized representatives of the Ukrainian State
Property Fund [SPF] may attend meetings of companies in which the state
has a share, and the participation of a representative of the cabinet would
have no legal bearing so there would be no point in it.
It is hardly worth giving any credence to a version which came out at the
same time that Pryvat and the prime minister had agreed to some kind of
exchange: the premier would gain control over the One Plus One television
channel and Pryvat over the Nikopol ferroalloys plant.
The scheme described above to seize control of the NFP, taking into account
that it is quite an illegal one, looks more like a gesture of despair than a
typical Ukrainian corporate confrontation. The point is that the head of the
State Property Fund, Valentyna Semenyuk, once again refused to take part
in the "Pryvat" meetings and to vote for the block of shares sold by the
fund to Pinchuk.
In this instance one must pay tribute to the head of the SPF who is well
known for her criticism of privatization. She has shown herself to be a
responsible state official. Since she, despite all her ardent attempts, was
unable to dispute Pinchuk's right to ownership of the plant in court, that
meant it belonged to him, and the fund cannot take part in any meetings of
shareholders of the Nikopol plant.
INTERESTS OF MINORITY SHAREHOLDERS ---------
Strictly speaking, it should not be said that the state's interest in
relation to the enterprise is of a priority nature. Behind all the actions
of the Cabinet of Ministers in relation to the return to state ownership of
the controlling block of shares of the ferroalloys plant one can clearly see
the interests of the minority shareholder.
It is evident that the re-sale of the plant to the Russians which, according
to representatives of Renova, is due to be completed in the next two months,
will make things substantially difficult for Pryvat in its future struggle
for the enterprise. Following the verdict of the Pecherskyy court [in Kiev]
on the closure of the case around the privatization of the Nikopol plant
and, as a consequence, the release of the shares belonging to Viktor Pinchuk
[son-in-law of Leonid Kuchma], the latter becomes the bona fide seller, and
Renova and Evraz the bona fide purchasers of the ferroalloys plant.
It will be recalled that by purchasing the NFP the Russian investors intend
to create on a parity basis a joint enterprise in which the shares of the
Nikopol plant would be registered. Immediately after the disclosure of these
plans Yuliya Tymoshenko made it abundantly clear to the Russians that they
would "not have an easy ride". At the same time the premier was quick to
give some "good advice" to the Russian businessmen, the essence of which
boiled down to the need to save "extra money" and not to waste it by
allowing it to slip away into the state's domain.
That is what you would call free inside information from the horse's mouth.
However, taking into account the fairly low price of the sale of the NFP
(some reports put the figure at about 380m dollars), the threats by the head
of the government may not intimidate Russian businessmen who have seen
it all before.
IMPORTANCE OF PLANT TO PRYVAT -----
Any Nikopol deal involving the Russians could inflict heavy financial losses
on Pryvat. One of the world's largest ferroalloys plant is of interest to
Pryvat not just for what it is - control over it will enable the group to
establish a virtual ferroalloys monopoly on the Ukrainian market.
Pryvat also has a vested interest in acquiring another purchaser of the
output of its mine enrichment plants. As is known, the Dnipropetrovsk
group owns the Ordzhonikidze and Marhanets enrichment plants which
are monopoly suppliers of raw materials for ferroalloys plants.
At the same time, the capacities of the Zaporizhzhya and Stakhanov
ferroalloys plants, which are also under Pryvat's control, do not allow for
fully selecting the output of the most powerful enrichment plants. The
search for alternative market sources is definitely not over, since the
owner of the NFP is not prepared to buy ore at the price offered by Pryvat.
Moreover, in order to produce output up to world standards, the Nikopol
plant technologically needs a mixture of two types of ore, and ore of the
second type is not mined in Ukraine. The transfer of the NFP to Pryvat's
type of raw material would mean the loss of the greater part of the sales
markets. -30- [The Action Ukraine Report Monitoring Service]
=============================================================
16. THE PRESIDENT IS LOSING HIS TEMPER
ANALYSIS AND COMMENTARY: By Leonid Amchuk
Ukrayinska Pravda, Kyiv, Ukraine, Friday, July 15, 2005
President Victor Yushchenko with his companions-in-arms came to the stage
of taking off the main post-revolution accessory - pink glasses. Last
Saturday the congress of People's Union Our Ukraine was dedicated to that.
This project never became what it meant to be - the main consolidation force
of Maidan.
The congress was attended by new-comer of People's Union Our Ukraine,
the Minister of Fuel and Energy Complex Ivan Plachkov with his wife, the
Minister of Transport Yevhen Chervonenko also with his wife (although she
sat three rows from him; but then they kissed on public), president's
brother Petro Yushchenko with a son Yaroslav (deputy governor of Kharkiv
region), Yushchenko's doctor from Wien Mykola Kaplan and over a thousand
of other delegates.
While everybody waited for Yushchenko, the chief manager of his party Roman
Bezsmertny told what had been done in those four months. Now the party
counts 77 thousand members; things are going pretty well in Zhytomir region,
run by Poroshenko's protege, governor Zhebrivsky. The worst situation is in
Rivne region - there are just 652 party members there. Who's to blame?
Kostenko's governor Chervoniy has terrorized the party so that it addressed
Yushchenko to find a better governor for them.
Bezsmertny decided to surprise the audience with proclamation of banalities:
"We shouldn't let the things, proclaimed on Maidan, be forgotten", "The
party should take responsibility for its members in government" and so on
and so forth.
Meanwhile Yushchenko was approaching KPI concert hall. The fountain was
turned on just on that purpose, but he didn't notice it as he went to the
side entrance. Before that Ukrainian president showed that he had enlarged
his lexicon with specific words and words combinations.
The Minister of Transport Yevhen Chervonenko decided to meet the president
among the others. Later on, he was likely to have regretted that. Yushchenko
told Chervonenko that some handicapped woman from transport branch was
following him and demanding a flat. Chervonenko answered his subordinates
did something wrong about her case. Yushchenko replied in a very unusual
way. The president just said: "Assholes".
Yushchenko seemed to be in low spirits. He was accompanied by one of the
youngest daughters, who was constantly getting underfoot. Before the
entrance Yushchenko harshly told the first man he saw (who appeared to be
the head of party executive committee Yuriy Yekhanurov): "Yuriy Ivanovych,
take the kid!" Yekhanurov had no time to do that, moreover what should he do
with her on stage? As a result the kid was taken care of by president's
assistant Vira Ivanivna.
President's choleric mood resulted in an endless (in fact 1.5 hour) speech
about party politics. That was the mix that authorities kept their Maidan
promises, but not always. "I want you to be optimistic. We will reach our
objectives no matter what", reassured Yushchenko.
Porno as Armageddon harbinger ---------
The first victim of the president low spirits was quite unexpected - that
was national TV. Yushchenko is worried about this matter - he told the same
at the Constituent Assembly of People's Union Our Ukraine in March. This
topic seemed to give the president hemorrhage 'cause this time he was
much more disappointed and discouraged.
"I'd like to say we've got no national informational space. And my goal is
not to tell how we're going to solve the problem in this branch", Yushchenko
began unexpectedly.
"There's just one plan - there should be no informational monopolies in
Ukraine. Ukrainian mass media market should be transparent and open for
public.People should know who stands behind mass media. No offshores
should back up so called Ukrainian mass media".
"In other words the contents should correspond to the national interests and
needs. I'm so sorry to watch some major channels with just 25% of programs
in Ukrainian. A new National Security Council has been formed; we have
strict license conditions. But we were the witnesses that some big cheeses
paid with 10-20 licenses under condition of deficiency", the president gave
a hint to NSCU.
"We can watch advertisement trailers of vodka, cigarettes and porno, so
everything you can't run into on Russian TV." Yushchenko was exaggerating.
"Our nation will never change with that! It's not the way I want to live and
it's not the way I want you and your kids to live. That's will the problem
for the generations to come. Let's keep off this Armageddon". Then
Yushchenko promised that "swindlers will leave Ukrainian TV soon and the
order will reign". The audience burs in applause.
Generally speaking, that sounds scary and menacingly. For instance, who are
these swindlers and why would they disappear. Again arrests? Or will they
resign themselves? Then how would Yushchenko know about it? Our TV
channels are private (I think) and it's not up to president to nominate and
fire staff there. Or did he mean selling of certain actives of TV channels
that has already happened? Or hasn't?
Yushchenko answered neither of the questions. He also didn't mention he did
want that public TV. Maybe we just grossly overestimate that desire of his?
"I can't say that Ukraine gave birth to even a single independent journalist
in five months. But I promise the authorities will never interfere into the
work of mass media and tell what to write and broadcast", said Yushchenko.
That means, while everybody celebrated the prosperity of independent
Ukrainian mass media the president never liked it. But he promised
everything is going to be ok: "We'll see the competition of mass media, but
what's more important we'll se an independent Ukrainian journalist! We'll
breed the new caste of Ukrainian journalists - proud, honest, brave. Mass
media is the best way of democracy transportation". He'd better haven't
told this - then there would be no reasons to criticize him.
Then Yushchenko stated that some of the main reforms would come only in
a year. Elections are ahead and not everything can be implemented in life.
"The year of 2006 is divided into two parts and it would be more reasonable
to start some reforms from April 1st". One of the reasons is the present
parliament. "We almost burnt the parliament because of 14 bills",
Yushchenko recalled the recent sitting concerning WTO bills.
But the main thing Yushchenko's going to do is to simplify business
registration procedures.
"When you go from the airport to the capital in Turkey there're plenty of
tables "Lots for sale". Check up our road and find at least one? No ground
whatsoever! Fields are all around but nothing for sale."
"If you want do some business in Ukraine - apply for a lot. And then go
through 34 stages.Do we understand that's the road to nowhere? If the
businessman decides where to go - Moldova or Ukraine, he'll go to Moldova
where the registration procedure is simplified.He'll go to Turkey where lots
are on sale but he won't choose 34 decisions of Ukrainian bureaucrats",
Yushchenko said with disappointment.
Then Yushchenko warned he would fire all officials who wouldn't meet the
demand of a "single instance" when registering business or going through
customs procedure.
"From July 1st the principle of "one window" comes to forth. My friends, if
you happen to know this principle hasn't been observed I promise you this
official will be fired till the evening.From July 1st the principle of "one
window" will simplify registration of small and midsized business. If this
law is broken - the first deputy governor will be fired", promised
Yushchenko.
It needs mentioning that before he promised to fire governor when making
such demands. Well, he changed his mind. But he promised to abolish 1300
institutions dealing with small and midsized business.
"We have 16 000 standards.EU is legging behind, they have just 9 000. That's
why any operation of import, export, entering or leaving business means much
fuss and troubles. We want the whole set of standards. I charged the
government with that. They are not doing ok in many matters. I remind Yulia
Volodymyrivna every other day. I'm sure all the decisions will be
implemented by September. It will be a bland print by September 1st.
When Yushchenko was saying that, the audience was in a light shock. Only
one man gave a bitter smile. That was another Yushchenko - the deputy
governor of Kharkiv region, the president's nephew.
We got to know what happened to him. "Well, I just recalled when the
president charged government with a resolution concerning Kharkiv region,
the deadline was two weeks. Two months have passed. No answer",
confessed Yaroslav Yushchenko. "But go easy on him.", he asked.
Yushchenko scolded someone in hat. Probably Tomenko
Meanwhile his uncle advised official not to pin up each other. Moreover he
told to love each other. Even if you don't want to.
"We should show mutual respect for each other. I've told a thousand of times
to Tomenko, Teryohin and others.guys, the day has begun: you're a team, make
compliments to each other. "You did one thing, someone has done something
else. We'll go on doing that.". Prove you're a team having one objective".
"You shouldn't apply to PR in the negative sense of the word. PR is a danger
for the government. A politician might babble and babble like communists
have been doing that for 14 years already. And they are responsible for
nothing. They know they'll never enter the government".
"When we mean government taking care of every single poor man, every child,
every soldier, we should talk only business. I know that it was pretty easy
for many people to work on Maidan - put you hat on, megaphone in you hands
and yell all day long. I realize it was a great deed to support millions of
people. But certain office with a certain amount of responsibility is quite
a different thing."
"This part of his report was interrupted by applause about ten times. For
some reason this topic seemed acute and burning for the present party
members. Although, Yushchenko named Tomenko and Teryohin. Only the
former was on Maidan. Although, without hat.
Yushchenko still has strong kuchmists' allergy. But unexpectedly he
encountered sabotage in this matter.
"We've been talking: we're going to substitute all the regional leaders. We
did it and came up to the holiest place - Kyiv. Omelchenko promised a
month ago to suggest some nominations in three-four days. Still nothing.
But don't worry, we'll come up to Kyiv, that's for sure, my friends",
promised Yushchenko.
"My friends, these are not repressions. It's people's natural desire to
witness changes".
"If you think that a top specialist, the head of regional tax service who
worked under Serhiy Medvedchuk, for instance, and who took bribes from
everyone and everywhere, can work with the new authorities - you are
mistaken!", said Yushchenko. Then he asked to be careful with such
people and try not to let them in the party, at least in presidium.
"We don't need local gods. Every region should be run by super trustworthy
people who have confidence and authority among the people, who proved
their loyalty. I don't want losers and criminals in Our Ukraine. I do know
there are a lot of such cases and that's clear: winners are always popular".
"I don't want to say that we can't forgive those who made mistakes. But we
do need the demonstration that Our Ukraine is being built by the new people
who substitute representation of the former authorities", Yushchenko added.
Pinzennyk decided to cheat ----------
That's how Yushchenko addressed the party. Better to say, that's the way he
preached it. Just after his report he decided not to listen what others
thought about his brain-child. On his way to the car he agreed to carry out
gathering of beekeepers and to solve problems of some ordinary citizens. As
usual, he gathered a crowd around and presidential bodyguards considered
journalists the most dangerous.
To leave this way is not characteristic of Yushchenko; moreover that might
be offensive for the present people. For instance, he sits at the meetings
with businessmen till the end. Leaving in such a way, Yushchenko deprived
himself of undesirable information about those who are dissatisfied with the
current course of things.
For example, Volodymyr Yavorivsky reported that the authorities were
becoming less and less popular. The president should gather "moral
authorities of the nation" around him but not those who gave more money for
elections. Our Ukraine in Rivne can't coexist with governor Chervoniy; in
Donetsk governor Chuprun does nothing of the promised; even big-boards
"I believe in Ukraine" were hung just for one day - the day of Zinchenko's
visit. That's why these two governors should be fired, Our Ukraine believes.
Borys Tarasuyk is discouraged by "tactless and impudent" statements
concerning his Narodny Rukh. Even Poroshenko has something to complain
of: there are still people on the lowest levels of militia and SSU who
fought against Yushchenko. Besides, NSCU secretary is worried by PR
technologies that slander certain people. People's Union Our Ukraine should
protect its members, he believes.
In spring, this summer congress was believed to be reunification of Our
Ukraine and "Reforms and Order". But it turned out to be just on the
contrary. "Reforms and Order" refused to do that; moreover they believe one
should run for the parliament as a block but not a party.
Although these questions were not regarded, the formal leader of People's
Union Our Ukraine Roman Bezsmertny was glad to accept such proposals. It's
strange because in March Yushchenko was of a different opinion - the block
should be formed by Tymoshenko and Lytvyn's People's Party. And that's it!
The fact that Bezsmertny supports this idea doesn't mean the coalition will
ever take place.
On the first point, no one knows if Yushchenko will change his mind and form
this coalition. On the second point the question is whether these parties
survive before the elections 2006.
No doubts, such configuration is suitable for Tymoshenko. Together with
Reforms and Order, Narodny Rukh and People's Party she can affect
Yushchenko's circle. They won't like the idea either.
That's why the gathering brought rather more misunderstandings instead of
consolidation. The only positive thing is that they adopted amendment to
statute and now they may be called Our Ukraine, as an abridgment. Thanks
God the Minister of Justice Zvarych is a party member, so he can guarantee
that. Although Pinzennyk thinks his party is empowered to have the same
name. (translated by Eugene Ivantsov) -30-
-----------------------------------------------------------------------------------------------------------
http://www2.pravda.com.ua/en/archive/2005/july/10/1.shtml
=============================================================
17. DOWN IN DONETSK
COMMENTARY: By Andrew Yurkovsky
The Wall Street Journal, Europe
New York, NY, Friday, July 15, 2005
DONETSK, Ukraine -- Donetsk, a steel and mining town in eastern Ukraine,
has long been regarded as an ungovernable place. In fact, the Bolshevik l
leader Leon Trotsky -- speaking of the region's political atmosphere rather
than its environmental state -- once said: "One can't go to the Donbas
without a gas mask."
Back in 1989, Donetsk's miners were among the first Soviet workers to
challenge Communist Party rule, winning wage and other concessions that
helped undermine the old regime. And it was from Severodonetsk, a city north
of Donetsk, that the first rumblings of secession emanated last November
when Viktor Yushchenko, Ukraine's current head of state, rejected official
vote tallies in the presidential election as fraudulent.
At the time, supporters of Viktor Yanukovych -- Donetsk's hometown candidate
and Moscow's favorite -- raised the threat of secession if Mr. Yanukovych's
official victory was overturned.
Talk last year that eastern Ukraine could split off and join Russia was
probably never more than an idle threat. Yet since taking office six months
ago in the wake of the "Orange Revolution," Mr. Yushchenko's government
has failed to overcome the distrust and skepticism of eastern Ukrainians.
For them, the leadership of Mr. Yushchenko and Prime Minister Yulia
Tymoshenko is synonymous with bad economic policy and with a campaign of
retribution against regional political leaders. Unless Mr. Yushchenko's team
moves to dispel such impressions, there could be trouble in the 2006
parliamentary elections on which his supporters pin their hopes for
consolidating democratic change.
The city known today as Donetsk was established in the late 19th century by
the Welshman John Hughes, who set up a factory that quickly became the
Russian empire's biggest producer of iron. Although Donetsk Metallurgical
Factory, successor to the original iron mill, is no longer the economic
powerhouse it used to be, this city of some 1 million people is hardly idle.
By all appearances, it is a prosperous town that has rebounded from the
difficult, early post-Soviet years.
Here, people speak about what they have to lose and what they feel they have
already lost under Mr. Yushchenko's presidency. They blame increasing
economic uncertainty on the various policies of Mr. Yushchenko's team --
raising the value of the hryvna relative to the dollar, abortive efforts to
regulate energy prices and threats to reverse the privatization of state
enterprises bought by the old regime's cronies at bargain prices.
Whatever his flaws, Donetsk residents believe Mr. Yanukovych was an
effective leader who delivered prosperity to this part of the country when
he was the regional governor from 1997 to 2002 and Ukraine's prime minister
from 2002 to 2004. At best, in their view, the Orange Revolution replaced
one criminal clan, Mr. Yanukovych's, with a new one -- Mr. Yushchenko's.
By this interpretation, the presence in the new government of Ms.
Tymoshenko -- a former head of United Energy Systems of Ukraine who was
prosecuted by the Kuchma government -- is evidence of a double standard in
fighting corruption. So, too, is the April arrest, on charges of extortion,
of Boris Kolesnikov, chairman of the Donetsk Regional Council and head of
the Donetsk branch of Mr. Yanukovych's Party of Regions.
In Kiev and the western cities of Lviv and Mukachevo, by contrast, there is
almost uniform, if sometimes critical, enthusiasm for the new government.
There, Mr. Yushchenko's ascent has brought newfound freedom and greater
opportunities for self-fulfillment.
If in the United States, "red" and "blue" have become shorthand designations
for Republican and Democratic parts of the country, in Ukraine orange and
blue have become the respective colors associated with Mr. Yushchenko and
Mr. Yanukovych. In this case, the colors are not based on TV election maps;
rather, they derive from the candidates' campaign logos -- hence, the name
of the revolution that brought Mr. Yushchenko to power. Ten eastern and
southern regions of Ukraine voted "blue" -- for Mr. Yanukovych -- in the
final election round in December. In the Donetsk region, Mr. Yanukovych got
93.5% of the vote. Ukraine's 17 other regions voted orange.
Polls support the idea of a continuing divide between eastern and western
Ukraine. The split is real and does not seem to be due solely to easterners'
lack of information or too much exposure to propaganda from Russian
television and newspapers. The people of the Donetsk region are mainly
Russian-speakers and political differences are sometimes expressed in
ethnic terms.
Not surprisingly, perceptions of economic interests differ sharply.
According to a survey by the Kiev International Institute of Sociology,
published May 14 in the weekly newspaper Dzerkalo Tyzhnia, most Ukrainians
favor a reexamination of the privatizations carried out under the previous
government. But a regional breakdown shows an east-west divide on this
issue. If large majorities of respondents in western and southern Ukraine --
80% and 70%, respectively -- favor a review of privatization, among eastern
Ukrainians, the figure is just 53%.
As for Ukrainian-Russian relations, 33.6% of respondents from eastern
Ukraine and 22.5% of respondents from southern Ukraine regard the new
government's policy toward Moscow as "anti-Russian." This contrasts with
just 7% of respondents in western Ukraine who believe that Kiev's policy is
anti-Russian.
Rather than closing this divide, members of the Yushchenko government have
taken steps in recent weeks that have served to widen it. That is the
opinion not only of people in Donetsk but of Mr. Yushchenko supporters as
well. These include Russian politician Boris Nemtsov, who in an interview in
the newspaper Segodnya criticized Ms. Tymoshenko's efforts to regulate the
gasoline market and called her talk of a Russian conspiracy regarding fuel
deliveries nonsense. The tongue-in-cheek headline read: "Tymoshenko is
now the Kremlin's biggest friend."
Western policymakers and Mr. Yushchenko's supporters may be
disappointed with Kiev's failure to deliver reform, but they remain on his
side. In Donetsk and other parts of eastern Ukraine, Mr. Yushchenko's team
has yet to show the people that his government represents the interests of
all
Ukrainians. Discontent will give the opposition a boost in next year's
elections and complicate relations with Russia.
The people of Donetsk are a practical, if temperamental, lot. They need not
remain forever hostile to Mr. Yushchenko. Today, people may sing the praises
of Moscow and heap scorn on Kiev. But back in 1991, it was the opposite. In
the referendum on independence, 84% of the voters in the Donetsk region
favored the creation of an independent Ukraine. Their support back then was
based on the hope of economic improvement. Economic interests could again
bring Kiev and Donetsk together. -30-
----------------------------------------------------------------------------------------------------------
Mr. Yurkovsky is a freelance journalist.
==============================================================
18. YUSHCHENKO VISITS RUSSIAN-SPEAKING DONETSK REGION
Associated Press (AP), Kiev, Ukraine, July 15, 2005
KIEV - Ukrainian President Viktor Yushchenko traveled Friday to the eastern
city of Donetsk, a region that overwhelmingly supported his rival in last
year's bitter election.
About 3,000 demonstrators - primarily from the Communist Party and the
party Derzhava - gathered outside the regional headquarters to protest
Yushchenko's visit, waving signs that read "Get out!" and "No to a
pro-American regime," according to Ukrainian media reports.
Yushchenko was scheduled to tour a refrigerator factory and meet with
regional officials, and to lay flowers at a chapel in memory of people who
have died on the job. The Donetsk region is the center for Ukrainian coal
mines, considered among the most dangerous in the world.
Yushchenko came to power on a pro-Western platform, promising a boost in
living standards and eventual membership in Western organizations such as
the European Union and NATO. Those aspirations draw little support in
Ukraine's Russian-speaking east, which favors closer ties to Moscow.
On the eve of Yushchenko's visit, people drove cars through Donetsk, waving
banners that read "Ukraine without Yushchenko," Ukrainian media reported.
The Ukrainian leader was accompanied by a top-level delegation, including
his top security official, the interior minister and a number of lawmakers.
Yushchenko made his first postelection visit to Donetsk in February - a
lightning-speed trip where he was met by crowds of hostile protesters, who
threw snowballs at him.
Nearly 94% of Donetsk voters supported their native son, former Prime
Minister Viktor Yanukovych, during last year's election. Many feared
Yushchenko was a pro-U.S. nationalist who would sever ties with Russia,
ban Russian-language schools and close down the mines and factories that
are the lifeblood of this region. Yushchenko has said they were misled by
election propaganda against him. -30-
==============================================================
19 TWO BOOKS OF UKRAINIAN LITERATURE NOW IN ENGLISH
Passion's Bitter Cup and Riddles of the Heart
Sonia Morris, Business Manager
Language Lanterns Publications
Surrey, British Columbia, Canada, July, 2005
The six-volume series Women's Voices in Ukrainian Literature was published
by Language Lanterns Publications between 1998 and 2000. Translated by
Roma Franko and edited by Sonia Morris, these books introduced the short
fiction of eight women writers (1880-1920) to the English-reading world.
Passion's Bitter Cup and Riddles of the Heart, companion anthologies of
short fiction written during this period by male authors, continue to fill
in blank spots in Ukrainian literature in translation by making stories with
love and erotic themes accessible to readers of English. These two books,
also translated by Roma Franko and edited by Sonia Morris, were printed in
2004 and released in July, 2005. They are available from Ukrainian book-
stores in Canada, Amazon.com, or the publisher for $14.95 a book.
Some of the short fiction in these companion volumes was deemed immoral
or amoral, and its authors were censured by their more conservative peers.
The works considered a threat to the social order were banned, and as was
true of similar groundbreaking literature in Western Europe, did not become
generally available to Ukrainian readers until several decades later.
The social issues that are addressed in these books are disturbing, and the
philosophical positions espoused by a number of protagonists have not lost
their capacity to elicit strong emotional reactions, but the stories
themselves are literary in conception, and in sharp contrast to writing that
is sexually explicit, deliberately titillating, or obscene, they are not
offensive
The content that scandalized the reading public of the day has long since
lost its shock value, and today's reader is likely to commend these authors
for their exploration of morality and equity in male-female relationships
and persistent social issues that some of us still prefer not to address.
The theme of Passion's Bitter Cup is the cost of living and loving
passionately, be it a matter of temperament or conviction. Some of the
stories are sentimental and romantic; others are hard-hitting depictions
of rape, abortion, suicide, crimes of passion, prostitution, the plight of
fallen women, and the licentiousness of the upper classes. Several
describe women's initial forays into the workplace and the sexual
exploitation of working class women by privileged males.
The stories in Riddles of the Heart have one overarching motif: the age-old
puzzle of physical attraction, sensuality, and desire, and the unfathomable
course of passionate love. Some portray the histrionic reactions of
adolescents to the vicissitudes of first love; others focus on the
disastrous consequences, for women, of flaunting social mores.
Still others, however, depict women as Jezebels. Thus, in an extreme case
of role reversal, a liberated woman callously takes advantage of a man's
infatuation to attain her goal of motherhood unencumbered by marriage.
These anthologies provide a fascinating glimpse into life as it was lived in
urban Ukraine at the turn of the twentieth century a time of social unrest,
shifting mores, and heady affirmations of freedom of choice. Some of the
content is simply humanuniversal, familiar, and predictable, and some of it
is bound to a particular time and place, but taken together, the stories
illuminate the social history of a part of the world that is still reaping
the wild wind of its turbulent past. -30-
-------------------------------------------------------------------------------------------------
Sonia Morris, Business Manager, Language Lanterns Publications
soniavmorris@shaw.ca; Phone: 604-538-9832; FAX: 604-538-4957
For more information about Language Lanterns, other books, and
publication plans, visit: www.languagelanterns.com.
=============================================================
20. NO CAUSALITIES AMONG THOSE WHO TOOK PART IN THE
UKRAINIAN PRESIDENT-LED CLIMB UP HOVERLA MOUNTAIN
TV 5 Kanal, Kiev, in Ukrainian 1200 gmt 17 Jul 05
BBC Monitoring Service, UK, in English, Sun, Jul 17, 2005
KIEV - There are new details about the accidents which happened during a
mass climb up Hoverla [Ukraine's highest mountain in the Carpathian
Mountains]. The Ministry of Emergency Situations has told 5 Kanal that
no-one of the four victims took part in the climb.
5 Kanal earlier reported that two people died on Hoverla Mount yesterday
evening. One was killed by lightning, another died of a heart attack. Two
more people were taken to hospital.
The Hoverla climb led by President Viktor Yushchenko was dedicated to the
15th anniversary of Ukraine's sovereignty declaration. About 16,000 people
took part. -30- [The Action Ukraine Report Monitoring Service]
=============================================================
21. SINGING IN UKRAINE
Huddersfield (UK) ladies choir off to Lviv, Ukraine in October
By The Huddersfield Daily Examiner
Huddersfield, United Kingdom, Jul 15, 2005
A HUDDERSFIELD ladies choir is off to Ukraine in the autumn to continue
forging musical links. Members of Vocal Expressions will be setting off for
Ukraine on October 22 and are now looking to raise funds for the trip or for
sponsorship. The choir, established for 10 years, will visit Lvov, to stage
several concerts.
Choir chairwoman Dianne Robinson said the links with Ukraine began in
2002 when Vocal Expressions bought a new lilac and heather concert dress.
She said: "When we changed our concert dress, we were looking to pass on
the old outfits to a needy choir."
An enterprising member of Vocal Expressions, Val Shuttleworth, asked
whether the "old" dress could be sent to a needy choir in Ukraine rather
than just be thrown away. Through Val's church and connections with the
local Ukrainian community, the dark green concert dress was passed on.
As a result, members of MRIYA, the Ukrainian national choir visited
Huddersfield last year and staged a joint concert with Vocal Expressions.
Strong bonds were formed between the two choirs as members of the
Ukraine choir stayed with families of Vocal Expressions.
Dianne said: "Thirty-five members of our choir are having a return visit to
Ukraine. Already we have held two curry nights at Meltham's Cinnamon
Lodge,done cake stalls at Holmfirth Market and held a concert in Holmfirth
Civic Hall to raise funds for the trip. "Tickets are now available for a
concert at St Paul's Hall in early October when we will share the stage with
some Ukrainian dancers."
Vocal Expressions also sing for weddings and events, and pride themselves
on being able to deliver anything from Elvis to Elgar. The choir can sing in
Latin, Welsh, Ukrainian and Spanish.
Vocal Expressions had a wide age range of members from 19 to mid-60s and
sings under the musical direction of Scottish-born Catherine Williams. As a
result of the 2004 concert,Vocal Expressions has been invited to perform for
the Ukrainian community in Manchester in January 2006. The choir practices
every Thursday evening at Holmbridge parish hall. Anyone who can help with
fundraising or sponsorship should call 01484-643848. -30-
=============================================================
22. WINNING OVER THE PEASANTS
A young Pioneer so idealistic and fearless that he would
denounce even his own father if he stood against the people.
BOOK REVIEW: By Enda O'Doherty, Irish Times Journalist
Irish Times, Dublin, Ireland, Saturday, Jul 16, 2005
RE: Comrade Pavlik: The Rise and Fall of a Soviet Boy Hero
By Catriona Kelly Granta, 352pp. GBP17.99
History: For the generation of savage idealists who set out to remake Russia
and the world after the Bolshevik Revolution of 1917, peasants were always
going to be something of a problem. For Marx, in The Communist Manifesto,
agricultural workers figured only as a remnant of the vanishing social order
of feudalism, a class ultimately doomed to extinction yet still likely to
take up reactionary positions and attempt to "roll back the wheel of
history".
The revolution, of course, was not supposed to happen in backward Russia
but in wealthy, advanced Germany. It is not quite true to say no one told
Lenin this, for people were always telling him, but he was not inclined to
listen; he was not, perhaps, the listening type. So the world's first
successful proletarian revolution was launched in a country in which
proletarians were a tiny minority and the peasantry was vast, far-flung and,
so it seemed, ignorant and superstitious.
In the early days of the revolution, when what the comrades might have
called "bourgeois legalism" still had to be accorded some attention and
respect, the unfortunate imbalance between the numbers of progressive
workers and potentially reactionary peasants was dealt with by the simple
constitutional expedient of according the peasant one vote and the worker
five. Later, when the parties the peasants might have wished to vote for had
been liquidated, this kind of political creativity was no longer necessary.
Though politically marginalised, the "doomed class" still retained a certain
economic importance throughout the 1920s and 1930s: Russia's towns and
cities badly needed bread and the peasants were sitting on the grain. At
first Stalin was in favour of a softly softly approach, while Trotsky, as
ever, advocated "harsh measures".
But eventually, faced with rationing in the cities and rocketing food
prices, Stalin too came to see the need to crush peasant resistance.
Agriculture would be collectivised and the wealthier peasants, the so-called
kulaks, "liquidated as a class". The immediate result of this campaign was
famine and the deaths of between five and 10 million people in the Ukraine
in the early 1930s.
Catriona Kelly's book focuses on the killing of two children, Pavel (13) -
also known as Pavlik - and Fyodor (11) Morozov, in the remote village of
Gerasimovka, in western Siberia, in September 1932. The violent deaths of
two insignificant peasant boys did not initially attract much attention in a
region that was then spectacularly lawless.
Soon, however, it began to be noticed by the security apparatus and the
national press, in particular that of the Pioneer (Soviet scouting)
movement. The legend that emerged was the following.
Pavel Morozov was an enthusiastic Pioneer, strongly committed to the tasks
of the revolution and in particular to the expropriation of the kulaks so
that Soviet agriculture could be modernised and put to work for all the
people. But his father, though chairman of the village Soviet, was secretly
in league with the kulaks.
Pavel discovered this and patriotically denounced his father to the secret
police, the OGPU. And as is fitting, he was imprisoned for his crimes.
Pavel's relations, however, secretly pledged vengeance and in due course
exacted it, brutally stabbing the boy and his brother to death as they
returned from a cranberry-picking expedition in the woods.
As Dr Kelly skilfully demonstrates, the reason this obscure case came to the
attention of the wider authorities and was given so much publicity was that
it contained all the essential elements for the propaganda battle then
raging: backward, brutal and superstitious peasants desperately resisting
progress only to be thwarted by a heroic exemplar of the new Russia, a
young Pioneer so idealistic and fearless that he would denounce even his
own father if he stood against the people.
As Pioneer Pravda put it: " A dark, unenlightened village, with age-old
ignorance and illiteracy, all-pervasive religion, and property-grubbing
attitudes. And suddenly into this dismal dump surges the radiant, heroic
life of Pioneer Pavlik Morozov. The kulaks snarled like dogs and bared
their fangs."
The reality, in so far as it is possible to establish it 70 years later, is
somewhat more prosaic. Pavel may or may not have been a Pioneer, but
he was certainly a young lad who liked denouncing people; the "kulaks" of
Gerasimovka were not rich peasants but poor and miserable wretches; the
real point at issue between Pavel and the villagers may not have been the
denunciation of his father - which may not even have happened - but a
squalid row over a single horse harness held back from "collectivisation".
Also, of the four people executed for the boys' murder, all of whom were
part of the Morozov extended family, possibly one was actually guilty of the
crime.
Nevertheless, the martyr's legend of little Pavel Morozov was to survive in
book, song and story to inspire, or more likely to irritate and bore, three
generations of Soviet schoolchildren.
Dr Kelly disarmingly relates that in the course of her researches she
encountered many Russians who were puzzled by the attention she was
giving the Morozov case, including "taxi-drivers astonished that you could
make good money by doing work like that".
Reluctantly, one is inclined to a sneaking sympathy for that rather
philistine viewpoint, for while the material is interesting it is perhaps a
little stretched and padded in the present treatment. Though this is not a
long book it could easily have been shorter.
Intriguingly, the author glances in her final chapters at the more general
question of the content and style of Soviet internal propaganda (a rich, and
richly hilarious, seam) and the popular parodies and subversions of it that
thrived underground. Now that would be a book to look forward to. -30-
=============================================================
23. DREAMLAND IN UKRAINE
Ethnic festival held on Spivoche Pole
By Dmytro Antonyuk, Kyiv Weekly #27 (167)
Business & Socio-Political Weekly
Kyiv, Ukraine, Friday, July 15-22, 2005
This past weekend the trendiest feature in fashion for many Kyivans was
vyshyvanky (hand-embroidered traditional Ukrainian shirts and blouses).
The girls went into their grandmas' wardrobes to put on linen blouses with
intricate embroidered decorations, coral necklaces, beads and everything
else that could be an accessory to folk attire. Ukrainians paid tribute to
their ancient folk traditions at the Dreamland ethnic festival held on
Spivoche Pole
The natural amphitheater on Spivoche Pole (Singing Field), which was host to
a three-day folklore festival this past weekend resembled a combination of
the annual Sorochynska Fair in the Poltava oblast and the historic Woodstock
festival. Indeed, over 50,000 people attended this combination festival of
folklore, craftsmanship and Ukrainian rock music in the name of freedom and
people fulfilling their dreams, hence the name Dreamland.
Folk craftsmen demonstrated the work of blacksmiths to all interested
visitors. In addition, they showed them how to use a potter's wheel, weave
puppets from straw and play on clay whistles. While practicing the newly
learned crafts, the guests could enjoy listening to folk songs performed by
Ukrainian, Russian, Georgian, Bulgarian, Uzbeki, Belarusian, Polish and
French bands on six stages spread across the field.
In addition to the several hundred senior folklore experts and craftsmen,
the festival gathered more than 50,000 people of different ages. The
inspirer of the Dreamland Festival and legendary lead singer of the VV rock
group Oleh Skrypka managed to break a common stereotype that folklore
festivals are rather boring events and turned the festival into an exciting
show.
Indeed, the festival gained the attention of recognized sponsors, all major
Ukrainian TV channels and even the personal attendance of President
Viktor Yushchenko.
Elderly and young guests surrounded a miniature stage featuring a kobza
player and listened to ancient kozak songs, while others took part in the
lighting up of the ritual bonfire near the ceremonial stage.
Meanwhile, some guests preferred singing and dancing in a ring to the
fiery Bulgarian melodies in front of the dance stage, on which a tireless
choreographer demonstrated his plasticity in a number of Balkan folk
dances.
The only drawback of the festival, though quite significant, was the lack
of portable toilets. The thousands of liters of beer that visitors bought at
tents set up on the territory of the festival forced them to became a little
"closer to nature", every now and then trying to find a secluded spot in
woods.
Despite this inconvenience and the amount of beer consumed, there were
almost no drunken people among the huge crowd of "vyshyvanky". All in
attendance left the festival quite satisfied after it closed with a
magnificent fireworks display. -30-
----------------------------------------------------------------------------------------------------
LINK: http://www.kyivweekly.com/english/article/?957
==============================================================
25. DRIVE TO FORM A NEW, STRONG, INDEPENDENT UKRAINIAN
ORTHODOX CHURCH GAINS SPEED
By Mara D. Bellaby, The Associated Press
Kiev, Ukraine, Friday, July 15, 2005
KIEV -- More than a thousand years ago, a Slavic prince ordered his
subjects into the Dnepr River, which slices through Kiev, to baptize them-
selves in his newly adopted faith.
Now the powerful Russian Orthodox Church that emerged from that
christening is losing control over its Ukrainian birthplace.
Having broken free of Russia's political grip in last year's Orange
Revolution, many Ukrainians are now turning their nationalistic impulses
toward religion and with tacit backing from their president, Viktor
Yushchenko, are seeking to create an independent Ukrainian church -- an
equal to Moscow, rather than a daughter.
For the Russian Orthodox Church, to lose this predominantly Orthodox nation
of 48 million would be a devastating blow, significantly shrinking the size
of its flock and its global clout. It could sever one of the oldest links
between the two neighboring countries, dealing another setback to the
Kremlin's efforts to maintain influence in the former Soviet republics.
"Russia understands and is fighting to keep the Ukrainian church. ... If it
loses the church, Moscow doesn't have any hope of ever returning Ukraine
into a revived Russian empire," said Patriarch Filaret, who heads the
breakaway Ukraine Orthodox Church's Kiev Patriarchate.
The split is already real, with two breakaway churches having set themselves
up since the end of Soviet rule. They are now talking about unifying, which
would create a strong new independent church, boasting nearly 4,700
parishes and 3,400 priests.
Although still smaller than the Ukrainian Orthodox Church Moscow
Patriarchate, as the Russian Orthodox Church is called here, its size could
nudge Patriarch Bartholomew, the spiritual leader of the world's 200 million
Orthodox, into recognizing the new church. That would be a significant stamp
of legitimacy that Filaret believes will prompt many priests and parishes to
switch sides.
Losing Ukraine would cost the Russian Orthodox Church not only followers,
but also valuable church property, including some of Russian orthodoxy's
most revered sites. The oldest and holiest monastery, the Pechersky Lavra,
remains under the control of the Moscow Patriarchate. But around a bend in
the Dnepr, the majestic Vydubytsky Monastery, which commemorates the
mass baptism ordered by Volodymyr in the year 988, is in the hands of the
breakaway church.
In Orthodox countries, national identity is often forged equally by the
state and the church, giving the clergy a powerful voice in society. That
clout has been growing since the fall of the Soviet Union and the end of a
communist creed hostile to religious freedom.
The Russian connection long predates communism, dating to 1654 when a
Ukrainian Cossack leader signed an alliance with Russia, which gradually
ushered in the Russian political, religious and cultural domination that
persists to this day. The Russian Orthodox Church promoted a message of
unity between the Ukrainian and Russian peoples.
Critics say this was done -- particularly during communist times -- at the
expense of Ukraine's own identity. The church is basically "an avant-garde
of Russian influence in Ukraine," said Ivan Dzyuba, a religion analyst with
Ukraine's National Academy of Science.
Ukraine renewed the push for its own independent Orthodox church shortly
after the Soviet Union dissolved in 1991. But the Russian church resisted,
sparking a division that eventually resulted in three separate Ukrainian
churches: the Moscow Patriarchate, the breakaway Kiev Patriarchate, and its
splinter, the Ukrainian Autonomous Orthodox Church.
The Moscow and Kiev churches are the two dominant ones, and differ little in
liturgical terms. It is not unheard of for Ukrainians to marry in one church
and baptize a child in another. Opinion polls suggest many Ukrainians
identify themselves simply as neither Moscow- nor Kiev-aligned, just
Orthodox. The choice is often more political than spiritual.
"Of course, our links with Russia are very strong. We are all Slavs, and
Russia has always been the most dominant Slavic country. But Ukraine has
detached itself, so why shouldn't our church also enjoy that independence?"
said Nina Venhar, 57, emerging from one of the cool, candlelit churches that
make up the Vydubytsky Monastery.
Ukraine's first post-Soviet president, Leonid Kravchuk, was a moderate
nationalist and backed the breakaway church. His successor, Leonid Kuchma,
whose support base was Russian-speaking eastern Ukraine, swung state
support back toward the Moscow Patriarchate church.
Yushchenko, winner of last year's tumultuous election, has said he will not
meddle in church affairs, but he has also emphasized that Ukrainians are
eager for an independent, united national church.
For Ukraine's new government, which has been using Cossack symbols to
strengthen Ukrainian identity, the need for an independent church is also
driven by political concerns. During last year's presidential campaign,
church leaders insisted that they were not meddling in politics, yet priests
and monks from the Moscow Patriarchate regularly marched through Kiev's
streets holding icons and crosses aloft in support of the Russian-backed
candidate, Viktor Yanukovych. And Filaret and clergy from his breakaway
church were often on stage blessing the crowds at the pro-Yushchenko
rallies.
The Moscow Patriarchate insists it too wants a Ukrainian Orthodox church as
"an equal sister in the family of Orthodox Churches, but we are going toward
this on a canonical path," its leader, Metropolitan Vladimir, said in a
written response to questions.
Russian Orthodox Patriarch Alexy II, however, has given no indication that
he would consider loosening his church's grip on Ukraine. The breakaway
churches hope to force his hand. The Kiev Patriarchate and Autonomous
Orthodox Church agreed in May to begin reunification talks.
It remains to be seen whether Ukraine has the appetite for a fight. The new
government came to power amid threats of a split between Ukraine's
pro-Russian industrial east and its more nationalistic west. Those passions,
while somewhat cooled, still exist, and Yushchenko has his hands full
fighting corruption and trying to win much-needed foreign investment.
Oles Doniy, head of Ukraine's Center for Research into Political Values,
cautioned against adding a religious battle to the mix. "Religious wars in
Europe took place several centuries ago, and it is hardly necessary to rouse
those spirits on the shores of the Dnepr." -30-
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