FREE GEOPOLITICAL NEWSLETTER

ukraine  

For current reports go to EASY FINDER

UKRAINE


 

 

Key Economic Data 
 
  2003 2002 2001 Ranking(2003)
GDP
Millions of US $ 49,537 41,380 37,600 55
         
GNI per capita
 US $ 970 770 720 137
Ranking is given out of 208 nations - (data from the World Bank)

Books on Ukraine




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.

Top

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. 

Top

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.

Top

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.

Top

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.

Top

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

Top

 

Back

 


 
Published by 
Newnations (a not-for-profit company)
PO Box 12 Monmouth 
United Kingdom NP25 3UW 
Fax: UK +44 (0)1600 890774
enquiries@newnations.com