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Books on Ukraine
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Update No: 312 - (20/12/06)
Ukraine's Yushchenko wants to unite Ukrainians all over the
world
Ukraine thought it had the opportunity to move out of the shadow of Russia at
last when it created the Orange Revolution in late 2004, under the leadership of
Viktor Yushchenko, the president of the country. But it has not done so yet.
Yushchchenko has been fighting bitter battles with his allies in the revolution,
notably Julia Timoshenko, his former premier and now head of the opposition
Timoshenko bloc. He has even gone so far as to accept the return to power of
Russophile Viktor Yakunovich as premier in mid-2006 rather than re-instate her.
He is a grim former Soviet heavy, who was also premier under the preceding
president, Leonid Kuchma, a notoriously brutal and corrupt former Soviet
apparatchik,
The present president is of a different stamp, the author of the Orange
Revolution in October, November and December 2004. He was actually briefly in
the KGB himself, but is not really a KGB type at all. He was a banker, who
steered the economy well as head of the Central Bank and as premier as it turned
the corner at the onset of the new millennium. He wants to reach out to new
partners beyond Russia.
He wants to mobilise the extensive Ukrainian Diaspora, two million alone in
Canada, and as much in the US and the EU. To do so in Ukraine's interests he
needs to have his own foreign minister. This has become a highly contentious
matter.
Ukraine's Yushchenko reinstates sacked foreign minister
On December 5th Yushchenko reinstated a sacked foreign minister back into
office - a move likely to spark yet another constitutional wrangle in the former
Soviet republic. Yushchenko by executive order returned to office political ally
Borys Tarasiuk, whom parliament had thrown out of the foreign minister job the
previous week.
The Ukrainian president, a supporter of closer relations with NATO and the
European Union, cited a Kiev court decision cancelling the parliamentary vote on
grounds that it was potentially unconstitutional. Ukraine's recently-amended
constitution reserves the right of hiring and firing foreign ministers to the
president.
Controlled by an anti-Yushchenko and pro-Russia majority, the parliament voted
against Tarasiuk's continuing in job on December 1, citing a worsening of
relations between Russia and Ukraine. MPs at the time argued the constitution
did not specifically forbid parliament from firing a foreign minister in case of
incompetence.
Tarasiuk ran afoul of parliament, according to most analysts, not for lack of
professional skill, but rather for his outspoken support of Ukrainian access to
NATO and the European Union, and a decidedly hostile attitude towards Ukraine's
giant northern neighbour, Russia.
The reinstatement of Tarasiuk by Yushchenko is certain to be embarrassing for
the country's Prime Minister Viktor Yanukovich, a powerful pro-Russia politician
recently in the US on a state visit.
The reappearance of Tarasiuk in the cabinet will undermine Yanukovich's
assertions in Washington that he, rather than Yushchenko, makes the decisions in
Ukrainian foreign policy.
Yanukovich and Yushchenko have been at open odds since late 2004, when the two
politicians found themselves on opposite sides of the barricades during
Ukraine's Orange Revolution. Yanukovich defeated Yushchenko in an October 2004
Presidential election badly marred by vote-rigging. The Supreme Court eventually
cancelled the result in the wake of massive street protests against election
fraud.
Conflict between the pro-Europe wing of Ukrainian politics led by Yushchenko,
and the pro-Russia wing led by Yanukovich, has paralysed much of Ukrainian
government for months.
Russian Navy to Stay in Ukraine Till 2017 - President Yushchenko
Yushchenko, nevertheless, wants to mollify the Russians as much as possible.
According to the official statement of the president, the Russian Black Sea
Fleet will stay in the Crimea until 2017, the Interfax news agency reported
December 14th.
Speaking at a press conference for the Ukrainian media in Kiev on Thursday,
Yushchenko said Ukraine's position should lie within the legal framework. Under
a 1997 agreement that divided the Soviet Union's Black Sea fleet between Russia
and Ukraine, the Russian navy was allowed to remain in Sevastopol until 2017,
paying an annual rent of US$93 million, a not inconsiderable sum, which is
really a free present to the Ukrainian nation, since the presence of the Russian
fleet in the Crimea is pointless.
"The agreements signed prompted Ukraine to take on the political
commitments to preserve the presence of the fleet until 2017," Yushchenko
said. Any political gambling on this issue will only harm both Ukrainian and
Russian interests, he added.
The date has a resonance of its own. It will be the centenary of the Bolshevik
Revolution. Who would have thought in 1917 what the intervening century was to
bring?
******
The following shows the bitterness of the post-revolutionary power struggle
going on in Ukraine:-
Khoroshkovskiy returns to politics
by Oksana Bondarchuk,
President Viktor Yushchenko, whose powers have been relentlessly snatched up by
his political nemesis Viktor Yanukovych since the latter came to power last
summer, appears to be building up an executive counterweight in the country's
hitherto defunct National Security and Defence Council [NSDC]. Rather than
relying on members of his largely discredited Orange team, which accompanied his
rise to the presidency to the approval of the West and western Ukraine,
Yushchenko is enlisting help from influential businessmen with solid connections
to Russia and the country's Russian-speaking east.
In a presidential decree dated Dec. 11, Yushchenko appointed Ukrainian Valeriy
Khoroshkovskiy, who is best known for his close ties to Russian steel baron
Aleksandr Abramov of Evraz Group and major Ukrainian television station Inter,
first deputy secretary of the NSDC.
Khoroshkovskiy could use these ties, together with his significant experience in
government, to bolster Yushchenko's eastern front and possibly to improve his
coverage in media.
Khoroshkovskiy once served as deputy head of former President Leonid Kuchma's
powerful presidential administration and, between 2002 and 2004, as the
country's minister of economy and European integration in the first Yanukovych
government.
Unlike many of Ukraine's politicians, Khoroshkovskiy, only 38, survived the
experience politically unscathed, having quit his Cabinet position over a policy
dispute with a top Yanukovych ally. Khoroshkovskiy left in protest to plans for
joining an economic union with former Soviet states which he viewed as a risk to
Kiev 's western integration aspirations.
Yanukovych, whose fraud-marred bid for the presidency in 2004 was supported by
the Kremlin, managed a political revival after last March's parliamentary
elections, during which his Regions party soundly defeated Yushchenko's tattered
Our Ukraine bloc.
Since then, the president has been steadily losing public approval and, more
importantly executive power, largely on account of controversial constitutional
reforms that had been foisted on him during a turning point in the 2004 Orange
Revolution.
While still trying to get the reforms overturned, Yushchenko looks to be
balancing his team of supporters with businessmen who know how to deal with
Moscow and can counterbalance Yanukovych's Regions party, which is backed by big
business interests from Donetsk oblast.
In addition to having recently held the post of CEO of Evraz, Russia's number
two steelmaker, Khoroshkovskiy has several business interests in Ukraine, in
addition to the controlling share in Inter.
Ukrainian political analysts see Khoroshkovskiy's appointment as deputy security
supremo, a body whose authority is wide open to interpretation, as a chance for
the president to level the playing field with Yanukovych, who has challenged
Yushchenko at home and abroad. "He [Khoroshkovskiy] represents one more
opportunity to establish contacts with Russian businessmen and
politicians," Yuliya Tyshchenko, an expert of the Independent Centre of
Political Research, said.
Despite having served under Kuchma, whose last years in office were stained by
international and domestic scandals, Khoroshkovskiy is too young to be
associated with those days, Tyshchenko said. He belongs to the same generation
of politicians as the deputy head of Yushchenko's Secretariat, Arseniy Yatsenyuk,
and thus is viewed more positively.
Others see Khoroshkovskiy's main attractiveness in his Russian connections.
"The president is trying to form his own parallel line of contacts with
Russia's business and political elite. And Khoroshkovskiy is needed here,"
according to Yuriy Yakymenko, a political expert at Ukraine's Razumkov Centre.
Another eastern savvy businessman recently appointed by Yushchenko to build up
the NSDC is Vitaliy Hayduk, appointed as its head on Oct. 10.Hayduk, 49, is one
of the founders of the Industrial Union of Donbass, a powerful Ukrainian
industrial group that rivals System Capital Management (SCM), largely accepted
as the money bag for Yanukovych's Regions Party.
Like Yanukovych and SCM owner Rinat Akhmetov, Hayduk has roots in Donetsk,
having served as the deputy chairman of the Regional Council and then first
deputy governor of the eastern region. Like Khoroshkovskiy, he briefly served
under Yanukovych, a former governor of Donetsk. Also like his current deputy,
Hayduk left a Cabinet position on a position of principle.
The Donetsk industrialist quit his job under Yanukovych in protest to the
government's decision to reverse the flow of oil through Ukraine's Odessa-Brody
pipeline in favour of Moscow, which wanted to block attempts by Ukraine to use
the pipeline to pump Caspian oil around Russia to Europe.
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BANKING
Austrian, Greek banks plan for major Ukraine investment
Two leading Central European banks - one Austrian and one Greek - announced on
December 5th plans for major expansions into the Ukrainian market. The news came
one day after Ukrainian President, Viktor Yushchenko, signed laws allowing for
foreign banks to operate branch offices for the first time in the former Soviet
republic.
Austria's Erste Bank AG will open up to 400 branch offices in Ukraine in a net
investment worth US$397 million, Interfax News Agency reported.
Greece's Alpha Bank intends to open 100-150 branch offices, but the cash value
of that investment has not been announced, according to an Ekonomicheskie
Izvestia magazine report.
The move by Erste Bank, Austria's second-largest, into the Ukrainian market will
build a nationwide network of 400 branch offices over three years in cooperation
with Ukraine's Prestizh bank, in which Erste holds a controlling stake. Aside
from Erste, other Prestizh shareholders will assist in the expansion programme
to the tune of US$153 million over four years, according to the Interfax report.
The project, if completed, would be one of the largest Ukrainian bank expansions
in a decade. Erste Bank bought a controlling 50.5 percent stake in Prestizh
earlier this year. Prior to the Erste Bank takeover, Prestizh was a mid-level
player in Ukraine's banking market, rated 72nd out of 164 banks operating in the
country.
Athens-headquartered Alpha Bank, Greece's second-largest, will, by contrast,
finance its expansion into Ukraine without a Ukrainian partner. The 100 to 150
office expansion programme will begin immediately, and end in 2008, Izvestia
cited Alpha Chairman Jannis Kostopoulos as saying.
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ENERGY
Tengizchevroil to export oil through Ukraine
The joint venture Tengizchevroil, which is developing the Tengiz field in Atyrau
region, plans to export oil through a Ukrainian terminal on the Black Sea,
Tengizchevroil spokesman, Antonio Palmeirim, said, Interfax News Agency
reported.
He said that at the moment Tengizchevroil exports all the oil it produces
through the Caspian Pipeline Consortium (CPC) pipeline. The joint venture is
also implementing projects to pump natural gas back underground and to build a
Second Generation Plant (SGP).
"Growth in oil production after the launch of the projects will be achieved
before the capacity of the pipeline will be increased, and as a result it will
be necessary to look for alternative routes," Palmeirim said. He said that
the aim of the oil export project, which will also involve expanding the
capacity of the rail terminal in Tengiz, is to ensure the export of additional
volumes of oil that will be produced after the gas-injection and plant projects
are implemented.
As part of the project Tengizchevroil plans to export oil to the north and to
the south. Palmeirim said that oil being transported along the northern route
oil would be transported to a Ukrainian terminal on the Black Sea.
Along the southern route, Tengiz oil is to be transported from Kazakstan through
the port of Aktau on the Caspian to Baku, and onwards through the Georgian port
of Batumi on the Black Sea coast for subsequent export to international markets.
The southern route will also give Tengizchevroil access to the
Baku-Tbilisi-Ceyhan pipeline.
Palmeirim did not say what volume of oil would be transported along these
routes, as this information should not be disclosed - according to the terms of
the contracts.
Palmeirim said that as a result of these projects Kazakstan would significantly
increase oil exports to international markets. Additional benefits to be
received by the republic include the expansion and modernization of the national
rail system, the development of the national marine fleet for the transportation
of crude oil, the introduction of tougher labour and environmental safety
standards in connection with the transportation of oil through the Caspian, and
the receipt of revenue from oil transportation along these new routes, he said.
Construction of the gas-injection and Second Generation Plant projects started
in July 2003. The projects were developed to increase oil production by more
than seven million tonnes of crude per year (160,000 barrels per day) at the
Tengiz and Korolevskoye fields, which are being developed by Tengizchevroil.
This year Tengizchevroil plans to produce the same amount of oil and gas as last
year - 13.6 million tonnes of oil and 3.4 billion cubic metres of associated
gas, compared with 13.6 million tonnes of oil and 4.7 billion cubic metres of
gas in 2004. Tengizchevroil started oil production activities in Tengiz back in
1994 based on the agreement signed between Chevron and Kazakhstan in 1993.
The joint venture is currently owned by ChevronTexaco Overseas (50 per cent),
ExxonMobil Kazakhstan Ventures Inc. (25 per cent), Kazakstan through the
national company KazMunaiGaz (20 per cent) and Russian-American JV LUKArco (5
per cent).
Kiev, Moscow agree to increase oil transit
Ukraine's Ukrtransnafta and Russia's Transneft have agreed to increase oil
transit through Ukraine in 2007, the Ukrainian Fuel and Energy Ministry's press
service said. "Following two months of negotiations with Transneft it has
been decided to significantly increase the volume of oil transit, particularly
through the Brody-Odesa route and the Druzhba pipeline," the statement
quoted Ukrtransnafta CEO, Ihor Kiryushin, as saying after a meeting with
Transneft President, Semyon Vainshtok, in Moscow on November 23rd, New Europe
reported.
Ukrainian Fuel and Energy Minister Yury Boiko, who also took part in the
meeting, said that the agreements reached will play a part in long-term
partnership and will benefit the economies of both countries. The sides agreed
to increase oil transit along the Brody-Odessa route by five million tonnes per
year. "We currently transport 3.7 million tonnes through the Odessa-Brody
pipeline," the Ukrtransnafta chief said.
Ukraine intends to transit Caspian oil to Europe
Ukrainian President, Viktor Yushchenko, said his country can start to transit
Caspian and Azerbaijan oil to Europe in 2010, inasmuch as the European Union
intends to reduce dependence on deliveries of energy resources from Russia,
according to news agency Bloomberg.
Ukraine expects to carry out oil transit in volume of seven million tonnes per
year to Europe. "It is the major achievement. Ukraine is interested in this
project realisation as soon as possible," Yushchenko said.
Kazakstan had signed an agreement with the European Union of cooperation on gas
and oil supplies.
Ukrainian Prime Minister of Ukraine Viktor Yanukovich during his visit to
Kazakstan is expected to discuss Astana's participation in supplying with oil a
pipeline from Odessa to Brody and a possible extension to Plock in Poland.
Volodymyr Fesenko, political scientist and president of the centre of applied
political researches "Penta," told Forum that last month the issue of
Odessa-Brody was discussed twice. "This project has been renewed (it is
suggested its construction is in west-north direction to Poland). It is provided
for transit of Central Asia and Kazaks oil to Europe. This issue was discussed
during the visit of the Polish prime minister to Ukraine and during Yanukovich's
visit to the USA and is going to be discussed in Kazakstan," Fesenko said.
The Ukrainian government has reactivated international interest in using the
Odessa-Brody oil pipeline in the originally intended northerly direction, which
involves extending the pipeline into Poland to Plock and on to Gdansk. Initially
designed for transporting Caspian oil to Europe, the Odessa-Brody pipeline has
instead been used "in reverse mode" since 2004 for transporting
Russian oil southward to the Mediterranean basin.
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FOREIGN RELATIONS
Warsaw, Kiev to boost relations
Ukrainian President, Viktor Yushchenko, has discussed pressing issues of
bilateral cooperation and the expansion of dialogue on European and
Euro-Atlantic integration with Poland's Prime Minister, Jaroslaw Kaczynski, as a
part of his official visit to Kiev, the Ukrainian presidential press service
said, New Europe reported.
The parties stated at the meeting that the Ukrainian-Polish strategic
partnership was a crucial element that strengthens the position of the two
countries in solving pressing issues of pan-European scale.
Economic relations should be taken to a qualitatively new level, Yushchenko
said, adding that a meeting of the intergovernmental economic cooperation
commission that took place in the run-up to the visit, on November 13-14th,
allowed for considerably improving bilateral trade indicators and for moving
closer to the implementation of certain joint projects. It was also noted at the
meeting that energy was a promising area of cooperation, including in the
pan-European format.
Poland's prime minister backed Ukraine's aspirations to join Europe and stated
his readiness to assist in the fastest possible beginning of official talks on
the signing of a new Ukraine-EU agreement.
Yushchenko told an international media forum in Kiev on November 15th, that
Ukraine is determined to continue its European integration efforts and be a
leader in its region. "We'll continue our efforts to become integrated with
the European Union and NATO, and we must launch large-scale programmes to join
the socio-cultural European space," he said.
Ukraine must be open not only for economic, but also for cultural and
information investment from Europe, he said. "Dialogue with the United
States and with our key European partners - from London to Warsaw - is of
crucial importance," Yushchenko said.
Ukraine will pursue an active regional policy in the post-Soviet area,
Yushchenko said, noting that Ukraine is in second place after Russia in terms of
economic and scientific-technical potential, size and population, "and will
pursue a policy of intensive activity and leadership (in the region.)."
"This involves multilateral regional cooperation initiatives, further
dialogue of trust in Central and Eastern Europe, and more efforts to promote
democratic reform in the area between the Baltic, Black and Caspian seas,"
the Ukrainian president said.
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FOREIGN LOANS
EBRD loans US$258 million for trans-Europe highway
The European Bank for Reconstruction and Development (EBRD) loaned the Ukrainian
government US$258 million on November 22 for work on a trans-European highway,
New Europe reported.
The money will go towards improving a dilapidated surface connecting the
Ukrainian capital Kiev with the town Chop, on Ukraine's western Hungarian
border. The modernised highway would connect Ukraine with the European road
system and so help link Ukraine's economy with Europe's, according to a Ukraine
Cabinet of Ministers statement.
The money is being offered at a 3.5 per cent annual rate over a 15-year period -
terms roughly four times better than commercial loans currently available in
Ukraine's overheating economy. The EBRD already has advanced Ukraine the
equivalent of US$200 million for the project. Ukraine's government has invested
some US$70 million. A completion date has not been announced.
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TECHNOLOGY
Yushchenko wants Ukrtelecom to be privatised
Ukrainian President Viktor Yushchenko wants the national telecommunications
operator Ukrtelecom to be privatised. "No time should be wasted. If anyone
decides to sell Ukrtelecom in a couple of years, there will be nothing left to
sell," Yushchenko told businessmen in Kiev on November 27th, New Europe
reported.
Ukrtelecom's charter capital is 4.682 billion hryvnias. Each share has a par
value of 0.25 hryvnias. The state owns a 92.86 per cent stake. The other 7.14
per cent was sold at a discount to company employees in a closed subscription.
Ukrtelecom's further privatisation was suspended in the middle of 2005
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