Wednesday, December 31, 2008

Ukraine Will Pay Its $2 Billion Russian Gas Bill

MOSCOW, Russia -- In what is becoming an unpleasant New Year tradition, Russia again threatened to cut off Ukraine's gas supplies if the struggling post-Soviet state failed to pay off at least $2 billion in arrears by Dec. 31.

A worker at a gas compressor station in Boyarka, Ukraine, checks a pressure gauge. Europe depends on Russia for some 40 percent of its natural gas consumption, most of which flows through Ukraine pipelines.

By Tuesday evening, Ukraine appeared to have averted a cutoff by borrowing money from the country's two biggest state banks. A spokesman from Russia's state gas monopoly, Gazprom, said that no money has been received yet.

Even if the immediate crisis is resolved, the underlying tensions between Russia and Ukraine remain – and could result in another standoff later.

Ukraine is floundering amid financial paralysis and is racked by political conflict between President Viktor Yushchenko and Prime Minister Yulia Tymoshenko. Europeans are watching developments closely, worried that any extended cutoff of the main energy artery between Russia and the West could leave them facing serious disruptions this winter.

Europe depends on Russia for some 40 percent of its natural-gas consumption, and most of that arrives via a Soviet-era pipeline through Ukraine.

Gazprom, itself requesting a government bailout, insists that the Ukraine dispute is purely commercial, and has appealed to Europeans for "understanding." Some Ukrainians, however, claim there is a political subtext to Russia's demands and warn that the Kremlin's real target is their government's aspirations to join NATO and draw Ukraine closer to the European Union.

"The Kremlin is showing that we can be rewarded for good geopolitical choices, and punished for bad ones," says Alexei Kolomiyets, president of the independent Institute of Euro-Atlantic Integration in Ukraine's capital, Kiev. "Energy supplies are the main instrument of pressure upon us, and we are left with very few options. It's quite possible that there can be interruptions in the gas supply to Europe in coming weeks."

Mr. Kolomiyets points to Belarus, a Russian ally granted a significant price cut this week on its already subsidized rates for Russian gas, as an example of how some are rewarded for making the "right" choices. "We hear that the Belarussian Parliament will recognize the [Russian-sponsored] republics of South Ossetia and Abkhazia in Georgia," in return for being given a favorable gas deal, he says. "This is an obvious object lesson for others."

But Russian experts allege it's Ukraine that's complicating the issue, by pursuing anti-Moscow policies while enjoying subsidized Russian gas. "Russia doesn't want to influence Ukrainian politics," Kremlin-connected analyst Gleb Pavlovsky told the independent Interfax news agency Monday. "The Russian position is simple: Get the money, step back, and leave Ukraine to its own devices."

Prices for Russian gas spiked this year to some $500 per thousand cubic meters, although Ukraine, which depends on Russia for 75 percent of its gas, has until now paid less than half the European price. Russia's point of view is that Ukraine needs to clear its arrears and begin paying market rates. The Kremlin says Ukraine, which received an emergency $16.5 billion loan from the International Monetary Fund this fall, ought to be able to cover its debt to Moscow.

"The problem is aggravated this year by several factors," says Konstantin Zatullin, deputy chair of the State Duma's commission on the Commonwealth of Independent States. "First, Ukraine really lacks the means to pay. Second, the Ukrainian political system is on the verge of collapse. And the Ukrainians seem to be in no mood to hold constructive talks on ways to resolve the problem."

In the short term, Russia has few alternatives. If Gazprom attempts to halt Ukraine's gas supplies, it faces the likelihood that Ukraine's state energy firm Naftogaz will start siphoning gas from the pipeline as soon as its stored [and unpaid-for] reserves of Russian gas run out, which could happen as early as mid-January. When this occurred in previous years, the shortfall was passed on to downstream European customers. Another option being discussed in Moscow is a total halt in gas supplies through the line, which would punish Ukraine but face Europe with crippling shortages.

"Gazprom has attempted to explain things to the Europeans, and to seek their understanding, but these efforts haven't been very successful so far," says Valery Nesterov, an energy expert with Troika Dialog, a Moscow investment bank. "Europe is egoistic. They're interested in receiving stable deliveries of gas, and if they don't they'll blame the supplier. This is Russia's dilemma."

In the longer perspective, Russia is sponsoring two new pipelines to Europe that will bypass potential problem countries such as Ukraine, Poland, and the ex-Soviet Baltic states. Nord Stream, an undersea Baltic route promoted by both Russia and Germany, is due to open in 2011. South Stream, under the Black Sea, will eventually deliver Russian gas directly to southern Europe.

Moscow may also hope that a new OPEC-style natural gas cartel, launched at a forum of gas-exporting countries in Moscow last week, will be able to decouple the price of gas from that of crude oil, which has plunged by two-thirds in recent months.

Since most gas supplies are delivered via expensive dedicated infrastructure and under long-term contracts, it's uncertain how effective the group, which includes Iran, Qatar, Libya, and Venezuela, might be in any short-term efforts to control the market.

But Russian Prime Minister Vladimir Putin made Russia's intentions clear.

"The expenses necessary for developing fields are rising sharply," he told the forum. "This means that despite the current problems in finances, the era of cheap energy resources, of cheap gas, is of course coming to an end."

Source: Christian Science Monitor

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Tuesday, December 30, 2008

Ukraine, Russia Still At Odds In Gas Standoff: Putin

MOSCOW, Russia -- Prime Minister Vladimir Putin said Monday that Russia and Ukraine had failed to break the deadlock in their dispute over gas debts, as the clock ticked down to a New Year deadline to settle the dispute.

Russian Prime Minister Vladimir Putin.

"We have not agreed so far," Putin said Monday, after what he said was an hour-long telephone conversation with Ukrainian President Viktor Yushchenko.

Asked why the two sides had still failed to reach an agreement, Putin replied succinctly: "Because they (Ukraine) do not want to pay."

Putin's comments came as Russia ramps up pressure on Ukraine to pay off two billion dollars in gas debts in full or face a cut in gas supplies from January 1.

Moscow and Kiev are locked in a price dispute, the fourth in as many years, and Gazprom has said it will cut supplies to Ukraine if it does not pay off its gas debt in full by January 1 so a new contract can be signed.

Also Monday, the CEO of Russian energy giant Gazprom Alexei Miller and the head of Ukraine state gas company Naftogaz Oleh Dubyna were meeting in Moscow but the meeting has not yielded any result so far, a Gazprom spokeswoman said.

"Unfortunately, nothing is happening so far," she told AFP. "Everything changes every hour."

Gazprom deputy CEO Alexander Medvedev expressed hope in a televised interview that the countries would find a solution within the next three days.

"We very much hope that the proposals that we are tirelessly putting forward will be accepted by the Ukrainian side, which will allow us to enter the new year with the signed contracts and reassure the people in Europe, in Russia and Ukraine," he told Vesti television channel.

Medvedev reiterated that Gazprom had taken steps to keep its European partners informed of progress in the gas dispute.

The company has even launched an English-language website, www.gazpromukrainefacts.com to give its side of the dispute.

Earlier Monday, Gazprom's board of directors met for an extraordinary meeting, the sole item on the agenda being the situation concerning the Ukrainian gas debts, the spokeswoman said.

Gazprom said in a statement the board meeting had agreed to "continue work" with Ukraine over payment arrears but did not elaborate.

The statement added that Gazprom would carry out its obligations towards the European gas consumers "in full", indicating any possible gas cuts would not disrupt supplies to Europe.

The Gazprom spokeswoman said company specialists were being told to be at work over the New Year's night if the company management decided to cut gas to Ukraine.

The Russian gas giant maintains that Naftogaz owes it more than two billion dollars for gas delivered in November and December and fines for late payment.

Source: AFP

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Monday, December 29, 2008

Clock Ticks Down To New Russia-Ukraine Gas Conflict

MOSCOW, Russia -- Time is running out for Russia and Ukraine to reach a last minute deal by midnight at New Year to prevent a Russian cut of gas deliveries to its neighbour and a possible bitter diplomatic conflict.

The newly built Bobrovnytska gas compressor and holding station is pictured near Kiev.

Instead of awaiting the traditional champagne toasts for New Year, Russian and Ukrainian gas executives have cancelled their holiday plans as the sides try to strike a deal over Kiev's two billion dollars of unpaid gas debts.

Russian energy giant Gazprom has warned it will cut off supplies to Ukraine if the debt is not settled, saying that a new contract needs to be signed by January 1 and no deal can be inked without the money being paid.

Gazprom's board of directors, which is chaired by Russian Deputy Prime Minister Viktor Zubkov, is to hold an extraordinary meeting on Monday to discuss the situation.

"I think it's 50-50," Gazprom spokesman Sergei Kupriyanov said in an radio interview Saturday when asked if Russia would cut gas deliveries or if the two sides would clinch a last minute deal.

A cut in deliveries could even hit west European consumers, who receive Russian gas that transits across Ukraine and were affected by a similar conflict in January 2006.

Such a move would intensify tensions between Moscow and Ukraine's pro-Western government already inflamed by Ukrainian support for Georgia in its August war with Russia.

Russia found the sight of Ukrainian President Viktor Yushchenko visiting Tbilisi to give his support during the war hard to swallow and the gas standoff is the consequence, said Russian analyst Alexei Malashenko.

"Putting pressure on Ukraine over gas has become an obsession of Russian politicians," said Malashenko of the Carnegie Centre in Moscow.

According to Kupriyanov, the Ukrainian side has already made clear it cannot pay the debts comprising 805 million dollars for November, 862 million dollars for December and 450 million dollars in penalties for late payment.

He said the two sides would use the last days to find a non-monetary solution to the conflict, possibly involving the money that Russia pays for the transit of gas across Ukraine.

"I hope that in the remaining days we will succeed in doing this," said Kupriyanov.

In a stark warning, Russian President Dmitry Medvedev told Ukraine's government last week to pay up to the "last ruble" or face gas cuts or even sanctions against its wider economy.

"If Ukraine does not pay we will use a whole arsenal of possibilities and it is completely clear that there can be no illusions there," Medvedev said in an interview with Russian television.

"We cannot carry on like this. They should just pay up."

The negotiations are further complicated by Gazprom's desire to raise prices for Ukraine closer to those paid by western European customers.

Ukraine currently pays Russia 179.5 dollars for 1,000 cubic metres of gas but Gazprom has warned that price could rise to 400 dollars for 1,000 cubic metres from next year.

Gazprom has vowed to fulfil its obligations to Europe but has also warned it cannot rule out disruptions to west European supplies if Ukraine siphons off transit gas during a crisis.

"Russia is carrying out a psychological war to force Ukraine to sign the contract under its conditions," said Ukrainian political analyst Volodymyr Fesenko.

"Gazprom could make European consumers suffer from the crisis so that Europe puts pressure on Ukraine," he added.

Ukraine, which has tense relations with Moscow, is expected by analysts to plunge into recession next year as a result of the economic crisis and suffers from political turmoil amid a feud between its president and prime minister.

Source: AFP

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U.S. - Ukraine Charter

WASHINGTON, DC -- The United States and Ukraine have signed a charter on strategic partnership and security. "We have long believed," said U.S. Secretary of State Condoleezza Rice, "that Ukraine's independence, its democracy, is essential to a Europe whole and free and at peace."

U.S. Secretary of State Condoleezza Rice.

To that end, the charter outlines enhanced cooperation in the areas of defense, security, economics and trade, energy security, democracy, and cultural exchanges.

Ukraine has shown a commitment to international security and peacekeeping. It is the only non-NATO country participating in all NATO operations. The NATO summit declaration in Bucharest affirmed that Ukraine will become a member of NATO when it meets certain requirements.

"The United States," said Secretary Rice, "supports Ukraine's integration into the Euro-Atlantic structures." The Charter expresses the United States' continued commitment to help Ukraine meet the requirements for NATO membership. The United States plans to help Ukraine increase its interoperability with NATO forces, including via training and equipment for Ukrainian armed forces.

The U.S. and Ukraine intend to expand economic growth through reform and liberalization, developing a business climate that supports trade and investment. It is also critical to improve market access for goods and services. The U.S. will help Ukraine in efforts to protect intellectual property and investor rights.

Recognizing the importance of an efficient energy sector, the U.S. plans to work with Ukraine to rehabilitate and modernize the capacity of Ukraine's gas transit infrastructure and secure Ukraine's sources of nuclear fuel.

Under the Charter on Strategic Partnership, the U.S. plans to help Ukraine increase the professionalism, transparency, and independence of its judiciary. Both countries will address common criminal threats including terrorism, organized crime, and trafficking in persons.

In an effort to further promote democratic values, the United States and Ukraine intend to encourage cultural and social exchanges through initiatives including the Fulbright program and Future Leaders Exchange Program.

The U.S.-Ukraine Charter on Strategic Partnership lays the foundation for Ukraine's long-term democratic development and security needs.

Source: Voice of America

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Sunday, December 28, 2008

Gazprom Says Ukraine Has Non-Cash Options To Pay

MOSCOW, Russia -- Crisis-stricken Ukraine may count its $2 billion debt for Russian gas deliveries against future fees for Russian gas transit to European customers, a Gazprom spokesman said on Saturday.

Sergei Kupriyanov

Russia and Ukraine are locked in a gas dispute, the fourth in four years, and Kupriyanov said there was a 50 percent chance Moscow could cut supplies to Kiev from next year if Ukraine does not pay the debt.

“We are looking for ways to do it (avoid a supply cut), including prepayment for transit,” Gazprom spokesman Sergei Kupriyanov told Echo Moskvy radio station. “I hope we will be able to do it (negotiate a settlement) in the remaining days.”

Ukraine previously declined to accept the proposal. Ukraine currently pays $1.7 to transit 1,000 cubic metres for 100 kilometres.

Kupriyanov said another option for Ukraine to pay its debt would be to hand back gas it had stockpiled in underground gas storages to help it live through the winter in the event Gazprom turns off the gas taps.

Ukraine’s state firm Naftogaz says it has 17 billion cubic metres in storage, 22 percent of Ukraine’s annual consumption.

Ukraine has been forced to accept International Monetary Fund assistance as the global financial crisis bites.

Kupriyanov’s suggestion marked some softening of the line expressed by President Dmitry Medvedev, who chaired Gazprom’s board during previous disputes. Medvedev said Ukraine should pay the debt “to the last rouble” and threatened it with sanctions.

European countries are watching the dispute nervously. A previous dispute in 2006 briefly disrupted Russian gas supplies to the entire continent in the middle of winter, when Ukraine suspended transit to Europe, sending up spot gas prices.

Gazprom’s Chief Executive Officer Alexei Miller wrote a letter to the firm’s European customers warning them of possible supply disruptions because of the debt row.

Kupriyanov declined to reveal any details of the negotiations or say how much Gazprom wants Ukraine to pay for gas from next year but said the price will be higher than $179.5 per 1,000 cubic metres Ukraine is paying now.

Kupriyanov said Gazprom is ready to dump an intermediary firm RosUkrEnergo and move over to direct supplies once the debt is fully paid.

Moscow and Kiev are trading accusations daily in the latest gas clash. Both countries feel the dire effects of the global financial crisis on their markets and economies and continue to argue over the size of the debt and payment deadlines.

Kupriyanov said Gazprom, which employs 400,000 people plans no major job cuts next year because of the crisis and added that its $32.5 billion investment will help create new jobs.

Source: Khaleej Times

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Top 10 Uncovered Bribes By Law Enforcement

KIEV, Ukraine -- In 2008, more Ukrainian officials than ever got their fingers caught in the cookie jar. This year went down as a record-breaking year in the annals of bribes uncovered by law enforcement.

Mykola Konev, seen here handcuffed and flanked by special Internal Ministry forces at Kyiv's Pechersk District Court, allegedly accepted a $5.2 million bribe.

Given Ukraine’s reputation for corruption, one has to wonder how many bribes escaped the short arm of the law here. Some 1,500 public servants took bribes in 2008, totaling Hr 91.1 million, the Ministry of Interior Affairs announced on Dec. 19, almost triple last year’s totals. These are the top 10 bribes we found, mostly in the public service and real estate sectors:

(1) - Law enforcement officials said they uncovered the all-time whopper – a $42 million bribe. The corruption bust came earlier in December when Mykola Didenko, a district council chairman in the Kyiv Oblast city of Brovary, along with two subordinates, were allegedly caught taking Hr 11 million “up-front” money from foreign investors wishing to build cottages on two plots of land totaling 76 hectares in a deal worth $42 million. At a news conference, Interior Affairs Minister Yuriy Lutsenko said that people along “[President Victor] Yushchenko’s vertical chain of command ‘covered’ for Didenko.” Yushchenko dismissed the Brovary official in February 2008 amid a land scandal, which critics said involved hundreds of hectares of land distribution worth $2 billion. Nevertheless, Didenko was reinstated as Brovary district chair in March 2008. News reports have speculated that Victor Baloha, head of the presidential secretariat, stands behind Didenko.

(2) - The second on the list allegedly took place outside of Alushta in Crimea, where a township council member, Mykola Konev, elicited a $5.2 million bribe in return for leasing 17 hectares of land in the first half of 2008. “The overall sum of bribes is increasing dramatically,” said Leonid Skalozub, head of the economic crime unit of the Ministry of Interior Affairs, during a news conference in June.

(3) - The next million-dollar land deal labeled as corrupt came in Kyiv Oblast’s Novi Petrivtsiv where Oleksiy Yankovskiy, the village council chair, was suspected of demanding $1.3 million for allocating land.

(4) - More land deals made the news when Dnipropetrovsk City Council Chair Ivan Kulichenko and his aide allegedly were caught with $600,000 payoff in a land deal.

(5) - Many bribes ranged from $20,000 to $200,000. For example, a district council chair in Cherkasy Oblast was nabbed for accepting $200,000 in exchange for doling out 2.6 hectares for development.

(6) - A village council chair in Bakhchysarai district of Crimea was nabbed for accepting a $140,000 bribe in order to allocate two hectares of land in a recreational zone.

(7) - The Security Service of Ukraine detained a Ministry of Interior police officer early in December while taking a $120,000 bribe for unspecified reasons. Subsequently, the Pechersk District Court of Kyiv dropped the case but prosecutors have appealed the case on grounds that the ruling was unlawful.

(8) - In another case that further undermined respect for the country’s corrupt judicial system came when the former Lviv Appellate Court judge, Ihor Zvarych, was allegedly caught red-handed accepting a $100,000 bribe in the ex-governor's office early in December 2008. A search of his house later found large sums of hryvnia and more than $1 million in cash, which Zvarych explained as a "hourse warming." Zvarych was later released on bail and went missing on Dec. 12.

(9) - Fraud is common in the banking system, especially in credit unions where loans were issued by employees to people who never repaid the money they borrowed. This particular incident is exemplary: A young loan officer issued nine loans ranging from Hr 20 to Hr 100,000 and received more than $20,000 for her “services.”

(10) - To further diversify the scope of bribes, the director of the Department of Spirits, Alcoholic Drinks and Tobacco Goods at the State Tax Service was detained in August for taking $20,000 in return for issuing a license for the sale of alcoholic beverages to a private entrepreneur.

Source: Kyiv Post

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Saturday, December 27, 2008

German Expert Alexander Rahr: Ukraine Might Steal Gas Bound For Europe

MOSCOW, Russia -- There is a risk that, if Kyiv and Moscow do not settle their dispute over Ukraine's debt for natural gas imported from Russia by the end of 2008, Ukraine might start siphoning off gas from the transit pipeline running further to Western Europe, said Alexander Rahr, the Russia/Eurasia program director at the German Council on Foreign Relations (DGAP).

Alexander Rahr

"There are concerns that, while it is unclear who actually controls the transit pipeline in Ukraine, some forces there could illegally siphon off transit gas for domestic needs. Such a risk does exist," Rahr told Interfax.

"Ukraine should understand what political risks it could face if gas supplies to Europe stop," Rahr said.

"If it resorts to this, then, in addition to harming Russia, it will also harm itself and its image as a reliable country transiting Russian energy to the West," he said.

As regards Europe's attitude toward the gas dispute between Russia and Ukraine, "Europe is very egoistic in this respect," he said.

"Europe believes that what matters above all is to receive its gas, and it is not inclined to look into the essence of this conflict to see whether Ukraine steals the gas, who is to blame, and why Russia cuts off gas supplies to Ukraine. Europe is demanding what it is entitled to, and if it doesn't get it, it would always begin to blame the one from whom it expects to receive gas, namely Russia, without getting into the situation, for which Ukraine is actually responsible," he said.

Some political forces in Ukraine could make use of certain political nuances to destabilize the situation, he said.

"For the sake of promoting Ukraine's integration into NATO and the European Union, some Ukrainian forces would manipulate this situation, steal transit gas, and accuse Russia of the lack of gas supplies to Europe in order to artificially unleash a conflict," he said.

"This is how Ukraine is acting these days, and this is how the Baltic states are acting," he said.

"This is a silent war that Eastern European countries are now waging against Russia," he said.

Source: Interfax

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Top Events Of 2008

KIEV, Ukraine -- In 2008, yellow currency boards agitated Ukrainians the way waving flags bother bulls. Fluctuating rates flattened many champagne drinks this holiday season.

The Klitschko brothers are one belt away from having a monopoly on the world’s most prestigious boxing titles.

To bring the fizz back, the Kyiv Post presents the Top 10 “feel-good” stories of the year. Maybe 2009 will bring calm and patience. After all, most humans are luckier than bulls, who only see the world in two colors: black and white.

1. Vitaliy and Volodymyr (Wladimir) Klitschko

“They feel good, we knew that they would” is the Post’s slight remake of James Brown’s signature song “I feel good.” The Klitschko brothers’ boxing victories inspired Ukrainians to be proud of their country, if not to keep fit themselves.

Vitaliy Klitschko, also known as Dr. Iron Fist, returned to the ring after a three-year break and quickly reclaimed his World Boxing Council heavyweight champion title.

He beat the much younger Samuel Peter, nicknamed the “Nigerian Nightmare,” in the eighth round in October.

Volodymyr, his brother, currently holds the International Boxing Federation, World Boxing Organization and International Boxing Organization world heavyweight titles. Beating Russian Sultan Ibragimov in February, he made Ukrainians roar in his honor. Held in New York, the bout had a special meaning for immigrants from the Soviet Union.

The victory overwhelmed Ukrainians in the Big Apple who still remember traditional rivalries among ex-Soviet republics.

2. Dasha Astafieva

Staying with James Brown’s immortal “I feel good,” Dasha Astafieva feels nice, like sugar and spice. Ask Hugh Hefner for details. The man about town in his 82 years of age undressed her for the American version of his world-famous Playboy Magazine.

He also announced the 23-year-old Ukrainian model and pop singer as January 2009’s Playmate of the Month. If that was not enough, she is also Playboy’s 55th Anniversary Playmate.

To cause more scandal, Astafieva pulled off her underwear in front of the cameras on the red carpet before the ceremony. Despite some ranking it as bad publicity for Ukraine, she put a smile on many faces around the world.

3. Ani Lorak

Ukrainian pop singer Ani Lorak did not wear much either at the 2008 Eurovision Song Contest. Hardly anyone, however, can dispute her strong vocals and stage presence. She took second place with the song “Shady Lady,” defeated by Dima Bilan from Russia.

Repeatedly named the most beautiful woman in Ukraine and the best singer by various magazines and music awards, she got engaged to a Turkish man this year.

4. Olympics

Against all odds, Ukraine’s Olympic team finished 10th in the total medal count of 81 countries at the Summer Olympics in Beijing.

Neither aging Soviet facilities, nor lack of financing could stop Ukraine from winning 27 medals. The team bested their Athens performance by four medals. Ukraine’s strongest side was in archery, boxing, athletics, canoe/kayak, shooting and fencing.

Ukraine’s Paralympics athletes stood an impressive fourth place this September with an impressive 74 medals among 78 competitors.

5. Chess

If chess was a part of the Olympic Games, Ukraine may have scored even better. This brainy game, however, has a separate competition. At the Chess Olympiad in Germany this November, the Ukrainian team edged other nations in combined men’s and women’s results.

On the way home with a precious cup, they had a nerve-wracking adventure with damaged luggage. Their prize reached Kyiv broken and missing a few golden parts. Luckily, the trophy was insured. The team received more publicity for their part.

6. Anatoliy Tymoshchuk

Many foreigners admit that one of the toughest things about Ukraine is its surnames - Yushchenko, Tymoshenko, or indigestible Chernovetsky. But apparently difficult names do not always mean difficult times.

Bavaria football club is interested in Ukrainian national team’s player Anatoliy Tymoshchuk. Korrespondent, the Kyiv Post sister publication, named him the Personality of the Year in the eponymous category to honor his victories.

Currently playing for Russian Zenit, he claimed victory in Union of European Football Association’s Cup, UEFA Super Cup and Russian Super Cup.

Tymoshchuk is considered one of the most sought-after players in Eastern Europe.

7. Olga Kurylenko

This girl had to learn how to fly to land on this list. Olga Kurylenko, the Ukrainian-born top model-turned-actress, shook hands with the British royal family this year and kissed Daniel Craig (aka James Bond) after a world premier of the 22nd Bond film in London.

Playing the secret agent’s friend, rather than girlfriend, Kurylenko performed most of her tricks herself. Fearlessly crossing continents and fighting villains in the movie, she confessed that her own life reminded that of her character, Camille.

8. National Symphony Orchestra of Ukraine

The Symphony Orchestra of Ukraine secured the Grammy Awards nomination in Best Classical Performance category. It is considered the highest music honor, the United States’ record industry equivalent to the Oscars. The ceremony will take place in February. The Ukrainians will present a violin concert they recorded with American soloist Elmar Oliveira. It is their second Grammy nomination.

9. Bohdan Stupka

He has the courage of Mongolia’s historic leader Genghis Khan, the wit of Goethe’s Faust and the leadership of hetman Bohdan Khmelnytsky, a historic Kozak leader. Possibly the most famous living actor in Ukraine, Bohdan Stupka conquered Rome this year. At the III Rome International Film Festival, he won Best Actor award for the film “With a Warm Heart.”

Stupka played a mentally and physically ill Polish aristocrat in a joint Polish-Ukrainian production. At the same ceremony, Al Pacino collected a lifetime achievement award.

10. Viewdle

Ukraine has a room with the Viewdle – a start-up company with facial recognition technology for online video. At the largest web event in the world, LeWeb, they collected gold for the most successful start-up.

Viewdle beat 30 other companies from Europe and a few from the U.S. What started in the ex-military university laboratory in Kyiv has turned into a lifeline technology for major media companies, like Reuters. Thanks to Viewdle, video recognition is no longer an exclusive spy tool.

So there, despite a recession, good news still happens.

Source: Kyiv Post

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Friday, December 26, 2008

Ukraine's Parliament Urges Top Banker's Dismissal

KIEV, Ukraine -- The Ukrainian parliament on Friday demanded the central bank chief be dismissed over the collapse of the national currency, accusing him of corruption and incompetence.

Volodymyr Stelmakh

National Bank chief Volodymyr Stelmakh has denied having any hand in the exchange market speculations that caused the hryvna to lose half its value against the dollar last week.

President Viktor Yushchenko is expected to ignore the nonbinding motion for Stelmakh to be fired. The motion was spearheaded by Yushchenko's rival, Prime Minister Yulia Tymoshenko, who has accused the central banker of conspiring with banks over the currency speculations and pocketing profits.

Yushchenko has said the country needs the expertise of Stelmakh, his longtime associate, to weather the current financial crisis. The currency devaluation coincided with a drastic fall in steel exports, leading to a foreign currency squeeze.

In the meantime, the Ukrainian currency has recovered some of last week's losses, which took it to 9.6 to the U.S. dollar from its September rate of 4.9 to the dollar.

At the close of trading Friday, the hryvna was listed at 7.6 to the dollar, thanks to the National Bank's efforts to prop up the rate by selling hard currency.

Tymoshenko has claimed Yushchenko was involved in the alleged corruption schemes.

The president has dismissed the allegation, and his top aide this week accused Tymoshenko of seeking to take control of the National Bank for personal gains.

Ukraine is sinking into a deep recession, with the economy expected to shrink up to 10 percent early next year, according to Yushchenko's estimates.

Industrial output has fallen nearly 30 percent, as global demand for steel, the heart of the economy, halved.

Source: International Herald Tribune

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Need A Ride? President Gives Archrival A Lift

SIMFEROPOL, Ukraine -- Feuding rivals President Viktor Yushchenko and Prime Minister Yulia Tymoshenko of Ukraine put their differences aside on Thursday to share a car to visit the scene of a deadly explosion.

Ukraine's Prime Minister Yulia Tymoshenko (L) and President Viktor Yushchenko sit in a car as they visit the shattered five-storey block in the Black Sea resort of Yevpatoria in the Crimea peninsula.

Both leaders, who have quarrelled incessantly over the last few weeks, travelled to the southern region of Crimea to visit the scene of the blast at an apartment block that killed 27 people in the resort town of Yevpatoria.

Tymoshenko arrived in Crimea before Yushchenko but then decided to wait for the president to visit the scene of the incident together.

They then shared the same car to Yevpatoria before going back to Crimea's main airport in a vehicle personally driven by the president and leaving on the same plane, an AFP correspondent on the scene reported.

The pair were accompanied by national security chief Raisa Bogatyriova, a Yushchenko confidant.

Simferopol airport is 70 kilometres east of Yevpatoria, so the pair would have had ample time to either clear the air or sit in silent tension.

Yushchenko and Tymoshenko were allies in the Orange Revolution of 2004 that swept them to power, but they have fallen out spectacularly in recent months, exchanging repeated accusations over Ukraine's economic crisis.

It remains to be seen whether their car-sharing heralds a thaw in their relationship.

Tymoshenko had on Wednesday accused Yushchenko of personally provoking the plunge of Ukraine's currency to enrich himself and weaken her government.

Yushchenko then did not mince his words in biting back: "She's just an adventurer in politics, who is going to drown us all because she only needs one thing: unlimited power."

Source: AFP

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Apartment Explosion Kills 19 In Ukraine

YEVPATORIA, Ukraine -- Ukrainian authorities say 19 people, including two children, are dead and at least 24 are missing after an explosion at an apartment building in the Crimean resort town of Yevpatoria.

Ukraine's President Viktor Yushchenko (R) and Prime Minister Yulia Tymoshenko visit a shattered five-storey block in the Black Sea resort of Yevpatoria in the Crimea peninsula, December 25, 2008. An explosion ripped through the apartment building in southern Ukraine, killing 19 people, including two children, officials said on Thursday.

Rescue teams are digging through rubble Thursday to find survivors from the blast that tore through the five-story building late Wednesday.

They say 21 people have been rescued so far.

Ukraine's Prime Minister Yulia Tymoshenko and President Viktor Yushchenko headed to Yevpatoria Thursday to meet with rescue officials.

Russian President Dmitri Medvedev has offered to send naval personnel from Russia's Black Sea fleet to help with the search efforts.

Authorities are working to establish the cause of the explosion. Preliminary reports say it could have been caused by oxygen or acetylene cylinders that may have been stored in the building's basement.

Gas explosions are common in Ukrainian apartment buildings, especially during the winter when residents turn up the heat.

Source: Voice of America

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Thursday, December 25, 2008

China's Hainan Airlines Announces New Route To Ukraine

KIEV, Ukraine -- China's Hainan Airlines announced here Wednesday that it would launch a new route from Beijing to Ukraine's capital of Kiev at the beginning of next year.

Chinese Hainan Airlines

Zhang Ning, the company's representative in Kiev, told a news briefing that passengers would be able to take a flight between the two cities on Tuesday and Saturday since Feb. 10, 2009.

"Flight frequency would be increased later," he said.

Zhou Li, the Chinese ambassador to Ukraine, said that the opening of the new route will play a positive role in deepening mutual understanding and trust between the two countries and promote bilateral economic cooperation.

The airline would use Airbus A330-200 aircraft, which has 222 seats with 36 business-class seats.

Source: Xinhua

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Medvedev Threatens Sanctions Against Ukraine

MOSCOW, Russia -- Russian President Dimitri Medvedev says Ukraine will face retaliatory sanctions unless it pays up every ruble it owes energy giant Gazprom.

Russia President Dimitri Medvedev.

Speaking in a televised end-of-the-year interview, Medvedev didn't specify what those sanctions might be.

His statement came after Gazprom threatened to cut off gas deliveries to Ukraine on January 1, unless a new contract for 2009 is signed by then.

Gazprom and Ukraine's state energy firm Naftogaz have failed to resolve a dispute over unpaid debts.

Gazprom says Naftogaz owes it almost two billion euros.

A bilateral dispute almost four years ago led to a brief disruption of gas supplies to several European Union countries.

This time Gazprom has pledged to ensure that there is no disruption to the flow of gas to EU customers.

Source: Deutsche Welle

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Wednesday, December 24, 2008

'Tis The Season To Blame Ukraine

MOSCOW, Russia -- Gazprom tries to rally Russian workers' support for its case, saying Ukrainian gas debts could hurt the Russian economy and employment.

Gas flares behind the Gazprom logo and the sign of the Yuzhno-Russkoye gas field in northern Russia, just below the Arctic Circle. Russia has raised the spectre of gas cuts to Europe over the winter, warning that it did not rule out supply disruptions as a result of the dispute with Ukraine over non-payment of debts.

Russia's spat with Ukraine over unpaid gas bills is widening; Moscow is now portraying its own citizens as victims of the disagreement.

Russian state-run energy giant Gazprom said Tuesday that the $2.0 billion debt that Ukraine still owed it was hurting the Russian economy. "Since the majority of the goods imported from Ukraine are also made in Russia, non-payments for gas damage those sectors where Ukrainian goods compete on Russia's domestic markets," Gazprom spokesman Sergei Kupriyanov said. "This cannot but affect the industries and the people who work in them."

Gazprom had warned Monday that its European customers could face a disruption of gas supply due if its dispute with Ukraine led the Kremlin to stop the supply of gas to the former Soviet satellite. Russia provides about a quarter of Europe's gas, and 80.0% of its exports transit through Ukraine.

Now Gazprom is highlighting that Russia's 6.6% unemployment could rise further, and Kupriyanov on Tuesday listed potentially vulnerable industrial cities and factories by name.

Gazprom's tactical line of argument could help deflect Russian workers' collective anger about worsening unemployment and the economic slowdown toward Ukraine and away from the Kremlin.

Shares of Gazprom were up by 2.1%, at $3.88, on Tuesday morning in Moscow, having risen 4.1% on Monday. Gazprom's shares have fallen 73.0% since the start of 2008, when they were trading at $14.38.

Gazprom maintains that Ukraine's state gas company Naftogaz owes it up to $2.4 billion (1.8 billion euros), and it has warned of delivery cuts to the company if its outstanding debt is not cleared.

The companies have until Jan. 1 to sign a new contract, and Russia is pushing for higher prices. Russia has warned that gas prices for Ukraine could rise to $400.00 per 1,000 cubic meters, from the current $179.50.

There is a whiff of familiarity in all this. A similar dispute in January 2006 saw Russia turn off the gas taps to Ukraine, a key transit country for Russian gas exports, and disrupt gas supplies destined for the European Union for several days.

On Dec. 19, President Viktor Yushchenko of Ukraine said his government had paid $1.0 billion to Gazprom for gas pumped in September and October.

Both countries face difficult economic times. The Kremlin spent up to $2.5 billion supporting the ruble on Monday, according to TradeTheNews.com, marking the sixth time it has had to do so in December alone.

Capital flight from Russia has meanwhile compelled the country's billionaire oligarchs to ask for loans from the government in exchange for portions of their assets (often companies).

Ukraine's economic downturn is also being exacerbated by a sliding currency: the hryvnia has halved in the past six months, making imports far more expensive, not to mention the country's debt to Gazprom.

Its central bank had to raise interest rates to 22.0%, from 18.0% last week, in a bid to boost the currency, and a perennially unstable political situation is not helping matters.

Ukraine received a $16.5 billion loan from the International Monetary Fund in October, and Russia expressed "bewilderment" in an official statement that Ukraine had been unable to repay the debts in spite of that assistance.

Source: Forbes

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Tuesday, December 23, 2008

Serial Killer In Ukraine Sentenced To Life In Prison

DNIPROPETROVSK, Ukraine -- A serial killer in the eastern Ukrainian city of Dnipropetrovsk has been sentenced to life in prison, RFE/RL's Ukrainian Service reports.

Serhiy Tkach in the dock during his trial in Dnipropetrovsk.

Serhiy Tkach was arrested in 2005. He had been found guilty of almost 80 rapes and murders. His victims were girls and young women.

Tkach, who used to be a professional criminal investigator, has been able to conceal his crimes skillfully for more than 20 years.

Nine people had been erroneously convicted for some of the rapes and murders committed by Tkach.

Source: Radio Free Europe

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Ukrainians Protest Financial Crisis

KIEV, Ukraine -- Thousands of car drivers in the Ukrainian capital angrily blew their horns for several minutes Monday, protesting what they call incompetent and corrupt government policies that led to a devastating financial crisis.

A pregnant woman begs for money in central Kiev.

The Ukrainian currency has lost some 40 percent of its value since September as a fall in the export of steel, the heart of the economy, led to a shortage of foreign currency. That was coupled with a loss of confidence in the hryvna and the banking system.

Monday's protests branded "Enough" and organized mainly through the Internet were a sign of growing anger and opposition to the government which experts say could boil over into mass protests in the coming months.

Many Ukrainians think that their leaders, brought to power on a wave of the 2004 pro-democracy protests known as the Orange Revolution, have betrayed their promises of turning Ukraine into a prosperous European nation.

Instead, the government has been paralyzed by infighting and failed to deal efficiently to deal with the financial meltdown even after receiving several billion dollars on a loan from the International Monetary Fund.

"We've had enough of the authorities," said one protester, Ihor Ratushny.

Prime Minister Yulia Tymoshenko has accused the National Bank officials of making huge profits on the shocking devaluation of the hryvna by allowing speculation on the foreign currency exchange.

The National Bank denies the accusations, which were seen by some analysts as aimed at Tymoshenko's arch-rival, President Viktor Yushchenko.

Ukraine is sinking into a deep depression. Yushchenko has forecast that the economy will contract by up to 10 percent in the first quarter of next year. Tens of thousands of workers face layoffs as steel and other plants across the country freeze.

Industrial output shrank nearly to 30 percent in November, from a year earlier, the sharpest drop in a decade.

On top of the crisis, Ukraine is facing Russia's threat to cut natural gas supplies on Jan.1 over its debt for the past supplies.

Source: AP

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Monday, December 22, 2008

Batman: Part-Time Job For A European President

KIEV, Ukraine -- Ukrainian president Viktor Yushchenko could be accused of inconsistency in everything he does politically, but not in his love for wildlife. Amid financial and political instability, it seems the passionate beekeeper is the only one who cares about bats.


This week President Yushchenko propositioned the Parliament to adopt an amendment to the Agreement on the Conservation of Populations of European Bats.

The agreement of 1991 has been ratified by 30 countries and has been effective in Ukraine since 1999. No information as to what particular changes should be made, however, has been released to the media.

There is no doubt the endangered species both needs, and is worth, protection, but it seems few in Ukraine are concerned about their fate.

Immediately after the proposal to parliament, Viktor Yushchenko came under fire from both his sarcastic political opponents and ordinary Ukrainians, who simply could not figure the importance of the move, or its timing.

The Ukrainian president might have felt offended with such an inadequate response to his animal protection efforts but did not show it.

He explained with patience that the initiative is “one of the steps Ukraine is undertaking in joining a series of international documents in the context of the country’s integration into Europe.”

A statement from the Presidential press service said that since the beginning of the year the president has submitted to the parliament 17 draft laws of this kind, including those concerning Ukraine’s accession to the WTO and the ratification of the European convention about transborder television.

Ukrainians already unhappy with Yushchenko were not placated by these moves.

Their perceived obstinacy and ingratitude upset their leader so much that he even cancelled his annual media conference.

Indeed, what can he respond to thousands of people who asked him online “Dear Mr. President, could you please tell us, how much do we (the simple people) have to pay you so that you – together with your parliamentarians, ministers and officials – leave the country?”

How can he justify to the Ukrainian people, fearing to be without gas or heating this winter that bats will lead Ukraine towards a bright European future? It could be a future with no malicious Russia by its side, threatening to cut energy supplies for a $2.4 billion debt.

In this perfect Ukraine, abundant in bats and covered with beehives, Prime Minister Yulia Timoshenko will forget her political and power ambitions or at least won’t be contradicting him on every issue possible - and President Yushchenko won’t have to dissolve Parliament every time the deputies fail to form a governing coalition.

The country’s corporate and state debt of $105 billion could somehow be repaid and the national currency, the hryvnia, which has devalued by 50 per cent since June, will regain its value… if integration ever comes about.

So, thanks to the President’s environmental awareness and love for all living creatures his move could propel Ukraine in the right direction, but it seems that Yushchenko’s initiative has not been appreciated for its true value.

Whether or not this happens one day, one thing is clear: at least the bats will be grateful.

Source: Russia Today

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Ukraine's President Blasts Premier

KIEV, Ukraine -- Ukrainian President Viktor Yushchenko accuses Prime Minister Yulia Tymoshenko for lack of management over the country's economic crisis.

Ukrainian President Viktor Yushchenko (L) and Prime Minister Yulia Tymoshenko continue to accuse each other.

"Without a doubt, the prime minister lost control of the situation a long time ago," said Yushchenko in a statement aired Sunday and blamed Tymoshenko for the rise in Ukraine's inflation rate to 22 percent during the current year.

Ukraine's prime minister had called earlier on the country's president to resign as she raised corruption allegations against him.

"I believe the president of this country, who works according to the (principle)...that whatever is worse for the country is better for me, who makes money out of the misery of people, must step down tomorrow together with the head of the central bank," Yulia Tymoshenko had said on Friday.

But Yushchenko emphasized that according to the country's constitution, it is only the government that is responsible for creating an independent economic and financial policy.

"I am sure the prime minister is unable to assess the economic and social processes today," he said. "She put herself in opposition to the Ukrainian people and the state with her last accusations".

Tymoshenko and Yushchenko known as political allies in Ukraine, have also been criticizing each other in recent months over issues such as a gas dispute with Russia and Russia's war with Georgia in August.

Source: Press TV

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Sunday, December 21, 2008

Food-Poor Countries Seek Farmland

MOSCOW, Russia -- Wearing flowing red robes and pitching his own trademark desert tent, Libyan leader Moammar Qaddafi paid a visit to Ukraine last month in search of a remarkable deal to help feed his oil-rich but soil-poor people.

Libyan leader Col. Moammar Qaddafi.

Under a proposed agreement with Kiev, Libya would lease 247,000 acres of Ukraine's rich black land to grow wheat. The harvest would then be shipped back to Libya, giving the desert nation a more secure supply of food in the face of predictions about higher food prices and potential shortages in decades to come.

Ukraine, in turn, would get access to Libyan oil fields, helping free it from dependence on Russia for its energy needs.

Around the world, food-poor but cash-rich countries, spooked by last season's high food prices, are racing to snap up rights to farmland in developing countries and breadbasket nations.

• South Korea's Daewoo Logistics announced last month that it has signed a 99-year lease on 3.2 million acres of land in Madagascar, which it will use to produce corn and palm oil for shipment home.

• China, which already farms more than 100,000 acres of land in Australia, is buying or leasing huge swaths of farmland in the Philippines, Laos, Kazakhstan, Myanmar, Cameroon and Uganda, according to Grain, a sustainable-agriculture group based in Spain.

• Gulf nations -- Saudi Arabia, the United Arab Emirates, Bahrain and others -- also have locked up millions of acres in Indonesia, Pakistan, Sudan and Egypt.

In the United States, a similar buy-up occurred in the late 1980s, when Japan purchased more than half a million acres of farmland in California, Montana, Colorado and Florida.

In contrast to the latest rush, however, the main purpose was to raise cattle for Japan's beef appetite, rather than grain.

"It's literally all over" that rich countries and corporations have been looking for land, said Carl Atkin, head of research for Bidwells Agribusiness.

The rush to buy or enter long-term leases on land has been fueled in part by the low levels of world grain stocks, despite record harvests this year.

Source: Chicago Tribune

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Prime Minister Calls For Probe Into Ukrainian Currency Collapse

KIEV, Ukraine -- Ukrainian Prime Minister Yulia Tymoshenko called Saturday on prosecutors and a corruption watchdog to probe the plunge in the country's currency, which she has blamed on her political rival, President Viktor Yushchenko.

Prime Minister of Ukraine Yulia Tymoshenko.

She told a press conference she had sent a report to the Global Witness group, which campaigns against corruption, and the state prosecutor and the national security service, while expressing doubts about their honesty.

Tymoshenko, who is in open conflict with Yushchenko, said Friday that the president should resign for "making money on people's grief."

Earlier in the week she accused the president of provoking the plunge of the hryvnia's value, with the support of the national bank, to boost his personal fortune and weaken her government.

"They are pushing the country toward bankruptcy," added Tymoshenko, who is likely to challenge Yushchenko for the presidency in elections due late 2009 or early 2010.

Yushchenko for his part has accused Tymoshenko of populism, saying this was one of the causes for the national currency's collapse.

The hryvnia has lost nearly half its value against the dollar over the last six months amid global financial turmoil, sending Ukrainians rushing to swap local money for dollars and euros in scenes that have recalled the chaotic 1990s.

Tymoshenko and Yushchenko are allies turned bitter rivals who have regularly denounced each other in recent months over topics including a gas dispute with Russia and Russia's war with Georgia in August.

Source: AFP

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Russia And Ukraine Again Face New Year Gas Showdown

MOSCOW, Russia -- Russia is heading towards another New Year's showdown with the embattled Ukrainian government over its failure to pay off gas debts amid apparent deadlock in negotiations, analysts say.


Talks between Russian gas monopoly Gazprom and Ukraine's Naftogaz have failed to reach any breakthrough and Gazprom has warned it has no obligation to pump the gas if the debts are not settled.

A source close to the talks refused to rule out a repeat of a scenario similar to the 2005-2006 gas row where Russia cut off supplies to Ukraine, triggering a supply crisis in Europe

"Everything can happen," the source, who asked not to be named, told AFP.

The significance of the looming standoff is not lost on Ukraine, whose economy has been battered by the economic crisis and whose currency has lost half its value in six months

A high-ranking official within the Ukrainian presidential administration told AFP he could not make any plans because of the unsettled debts.

"Well, I have not taken a vacation during the New Year's, just in case," he said on condition of anonymity.

Yevgeny Minchenko, director of Moscow-based International Institute for Political Expertise said he had been informed that top management at Gazprom had also cancelled holidays in case the pricing dispute flares up.

"The Ukrainian side is blatantly refusing to pay the debts," he said.

Ukraine over the last week repaid one billion dollars of debt to Gazprom for gas pumped in September and October. But for Gazprom, this is far from being enough.

Gazprom maintains that Naftogaz owes a total of 2.4 billion dollars (1.8 billion euros), not to mention fines imposed for late payment.

"If the debt is not reimbursed by January 1 and if other solutions are not found, we cannot sign a new contract and we will have no legal basis to supply gas to Ukrainian consumers," Gazprom spokesman Sergei Kupriyanov said.

The complexity of negotiations is exacerbated by Gazprom's desire to charge Kiev more under a new contract, something Ukraine is reluctant to agree amid the financial crisis.

Ukraine currently pays Russia 179.5 dollars for 1,000 cubic metres of gas but Gazprom has warned that price could rise to 400 dollars for 1,000 cubic meters from next year.

The stakes are raised even higher by the strained diplomatic relations between Moscow and Kiev following the war in Georgia.

"The situation is certainly extraordinary and is being exacerbated by the financial crisis," said Valery Nesterov, an oil and gas analyst with Troika Dialog investment bank.

"The absence of a long term contract and a price formula make this an easy task," said Dmytro Naumenko, energy analyst from Institute for Economic Research and Policy Consulting in Kiev.

"This is psychological warfare in its concrete financial aspect."

Despite the highly opaque nature of the gas talks, analysts say Russia may still try this year to prevent the repeat of the gas cuts, if just to prevent a diplomatically costly row with Europe.

Gazprom supplies a quarter of the European Union's gas, mostly via Ukraine.

The European Commission said Friday it had received assurances from Russia and Ukraine that European customers will not be affected by the latest row over Russian gas supplies.

"Waging a pricing war with Ukraine does not make any sense", said Vycheslav Bunkov, an oil and gas analyst at Aton, a Russian investment bank.

Western officials also increasingly realize both countries will have to shoulder the blame if they fail to find a solution, analysts say.

"The first time gas was turned off in 2005 the matter was settled somehow. Every time we pulled through -- in 2006, in 2007. Now the year 2008 is coming to an end," said Russia's ambassador to Ukraine, Viktor Chernomyrdin.

"If Ukraine pays all its cash debts to Gazprom, all questions will be settled," added the former prime minister.

Minchenko predicted: "This time pressure will most likely not go down in the pipes."

"The companies will likely sign an agreement at the last minute to the chime of bells and champagne corks popping on the New Year's night."

Source: AFP

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Ukraine Journalist Hurls Shoes At Politician In NATO Protest

ODESSA, Ukraine -- A Ukrainian journalist hurled a shoe at a local politician Friday to protest against remarks concerning NATO. The reporter in southern Ukraine's Odessa tossed his footwear at Oleh Soskin, an official presiding at the opening of a NATO information centre in the Black Sea port, the Interfax news agency reported.

Dr. Oleh Soskin

Odessa-based Revizor, a website devoted to controversial regional news, reported the incident took place at the city's Ushansky University, where Soskin reportedly was giving a speech on the need for Ukraine to join NATO.

ATV television news reporter Ihor Dmitriv reportedly took exception to Soskin's assertion during a speech that Ukrainian women were the more intelligent members of the Ukrainian population, and so would be more inclined to join NATO than men.

Dmitriv, according to the report, questioned Soskin's sexual orientation and hurled a single shoe, striking but not injuring the lecturer.

Soskin and Dmitriv, according to a witness, then exchanged insults, but members of the predominantly female audience separated the pair before blows were thrown. Neither Soskin nor Dmitriv was injured, according to the reports.

Soskin is a member of a nationalist political party supporting close Ukrainian relations with Europe, and an antogonistic relations with Russia.

Dmitriv subsequently told fellow Odessa reporters he threw his shoe at Soskin as Ukraine's senior political leaders "were crazy about NATO," and the only means of changing their minds was by hurling objects at them.

"A shoe is going to become a leading means (for common people) to influence their leaders," Dmitriv predicted.

The attack closely paralleled a Sunday incident when Iraqi television reporter Muntadhar al-Zaidi threw a pair of loafers at US President George Bush during a Bagdad press conference.

The population of the former Soviet republic Ukraine strongly opposes joining NATO, partly because of lingering loyalties to Moscow, but also because most Ukrainians consider NATO military operations in Serbia and Afghanistan unjustified invasions.

Ukraine's pro-West leadership nonetheless heavily favours early Ukrainian membership in NATO because of fears of increasing Russian military power, and hopes that a pro-NATO Ukrainian government would have increased chances of foreign aid to deal with the effects of the world financial crisis.

Source: DPA

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Saturday, December 20, 2008

US, Ukraine, Sign Partnership Charter

WASHINGTON, DC -- The United States and Ukraine Friday signed what was termed a Charter of Strategic Partnership calling for cooperation in defense, energy, trade and other areas. The United State will set up a diplomatic mission in Ukraine's Crimean region.

Ukranian Foreign Minister Volodymyr Ohryzko, left, and Secretary of State Condoleezza Rice, right, take part in a joint signing ceremony for the U.S. - Ukraine Charter on Strategic Partnership at the State Department, Friday, Dec. 19, 2008, in Washington.

State Department officials said the terms of the partnership accord are not unlike those of agreements the United States has with many other countries. But the signing comes at a politically-sensitive time, in the aftermath of the Georgia crisis, and officials said it is a signal to Moscow of U.S.-Ukraine solidarity.

Following Russian intervention in Georgia and its recognition of two breakaway Georgian regions, there has been concern about increased Russian pressure on Ukraine and that it might try to foster a separatist movement in the Crimea, which has a large ethnic-Russian population.

Friday's signing of the U.S.-Ukraine charter coincided with confirmation that the Bush administration intends to set up a small but symbolically-important diplomatic post in the Crimean regional capital, Simferopol.

At the signing ceremony with Ukrainian Foreign Minister Volodymyr Ohryzko, Secretary of State Condoleezza Rice said the United States has long believed that Ukraine's independence and democracy are essential to a peaceful Europe, and that Washington holds to its support for that country's membership in NATO:

"The United States supports Ukraine's integration into Euro-Atlantic structures. And I want to assure you that the declaration at Bucharest which foresees that Ukraine will be member of NATO when it can meet those standards is very much at the center of our policy. We look forward to helping you execute the decisions of Brussels to intensify the work of the Ukraine-NATO commission toward the fulfillment of the Bucharest declaration", she said.

At last April's NATO summit in Bucharest, leaders supported eventual alliance membership for Ukraine and Georgia but could not reach a consensus to offer them a formal membership action plan.

Meeting earlier this month in Brussels, alliance foreign ministers said they would work for membership for the two states through existing structures like the NATO-Ukraine commission.

At the signing ceremony, Ukrainian Foreign Minister Ohryzko said the charter agreement gives added stimulus to a rapidly expanding bilateral relationship. He was heard through an interpreter:

"This is a very important document because it summarizes our efforts during the past year, but it also has a very important dimension for our future. I would like to call your attention to the areas in this document that address defense, security, the economy, human rights, increased importance to cultural and people-to-people contacts and also the presence of the United States in Ukraine, in particular the Crimea," he said.

State Department Spokesman Sean McCormack said the administration plans to set up a so-called American Presence Post in the Crimean capital, which would include one or two U.S. diplomats and engage in a wide range of political and cultural activities. Currently the U.S. embassy in Kyiv is the only American diplomatic mission in the country.

A majority of Crimea's two million residents are ethnic Russians, and Russia has a lease on the Soviet era naval base at Sevastapol which expires in 2017, and which Ukraine says will not be renewed. Russia denies any intention to undermine Ukrainian sovereignty in Crimea or elsewhere.

Source: Voice of America

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Tymoshenko Demands Yushchenko's Resignation

KIEV, Ukraine -- Ukrainian Prime Minister Yulia Tymoshenko called on the country's president to resign on Friday, accusing him of putting personal ambition above the country's interests.

Prime Minister Yulia Tymoshenko and President Viktor Yushchenko in friendlier times.

Massive corporate debt, a tumbling currency, a Russian threat to cut off gas supplies and feuding between state institutions have prompted some analysts to say Ukraine could be the next big casualty of the global downturn.

Tymoshenko has long been at odds with her former ally, President Viktor Yushcheko. But her direct call for his resignation suggested a serious worsening of political tensions ahead of a cabinet meeting on Saturday.

"I believe the president of this country, who works according to the (principle)...that whatever is worse for the country is better for me, who makes money out of the misery of people, must step down tomorrow together with the head of the central bank," Tymoshenko told an evening television talk show.

Ukraine's central bank said on Friday the government had run out of money to pay wages and meet its financial obligations.

Central bank moves, including a 4-5 percent rise in overnight refinancing rates, helped drive the hryvnia up for the first time in two weeks to 8.6 to the dollar from about 9/$ on Thursday, when the currency touched 10/$ at one point.

But trade in the currency looked to be drying up on Friday and the hryvnia has lost roughly half of its value since June, raising the prospect that heavily-leveraged companies could fail to pay off maturing dollar-denominated debt.

The central bank's attack on the government was the latest salvo in a feud which flared on Thursday when Prime Minister Tymoshenko called for the bank's chairman to resign over the fall in the hryvnia.

"The government's inept policies in running the economy... led to a situation in December in which the country could find itself in internal default," the central bank said in a statement.

"The government now has no funds to pay salaries, pensions and social benefits or to cover its domestic and external obligations."

In the first 10 months of this year the budget has been in surplus. The finance ministry said late last month Ukraine will reach its budget revenues target for the year, despite a sharp fall in industrial output.

GAS BILL

In another challenge to Ukraine's battered economy, Russian gas giant Gazprom is threatening to cut off supplies unless Kiev pays $2 billion the Russian firm is demanding in arrears for gas supplies.

Yushchenko issued a statement on Friday challenging suggestions from Russian officials that Ukraine next year should pay $250-$300 per 1,000 cubic meters of gas.

A price of about $100 would better reflect world prices, the statement said. Negotiations over 2009 prices could have a bearing on the debt dispute.

European countries are watching the dispute closely because a brief cut-off of supplies to Ukraine in 2006 over a similar dispute had a knock-on effect on gas deliveries to Europe, which relies on Russia for a quarter of its gas needs.

Mud-slinging between institutions whose job it is to manage the economic crisis -- including a feud between Tymoshenko and President Yushchenko -- has helped undermine many investors' faith in the Ukrainian economy.

Hours after the central bank's statement, Yushchenko told it to secure "total control" over banks' purchases of dollars and issued a deadline for it to stabilize the currency market.

"There are no economic reasons for not having a stable rate. In 10 days' time we should organize the market in such a way that maximizes dollar supply," Yushchenko said at a meeting with central bank and commercial bank officials.

TRADING INSULTS

Tymoshenko and Yushchenko have traded increasingly personal insults since September when a coalition of their parties in parliament fell apart, after months of squabbling.

Although the coalition has since been reinstated, there are few signs that the two have resolved their differences a year before a presidential election.

The economy sank 14 percent in November compared to the same month last year as industrial output fell 30 percent. Inflation, which peaked at 31 percent in May, remains high at 22 percent.

The central bank has begun imposing what some analysts have called capital controls to stem the hryvnia's losses, limiting sales of its dollars only to importers and clients needing to service their foreign debt in December.

It has also moved to defend the currency by raising the overnight refinancing rate to 22 percent from 18 percent on secured deposits and to 25 percent from 20 percent on unsecured deposits.

Deputy Chairman Anatoly Shapovalov said the central bank sold $180 million on Thursday and would intervene next week.

But dealers, frustrated for weeks with the central bank's lack of clear communication, complex intervention procedures and limits on dollar sales, said the hryvnia could have risen higher had the bank not unexpectedly offered to buy dollars.

"Until the central bank announced (a buy rate of) 8.65 hryvnias, the rates were 8.1/8.2-8.4," one dealer said.

"The central bank didn't allow for the hryvnia to rise as strongly at it could have. We could have finished the day at 8/$...The actions of the central bank are such that there are simply no words for criticism."

Analysts at Ukrgazbank said the hryvnia's rate next week depended entirely on subjective factors. "As a consequence, next week the hryvnia-dollar rate could be 6/$ or 12/$. There are no clear parameters for the market."

Source: Kyiv Post

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Friday, December 19, 2008

Tymoshenko Accuses President Of Covering Up Illicit Banking Ops

KIEV, Ukraine -- Ukraine's Prime Minister Yulia Tymoshenko, a former ally of President Viktor Yushchenko who has turned into his staunch critic, on Thursday accused him of covering up wildcat operations of the National Bank.

Yulia Tymoshenko at a press conference on December 18, 2008.

"These people understand they are losing the remainders of state power and that's why they are acting along the principle of "the worst is the best" so as to rip off billion-size profits from this crisis and the Ukrainian people's problems," she said at a news briefing.

Tymoshenko said she has the materials on this gathered by the state commission for financial monitoring and the Finance Ministry.

"They will be submitted to a special interim investigating commission of the Verkhovna Rada, the national parliament, that must bring all that disgrace out into the open," she said.

Tymoshenko asked the Prosecutor General's Office and the Accounting Chamber to inspect the operations of the Kiev-based Nadra Banka bank and a number of other large commercial banks that have been involved in foreign currency speculations with the National Bank's assistance.

"I ask President Viktor Yushchenko to put an end to the speculations that derail the exchange rates of the hryvnia, the national currency," she said.

Unless the National Bank takes a decision to revert the hryvnia to the previous exchange rate corridor, materials gathered by the financial monitoring commission and the Finance Ministry will be submitted to international organizations that investigate machinations.

"All the compromises go away as of this minute and we'll act in an absolutely legitimate and transparent way," Tymoshenko said.

Earlier in the day, she accused the National Bank of currency speculations and the fall of the hryvnia and demanded that Yushchenko present to parliament a request to dismiss the National Bank President, Vladimir Stelmakh, and members of the bank's board of governors.

"The slide of the hryvnia was a prearranged operation that was supported by the National Bank," Tymoshenko claimed. "There are no objective reasons in this country for the hryvnia's fall versus the U.S. dollar."

She also warned that the Yulia Tymoshenko bloc's faction in the Verkhovna Rada will not take part in considering any issues until Stelmakh is dismissed.

"The President, Viktor Yushchenko, who appoints and dismisses the presidents of the National Bank, bears the full brunt of responsibility for the situation with the exchange rate," Tymoshenko said.

Source: ITAR-TASS

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MOSCOW, Russia -- Russian gas giant Gazprom warned Thursday that it had no obligation to deliver gas to Ukraine from January 1 if Kiev failed to pay its debts, raising the spectre of cuts to downstream customers in Europe.

A gas pressure-gauge and the valve of the main gas-pipe outside Kiev. Russian gas giant Gazprom warned Thursday that it had no obligation to deliver gas to Ukraine from January 1 if Kiev failed to pay its debts, raising the spectre of cuts to downstream customers in Europe.

"If the debt is not reimbursed by January 1 and if other solutions are not found, we cannot sign a new contract and we will have no legal basis to supply gas to Ukrainian consumers," Gazprom spokesman Sergei Kupriyanov said.

Kupriyanov did not explicitly say that Gazprom would cut off gas to Ukraine if the debt remained unpaid. But his comments represented a clear warning of the consequences if the debt were not cleared.

Ukrainian President Viktor Yushchenko said in Kiev that 800 million dollars' worth of debt had been repaid to Gazprom on Wednesday, promising that an additional 200 million dollars would be paid in the near future.

"We must not have debts," the Interfax news agency quoted him as saying at a briefing.

Kupriyanov confirmed that Ukraine had paid 800 million dollars (544 million euros) of its debt to Gazprom but said this left an outstanding sum of roughly two billion dollars which he did not expect Kiev to pay soon.

"The other piece of news is that they are they are not going to pay more before the New Year. In other words they have paid back the debt for October, but not for November and December.

"We are not going to see this sum before the New Year and if they do not propose any timetable for repayment, the problem of January 1 is going to be aggravated.

"It is evident that we cannot go onto a new contract while leaving behind a debt of two billion dollars," he told reporters at a news conference broadcast live on state television.

Gazprom maintains that Ukraine's state gas company Naftogaz owes it 2.4 billion dollars (1.8 billion euros) and Russian officials have warned of steep price rises or delivery cuts if the outstanding debt is not cleared.

Meanwhile a Ukrainian delegation left for London to discuss the dispute with European Energy Commissioner Andris Piebalgs, officials in Kiev said.

The delegation -- consisting of Naftogaz chief Oleg Dubina, one of his deputies and a representative of Yushchenko -- will "carry out consultations in the context of regulating" the dispute, the presidency said in a statement.

They are to meet with Piebalgs, who is currently in London, a source close to the delegation told AFP under condition of anonymity.

"Efforts are being undertaken to ensure the timely payment of bills for November and December," the presidency's statement said, before taking a dig at Yushchenko's political archrival, Prime Minister Yulia Tymoshenko.

"Today the president's actions aim to settle the problems provoked by the systemic mistakes and inaction of the head of government," Yushchenko's top official for energy, Bogdan Sokolovsky, said in the statement.

Ukrainian Energy Minister Yuri Prodan denied that Ukraine was going to stop paying off its debts, saying that it would continue to negotiate with Gazprom.

The two sides are also at odds over fines imposed by Gazprom on Ukraine for late payment. The method of payment is also an issue as Naftogaz currently pays through an intermediary.

The new contract is a crucial issue as Gazprom wants to gradually increase the price Ukraine pays for gas to bring it closer to the price paid by European Union countries.

Ukraine currently pays Russia 179.5 dollars for 1,000 cubic metres of gas, less than half what some EU countries pay. A sharp rise would cripple Ukraine's economy, already ravaged by the global financial crisis.

Analysts have warned that any cut in supplies could have knock-on effects elsewhere in Europe, as Ukraine is a major transit country for Russian gas exports to the EU.

An earlier dispute between Russia and Ukraine over gas prices led to a brief interruption of gas supplies in several European countries in January 2006.

Source: AFP

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Thursday, December 18, 2008

Basic Human Rights Not Advancing In Ukraine Despite Country’s Formal, Signatory Commitment

KIEV, Ukraine -- Taboo during the Soviet era, the Universal Declaration of Human Rights is available for anyone to read at www.un.org/Overview/rights.html.


Adopted by the United Nations General Assembly on Dec. 10, 1948, the declaration arose from the tragedies of World War II and became the first to globally recognize the “inherent dignity, equal and inalienable rights of all members of the human family.”

Ukraine, however, celebrated the 60th anniversary still mired in official corruption and other human wrongs. The Kyiv Post asked Ukrainian Ombudsman Nina Karpacheva for a progress report.

“Disregard for human rights is a norm of modern life in Ukraine. The country is drawn into brutal legal nihilism. Ukraine has joined 220 U.N. human rights conventions, but mechanisms for their realization are not working as any official at any level ignores court decisions,” Karpacheva said.

“Respect for human dignity can not appear out of nowhere, it has to be cultivated. We must realize that rights are inherently entitled and not given by the state. Next year we’re issuing a manual for human rights protection for children. Our human rights start with the rights of our kids. The text of the declaration has to be on every Ukrainian desk, as it is the constitution of mankind.”

Karpacheva also summarized progress in the following areas:

Violence: “Measures [to stop] mass police tortures must be found. Domestic violence is another huge problem. Thousands of women, children and elderly people need to be protected. Years ago, when I started fighting against abuse of inmates’ rights, many were asking me ‘Don’t we have other problems than those of inmates?’ I never grew tired of repeating that the wall between penitentiary establishments and society is relative.”

Freedom of speech: “PR took over vital social issues. Persecutions and intimidation of journalists still exist. In 2005, there were 16 cases of journalist harassments [beatings, assaults, intimidation], 33 in 2006 and 22 in 2007. None of the crimes was solved. Even if they get to court, they fade out in their infancy. Until the head of Georgiy Gongadze is found, Ukraine will remain the ‘headless rider.’ ”

Discrimination: “There is brutal disrespect towards foreigners, persons without citizenship and refugees. Ukraine must create more efficient laws against xenophobia, racism and intolerance, as there were five murders of foreign citizens and 76 attempted murders during the year.”

Rights of defendants: “For 10 years, parliament has not adopted a law about free legal assistance. More than 70 percent of Ukrainians appeared below the poverty line and are unable to afford a private lawyer.”

Human trafficking: “In 1999, all U.N. conventions concerning human trafficking were efficiently included in a single article [of the Criminal Code], covering men, women, children and organ trafficking. Parliament successfully tore the article into pieces and scattered it among others. Now it’s almost impossible to institute criminal proceedings for human trafficking.”

Adoption: “The Hague Convention on Inter-country Adoption ... contradicts our national interests, clearing the way for masked trafficking of orphans.”

Rights of sailors: “Our sailors wander around the world under foreign flags, unprotected. We initiated the ratification of U.N. Convention on the Law of the Sea and parliament ratified it. This convention gives the opportunity and mechanism for protection of sailors’ rights. Nobody uses it. Nobody cares.”

Source: Kyiv Post

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Ukraine’s President Cancels Annual Online Q&A Session For Flimsy Reason

KIEV, Ukraine -- The president chickened out. He was afraid to face questions from the nation that elected him and stood up for him, and canceled his Internet conference.


The president chickened out...


On Dec. 16, Victor Yushchenko was supposed to have an Internet chat through three of the largest news portals on the Ukrainian web.

The growing Internet community was holding its breath, hoping to get answers to thousands of questions they had been posting on participating web sites for more than a week.

But the president’s aides announced on Dec. 12 that the session would be canceled. They said the president scheduled “an emergency meeting” instead to deal with cutoffs of heating and hot water in Kyiv.

Some of the questions, they said, the president might take during his annual press conference summarizing this year’s performance. Maybe. If the president has enough time.

Obviously, the "emergency meeting" is the lamest of excuses.

The president, who has plenty of time to fly abroad and grant interviews to foreign journalists, has no time for those in his own nation.

By the time the “emergency meeting” took place, Kyiv residents would have been freezing for nearly a week.

The real reason for refusal is, of course, Yushchenko’s fear of facing tough questions.

The most popular question asked on the Internet was:

“Dear Mr. President, Can you tell us (the simple people) how much do we have to pay you so that, together with parliament deputies, ministers and government members, you leave for abroad and do not hinder Ukraine’s normal development?” This question received over 72,000 votes from the audience of pravda.com.ua, where it had been posted.

Nearly 13,000 questions were posted altogether on all three participating websites, and none of them was easy.

Many questions called for his resignation, asked for accountability involving crimes and election promises, and asked for help and advice on how to survive in times of crisis.

Many personal questions were asked, including why the Ukrainian president’s young children study in an English-language school and why his oldest son is an idle and rich “golden boy.”

So, now the nation will have to wait for the annual press conference to hear answers to some of these questions. Maybe. If the president has enough time.

Source: Kyiv Post

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Wednesday, December 17, 2008

Somali Pirates Seize Turkish Ship With 8 Ukrainians In Crew

KIEV, Ukraine -- Eight Ukrainians are among the crewmembers on board a Turkish ship captured by Somali pirates in the Gulf of Aden, the Ukrainian Foreign Ministry said on Wednesday.


The Turkish-owned, Antigua-flagged Bosphorus Prodigy was captured by Somali pirates on Tuesday, according to a report from the Ukrainian Embassy in Kenya. The report was confirmed by a British military attache in Nairobi and the Turkish Embassy in Kenya.

The dry cargo ship, which was built in 1985, is owned by Isko Marine Shipping Company and has eight Ukrainians and three Turks on board.

So far there have been no demands for ransom from the pirates.

Ukraine's embassy in Ankara and consulate in Istanbul have been ordered to take the incident under control and contact the ship owners to secure the release of the crewmembers as quickly as possible, the Foreign Ministry statement said.

Pirates have been increasingly active in the waters off east Africa, where over 120 ships have been attacked so far this year, with around 40 vessels seized.

The French oil company Total said on Tuesday that a tug and unladen barge chartered by it had also been seized. They were bound from Yemen to Malaysia.

A Ukrainian-owned ship, the Faina, carrying 33 T-72 tanks and other heavy weaponry, was boarded by Somali pirates on September 25 and has not been released. The crew comprises 17 Ukrainians, three Russians and one Latvian.

The navies of at least 10 countries, including Russia, are involved in anti-piracy operations off the coast of the East African nation.

Source: RIA Novosti

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Heat Rises In Russia-Ukraine Gas Talks

KIEV, Ukraine -- Every year, Russia and Ukraine pledge to end their high-stakes annual gas negotiations well before winter. And for the fourth year running, the January 1 contract deadline is looming with no agreement in sight.


“We spend every new year waiting to sign an agreement,” says one gas trader. “I make money but I am tired of making it this way.”

Tension is particularly high this year because of Moscow’s intervention in Georgia, a power vacuum in Ukrainian politics and the global economic crisis, which is increasing pressure on Gazprom, the state-controlled Russian gas group, to extract a big price rise.

Yulia Tymoshenko, prime minister of Ukraine, is also determined to implement a deal agreed with Vladimir Putin, her Russian counterpart, to cut “corrupt” intermediaries from the gas trade. She wants to exclude Rosukrenergo, a joint venture between Gazprom and Dmitry Firtash, a Ukrainian billionaire gas trader. The Swiss-registered company says it is fully transparent and intends to keep its contractual role.

Alexander Medvedev, the Gazprom deputy chief executive, has warned the European Union that the two countries are “far away from a settlement”, raising fears of disruption to EU supplies similar to that caused by the price dispute in 2005-06 and, to a lesser extent, in March 2008. Gazprom supplies 25 per cent of the EU’s gas, mostly via Ukraine.

The three key issues are price, Ukraine’s unpaid arrears, and the intermediaries. Russia has increased its prices to former Soviet republics since 2003 from $50 per thousand cubic metres, with the largest rises hitting the two countries that have tried to break out of Moscow’s political orbit – Ukraine and Georgia.

Next year Gazprom wants another big increase from Ukraine, from $179.50 per 1,000  cu  m to $400 – close to what Germany pays. Naftogaz, Ukraine’s state gas company, want to keep the price it pays at about $250, not least because the Ukrainian hryvnia has dropped 30 per cent against the dollar this year and could slide further. With its economy set for recession in 2009, Kiev fears the impact of higher gas prices on a country that has already needed International Monetary Fund support.

Ukraine wants to replace today’s ad hoc negotiated prices with a long-term agreement pegged to world oil prices. This could reduce disputes and lead to cuts in gas prices in late 2009, when rolling six-month average oil prices – which could be the basis of a peg – are expected to fall sharply. Yet Russian economic growth has plummeted from more than 7 per cent to about 3 per cent. The state is running down its huge financial reserves by supporting the rouble and refinancing banks. With or without a new price formula, Gazprom is keen maintain export prices.

It also insists that Ukraine settle unpaid gas bills worth $2.4bn (€1.7bn, £1.6bn) – an amount Ukraine disputes. The IMF says Kiev has the means to pay. But there is speculation in Ukraine that Moscow wants it to settle by transferring assets, notably a stake in Ukraine’s vast pipeline network. The ageing network needs investment, for which Ukraine may require partners. But selling stakes to foreigners, especially Russians, would be politically unacceptable.

In the middle of the dispute sits Rosukrenergo. In taking a soft approach towards Moscow over Georgia, Ms Tymoshenko appears to have won favour with Mr Putin and may get her way over Rosukrenergo.

The company has a contract to supply all Ukraine’s imported gas, 55bn cu m annually, which it buys from central Asian countries and ships via Gazprom. The $1bn annual losses made on the trade are offset by gains from a second contract to ship 15bn  cu  m across Ukraine into the EU. Even allowing for transit fees, this is very profitable. Last year the company made $867m pre-tax profits on sales of $9.9bn.

The US has criticised this arrangement, but the EU has been cautious. Edward Chow, a fellow at the Center for Strategic and International Studies in Washington, says “the critical question” is what Rosukrenergo does to secure gas worth billions a year. “What service does it perform that Gazprom and Naftogaz cannot do for themselves?” asks Mr Chow.

Even if Rosukrenergo were squeezed from Ukraine’s import trade, it could remain a big player in gas if it kept its transit contract. Mr Firtash’s holding company, Group DF, has also invested heavily in Ukraine’s domestic distribution market and in central Europe. Whatever the outcome of the talks, Ms Tymoshenko will struggle to fulfil her aim.

Source: Financial Times

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Tuesday, December 16, 2008

Yushchenko's Son Spends $500,000 Dollars On His New Girlfriend

KIEV, Ukraine -- Andrei Yushchenko, the son of Ukrainian President Viktor Yushchenko, has found himself in the middle of another scandal again. Ukrainians continue to discuss a very expensive taste of both the presidential son and his new girlfriend Elizaveta Efrosinina.

Yushchenko's son with new girlfriend Elizaveta (L). A BMW M6 (R).

Ukrainian tabloids have published quite a number of articles on Andrei’s adventures in Dubai, when he bought Chanel bags worth $500,000 for his girlfriend.

He also became known for ordering a bottle of champagne with oysters for 2,000 euros ($2,768) at Kiev’s most luxurious nightclub.

Andrei Yushchenko was originally spotted with a new girlfriend Elizaveta (Liza for short) in the middle of the summer of 2008.

Everyone thought that it was just another girlfriend for the adventurous young man. It became known afterwards, though, that Andrei organized a ‘meet the parents’ party at his father’s home in Kiev.

President Yushchenko reportedly had nothing against their wedding.

Liza is only 21 years old, but she owns a luxury apartment in one of the most prestigious neighborhoods in Kiev.

She frequently attends fashionable parties in Monte Carlo and Courchevel and buys clothes from latest collections of world’s most renowned designers.

She appeared on front pages in a company of wealthy businessman Roman Gurevich. However, when Yushchenko’s son paid his attention to her, the woman decided not to miss such a chance.

Andrei Yushchenko thus had to accomplish a difficult goal to outstrip businessman Gurevich behind in terms of his generosity.

Andrei can be a very good match at this point: he lives in a 600 square-meter penthouse apartment. His fellow-students say that he owns a platinum Vertu cell phone worth 43,500 euros ($60,000).

He usually leaves $500 tips at restaurants and spends there not less than two or three thousand euros. He is the only owner of BMW M6 in Kiev ($130,000).

President Viktor Yushchenko uses the symbols of the orange revolution to let his son lead his idle life.

The orange revolution brand (orange scarves, mittens, hats, flags, etc) is evaluated at $100 million, experts calculated.

The Ukrainian Souvenir company sells orange revolution photo albums, watches, cigarette lighters and mugs, while Andrei Yushchenko simply has to go to the bank to get some cash.

Andrei’s previous girlfriend, Anna Pavlovich, enjoyed the orange fruit too. The couple booked a $2,500-a-night hotel room during their holiday in Turkey.

In the meantime, Andrei showers his new girlfriend with luxury. He ordered to pack everything that Liza would choose at a Chanel boutique and spent $500,000 to please the girl.

Source: Pravda

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Ukraine Bank Prominvest Receiver 'Blockaded'

KIEV, Ukraine -- The receiver of Ukraine's sixth-largest bank was trapped in his office on Monday and prevented from announcing a proposed plan to revive the bank with the government's involvement, a bank official said.

A woman walks in front of the main office of Prominvestbank.

Members of parliament confined receiver Volodymyr Krotyuk to his office as he was due to address a news conference, Andriy Shvets, part of the receiver's team, told waiting reporters.

"The press conference cannot take place for technical reasons -- the management of the temporary administrators is blockaded by members of parliament," Shvets said.

Shvets would not identify the parliamentarians blockading the receiver. The central bank declined all comment.

Prominvest, in receivership since October after a run on its deposits, was to have been bought by an Austrian holding company, Slav AG, controlled by two Ukrainian members of parliament -- brothers Andriy and Serhiy Klyuyev.

But the brothers failed to meet last week's deadline for payment.

Before the news conference, Krotyuk's press service issued a statement saying international auditor Deloitte&Touche was studying the bank's finances "after which a realistic estimate of the size of bank's assets will be made".

"After this assessment, the temporary administrator will establish a programme of financial revival with government participation and submit it for central bank approval," it said.

The brothers agreed to increase Prominvest's capital by 900 million hryvnias ($120 million) via a share issue and raise an extra 3.6 billion hryvnias through deposits or subordinated debt but twice failed to meet payment deadlines.

Prominvest said a steep fall in the value of the hryvnia currency had complicated the transaction. The last deadline set by the administrator for payment was Dec. 8.

Prominvest remains barred from allowing withdrawals, affecting ordinary depositors and heavy industry businesses traditionally financed by the bank.

Such blockades are not uncommon, especially in ownership rows. Ukraine's largest refinery was taken over by a former head and armed men last year and two years ago members of parliament blockaded the prosecutors office in a row over its top staff.

Source: Guardian UK

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Use Her Refuse Her

KIEV, Ukraine -- It’s regrettable that once again the marriage between Ukraine and NATO failed to take place. Russia snickered with satisfaction that neither its nemesis, the United States, nor NATO’s other member states, nor Ukraine together with its patriotic diaspora managed to pull it off.

NATO boss Jaap de Hoop Scheffer.

Russia won again: it decides who becomes a NATO member while Ukraine, despite its significance as the largest country in Europe and after some twenty years of nurturing democracy against great odds once again gets a "harbuz", a pumpkin-- Ukrainian vernacular for a marriage refusal.

Why again? And the bureaucratese mumbo jumbo about “not meeting standards” simply doesn’t stand up as others join in. Was it because of Russia’s Goliathan response to Georgia’s legitimate claims to protect its territory? Fear of military engagement should Russia pursue other illegal land grabs like Ukraine’s Crimea? Threats of energy cut-offs to Europe?

Are longer term aspiration with Russia—trade, space or power sharing-- influencing the two perennial opponents to Ukraine’s entry reducing France and Germany to placating Russia even while the United States -- to whom they owe post War peace -- supported Ukraine’s entry?

Was it Ukraine’s own lack of determination coupled with the disfunctionality of President Victor Yushchenko, with a dismal 3% rating, that prevented the union?

What about Ukraine’s diaspora? Was its absence of pressure in Nato members’ corridors of power a factor which turned former supporters, chiefly the United States, ultimately into refuseniks?

The answer lies in all of the above.

Following Russia’s over-the- top-response in Georgia this summer most members favoured Ukraine’s admission. To counter, Russia revved up its aggression. It refused to withdraw from occupied territory, threatened Ukraine with nuclear attacks, and distributed newly issues Russian passports to Ukraine’s citizens.

Instead of standing firm against increased bullying some NATO members caved while Ukraine’s international diaspora failed to mount any significant support.

The diaspora in Canada, for instance, couldn’t tear itself away from summer holidays long enough to protest Russia’s aggression let alone muster a vigorous political campaign to ensure Canada’s ongoing support of Ukraine’s membership would hold.

Elsewhere, members found little incentive to follow through when confronted with the gargantuan pressures from Russia to halt Ukraine’s entry.

Furthermore, Germany and France appear to have their own agenda in appeasing Russia. Perhaps Germany’s Chancellor Angela Merkel aspires to a more serious entente. Recently she’s been leading Europe’s rapprochement with Russia, supported by President Nicholas Sarkozy of France, clearly at Ukraine’s expense.

Sacrificing Ukraine is not a new phenomenon. Consider this.

Since Prussian Catherine the Great ascended Russia’s throne in the 18th century, Germany has had hopes of ruling up to the Urals. To this end, she destroyed the Ukrainian Cossak military formation that had defended Europe from the Ottoman Empire for some three hundred years. The rest of Europe said nothing.

After WWI when Ukraine sought recognition of its sovereignty over its newly reunited eastern and western lands, Britain’s Prime Minister Lloyd George et al killed this aspiration at the Treaty of Versailles.

Ukraine was again to be divided, this time between Russia and Poland. But Poland was determined to Polonize it while Russia, de facto the USSR, starved some 10 million to ensure russification and Communism’s dominance.

There was more of the same after WWII when most of Ukraine was reunited but handed over to “friend and ally” Russia. The West made little of the fact that it was Ukraine, with yet another 10 million dead, that won WWII against Hitler.

And last week the US, a staunch supporter of Ukraine backed away from seeking its NATO membership in exchange for support for the missile defense system.

Unfortunately for both Ukraine and others most attempts to appease Russia have brought agonizingly painful consequences. In the last century alone czarist abuses precipitated the Communist era with its staggering 80 million victims in the USSR alone. The post WWII appeasement gave the world some fifty years of the Cold War.

Returning to NATO’s latest rejection much of the blame also rests with President Yushchenko. His pro-NATO rhetoric over his four-year presidency did not translated into action.

He failed to mount a robust public education campaign to increase support; there was no NATO ambassador in place months to the lead-up to April’s critical talks in Bucharest; failed, again, to hold support among western members.

By default, the President -- directly responsible for foreign affairs under Ukraine’s Constitution -- has worked Russia’s rather than Ukraine’s agenda.

For over two centuries the West—ignorant and acquiescing -- has appeased Russia at the expense of Ukraine. Each time Russia turned into a monster that ultimately turned on the West.

Following last week’s meeting, Russia’s NATO Ambassador snickered. NATO, he said "pomatrosyla y brosyla Ukrajinu". In genteel vernacular is means NATO used her and refused her. The expression is cruder in Russian. It is obvious to all what happened, pretty rhetoric and promised of future membership in NATO notwithstanding.

Perhaps next time NATO will get the point: its best interests lie with Ukraine inside NATO not aligned with Russia.

Source: Unian

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Monday, December 15, 2008

Don’t Expect Service, With Or Without Smiles

KIEV, Ukraine -- Here’s a joke dating back to the times of the U.S.S.R.: In the metro, a woman says to a man: “Can you take your glasses off. You’re going to tear my stockings.”

Grumpiness of servers, long queues and disregard of clients were characteristic for service in the Soviet Union. This style of service is still alive in Ukraine.

I think only the Japanese can understand this sort of humor among all people from capitalist countries. I have never visited Tokyo, but I read that their metro is just as busy as ours.

To be able to laugh at this joke one has to imagine oneself in the middle of a Kyiv metro carriage in a peak hour when people travel to or from work. People are pressed against one another as if they are fish in a can. There used to be jokes that one could get pregnant in the metro and not know by whom.

Here is another curious phrase from the same sort of humor. A woman says to a man in a metro carriage: “Excuse me! Can you take your hand off!” Then to another man: “Not you, you’re ok.” People had to survive with this sort of service and it was easier to endure with laughter.

Service remains bad in the metro. But it wasn’t just service that was bad, it was the whole philosophy of service back then. Unfortunately, these attitudes persist today.

We ironically called it “unobtrusive Soviet service.” It wasn’t tactful or considerate. It existed for its own sake and could easily survive without the consumer. It didn’t care about the needs of its hypothetical clients in shops or wherever else transaction with the public took place.

Foreign visitors to Ukraine rebelled against such a state of affairs. They did want to accept it, leading to funny situations.

In the early 1990s, I worked in the press service of Narodniy Rukh political party. I worked with American Irene Jarosewich. One day we went to drop off some documents at a Kyiv hotel where parliament members lived.

Afterwards, Irene felt tempted to dine in the hotel’s restaurant. I tried to delicately dissuade her, because I knew what restaurants were like, and suspected that it could not have a happy ending. But she insisted.

We entered the restaurant’s great hall that was completely empty. Not a single visitor was to be seen at any of the tables. The waiters told us they will not serve us because they have a reception in a couple of hours. “We won’t eat for two hours. We’ll eat quickly and go,” she tried to persuade them.

They advised us to talk to the administrator. He was sitting in a corner and writing something. He barely looked at Irene and continued his writing. He shook his head to all her arguments, with his eyes still fixed on the paper. “Soviet boor!” she exclaimed in the end. The administrator did not even so much as move his head to these words.

But it didn’t end there. She poured out her frustration on to that parliament deputy in whose room we had left our coats. He put on his jacket with a parliament member’s badge on it, came down to the restaurant and firmly asked the administrator to feed us.

Such impudence made the administrator stop writing and lift up his astounded eyes. When he saw the parliament member’s badge, he ordered the waiters to feed us. They were all afraid of authorities back then. Irene felt as if she were a World War II Red Army fighter who had set the Soviet flag atop the roof of Berlin’s Reichstag.

At that time we, Soviet citizens, had an ironic attitude to foreigners who hoped to receive the same level of service in our country as they were accustomed to at home. We joked that they did not understand our realities.

They couldn’t understand why a plumber cannot immediately come over to fix a leaky tap. They couldn’t understand why, in a shop with almost empty shelves, a sales assistant can just stand there and chat with her colleague, or even disappear for 10 minutes. They couldn’t understand why someone is being rude to them when you bring them money, i.e., contribute to the profitability of their establishment.

But now I realize that I probably couldn’t explain the logic of Soviet service to the generation that was born after the U.S.S.R. These young people have a hard time believing this sort of thing.

They have become foreigners to the U.S.S.R. They will hardly be able to imagine that if you said to someone then that “I’ll take my money elsewhere,” you would be ridiculed. There were few restaurants; there were queues in them. They didn’t have to care about their reputation and fight for clients.

But Soviet people should thank former Communist Party General Secretary Leonid Brezhnev for having any service and any service industry at all. Until he came to power in 1960s, there was no such thing. The Soviet people had to be jacks of all trades and service themselves in everything.

They had to repair their own flats, fix their own bathroom equipment and so on. There had been some restaurants. But they were meant for people with high incomes; in other words, for party and state bureaucrats.

It seems that today we can exhale with relief. And even though the service industry is not flawlessly smooth, at least its philosophy is changing. It’s trying to satisfy the client. Former Soviet citizens should be able to rejoice.

However, their joy is sometimes cut short by old habits that die hard. Last summer I visited a small town called Katerynopil in Cherkasy Oblast. When it was time to come back home, I came to the bus station. I had to squeeze myself inside the building between several refrigerators and a wall. It looked like a part of the bus station was rented out to someone selling household appliances, and they left it right in the middle of the passageway.

I came to the cash desk. There was no one there, inside or outside the booth, not even a queue. Suddenly a woman sprang up from her chair and started sprinting. It turned out she was running towards the cash desk. When I realized that, I felt happier -- someone is hurrying to serve me. But I was about to get disappointed.

When she got to her work station, the lady quickly grabbed her ringing cell phone. It was the phone call that made her hurry. She did not want to miss the call. For three or four minutes she talked on the phone, paying no attention whatsoever to me.

Having said goodbye to her interlocutor, she sold me a ticket. I took it without looking. It wasn’t until I got inside the bus that I realized she charged me an extra fee for an early booking that I obviously had not made. This was yet more proof to me that Soviet service is still alive and well.

Source: Kyiv Post

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The Battle For Bulgakov's Nationality

KIEV, Ukraine -- Russia and Ukraine are engaged in a cultural cold war over the nationality of one of the world's most celebrated playwrights.

Mikhail Bulgakov ... A national hero, but of which nation?

Few would disagree that Mikhail Bulgakov is a great writer. But is the man who wrote Flight and A Cabal of Hypocrites a great Russian writer, or a great Ukrainian writer? Or, can any country that exists today really lay full claim to him?

I didn't give these questions much thought until visiting Kiev recently. There, Vitaly Malakhov, an acclaimed Ukrainian director who started the Bulgakov international art festival seven years ago, debated the question of Bulgakov's nationality with me.

The identity crisis arises it seems because although Bulgakov was born in what is now Ukraine's capital, a city he immortalized in his first novel The White Guard, the playwright and novelist was ethnically Russian, wrote in Russian and moved to Moscow when he was 21.

So, while in a recent poll of Russians, the author of The Master and the Margharita was named the country's second greatest writer, in similar poll in Ukraine, he was claimed as Ukraine's third best playwright.

The mixed opinions on nationality aren't any less muddy elsewhere in the world of letters.

Take, for example, Bernard Shaw – described as an Irish dramatist despite living in England most of his life – or Polish-born Tom Stoppard, who is nearly always referred to as a British playwright.

The issue is, understandably, more politically fraught in Ukraine.

As Malakhov said, "the problem is, that before 1990, we were all thought of as Russian". I was reminded of this recently when Anton Chekhov's dacha in Yalta, Ukraine hit the news.

The playwright's Crimean house, where he wrote both Three Sisters and The Cherry Orchard, is falling apart, but the governments of Ukraine and Russia have been in a stand-off over who should pay to fix it up.

It's a cultural cold war with little sign of tensions easing; Nikolai Gogol is another playwright often pulled into the fray.

Although Gogol wrote in Russian, ethnically he was Ukrainian and his comic stories drew extensively on his Ukrainian background. The war over Gogol's nationality though, is fought everywhere from scholarly journals to Wikipedia. Alas, there are no government inspectors coming to town to rule on the subject.

In an ideal world, the multi-faceted identities of famous literary figures would be used to promote intercultural understanding, rather than fuel rival nationalisms.

Kiev's Bulgakov festival attempted just that, by bringing together theatre-makers and artists from around the world – including Russia and Georgia.

As Igor Volkov, an actor who participated in the festival, told me: "Bulgakov's work unites people from different parts of the world and people with different political views." So does Gogol's and Chekhov's.

As LP Hartley wrote, "the past is a foreign country," and that's the borderless country to which all great writers eventually get citizenship – regardless of where they were born or in which language they originally wrote.

Source: Guardian UK

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Sunday, December 14, 2008

Ukrainian Criminals Find Refuge In Russia

KIEV, Ukraine -- Corruption was endemic in Leonid Kuchma’s Ukraine and continues to plague the country under Victor Yushchenko. Law enforcement officials have attempted to prosecute some Kuchma era officials.

Fugitive Ihor Bakai

But in several cases, the men have fled the country and found refuge in Russia.

In an attempt to bring at least one prominent person to justice, prosecutors accused Ihor Bakai, the gas tycoon and head of Naftogaz Ukraine from 1998-2000, of illegally misspending Hr 828.5 million of state funds, of abuse of power, extortion and theft of state assets.

After the Orange Revolution, Bakai fled to Russia where he was granted citizenship. An international arrest warrant for Bakai was issued in May 2005. Russia has refused to hand him over.

Other former officials are charged or wanted for questioning in Ukraine: former Interior Minister Mykola Bilokon, former mayor of Odessa Ruslan Bodelan, former Kiev Oblast governor Anatoliy Zasukha and the former deputy chief of the State Security Service of Ukraine, Volodymyr Satsyuk, all fled to Russia.

Even if Moscow agreed to extradite the suspects, there are no guarantees that Ukrainian officials will prosecute them.

Former Sumy governor Volodymyr Shcherban fled to the United States on an “investor’s visa” after the Orange Revolution. He was wanted in Ukraine on corruption charges.

Shcherban triumphantly returned in November 2006, with the help of high-priced U.S. lawyers and his political ally Victor Yanukovych, who had just become prime minister.

The case against Shcherban was shelved.

Source: Kyiv Post

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Klitschko Beats Rahman To Retain Heavyweight Title

MANNHEIM, Germany -- Wladimir Klitschko defended his IBF heavyweight crown by stopping Hasim Rahman in the seventh round at SAP Arena on Saturday.

Heavyweight boxing champion Wladimir Klitschko (L) from Ukraine, punches challenger Hasim Rahman (R) from the US, during their IBF, WBO, IBO title fight at the SAP Arena in Mannheim, southwestern Germany on Saturday, Dec. 13, 2008.

Klitschko, who has not lost in more than four years, hit the shorter Rahman at will throughout, and after landing a left-right-left combination against the cornered American, the referee stepped in to end the contest.

Rahman didn't appear upset.

Klitschko had knocked down Rahman in the previous round with successive left hooks.

The technical knockout in Klitchsko's sixth defense of the IBF belt — and third this year — improved the Ukrainian-born fighter to 52-3 with 46 KOs.

Rahman, the two-time heavyweight champion who stepped in as a replacement opponent last month, struggled to get inside the taller Klitschko's reach, and dropped to 45-7-2.

The fighters started out fast and light on their feet, but it soon became apparent that Rahman was struggling to overcome the 3 1/2-inch height advantage enjoyed by the champion.

Rahman had to lean in drastically, and Klitschko easily fended off his punches.

Rahman did little more than lean on the ropes for a time and guard his face as Klitschko sought his opening.

Rahman looked reinvigorated in the fourth round, using his whole torso to make ambitious attacks, often connecting with Klitschko's body.

But he rarely landed blows above Klitschko's shoulders, and the consequences were clear when Klitschko dropped Rahman early in the sixth with two hard lefts to the side of his head.

Rahman got up but spent the remainder of the round in the corner, taking a sustained beating.

Another flurry at the opening of the seventh ended Rahman's challenge.

Klitschko also retained the minor WBO and IBO belts.

Klitschko was originally scheduled to face Alexander Povetkin (16-0), but the Russian pulled out with an ankle injury.

Rahman, who won the WBC and IBF belts from Lennox Lewis in 2001 and the vacant WBC belt in 2005, arrived in Germany on Monday and declared he was in top shape.

On the undercard, former heavyweight champion Riddick Bowe made a modest comeback with an eighth-round decision over Germany's Gene Pukall. It was just the third fight in a decade for the 41-year-old American and his first in three years.

Bowe (45-1, 33 KOs) had been training in Germany since September in an effort to get his stamina up and his weight down. The work paid off in the ring, where he kept up with the 33-year-old Pukall (14-13-2, 12KOs) and bested him with a stream of careful head shots.

Source: AP

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Saturday, December 13, 2008

IMF Satisfied With Ukraine Loan Plan Amid Crisis

KIEV, Ukraine -- Ukraine is on the right track in implementing policies it had committed to when accepting an emergency loan to survive its worst economic crisis in a decade, an official from the International Monetary Fund said in an interview published Friday.

Ceyla Pazarbasioglu, the head of the IMF mission to Ukraine.

Ukraine has so far received more than a quarter of a $16.4 billion IMF rescue loan to help it cope with an economic crisis brought on by a drastic fall in its exports of its main commodity, steel, and in its national currency, the hryvna.

Ceyla Pazarbasioglu, the head of the IMF mission to Ukraine, was quoted by the daily Kommersant Ukraine as backing the central bank's policies to let the market determine exchange rates and to recapitalize major banks.

Pazarbasioglu also countered speculation that financial regulators were misusing the IMF funds.

"So far we have no comments or remarks and we have not felt in any way that the IMF funds are being used inappropriately," she was quoted as saying.

Meanwhile, the depth of the economic slump was illustrated by data from the State Statistics Bureau, which late Thursday said industrial output fell 29 percent in November from a year earlier, the biggest decrease in a decade.

Parliament on Friday passed more legislation to soften the effects of the crisis. Lawmakers backed increasing funding for pensions, deposit insurance and prohibiting banks from unilaterally reconsidering the conditions of loans.

Lawmakers approved a transfer of 3.2 billion hryvna ($415 million) to the state oil and gas company Naftogaz, crippled by a $2.4 billion debt to Russia's natural gas giant Gazprom for imports.

Naftogaz officials traveled to Moscow Friday to continue talks on settling the debt and agreeing for next year's imports.

Russia is threatening to more than double the price for Ukraine's imports to over $400 per 1,000 cubic meters if Kiev fails to pay off the entire debt.

Source: AP

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Russia Raps NATO Over Georgia, Ukraine

MOSCOW, Russia -- Russia's ties with NATO will remain strained as long as Ukrainian and Georgian membership of the alliance remain on the agenda, its defence minister said in an interview published on Friday.

Russian Defence Minister Anatoly Serdyukov.

The Kremlin accuses Washington of using NATO expansion -- in particular long-term plans to bring in ex-Soviet vassals Ukraine and Georgia -- to encircle Russia with hostile armies and draw new dividing lines in Europe.

"We stand for a serious, constructive dialogue with the alliance," Defence Minister Anatoly Serdyukov told Finland's National Defence Journal.

"But if someone hopes we will compliantly watch a military armada being built at our borders, with our national security interests being ignored, then we will have to upset someone".

Serdyukov said Moscow was worried by "the stubborn persistence of some alliance members, in particular the United States, to drag Ukraine and Georgia into NATO, no matter what".

"We would like to know, for instance, whether you would feel worried if there was a person armed to the teeth standing at the door of your house, who would not say why he came or what he would do next, and only brandished a knife in front of your face," he added.

At a meeting of NATO foreign ministers earlier this month, Germany led resistance to U.S. plans to give Ukraine and Georgia a timetable for NATO membership. Washington, however, has urged NATO to encourage the two states to join the alliance one day.

"As we know, there is no consensus in the bloc's ranks on this issue (of Ukraine's and Georgia's membership)," Serdyukov said. "Nonetheless, it remains on the agenda."

NATO-Russia forum
The work of a NATO-Russia forum was suspended after Russia's five-day war with Georgia in August following Tbilisi's attempt to retake the rebel region of South Ossetia by force.

"As for Georgia ... one can hardly imagine a role for this country in ensuring collective Euro-Atlantic security, especially now, after its barbaric punitive operation in South Ossetia," Serdyukov said.

"Of course, such a state of things does not help building constructive foreign policy relations between Russia and NATO."

In a move welcomed in Europe, U.S. State Secretary Condoleezza Rice has said she does not oppose "in principle" reviving contacts with Russia via the NATO-Russia Council set up to oversee the relationship.

But Serdyukov said that unless NATO was prepared to address Russia's concerns about expansion, Moscow had "something that can turn such hopes into illusions".

The minister said he was referring to President Dmitry Medvedev's order not to disband by 2010 three regiments of a nuclear missile division in central Russia.

Serdyukov reiterated that Russia could deploy Iskander tactical missiles in the Kaliningrad region bordering European Union territory, if Washington pushed ahead with deploying elements of an anti-missile system in Poland and the Czech Republic.

"You must understand that all these measures are forced upon us," he added.

Source: Hurriyet Daily News

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Russia Offers Ukraine Deal On Gas Debt: Gazprom

PARIS, France -- Russian energy giant Gazprom has offered Ukraine a compromise deal on its outstanding gas supply debts, the company's deputy chairman Alexander Medvedev told reporters Friday in Paris.

Alexander Medvedev

"We hope to find a solution. We are making proposals to our Ukrainian colleagues," said Medvedev, who is also head of Gazprom's export arm.

Gazprom says Ukraine's Naftogaz state gas company owes it 2.4 billion dollars (1.8 billion euros) and Russian officials have warned of steep price rises or cuts in supplies if the outstanding debt is not cleared.

Kiev disputes the size of its tab, arguing that some of the penalties for late payment are unfair, and the issue has further embittered already tense relations between Moscow and the westward-leaning former Soviet republic.

Ukraine agreed last month to pay the debts owed for September and part of those owed for October by December 1. Gazprom has said part of this sum has now been paid back but not the full amount required.

Gazprom -- a firm whose executives have extremely close ties to the Kremlin -- have warned that it could raise the price to 400 dollars per 1,000 cubic metres, more than double what Ukraine pays now.

Currently Ukraine pays Russia 179.5 dollars for 1,000 cubic metres of gas, much less than what European Union countries pay. A sharp rise would hurt Ukraine's economy, already ravaged by the global crisis.

Analysts warn that any cut in gas supplies could have knock-on effects elsewhere in Europe, as much of the Russian gas exported there passes through Ukraine, although a previous dispute did not hurt western supplies.

Medvedev also said that Gazprom hoped to triple its supply of gas to France within three to five years, from half a billion cubic metres per year to 1.5 billion, essentially through seeking out small-scale business customers.

France's main gas firm, the partially state-owned Gaz de France, already buys 12 billion cubic metres of gas per year from the Russian supplier, but the giant is keen to become major actor in the French market in its own right.

Source: AFP

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Friday, December 12, 2008

Red Cards? Poland And Ukraine Struggle As Soccer Hosts

WARSAW, Poland -- It seemed like the perfect plan, if a slightly risky one. Give Poland and Ukraine, two of Europe's largest emerging economies, the chance to hold the Continent's premier soccer tournament, build on the Continent's fan base and help secure the sport's future in Eastern Europe.


After nearly two years plagued with disorganization, corruption and now a global financial crisis, the former Soviet-bloc countries' future as co-hosts of the Euro 2012 tournament is looking far from secure.

What ideally would be a pretty straightforward process - getting national teams together to play soccer in front of fans and television cameras - has turned into a multinational melodrama that could have sprung from the pages of Gogol.

Ukraine has played the part of the down-on-his-luck guy, Poland the corrupt official and Germany the ready opportunist, prepared to sweep in and take over part of the tournament if Ukraine stumbles.

After a series of harshly critical reports and comments by officials, there has been a flurry of activity as the two countries try to prove that they have their acts together so that the European soccer federation, UEFA, does not pull the plug.

Both countries have begun work on the marquee stadiums in their capitals, Kiev and Warsaw. To satisfy UEFA concerns about crowd control, the Ukrainians went as far as destroying a brand new shopping center built nearly on top of the stadium in Kiev.

So far, their efforts seem to have somewhat allayed the fears of soccer officials here. "We have full confidence in Euro 2012 in Poland and Ukraine," Michel Platini, the UEFA president, said in Nyon, Switzerland, on Wednesday after meeting with officials from the two countries.

That was a significant improvement over the UEFA announcement in September, which stated that Poland and Ukraine had "erred because of a lack of experience and rigor, and that the development of the necessary infrastructure needed for the good running of the final tournament was practically at a standstill."

So it was with understandable relief that a delegation from Ukraine's Euro 2012 organizing committee arrived at the plush diplomatic reception hall of Kiev's Boryspil airport on Wednesday, jovial - and a bit tipsy - after the meeting in Nyon, which many said was the most positive and cooperative they have had.

"Ukraine and Poland have demonstrated major progress in their preparations," said Hryhoriy Surkis, president of Ukraine's football federation. "We have really gotten into a rhythm."

It sounds like a familiar story, as with the Athens Olympics in Greece. The host is unprepared and a major sporting event begins to look like a looming disaster, then the imminent deadlines pull everyone together and the event goes off without a hitch.

But there is one major difference. The economic forces at play are beyond the control of the two governments.

The troubles faced by Poland and Ukraine serve as a lesson that sports do not take place on a rarified plane, but are subject to the same economic forces that plague homeowners under foreclosure and investment bankers looking for jobs.

Sponsoring the event requires a lot more than building just two stadiums - it means constructing and expanding roads, railroads and airports, not to mention making sure there are enough hotel rooms.

There is precedent for a country losing a big sporting event: Colombia was to host the World Cup in 1986 but had to yield to Mexico because of financial difficulties connected with a worldwide recession in 1982 and a drop in prices for coffee, the country's major export.

Ukraine has been brutalized by the global economic crisis, with the International Monetary Fund pledging an emergency $16.5 billion loan to try to stabilize the country, where inflation has reached close to 20 percent and economic growth has nearly bottomed out following almost seven years of averaging 7 percent gains.

There are very tangible fears that the private investment dollars Ukraine had hoped would help build up the country's infrastructure ahead of Euro 2012 will dry up.

The country also is plagued by political conflict that can freeze government activity for months at a time. In November, the government scrapped the agency overseeing Euro 2012 plans and replaced it with a 50-member coordinating bureau after UEFA complained about management effectiveness.

That might help explain why the new head of Poland's football association, Grzegorz Lato, shortly after being named to the job, declared, "If Ukraine does not make it, we could host the tournament with Germany." Letters flew back and forth between Kiev and Warsaw, and Lato later said that his comments had been taken out of context.

Franz Beckenbauer, who, like Lato, is a national soccer hero in his home country of Germany, did nothing to allay Ukrainian fears when he was quoted in a leading daily, Süddeutsche Zeitung, as saying that Germany's taking over Ukraine's role "has been under discussion. It is no longer a big secret." It did not help that Beckenbauer is vice president of FIFA, the world soccer federation.

Rumors also began to circulate widely that Spain, the champion of the 2008 European Championship, held by co-hosts Switzerland and Austria, could also step in as a replacement.

In September, Platini, the UEFA chief, stepped in and reaffirmed that Poland and Ukraine would sink or swim together. "If the stadiums in the capitals are not built, the Euro will go neither to Kiev nor to Warsaw," he said.

The sound of jackhammers and bulldozers now emanates from the gutted shell of Kiev's Olimpiyskiy Stadium. The interior has been stripped of seats and stairways, and piles of snow-covered rubble litter the outside. Hammer-and-sickle Soviet emblems and a socialist realist murals are all that remain of a past era of athletic preeminence.

Construction on the facility only began Dec. 1, the absolute deadline set by European soccer officials. Two of the other stadiums, in Donetsk and Dnipropetrovsk, are nearly finished thanks to financial backing by two Ukrainian billionaires. Municipal governments have had a harder time financing stadiums in Kiev and Lviv, a city in western Ukraine, and construction has been lagging.

The Ukrainian government has also pledged an addition $2 billion for Euro 2012 preparations and plans to spend a total of $10 billion to offset the loss of funds from private investors.

But Ivan Vasyunyk, Ukraine's deputy prime minister in charge of planning the championships, said difficulties were to be expected.

"When in 2006 UEFA decided who would host the championship, it understood perfectly that the level of infrastructure - athletic infrastructure, transportation infrastructure - in Ukraine was insufficient," he said. He added: "This was a political decision for UEFA. UEFA made a decision to push soccer eastward and UEFA took a risk on Ukraine and Poland."

While Poland is, at least for now, on much more stable footing economically than Ukraine, it had its own difficulties this autumn after dozens of coaches, referees and officials were arrested in a graft investigation. A former national team manager, Janusz Wojcik, was charged with 11 counts of corruption.

The Polish government suspended the national soccer association's management board, running afoul of FIFA rules that stipulate that national soccer associations must remain free of government interference.

The controversy almost cost the country its right to host the tournament - and nearly forced the cancellation of qualifying matches for the 2010 World Cup - before a compromise for electing a new board was reached in October.

Miroslaw Drzewiecki, Poland's minister of sport and tourism, said in an interview that everything was back on track, both with the soccer association and the preparations for the championship. The Polish master plan and timetable are in place, he said, and funding is safe and stable, even in light of the financial crisis.

"In many cases, we have made up for lost time when we were behind schedule, and in other cases we are actually ahead of schedule," Drzewiecki said.

At the site of the National Stadium along the Vistula River in Warsaw's Praga district, still just a muddy hole where the old stadium once stood, the rhythmic thudding of pile drivers pounds like a heartbeat.

While the stadiums in the two capitals are clearly required, UEFA has said that between six and eight venues are needed, and not necessarily the same number in each country. Polish officials sounded confident that they could end up hosting a majority of the matches.

Source: International Herald Tribune

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Thursday, December 11, 2008

Ukraine Continues To Knock On The West’s Doors But Looks Back To Russia

KIEV, Ukraine -- Kiev has suffered several setbacks in its Euro-Atlantic integration plans. The European Union came up with a collective plan for Ukraine and several other post-Soviet states that does not give Ukraine the prospect of EU membership.

Ministry of Foreign Affairs in Kiev.

NATO refrained from offering a Membership Action Plan (MAP), although President Viktor Yushchenko expected it in 2008. Meanwhile, Ukraine’s leaders are turning their eyes to Russia.

It remains to be seen whether Kiev is being sucked back into Moscow’s orbit or is returning to the multi-vector tactics of former President Leonid Kuchma (1994-2004), when Kyiv routinely played on differences between Moscow and the West.

The European Commission announced on December 3 that it would launch the Eastern Partnership plan aimed at political and economic integration for Ukraine, Belarus, Moldova, Georgia, Armenia, and Azerbaijan.

Lumping Ukraine together with its less-developed neighbors would probably have been unthinkable in the wake of the 2004 Orange Revolution, but after several years of political turmoil this is being presented by the EU as “a substantial upgrading of the level of political engagement”.

The Ukrainian Foreign Ministry’s reaction was reserved. While hailing the initiative, it noted that “Ukraine is ready to support and pragmatically use all elements of the Eastern Partnership in case the new EU policy is not presented as an alternative to the prospect of EU membership”.

Coincidentally, NATO pushed aside the MAP for Ukraine as a mechanism for eventual accession on the same day the EU touted for the Eastern Partnership.

Ukrainian Foreign Minister Volodymyr Ohryzko put on a brave face about the North Atlantic Council’s decision on December 3. “At this stage, we have achieved a desired result,” he said in Brussels. “We received a de facto MAP for joining NATO”. Ohryzko added that Ukraine might skip a formal MAP, joining NATO without it.

The pro-Western Ukrainian daily Den opined that Ohryzko’s optimism was out of place. It suggested on December 4 that NATO had offered the Annual National Program (ANP) instead of a MAP just so Kiev could save face.

A MAP, according to Den, was ruled out, given the current political crisis in Kyiv and the Ukrainian leaders’ uncertainty about the country’s foreign policy course. Interestingly, Den’s opinion coincided with that of Russia’s hard-line envoy to NATO, Dmitry Rogozin, who said that “nobody knows what it [ANP] means” and that it amounted to a refusal of a MAP to Kiev.

Viktor Yanukovych, the leader of Ukraine’s major opposition Party of Regions (PRU), hailed NATO’s decision. “Ukrainians have never supported the idea of joining NATO,” he said.

Yanukovych underscored the Russian factor: “The world leaders have understood and accepted the fact that Ukrainians, speaking against NATO membership, have expressed their rejection of more dividing lines between the two brotherly nations, Ukraine and Russia”.

President Viktor Yushchenko, who remains the only firmly pro-NATO Ukrainian leader, conceded, probably for the first time, that Russia might be involved in possible talks on NATO membership for Ukraine.

AFP, which interviewed Yushchenko, reported that he meant Russia when he said, "We must hold negotiations with all parties that are interested or not interested in Ukraine moving closer to NATO”.

Shortly before the North Atlantic Council’s meeting, Yushchenko made an apparent effort to mend relations with Russia, which were damaged after Moscow denounced the Orange Revolution.

On December 1 Yushchenko signed decrees, one appointing Ambassador to Russia Kostyantyn Hryshchenko as a special representative for developing relations with Russia, authorizing him to hold talks independently with Russian officials from the Foreign Ministry, and another setting up an interagency group for Ukrainian-Russian relations, chaired by National Security and Defense Council (SNBO) Secretary Raisa Bohatyryova.

Explaining his new responsibilities, Hryshchenko said that relations with Russia had been developing in the wrong direction, adding that “changes are needed.”

On December 3 the Ukrainian version of the Russian daily Kommersant quoted an SNBO source as saying that on several occasions Moscow had expressed its dissatisfaction with Ohryzko’s tone.

Ohryzko, who often refuses to speak Russian even when asked, is too outspoken to deal with Moscow at a time when Ukraine is in tough negotiations over Russian gas prices. Hryshchenko, who is linked to Yanukovych’s party, should speak a language better understood in Moscow.

Yanukovych, attending a congress of the One Russia party in Moscow in November, pledged that his PRU would serve as “a guarantor of stability” in bilateral relations and suggested reviving the idea of a Single Economic Space with Russia, Belarus, and Kazakhstan.

Yushchenko’s advisor Andry Kyslynsky promptly accused Yanukovych and Prime Minister Yulia Tymoshenko of competing for the Kremlin’s favor. Den suggested that through appointing Hryshchenko to deal with Moscow, Yushchenko may be trying to overtake his rivals in building bridges to Russia.

Source: Eurasia Daily Monitor

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Ukraine's Greatest Crimes, Injustices And Other Tragedies

KIEV, Ukraine -- “Bandits belong behind bars!” “One law for all!” These were the rallying cries that vaulted presidential candidate Victor Yushchenko to power during the Orange Revolution in 2004, when the nation refused to accept attempts to rig an election for Yushchenko's opponent, Victor Yanukovych.

The Leonid Kuchma era left high-profile murders and mysteries that remain unsolved today under President Victor Yushchenko. Can a nation that doesn’t confront its past ever make progress?

Yushchenko’s rise to the presidency was meant to finally cleanse the nation of the endemic corruption that marked the 10-year reign of predecessor Leonid Kuchma.

It hasn’t turned out that way.

Four years into Yushchenko’s presidency, most of the suspected lawbreakers from Kuchma’s time have yet to face justice. And none of the criminal cases that invigorated protesters during the Orange Revolution has been solved – neither the poisoning of candidate Yushchenko, nor election fraud in 2004 or previous years, nor the murder of muckraking journalist Georgiy Gongadze, nor the suspicious deaths of dozens of influential figures.

The Kuchma era from 1994-2005 left a trail of dead bodies, victims whose murderers never faced justice. Countless other crimes, ranging from embezzlement, abuse of office and theft of state property have gone unpunished. There was also the injustice in how the most valuable national industries were acquired by a small group of well-connected insiders, depriving the nation of billions of dollars in revenue and giving rise to an oligarch class that still dominates today.

Taken together, these unsolved cases and unredressed grievances raise questions about how far Ukraine has progressed from its post-Soviet gangland past.

“Impunity leaves the possibility for [crimes like these] to happen again,” said Adrian Karatnycky, who headed the United States-based Freedom House democracy watchdog when many of the events happened. He is now a senior scholar at the Atlantic Council in New York. “If you have politicians knocking off politicians or businessmen knocking off businessmen, you want to know that everything will be done to punish those responsible.”

Countries such as Poland and the Czech Republic initiated “peace and reconciliation” tribunals in the 1990s in an effort to make peace with their past and shed the vestiges of their communist histories.

In contrast, suspects in Ukraine have even received awards and decorations for their past “achievements and contributions” to statehood while others continue to hold power in the upper echelons of government.

And Ukraine’s wealthiest individuals, including Kuchma’s son-in-law, Victor Pinchuk, have held on to multi-billion-dollar assets grabbed at rock-bottom prices during the years of crony capitalist privatization.

“There is no political will to solve these cases now because many in power fear the disclosure of ‘kompromat’ [compromising information] and the potential political blacklist this can produce,” said Taras Berezovets, who runs the Politech political consulting company, which has advised Prime Minister Yulia Tymoshenko’s bloc.

The nation’s awful hangover from the Kuchma era, which became synonymous with murder, graft and corruption, lingers today. The ex-president, now 70 and living comfortably in retirement, doesn’t appear to be in any danger of having his deeds or alleged misdeeds investigated by the current government.

The inexplicable dead ends to these cases have also raised questions about how much Ukraine’s power structure has really changed – and whether Yushchenko and Tymoshenko, the twin democratic Orange Revolution heroes, really represent a clean break from the authoritarian Kuchma past.

Yushchenko, Tymoshenko and other top politicians worked for Kuchma, many of them cutting their political teeth under his tutelage. Yushchenko even once famously described his relationship with Kuchma as “father and son.” The current tandem, their financial backers and their allies were part and parcel of the system that flourished under Kuchma, who rewarded friends, disdained democracy and punished enemies.

While Freedom House has noted major improvements in Ukraine’s democracy since the Orange Revolution, upgrading it to one of a few truly “free” ex-Soviet republics, the organization did offer a cautionary note in a 2007 report:

“Political conflicts revealed a lack of respect for the division of power and the rule of law, with [the country’s leadership consistently] interfering in the courts. Corruption remained a key problem, particularly in the energy sector.”

Experts and political insiders said the long dirty laundry list of unsolved crimes has been kept unwashed by a ruling class bound by informal ties and connections dating back to the crony capitalist days of striking it rich with the sweet insider deals.

One of the key rules of staying in business appears to be not spilling all the dirt on political or business opponents because they could strike back with equally-damaging “kompromat,” or compromising information, of their own.

It all adds up to a government that has many of the same faces in place, playing musical chairs with posts. Those who fell out of line or out of favor ended up dead or abroad.

“The rule of law is ruined … nobody wants an investigator to get to the bottom of a case and open a can of worms,” said Kyiv lawyer and civil rights activist Tetyana Montian.

Montian’s husband, Yuriy Vasylenko, was the only judge who dared initiate criminal proceedings against Kuchma while he was president.

Meanwhile, the number of the nation’s unsolved crimes keeps growing as Ukrainians lose faith in the country’s institutions and government.

Ukraine’s Western partners, Brussels and Washington, watch from a distance and take cautious steps to integrate with a country whose democracy is fragile and whose leaders are unwilling, or incapable, of atoning for past sins. Russian leaders, too, look on with disdain – with Russian Prime Minister Vladimir Putin reportedly calling into question Ukraine’s claim to real statehood.

Rules of the game

“Criminal investigation and prosecution do not run things in this country. The only name of the game is money, influence, connections, etc. Justice ranks something like 150th on this list,” Montian said.

Law enforcement officers get scared when they come upon the trail of a large criminal network with extensive financial resources, intimidating bodyguards and ties to government.

If prosecutors or police take proper and lawful measures with a well-connected suspect, they can lose their jobs or, in the worst case, their heads. If they agree to hush such cases, they can be paid off handsomely.

With cops, prosecutors and judges earning meager salaries, many believe these rules are still in place today.

Although most of the unsolved crimes are perceived as a legacy inherited from the Kuchma era, the post-Orange Revolution governments have shown little willingness to pursue the cases, or fundamentally clean up the system. Salaries for police officers, prosecutors and judges have been raised slightly, but inadequately.

The media and public are often teased with news of “investigative breakthroughs” and populist proclamations that “criminals will face justice.” But the lack of progress leaves little hope that the status quo will change.

Experts contacted by the Kyiv Post declined to rank high-level criminal cases in terms of greatest impact, claiming their assessment would not be objective. However, all of them agreed that unsolved crimes damage the country’s image, both domestically and abroad.

Among the most heinous crimes left over from the Kuchma era are the decapitation of journalist Georgiy Gongadze in 2000, the mysterious roadside death of Vyacheslav Chornovil in 1999, earlier contract killings of powerbrokers such as Vadym Hetman and Yevhen Shcherban, corruption under former prime minister Pavlo Lazarenko and, of course, Yushchenko’s poisoning in 2004.

Officials often invoke the “investigation confidentiality” clause to justify not revealing any details to the public. For some high-profile cases, prosecutors and top politicians occasionally disclose tantalizing details that have the effect of soap-opera cliffhangers. But after promises of swift action, the buzz eventually dies out and the cases are forgotten.

Information about unsolved cases is sometimes leaked as weapons in political blackmail and dirty PR tactics. Rumors and speculation seem more important than the truth. Media outlets and journalists become pawns in the game.

“Cases remain unsolved because officials get involved. The main reason is that there are individuals in government who are not interested in seeing these types of cases through to their logical end,” said lawyer Andriy Fedur, who has represented Lesia Gongadze, the mother of the slain journalist, in her battle for justice. She refuses to bury her son’s body until his killers are all brought to justice.

Fedur thinks cases remain unsolved because of unprofessional investigation and because the influential exert influence over law enforcement. However, it’s difficult to believe that the case of Yushchenko’s poisoning has fallen victim to unskilled investigators, he said.

An overview of the highest profile criminal cases since Ukraine’s independence reveals a myriad of political and business connections revolving around a cut-throat battle for either power or resources, or both, given Ukraine’s intertwined political and business elite.

Experts said politicians fear that solving one case could lead to a domino effect, resulting in their photos appearing on charts resembling those elaborate FBI New York crime family charts they have seen in the movies.

Kuchma is implicated in scores of crimes, including bribe-taking, money laundering, pilfering of state coffers, and even murder, according to Hryhoriy Omelchenko, a Tymoshenko ally, a corruption whistleblower, and onetime State Security Service of Ukraine (SBU) officer. He has also served on parliamentary investigative commissions on various high profile crimes since 1994.

“Until Kuchma-era top officials are sentenced, not a single high-profile crime will be solved, including Gongadze’s beheading and Yushchenko’s poisoning,” Omelchenko said.

Omelchenko said that Ukraine’s first two presidents – Leonid Kravchuk and Kuchma – are to blame for the country’s inept and corrupt justice system. He said that, while in office, Kravchuk and Kuchma created a system that provided protection for political allies while the judicial system and “kompromat” were used to keep opponents in check or to eliminate them. Omelchenko said the same system is still in place today.

“It seems that a non-aggression pact was signed [by those in power]. Criminal investigations could be opened, but courts will never rule to incarcerate anyone,” said Serhiy Taran, director of the Sotsiovymir think tank. “If the president’s poisoning case isn’t solved, what can be said concerning cases involving average citizens?”

Analysts concluded that if laws continue to be broken with impunity, especially the elite, the public will naturally follow suit. The resulting widespread legal nihilism will bring more disillusionment and put democracy further from reach.

Honest members of the law enforcement will simply stop investigating complex and politicized criminal cases, many believe, if they haven’t stopped already. There is always a risk that this trend will reach a point of no return, said Volodymyr Fesenko, chairman of the Penta Center for Applied Political Studies.

He stressed that the harm to society is enormous with each unsolved economic or political crime, giving rise to a nation that views its politicians as thugs and stop caring about anything that happens in the country.

Source: Kyiv Post

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Putin's Patriarch

KIEV, Ukraine -- Church unity was the refrain of Alexy’s rule; in reality he danced to the Kremlin’s tune. “I expect the new president of Ukraine will have enough wisdom to go the way of unity and not confrontation,” said Alexy II, patriarch of Moscow and All Russia, after Victor Yushchenko became president in January 2005.

Russia's Prime Minister Vladimir Putin kisses the body of Russian Orthodox Patriarch Alexiy II in the Christ the Saviour Cathedral in Moscow December 9, 2008.

A few weeks earlier, Yushchenko’s staff had reportedly found 10,000 leaflets in a Russian Orthodox Church declaring their candidate “a partisan of the schismatics and an enemy of Orthodoxy.”

These are the two sides of the Russian Orthodox Church’s revival under Alexy, who died on Dec. 5 at the age of 79. In rebuilding the church after decades of Soviet repression, he also reinvigorated its traditional role as the Russian state’s spiritual prop and political ally.

For Ukraine, this meant promoting closeness with Russia in the name of “Orthodox unity” and “Slavic brotherhood,” which dovetailed neatly with the Kremlin’s policies.

When Vladimir Putin was handed the presidency by Boris Yeltsin on Dec. 31, 1999, he was quick to harness the church’s authority by asking for Alexy’s blessing. The patriarch shared Putin’s KGB past, having been recruited in February 1958 “on the basis of patriotic feelings.”

His rise up the church hierarchy – impossible without support from the Soviet authorities – demonstrated his ability to be a reliable state collaborator.

Under Alexy’s and Putin’s stewardship, the relationship between church and state in Russia returned to its historically established position as two sides of the same coin.

According to the Byzantine ideal of “symphonia,” the church is the nation’s spiritual guide, while the state administers human affairs. These roles are mutually supportive – the church needs the state’s protection to ensure its survival and growth, while the state can use the church’s authority to support its political goals.

As Putin led a revival of the power of the state, so Alexy rejuvenated the power of Orthodoxy as the nation’s “spiritual force.” Their alliance is summed up neatly by the slogan of 19th-century conservatism: “Orthodoxy, Autocracy and Nationhood.”

Both were resistant to reform and modernization, and continued Russia’s centuries-old fear of outside influence from the West. The church explained its position as opposition to Catholic proselytism and “moral degradation;” for Putin it was defense against malign Western attempts to undermine Russia and its role in the region.

The role of church leader has always been highly politicized. Orthodoxy came to the Rus – an East Slavic people who inhabited principalities across modern-day Russia, Ukraine and Belarus – in 988 with the baptism of Grand Prince Volodymyr of Kyiv.

When Metropolitan Peter moved his residence to Moscow in 1325, the burgeoning city-state secured the church’s widespread, cross-border influence as a unifying and centralizing force, aiding its expansion and eventually allowing its leaders to stake the messianic claim that it was the Third Rome.

The fight for control over church leadership was central to Moscow’s battles for regional supremacy against the Principality of Tver and the Grand Duchy of Lithuania.

As with church leaders throughout Russian history, Alexy was always much more than a religious figure. When Putin remembered him on Dec. 5 as “a great statesman,” he perhaps had in mind the unique scope that Alexy’s cross-border role gave him, as his predecessors, to promote the Church’s message, which frequently tallied with the Kremlin’s, across the lands of the Rus.

The presidential election campaign of 2004 in Ukraine is the prime example. Ukraine was being penetrated by a message unacceptable to Putin and Alexy – Western ideas such as democracy.

When Russian political technologists persuaded the Victor Yanukovych campaign team to frame the elections as an existential battle against harmful Western influence, the church was in a unique position to promote the message.

Its weight was thrown behind the Kremlin-backed candidate, to portray the West and its “agent,” Yushchenko, as a menace to traditional Orthodox civilization, a threat to the “brotherhood of Slavic peoples.”

Church leaders came out in favor of Yanukovych and in opposition to Yushchenko. “I view him as a truly faithful Orthodox person, worthy of becoming the head of our state,” said Volodymyr, Metropolitan of Kyiv and All Ukraine. He also said that Yanukovych received a blessing from Alexy and that “no other presidential candidate received our blessing.”

Russian fears of “losing” Ukraine resurfaced in a more direct manner for the church earlier this year when Yushchenko used the 1020th anniversary of the conversion of the Rus to push for canonical recognition of the Kyiv Patriarchate as the national independent Ukrainian Orthodox Church, free from Russia.

This has been a sore topic since Ukraine gained independence in 1991, as Alexy’s Moscow Patriarchate has co-existed with the Kyiv Patriarchate and a third group, the Ukrainian Autocephalous Orthodox Church. Alexy was vigorously opposed to the move, saying, “We must cherish the unity of our Slavic brotherhood. It’s more important than any political aims.”

But “Slavic brotherhood” and Orthodox unity were, in fact, Alexy’s and Putin’s political aim and an essential part of the Russian playbook in Ukraine. In reviving the authority of the Russian Orthodox Church, Alexy strengthened its traditional role as a centralizing force, promoting Moscow’s will throughout “All Russia.”

Source: Kyiv Post

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Wednesday, December 10, 2008

Ukraine: It’s Off! It’s On! It’s Off Again!

KIEV, Ukraine -- A new coalition was formed in Kiev on Tuesday. However, exactly one hour later one of the party factions denied that the coalition had been formed.

Newly elected speaker of the Ukrainian parliament Volodymyr Lytvyn speaks after the vote in Kiev, Ukraine, Tuesday, Dec. 9, 2008.

The Yulia Timoshenko Bloc, the pro-presidential party Our Ukraine and the bloc of newly elected parliamentary speaker Vladimir Litvin formed a coalition that would have ended months of politicial infighting.

However, the deputy chairman of the parliamentary faction of the Our Ukraine party, Boris Tarasyuk, then said that his party had not entered into the coalition.

"The party is planning to examine and discuss the coalition agreement tomorrow," said Tarasyuk

The retraction was just a part of a strange chain of events which included a vote for Litvin that was subsequently retracted by a deputy of the Our Ukraine party.

Litvin made the announcement regarding the unification of the Our Ukraine party, the Bloc of Yulia Timoshenko and the Bloc Vladimir Litvin.

"I didn't take part in the decision regarding the election of Litvin to speaker. I am convinced that all personnel questions should be decided after the official signing of the coalition agreement," said deputy Nikolay Kulchinsky of the Our Ukraine party.

Litvin, who was re-elected as speaker of the Verkhovna Rada (parliament) on Tuesday, said that a formal coalition agreement will be signed in the next few days, and that both Yulia Timoshenko and President Yushchenko have handed him statements saying they intend to cooperate.

There had been speculation that the Timoshenko Bloc would team up with the Party of Regions and would be able to form a coalition that could block any action by the pro-presidential party.

However, the largest faction in the Verkhovna Rada, the Party of Regions, will stay in opposition, according to party member Vasily Kiselyov.

"We stay in opposition and thus disclaim any responsibility for current developments in the country. I have no doubt that this coalition will exist until the presidential election of early 2010. So we will be in opposition until the presidential election," Kiselyov said.

That decision came just hours after the Ukrainian president had said that he would not form a coalition with Timoshenko.

"President Yushchenko absolutely will not accept the idea of forming a coalition with the Bloc of Yulia Timoshenko," said Oles Doniy, a deputy in the parliament.

"He (Yushchenko) offered to build a coalition - only not with Yulia Timoshenko." said Doniy

The announcement came after what Litvin described as difficult talks.

Besides the reunification of Timoshenko and Yushchenko, the re-election of Litvin also carries a feeling of déjà vu, as he served as speaker of the house from 2002-2006. He was elected speaker in 2002 as head of the party For United Ukraine.

From 1994 to1999 Litvin was a presidential assistant under the president at that time, Leonid Kuchma. He then headed the presidential administration from 1999 to 2002.

In 2000, he was accused of having directly taken part in the abduction and subsequent murder of opposition journalist Georgiy Gongadze. The incident became known as “the cassette scandal” due to the fact that Kuchma's former bodyguard had recordings of Kuchma saying the journalist needed "to be dealt with".

Perhaps his most important action was while he was serving as speaker during the election in 2004, which were contested by Yushchenko and Viktor Yanukovich of the Party of the Regions. Litvin helped organise emergency meetings in which the election of Yanukovich was declared void, eventually leading to the election of Yushchenko.

In March 2006, his party received only 2.44 per cent of the popular vote and won no seats in the house, as a result of which. Litvin was planning to leave political life. However, he was elected to the parliament again in September 2007 as the leader of the Litvin Bloc which now holds 20 seats in the Verkhovna Rada.

In Tuesday’s election he received 244 votes, including support from all the major parties, comfortably passing the 226 needed for confirmation of his re-election.

Source: Russia Today

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Klitschko Wary Of Rahman Threat

LUDWIGSHAFEN, Germany -- IBF heavyweight champion Wladimir Klitschko, from Ukraine, insists he will not underestimate Hasim Rahman, from the United States, on Saturday night.

Heavyweight boxing champion Wladimir Klitschko (L) from Ukraine, and challenger Hasim Rahman (R) from the United States, stand together during a news conference in Ludwigshafen, southwestern Germany, Monday, Dec. 8, 2008. Klitschko is to defend his IBF title against Rahman on Saturday, Dec. 13, 2008 at the SAP Arena in Mannheim, Germany.

The 36-year-old Rahman has arrived in Germany in place of injured Russian Alexander Povetkin to take on the man widely regarded as the world's top heavyweight.

Rahman has upset the odds before though in knocking out Lennox Lewis to claim the WBC, IBF and IBO titles back in 2001.

Despite then being knocked out in the fourth round of the rematch, Klitschko is wary of the power his American opponent holds in that big right hand.

"I am not going to underestimate him in any way. I am going to do my job and I will try to do it quickly," Klitschko said.

"This is his last chance to be a world champion again, so I expect a real challenge.

"If he comes such a long way to fight the best man, he wants to win naturally."

Klitschko has demonstrated tremendous power himself though in knocking out 45 of his 54 opponents to date, but Rahman says he is ready.

"I know he is extremely strong and quick. I have to be ready to take punishment and to dish it out. I am very fit and well prepared," Rahman said.

"I am looking forward to putting on a good performance. It will be a great fight."

Source: Sporting Life UK

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Ukraine Re-Forms Orange Coalition, Ends Deadlock

KIEV, Ukraine -- Ukraine's pro-Western governing coalition, rooted in the 2004 "Orange Revolution," was reinstated on Tuesday after months of deadlock, with Prime Minister Yulia Tymoshenko likely to remain in her job.

Newly elected Parliament Chairman, Volodymyr Lytvyn with Yulia Tymoshenko yesterday.

The new, expanded governing team, announced in parliament, will have to grapple with the effects of the world financial crisis which has hit the ex-Soviet state's steel and chemical industries and battered its banks and currencies.

The announcement all but ruled out for now the notion of a snap election which has hung over Ukraine for months.

It also appeared to end serious wrangling between Tymoshenko and President Viktor Yushchenko, allies during the 2004 mass rallies against election fraud but since turned rivals.

Groups led by the two antagonists will be joined in the new coalition by a faction led by the assembly's new chairman, Volodymyr Lytvyn.

"This coalition has recently looked far from likely and it will have to withstand the test of events," said independent analyst Oleksander Dergachyov.

"It cannot be viable unless there are changes in the relationship between Yushchenko and Tymoshenko."

Lytvyn announced the restoration of the coalition minutes after being elected to his post with backing from 244 members of the 450-seat assembly. The coalition can theoretically command up to 258 seats, though in practice it will be somewhat smaller.

Lytvyn, who earned a reputation as a skilled negotiator while parliamentary chairman from 2002 to 2006, said he saw few reasons to choose a new premier.

"We have a government, we have a prime minister," Lytvyn told journalists after announcing the coalition.

"Clearly, there will be proposals from the coalition on the make-up of the government. I see no legal grounds for substantial changes in the government and, first and foremost, the prime minister."

Ukraine has secured a $16.4 billion loan from the IMF. Its banking system is shaky, its currency plunging and its economy dependent on increasingly expensive energy from Russia, with which relations have deteriorated sharply since Yushchenko was swept to power by the 2004 protests.

Tim Ash, head of CEEMEA research at Royal Bank of Scotland, said a new government may not be enough to tackle the crisis.

"I would argue that you need a government to legislate - so that's positive," he said. "But the focus is on the central bank which is not driven by the government. It's driven more by Yushchenko."

The expanded coalition surprised many as Tymoshenko's bloc had been in talks with the Regions Party of ex-prime minister Viktor Yanukovich - the main target of the 2004 protests.

Yushchenko had denounced any notion of a coalition involving the politician he defeated in the contested presidential election which sparked the "Orange Revolution".

"This coalition was possible only because it is a lesser evil for the president than one between Tymoshenko and the Regions Party," said Volodymyr Fesenko of the Penta think tank.

Analysts said Tymoshenko almost certainly would have secured guarantees that she would remain in the job.

Parliament had been all but deadlocked since September when the president's Our Ukraine party walked out of its alliance with the premier's bloc after months of rows.

The president initially tried to resolve the conflict by dissolving the chamber and calling a snap election, but parliament and the government refused to finance the poll and in the face of the world financial crisis, he shelved the idea.

Following is a chronology of political events since the revolution.

TYMOSHENKO AS PRIME MINISTER

Jan 23, 2005 - Yushchenko is sworn in as president following street protests in November and December against a fraudulent election won by then Prime Minister Viktor Yanukovich. Tymoshenko is named the new prime minister within days.

Sept 8 - Yushchenko dismisses Tymoshenko's government after infighting. Yuri Yekhanurov, a presidential ally, replaces her.

Jan 10, 2006 - Parliament votes to remove the government over a gas deal with Russia that sharply raises imports prices.

March 26 - Yanukovich's Regions Party emerges as the largest party in a parliamentary election with 186 of 450 seats, but is outnumbered by the combined "Orange" score of 243. The Orange groups, however, fail to form a coalition after months of talks.

YANUKOVICH AS PRIME MINISTER

July 18 - A coalition made up of the president's opponents proposes Yanukovich as prime minister. He is approved a month later after promising not to reverse pro-Western policies.

Jan 12, 2007 - Yanukovich supporters pass law to reduce Yushchenko's control of the government, a blow to his authority.

March 13 - Yushchenko supporters storm out of parliament to back its demand that Ukraine stick to pro-Western policies.

April 2 - Yushchenko signs a decree dissolving the chamber, leading to months of turmoil over his call for a new election. Yanukovich eventually agrees to a new poll in September.

Sept 30 - "Orange" parties win a majority of 227 seats - one more than needed to win most votes in the 450-seat chamber.

TYMOSHENKO AS PM

Dec 18 - Parliament approves Tymoshenko as prime minister with 226 votes, the minimum number required to take office.

July 11, 2008 - Tymoshenko survives a no-confidence vote called in protest of her government's handling of high inflation and other economic ills.

Aug 18 - Yushchenko's deputy chief of staff accuses Tymoshenko of betraying national interests by not backing Georgia in its conflict with Russia.

Sept 3 - Our Ukraine, Yushchenko's allies, walk out of the "Orange" coalition after denouncing a joint vote by Tymoshenko's bloc and Yanukovich's party to reduce presidential powers. The president threatens to call an election.

Nov 12 - Yushchenko abandons plans to hold an early parliamentary election in 2008 and says officials should focus on coping with the effects of the global financial crisis.

Nov 26 - Tymoshenko issues a final warning to the president to end a row, threatening to team up with rival groups.

Dec 9 - The governing coalition is reinstated by newly elected Assembly chairman, Volodymyr Lytvyn.

Source: Canada.com

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Tuesday, December 09, 2008

Prospects For Political Stability In Ukraine Remain Dim

KIEV, Ukraine -- Ukrainian President Viktor Yushchenko announced dissolving parliament early October and called a snap election amid mounting political chaos in the country.

Political struggles among Yushchenko (L), Tymoshenko (C) and Yanukovich (R) are still continuing amid the deepening economic crisis.

Though he had to postpone the plan under threat from the spreading international financial crisis, prospects for political stability in the country remain dim.

FURIOUS WRANGLES BETWEEN FORMER ALLIES

After an early parliamentary election in September 2007, Prime Minister Yulia Tymoshenko's party and Yushchenko's "Our Ukraine-People's Self- Defense" bloc formed a fragile majority coalition with 227 seats in the 450-member chamber.

However, the relations between Yushchenko and Tymoshenko, the two strong allies during the 2004 "Orange Revolution," took a nose-dive soon after the latter became prime minister in December 2007.

The two have long been at odds over how to tackle the country's rampant inflation, sell state assets and spend budgets. On foreign policy, Yushchenko is seeking closer ties with the European Union and NATO, while the prime minister favors balanced ties with Russia.

Yushchenko's "Our Ukraine-People's Self-Defense" bloc withdrew from the 9-month-old coalition in September after Tymoshenko's party sided with the opposition Party of Regions to pass several laws to trim presidential powers.

Under Ukraine's constitution, the president can dissolve parliament if a new governing coalition is not formed within 30 days after the previous one collapses. Yushchenko announced the dissolution of parliament and called a snap election for December since talks on rebuilding a new coalition proved futile.

Yushchenko defended his move as the only way to safeguard the country's democracy and national interests. Tymoshenko, however, accused the president of orchestrating the collapse of the coalition in his bid to get rid of potential rivals and win the presidential election one year later.

IMMINENT ECONOMIC CRISIS

Tymoshenko has been waging a vigorous campaign against Yushchenko's decree of dismissing parliament. As analysts said, she would probably get ousted from the post of the prime minister after the snap election.

Yushchenko postponed the decree last month as Parliament had to act to approve anti-crisis legislation for Ukraine to qualify for a 16.4-billion-U.S. dollar emergency loan from the International Monetary Fund.

The global financial tsunami delivered a hard blow to Ukraine's economy. The inflation rate hit 18 percent in the first 10 months of this year. From a peak of 4.50 to the U.S. dollar this spring, the country's currency hryvnia has lost more than 60 percent of value by now.

Falling prices of steel, Ukraine's top export item, has led to the shutdown of most iron and steel plants. Lack of liquidity has also troubled banks.

The impact of the financial crisis on the real economy is beginning to unfold as the country's industrial production plummeted by 20 percent in October. The European Bank for Reconstruction and Development predicts Ukraine's economic growth will plunge to 1 percent in 2009 from about 6 percent in 2008 and 7.6 percent in 2007.

Yushchenko has now realized that he cannot force new parliamentary elections at least until the new year. He said the economic issue must be given top priority.

Recent polls showed that a snap election would not produce a clear victory for any party. Tymoshenko's party may get a support rate of about 23 percent, the Regions Party led by ex-Prime Minister Viktor Yanukovich, some 20.6 percent, while Yushchenko's party, about 7.1 percent.

THREE POLITICAL OPTIONS

Political struggles among Yushchenko, Tymoshenko and Yanukovich are still continuing amid the deepening economic crisis. Analysts say Ukraine is facing three political options: a fresh parliamentary election, a face-saving truce between the president and the prime minister or a new coalition between Tymoshenko and Yanukovich.

Tymoshenko this week threatened to resume talks with the opposition Regions Party for creation of a coalition if Yushchenko's "Our Ukraine" still failed to support her.

"Our Ukraine" quickly rejected the ultimatum, accusing Tymoshenko of trying to form a coalition with the Regions Party and the Communist Party for the creation of "the pro-Kremlin majority."

If the parliament could not regain its competence, dissolving the chamber and calling a snap poll will be the last resort to break the deadlock. However, no political stability or economic prosperity is in sight even after the elections, the analysts said.

The political tensions will not ease at least until the end of 2009, when voters choose between Yushchenko, Tymoshenko and Yanukovich in the first presidential elections since the 2004 revolution, the analysts said.

Source: Xinhua

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Ukraine Praises Eastern Partnership

KIEV, Ukraine -- Ukraine`s deputy prime minister today lauded the Eastern Partnership, an initiative presented by the European Commission last week, as “a step forward” in relations between the EU and its eastern neighbours, the European Voice reported.

Dr. Hryhoriy Nemyria

Hryhoriy Nemyria believes that the Partnership gives its six eastern members – Armenia, Azerbaijan, Georgia, Moldova, Ukraine and possibly Belarus – a sense of ownership that they lack in their current relations with the EU, which are framed by the European Neighbourhood Policy (ENP).

Nemyria also argued that it creates “a new visibility for the six countries that is separate from the Mediterranean countries” that are the other members of the ENP.

During a visit to Brussels on 8 December, Nemyria met Alexandr Vondra, the Czech deputy prime minister for European affairs, and he emerged to say that he holds high hopes for the Czech presidency of the EU, which starts in January.

Prague has indicated that the Eastern Partnership will be high up the agenda, with its official launch planned for the spring, and Nemyria believes that Czech Republic will manage to strike a good balance between the interests of the EU`s various member states.

“I believe that the Czechs can contribute with a sober calculation,” he said. “They are not immediate neighbours but they know the region, so I think that they can explain that the Partnership is not just beneficial for Ukraine, but for the whole region.”

Nemyria also rebuffed the argument that the new programme would be a half-baked substitute for eventual EU membership for Ukraine. “Half-baked measures can be good, because that allows you to add things as time goes by,” he explained.

He underlined, for example, that he expects more money to fund the introduction of biometric forms of identification and infrastructure along Ukrainian borders as well as a strong emphasis on energy security and energy supplies.

Potential investors are due to meet in the spring to consider funding to upgrade Ukrainian pipelines.

Source: European Voice

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Ukraine, A Post-Genocidal Society

KIEV, Ukraine -- Distrust of government and future uncertainty are just two of the most conspicuous features of the post-genocidal syndrome that psychologists have identified in modern Ukrainians some 75 years after the famine of 1932-33.


On a more intimate level, famine survivors still value every breadcrumb, and their descendants greet guests with tables overloaded with a variety of dishes. In one form or another, Ukrainians will universally impress on each other the importance of "having something to eat."

Doctors describe a number of symptoms of post-genocidal syndrome that are unconnected to the trauma directly, but which can still seriously undermine the sufferer's health. Victims feel pain in places that are not supposed to hurt and experience nightmares and hidden anxieties that steal their ability to laugh and enjoy life.

Taras Vozniak, the editor of "Ji" magazine, has described the experience as "such a trauma that for people who survived it is very difficult to remember what happened." He compares it to the effects of rape: "[Victims] don't want to testify, or to remember. They want to erase the tragedy from their memory."

Having survived a famine that was brought about by the policies of the Soviet government, Ukrainians now question the very notion of government. They have -- if not fear -- then a feeling of permanent uncertainty about the future. Under each shift in political direction or change of political leaders, Ukrainians rush to buy the necessary essentials. Just in case.

The memory of their ancestors -- who were robbed of food by their own people on orders from the Kremlin -- forces many Ukrainians always to keep something for a "black day" and never truly reveal themselves fully, even to close acquaintances.

That same instinct compels Ukrainians to stockpile food, and to invite anyone who stops by their home to sit down for a meal. Ukrainians tend to rely on themselves, living by their wits and soothing themselves with the eternal saying, "God willing."

Academician Myroslav Popovych survived the famine and believes that other survivors can never really forget. He says, "conditions then were such that all people who belong to that generation carry this taint." But he also asserts that "personality always wins out in the end -- I wouldn't say that I have become more obedient or completely focused on earthly problems."

But the most important thing that Ukrainians carry from these terrible times is a complete revulsion toward totalitarian regimes.

"Ukrainians still lack a political culture because of their history, but we have a huge drive toward liberty," Popovych says. "I don't know whether you can call this famine memory, but it is certainly a total aversion to totalitarian mentality."

Ukrainian society is highly individualistic, partly because its history has incorporated the terrible experience of death and survival of famine. Old notions such as "my home is my сastle" and "I'm my own boss" have hampered the formation of civil society and a genuine national elite in Ukraine.

At the same time, this attitude turns the average Ukrainian into a libertarian. They view even the slightest attempt by politicians to elevate themselves with sarcasm, and they sense the slightest false note in officials' speeches about their "love of the people" and their promises to solve the problems of average citizens.

One must remember that, aside from the natural psychological reaction to survived horrors, Ukrainians for decades were not allowed to speak about the famine -- it could have cost them not only their liberty but also their lives.

Former dissident and political prisoner Yevhen Sverstiuk recalls seeing fear in countrymen's eyes when he asked them about the 1932-33 famine even after perestroika. People asked whether they would be executed. Many said they still feared being punished for speaking out. That despite the fact that they'd been invited by the village council to speak on the subject, and the entire project soliciting their views had been authorized by the regional government.

Philosopher Yevhen Sverstiuk believes that the time has come when Ukrainians can cry over their painful experiences. They can process the past by talking about the famine, identifying all the villages where people died, naming all of the victims, and taking steps toward closure.

After crying out their trauma, people should wipe their tears and get to work, says Sverstiuk. Otherwise, they risk the danger of becoming spiritual beggars. The world values the brave. By telling the truth, and overcoming their fear, Ukrainians overcome their inferiority complexes.

Writer Ivan Dziuba calls the famine a blow to Ukraine's future. And the only way to fight back is to free oneself of this heavy burden of genetic memory by revealing the entire truth.

The late American researcher James Mace began the process by defining Ukraine as a post-genocidal society. Mace believed Ukraine would be incapable of further development until the entire truth of the famine was told.

That idea has been confirmed by the experiences of other nations that suffered similar traumas, defeats, and the burden of penance. Society returns to successful development through awareness, and acceptance of its national memory and history.

The best that the current government in Kyiv can do to commemorate those killed by famine is to create the conditions so that all Ukrainians could feel certain and security. Little is required in order to achieve this -- just respect for human rights, abiding by the rule of law, and hard work.

Source: Radio Free Europe

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Ukraine's Central Bank Helps Make $23 Billion Dent In Pockets Of Ukrainians

KIEV, Ukraine -- In early October, when the talk about the looming financial crisis was becoming loud in Ukraine, we heard soothing comments from National Bank of Ukraine officials and the finance minister.

NBU Governor V. Stelmakh

Strangely enough, while the dollar sank in the world, it surged in value in Ukraine. The officials said the rise of the dollar was only temporarily and the NBU would soon stabilize and strengthen the hryvnia.

It cannot be denied that, in part, the hryvnia devalued due to a severe political crisis, with the president and premier engaged in a cat-and-dog fight and the balkanized and stalled legislature bickering about the coalition.

Becoming a weighty negative factor, such political goings-on contributed to fuelling domestic inflation and panic buying of hard currency by Ukrainians.

Nonetheless, the NBU cited the ongoing financial crisis in the West as the basic cause of the hryvnia downfall. Not a word was spoken about the NBU share of the blame.

To explain the dollar surge, NBU governor’s chief advisor, Valery Lytvytsky, went on the air, saying the NBU is not guilty and the hryvnia rate of 7.3 to one dollar was too low. He said the fair exchange rate was Hr. 5.5-5.6 per $1.

He failed to explain, though, who or what stopped the NBU from selling dollars at this rate or why the rate was too low.

True causes of hryvnia downfall

Meanwhile, the causes of the high dollar value can be seen with a naked eye.

The NBU did not sell dollars to all banks that asked for it, selling greenbacks only to the chosen few. It led commercial banks to buy the hard currency from other banks.

Currently, the NBU provides credits to commercial banks at 8-12% interest rate. The banks, in their turn, give credits to legal entities at a staggering 25-30%, a killing rate for businesses.

To shield itself from accusations, the NBU started sales of American currency: for example, while the banks applied for $433 million on Dec. 3, the NBU sold merely $93 million. On some days the NBU did not sell dollars at all, whipping up demand and panic even higher.

The hryvnia downfall has been also caused by the large negative trade balance of Ukraine. Now that the national currency has devalued by almost 50%, many importers will be forced to stop to buy foreign goods and move into other areas of business. There’s a silver lining, the low hryvnia will make Ukrainian exports more competitive.

Even if Ukraine’s trade balance improves, it does not mean that the economy will recover. That is why financial experts predict a high exchange rate of 7.5 for $1 for the hryvnia (or even 8 according to the IMF forecast for 2009). Striking a pessimistic note, many bankers say it may take the hryvnia 3-5 years to recover to the 5.5 exchange rate.

As the demand for dollars dramatically exceeded the supply, the dollar value ballooned.

NBU and Yushchenko must take the blame

Many experts maintain that there were no real causes for the hryvnia downfall. The blame for it must be taken by the NBU and Pres Yushchenko as well as the cabinet for failing to react adequately to what the first two were doing.

When the dollar craze began in Ukraine, the country’s trade balance was the same as Armenia’s, Georgia’s, Moldova’s and Tadjikistan’s. Although some of these countries have even a worse trade balance, their national currencies were sinking by a mere 1.5-2% in a month.

A simple assumption can be made: by fanning inflation and forcing companies to go bankrupt, Ukrainian and other tycoons will soon be able to buy them up for a song. In what appears to be a well-orchestrated scenario, NBU Governor Stelmakh and NBU board members (P.Poroshenko, A. Kliuyev and others) handed out millions of hryvnias to their insider banks that launched a massive attack on the hryvnia.

In a telling example, the Ukrhazbank owned by Mr. Horbal, one of NBU board members, was selling dollars last week at a highly speculative rate of 7.5 hryvnia. Was it Mr Horbal’s way to stabilize the currency market?

Hypocritical moves by president

The NBU has a lot of levers to rectify the situation but, strangely, it has not used them. On Dec. 1, Viktor Yushchenko gave a stern warning to NBU Governor Stelmakh, saying he would fire him unless the hryvnia stabilized.

The incumbent even specified the exchange rate of 5.8 to 5.9 per $1 he wants for the hryvnia. Nothing has happened ever since, neither the first nor the second. Result: Stelmakh is still NBU governor.

Now, as many new facts have surfaced, we see that the NBU cashed in on the financial slump, playing its own sinister role. The central bank wouldn’t have dared to behave so blatantly without a blessing from the highest office.

In a quite hypocritical move, Pres Yushchenko stated on Dec. 2 that there are no economic or financial grounds for the hryvnia devaluation.

Commenting on the panic buying of dollars, he pinned the blame on the “psychological factor”, accusing the NBU and cabinet of being unable to cope with the panic among Ukrainians.

Faced with a barrage of presidential criticism, Premier Yulia Tymoshenko dismissed accusations of inadequate reaction, stressing that, first, the NBU is not accountable to the cabinet under the Constitution, and, second, that Stelmakh is a close associate of Yushchenko and bringing him to heel was easy for the incumbent.

Lawmakers threaten probe into NBU operations

Meanwhile, Rada lawmakers have threatened to bring Stelmakh to account. Dec. 2, Anatoly Hrytsenko, head of VR committee on defense and security, proposed opening a criminal investigation into Volodymyr Stelmakh’s track record as NBU governor.

In a related move, Regions lawmaker Mykola Azarov has publicly lashed out at the NBU and tabled a motion to create an investigation commission in parliament to examine the NBU activities. Given a negative assessment by the commission of his work, Stelmakh can be fired by the Rada without Yushchenko’s consent.

“When NBU operations began to threaten hryvnia stability and the country’s financial system, lawmakers set up a work group to examine the NBU activities since the start of 2008. The group has reached a conclusion that there were not only blunders but also corrupt dealings and law violations,” Azarov stressed.

It is becoming common knowledge in Ukraine that all personnel appointments by the president seem to have their concrete monetary dimension - in terms of kickbacks.

A group of people have lined their pockets as a result of the hryvnia fluctuations. If the group’s profits were low, Stelmakh wouldn’t be governor of NBU.

This is the bottom line of what is happening around the Ukrainian currency. No doubt, like in the similar past hryvnia downfalls, in a couple of weeks the hryvnia will be stabilized, but the wallets of ordinary Ukrainians have already been made lighter by 160 billion hryvnia ($23 billion), Yury Kostenko said (incidentally, a loyal Yushchenko supporter), putting forward his Ukrainian People’s party demand to the incumbent to fire Stelmakh.

Source: UNIAN

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Monday, December 08, 2008

2008 Miss World Betting Heats Up With Miss Ukraine Favored

ALBERTA, Canada -- With the 2008 Miss World competition just days away, betting on this popular event will increase throughout the week. The 2008 Miss World pageant takes place Saturday December 13 at the Sandton Convention Centre in Johannesburg, South Africa.

Iryna Zhuravska, 18-year old Miss Ukraine is a favorite to win the 2008 Miss World pageant.

Originally, the pageant was going to take place in Kiev, Ukraine, but because of the ongoing crisis between Georgia and Russia in neighboring South Ossetia, the Miss World Organization decided to move the pageant away from Eastern Europe.

The fact that the Miss World pageant is no longer taking place in the Ukraine hasn't changed the "favorite" status of its representative, Miss Iryna Zhuravska.

"Her odds to become Miss World 2008 were at 6-1," Gambling911.com Senior Editor Payton O'Brien pointed out. "She's a weather woman."

The favorites at BetUS.com were Miss Ukraine, Miss Spain (+600 odds also), Miss Ecuador (+1000 odds) and Miss Mexico, whose odds have been slashed to single digits to +600.

We asked Payton O'Brien: If you were stranded on a deserted island, what one item would you not be without? She responded - "Water". That same question was asked of Miss Ukraine, who got the answer correct. She said "Anti mosquito cream".

Zhuravska has even one-upped Gambling911.com's own Cuban transgender reporter and beauty in his/her own right, Sparky Collins.

Collins, who fled Cuba by inner tube 90 miles in shark infested waters, could have had a babe on board instead of three other hairy Cubans who can't swim. It turns out that Miss Ukraine has swam the open sea with sharks.

Miss Zhuravska's favorite musical group is ABBA.

Source: Gambling 911

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National Bank Of Ukraine Will Intervene This Week To Strenghten, Stabilize Hryvnia

KIEV, Ukraine -- The National Bank of Ukraine has unveiled its intentions to intervene Dec. 8 through Dec. 12 so as to revaluate the hryvnia.Anatolii Shapovalov, the NBU first deputy governor, also expressed hope the national currency has bottomed out in value.

Ukraine's hryvnia

"We will hold interventions next week in addition. As soon as people understand that the exchange rate [of foreign currencies] goes down and start to sell the dollars, everything will become calm," Shapovalov said.

Shapovalov did not disclose how many interventions there will be next week and on which days the National Bank will intervene.

He noted that the devaluation of the hryvnia stopped in early December and a trend for the revaluation of the national currency emerged then.

"The exchange rate trend has swung round. Possibly, this is the bottom we wanted to reach. As soon as people stop [purchasing foreign currency], there will be a result. There are no economic preconditions for the current exchange rate," the NBU first deputy governor said.

According to Shapovalov, the difference between the value of foreign currency bought by the Ukrainian population and the value of foreign currency sold by the population was USD 2.7 billion in January through September. This index grew to USD 6 billion in October and November.

As Ukrainian News earlier reported, the National Bank of Ukraine has said Ukrainian population sold more foreign currency than bought as registered on December 3 for the first time over the past few weeks.

The balance of the value of foreign currency sold by the population over the value of foreign currency bought by the population on December 3 was equivalent of USD 15.6 million.

The balance of the value of the cash dollars sold by the population over purchased cash dollars was USD 13.5 million on December 3. The trend has been registered for the first time over the past two months.

The cash sell rate for US dollars in Kyiv forex outlets fell by 1.2 kopeck to 7.5600 UAH/USD on December 5, as of 10:30, compared with data as of 9:30.

The National Bank of Ukraine has set its official exchange rate of UAH7.3614/USD1 for December 5 through December 7 and of UAH7.3598/USD1 for December 8.

Source: Kyiv Post

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Sunday, December 07, 2008

Somali Pirates Threaten To Pull Out Of Ukraine Ship Deal

MOGADISHU, Somalia -- Somali pirates holding an arms-laden Ukrainian cargo ship Sunday accused the owners of stalling on a ransom payment and threatened to pull out of a deal for its release struck a week ago.

Ukrainian cargo ship MV Faina.

A pirate spokesman told AFP that the armed gang holding the Faina was "unhappy about the delay in the ransom payment."

"The ship's owners are taking too long to hand over the money," the spokesman, identifying himself only as Ahmed, said by telephone.

"There have been consultations between the force on the ground and on the ship and everyone agreed that if the money is not delivered on time to abandon the agreement," he added.

Elders in the area who didn't wish to be named said a ransom of $3.5 million had been agreed for the ship, carrying 33 Soviet-type battle tanks, rocket launchers and ammunition when it was seized off Somalia two months ago.

Sugule Ali, the spokesman for the group of pirates aboard the Faina, told AFP Nov. 30 that agreement on a ransom had been reached and it was "just a matter of time and a few technicalities" before the ship and its crew were released, which he said would occur "within four days".

The U.S. military has overflown the hijacked vessel several times to take pictures of the crew lined up on the bridge and verify that all were in good health.

The MV Faina was anchored a few miles off the coast of Harardhere, north of Mogadishu, and had been moved several times.

The initial ransom demand in the immediate aftermath of the freighter's capture Sept. 25 had been for $35 million.

The Ukrainian ship was headed for Kenya when it was seized, with 17 Ukrainians, three Russians and one Latvian on board.

The capture of the ship triggered a controversy over its cargo's final destination.

Kenya has insisted it was the intended recipient of the arms, but maritime officials and diplomatic sources in the region have said the government of semiautonomous southern Sudan was the destination.

Source: AFP

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How The West Won Ukraine

BRUSSELS, Belgium -- In Brussels last week, NATO foreign ministers met to hash out details on whether Ukraine and Georgia should be allowed into the military alliance, and to figure out how even to make that decision without appearing to appease or provoke Russia, which has bitterly opposed it.

U.S. Secretary of State Condoleezza Rice arrives for her last NATO foreign ministers meeting at Alliance headquarters in Brussels.

Finally, after two days of diplomatic wrangling and 22 drafts of a communiqué, Western Europeans, led by Germany and France, finally succeeded in blocking U.S. efforts to offer Ukraine and Georgia a formal path into NATO.

But this obscures a simple fact: support for NATO membership has been waning fast among Ukraine's political elite, with little more than 10 percent of parliamentary deputies actively backing accession.

Meantime Ukrainians have their eye on a bigger prize. Close to 50 percent of Ukrainians, and all the major political parties, now favor joining the European Union—up from 30 percent four years ago.

If this trend continues, it would represent a fundamental shift in Ukrainian thinking.

For years the nation has been split between a Ukrainian-speaking west and a Russian-speaking east. The sides are roughly matched in terms of population and share of GDP, and the divide has created a series of fragile coalition governments and the sense that it would be forever torn between its two big neighbors: the European Union and Russia.

So why is this changing?

In part it is the result of a concerted effort by the pro-EU, pro-Western parties that came to power in the Orange Revolution five years ago.

They have done their utmost to create a Pan-Ukrainian consciousness, for instance by instituting a national holiday commemorating what Orange leader President Viktor Yushchenko calls a "genocide" of Ukrainians at the hands of Russian commissars during man-made famines in the 1930s, and by enforcing Ukrainian language instruction from kindergartens to universities.

They have also, perversely, tried to draw Ukraine away from Russia and toward the West by some less-than-democratic means. Earlier this year Yushchenko tried to ban Ukrainian cable companies from showing Russia's Channel One, Rossia and Ren-TV, purportedly because of violations of advertising rules, but in reality because of a desire to cut off voters from Kremlin propaganda.

In November Ukraine's security service forced Ukrainian lawmaker Valery Konovalyuk to cancel the showing of a pro-Russian film about the August conflict with Georgia, claiming that the film "disseminates unproved, untrue information prepared by the Russian secret services."

Another factor behind Ukraine's increasingly pro-EU orientation is the Kremlin's saber-rattling.

Moscow's repeated threats against Ukraine, its claim to enjoy "special rights" over its "near abroad" and its incursion into Georgia have disillusioned even Ukraine's Eastern-looking politicians.

Mikhail Pogrebinsky, director of Kiev's Centre of Political Studies and Conflictology, served as 2004 campaign manager to Viktor Yanukovych, the Kremlin's favorite, and took a strong pro-Moscow line at the time.

Now he says "the Russian way of treating Ukraine is arrogant." Ivan Lozowy, an independent analyst in Kiev, says the Russians ought to realize that they are pushing Ukraine away. "Ukrainians like Russia, feel close to Russia," he says. "But when it comes to political and economical issues, they trust Europe more."

Even Yanukovych now sees his country's politics as an extension of Europe's, not of Russia's.

In 2004, Moscow backed him in his run for Ukraine's presidency, spending millions of dollars and dispatching the Kremlin's finest political "technologists" to help him win. His loss to the pro-Western Orange revolutionaries marked the nadir of Russia's post-imperial fortunes.

But now Moscow's man has adopted many Orange policies. "Ukraine," he says, "should be a reliable partner for Europe in Europe's relations with Russia"—not the other way around. His power base in the east is also increasingly aware that while Moscow's and Kiev's economies are deeply intertwined, largely through gas exports, Ukraine must continue to foster economic links to the EU.

Russia's aggression has also pushed the EU into tightening its embrace with Ukraine. Last week European Commission President José Manuel Barroso unveiled an Eastern Partnership scheme, the EU's biggest commitment ever to its Eastern neighbors, and one with clear geopolitical undertones.

The ambitious program will give Ukraine and five other former Soviet states access to €350 million of financial aid, free-trade pacts, hassle-free visas and a slew of Brussels-funded projects to encourage better state institutions and assistance for small businesses.

Still, Ukraine is decades away from the real prospect of EU membership and isn't even close to starting formal accession talks, which means a prosperous, democratic Ukraine may be far in the future.

But a Ukrainian consensus that it belongs in Europe and that it shares basic European values—including respect for its Russian ethnic minority—is rapidly emerging.

With NATO off the table for the time being, Ukraine can focus on its European goals, and if it succeeds, even incrementally, it will go a long way toward liberating itself from the Kremlin's orbit, no matter what the tough guys in Moscow may do or say.

Source: Newsweek

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Digging Deeper Into The CheckFree Attack

WASHINGTON, DC -- The hijacking of the nation's largest e-bill payment system this week offers a glimpse of an attack that experts say is likely to become more common in 2009.


Atlanta based CheckFree acknowledged Wednesday that hackers had, for several hours, redirected visitors to its customer login page to a Web site in Ukraine that tried to install password-stealing software.

While this attack garnered few headlines, there are clues that suggest it may have affected a large number of people. CheckFree claims that more than 24 million people use its services.

Avivah Litan, a fraud analyst with Gartner Inc., said CheckFree controls between 70 to 80 percent of the U.S. online bill pay market. Among the 330 kinds of bills consumers can pay through CheckFree are military credit accounts, utility bills, insurance payments, mortgage and loan payments.

A spokeswoman for Network Solutions, the Herndon, Va., domain registrar that CheckFree used to register its Web site name, told Security Fix Wednesday that someone had used the correct credentials needed to access and make changes to CheckFree's Web site records.

Network Solutions stressed that the credentials were not stolen as a result of a breach of their system, suggesting that the user name and password needed to make changes to CheckFree's Web site could have been stolen either after a CheckFree employee's computer was infected with password-stealing malware, or an employee may have been tricked into giving those credentials away through a phishing scam.

There are several indications that the credentials may have been stolen through a phishing attack aimed at Network Solutions customers. Roughly one month ago, Network Solutions warned that phishers were trying to trick its customers into entering their Web site credentials at a fake Network Solutions Web site.

At about that same time, a similar phishing attack was spotted spoofing eNom, the second-largest domain name registrar, according to registrarstats.com (Network Solutions has the fourth largest stable of domain names, data from RegistrarStats shows).

Interestingly, CheckFree.com was not the only site that the attackers hijacked and redirected back to the Ukrainian server. Tacoma, Wash., based anti-phishing company Internet Identity found at least 71 other domains pointing to the same Ukranian address during that same time period. Of those, 69 were registered at either eNom or Network Solutions, and all appeared to be legitimate domains that had been hijacked.

Still, the phishing angle suggests that the attackers managed to phish not only an employee at CheckFree, but an employee who happened to know the credentials needed to administer the company's site records. This may seem like a logical stretch, and perhaps it is.

Regardless of how the credentials were stolen, however, the registrars remain an attractive target for cyber criminals, according to a sobering study (PDF) released this summer by a security advisory group to Internet Corporation for Assigned Names and Numbers (ICANN), which oversees domain registrars.

In an unrelated study conducted last year, Internet Identity examined some 12,305 domain names used by U.S. banks, and found that 70 percent of them were registered at a single domain registrar: Network Solutions.

In a note to Security Fix, Internet Identity President Rod Rasmussen said the 12,305 domains covers the entire banking industry plus select e-commerce and infrastructure providers, which is more like 30,000 institutions.

He said the reason for the apparent disparity between those two numbers is that there are a large number of banks and credit unions that use third party platforms for their online banking.

"That means that those platform providers are especially tempting targets, as they have dozens or even hundreds of small financial institutions that they handle online banking and other transactions for," Rasmussen said. "Those small institutions have no control over the DNS for those platform providers so are completely dependent upon them to make sure their domains are secure. CheckFree would certainly fit into that platform provider category."

Gartner's Litan said this raises the question: What kind of security mechanisms are in place at Network Solutions to ensure that someone armed with the credentials for any of these Web sites can't simply redirect visitors to a malicious or counterfeit Web site?

Perhaps other financial institutions have insisted on additional security measures, but all that was needed in this case to seize control over CheckFree's site was a single set of credentials.

"If all that's protecting a bank's Web site is a user name and password, that's kind of like having a massive vulnerability in the core of the Internet," Litan said. "This could have been a lot worse, and if they can do it to CheckFree, they can do it to other banks."

A spokesperson for Network Solutions declined to discuss what - if any - additional security measures the company has in place for bank Web sites.

Likewise, CheckFree isn't saying much about the attack, except that it is implementing an aggressive outreach plan to help affected users assess their computers and clean the malicious software if their PCs have been infected.

The company says it has begun notifying potentially affected users, and that those customers will receive complimentary McAfee anti-virus software and Deluxe ID Theft Block credit monitoring service.

"In addition, affected users will also have a special McAfee link to assess their computers to see if any viruses exist and if they do, will be provided a free clean up as well as complimentary updated antiviral software," CheckFree said in a statement. "We are working with our clients to provide this service."

CheckFree declined to answer any specific questions, such as how they know exactly how many and which customers may have been affected. Security Fix heard from a trusted source who claims to have had direct access to a log of visitors to the Ukrainian site during the hours that CheckFree's site was being redirected there.

That source, who asked to remain anonymous so as not to compromise his role in the investigation, said the log indicates that at least 5,000 people were redirected to the Ukrainian site during the 4 and ½ hours of the attack early Tuesday morning.

It is unclear whether that was a count of visitors whose systems were successfully infected with the malicious software the site was trying to foist, or whether it was a simple log of the number of visitors to the site.

The incident, however, highlights an attack that we are likely to see more frequently next year, said Panos Anastassiadis, chief executive at Cyveillance, a cyber intelligence company in Arlington, Va.

"This type of attack is going to come in a dozen flavors in the coming months," Anastassiadis said. "Registrars don't comprehend the layers of security they may be forced to put in place as a result."

Source: Washington Post

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Saturday, December 06, 2008

Russia Rubs Raw Nerves In Ukraine

KIEV, Ukraine -- In recent years, the Russian bear has bared his fangs at Ukraine as the grim season commemorating genocide-by-famine 75 years ago.


On November 22, the former "Soviet republic" of Ukraine observed the 75th anniversary of the end of the Holodomor, a genocide-by-famine perpetrated by Josef Stalin's Soviet government which left up to ten million Ukrainian men, women, and children dead due to forced starvation.

Punishing Enemies of Collectivism

In the fall of 1932, Stalin's Soviet Union was facing unrest caused by a shortage of food in the cities under his control. Rather than allow for the chance of a replay of 1917, when inner-city hunger helped the Bolsheviks instigate their successful communist revolution, Stalin turned his attention westward to the breadbasket of Europe, Ukraine.

Driven by the dual goals of increasing Russia's grain stockpile to the point where it could not only feed its city-dwellers but also export food for profit, and of forcing the Ukrainian farming class to accept Soviet collectivism (something it had not yet done at this time, despite the imposition of a communist central government on the East European state), Stalin increased the amount of grain Ukraine was required to provide the USSR by 44%, a level too high for the Ukrainian farmers to meet and also be able to feed themselves.

Stalin sent a host of Communist Party officials, soldiers, and secret police to Ukraine to enforce on penalty of death the Soviet law stating that no grain or grain products - not even a loaf of bread - could be kept by the Ukrainian peasants for their own consumption until the entire requisition quota had been fulfilled.

Further, according to a Ukrainian historical website, "an internal passport system was implemented to restrict movements of Ukrainian peasants so that they could not travel in search of food. Ukrainian grain was collected and stored in grain elevators that were guarded by military units [and] NKVD secret police units while Ukrainians were starving in the immediate area."

From "Tragedy" to "Statistic"

The barbaric tactic worked all too well. Between 1932 and November 1933, the man who became infamous for, among other things, coining the phrase, "One death is a tragedy; a million deaths is a statistic" added nearly ten million innocents to his tab through starvation, while taking such plentiful fruits of their labors for his own use that "journalists," like New York Times writer and communist sympathizer Walter Duranty, easily swallowed and regurgitated that Soviet party line that the sheer amount of grain flowing into Moscow and out through port cities like Leningrad and Vladivostok meant that the claim of famine anywhere in the Soviet principate was patently absurd.

One writer at conservative weblog RedState.com described the ending of that year of barbarism:

As fall turned into winter in Ukraine in late 1933, good summer and fall weather had produced a bumper crop in Ukraine's ultra-fertile fields. By later in November, it continued to sit there and rot under the impending damp of winter - because there was no one to harvest it. Everyone who had planted the crops in the spring was dead - there was no one left alive to gather the harvest.

On November 28, 2006, after Ukrainian President Viktor Yushchenko ordered the release of thousands of KGB documents showing that the forced famine was perpetrated in part for the purpose of wiping out ethnic Ukrainians, that nation's Parliament declared the Holodomor - a Ukrainian term which, roughly translated, means "Death by Hunger" - a deliberate act of genocide by the USSR.

Different Century, Same Bully

While Ukrainians were somberly observing the 75th anniversary of the end of Stalin's forced famine, Russian chose to remind those in Ukraine and elsewhere of its continued desire to play a negative role in the affairs of its neighbors.

This time, Moscow threatened to cut off the natural gas supply flowing through that gateway to Western Europe if the entirety of Ukraine's fuel-related debt to its former ruler, estimated at $2 billion, was not immediately settled.

The timing of the threat, which was likely every bit as accidental as President Dmitriy Medvedev's statement, made on the day Barack Obama was being elected President of the United States, that Russia was "prepared to place short-range missiles in the territory of Kaliningrad in response to U.S. plans for a missile-defense shield in Poland and the Czech Republic," did not go unnoticed by its target audience.

"The unsubtle Kremlin gets no points for timing," wrote the editors of Ukraine's Kyiv Post on November 26. "The threat to cut off gas in the dead of winter came over the weekend that Ukrainians commemorated the Holodomor, the death by hunger of millions of Ukrainians in 1932-33. The Soviets lied about the Stalin-ordered famine and today's Russian leadership still belittles the epic crime."

Russia's Financial Crisis

On December 4, Prime Minister Vladimir Putin reiterated the threat, this time before an international television audience. The move comes as Russia is attempting to force its former vassals, Ukraine included, to transition from paying Soviet-era subsidized prices for natural gas to paying the full international rate.

"How can we leave in place the prices of the current year?" Putin asked, referring to the hardship being brought on Russia by the growing global economic crisis (and by the transcontinental state's decision to increase the percentage of its GDP being spent on the military by nearly 200% over the last year to fund its invasion of former satellite Georgia and to fund its efforts to reassert itself on the global stage as a counter to the U.S.).

"Then," according to an AFP report of Putin's address, "drawing on a Ukrainian colloquialism -- and speaking in Ukrainian -- Putin added: ‘Have you lost your mind?'"

A Threat with Precedent

"In the long march of history, progress is being made," the Kyiv Post's editors wrote. "Kremlin leaders in the early 20th century starved Ukrainian men, women and children to death. Their successors in the 21st century merely threaten to freeze Ukrainians to death."

Russia's threat to cut off heating fuel to Ukraine, where winter temperatures reach as low as -68° Fahrenheit as a matter of course, is not without precedent. In January 2006, Russia responded to Ukraine's refusal to pay a higher price for fuel by reducing the natural gas flowing through Ukraine to a level commensurate with Western Europe's paid allotment alone.

Ukraine responded by siphoning gas to meet its own needs (though the government still officially denies that any siphoning ever took place), and, after some European leaders expressed concern about the amount of natural gas that was reaching their nations, Russia returned the flow of fuel to its full previous level.

A Desperate Desire for Relevance

The former Soviet capital has taken advantage of the state of flux in America's political leadership, and of outgoing President George W. Bush's unwillingness to make any further military commitments, to take a more active role both in the affairs of its neighbors and in those of Western nations.

From providing weapons and nuclear aid to Iran, to running roughshod over former vassal state and current NATO applicant Georgia this August, to dispatching President Medvedev to meet with Fidel Castro in Cuba and Hugo Chavez in Venezuela, to conducting joint naval exercises with Venezuela in the Caribbean Sea, Russia's leaders are working to regain the lost trust and rebuild the damaged nationalist pride of their subjects by asserting international relevance in the best way they know how: by intimidating neighbors and acting, despite their inability to actually be such, as a global counterbalance to the United States.

This year's dispute with Ukraine will likely be solved, as its 2006 predecessor was, with little or no physical harm done to Ukraine's population. Putin's threat, though, is yet another example of Russia's growing efforts to impose itself once again on the international stage in the way it has been doing so for centuries: through imperialism and intimidation.

"It seems that the closer a country is located to Russia, the worse Moscow's relations are with that nation," Russian radio host Yulia Latynina wrote in the December 3 Moscow Times. "The Kremlin wants to be on good terms with France and Germany, for example, but if any country that was once part of the Soviet empire tries to shed light on its own history, the Kremlin lashes out with angry reproaches that it is deliberately provoking a conflict."

While this will likely always be a hallmark of Russia's foreign policy, it is one which the civilized nations of the world - from Eastern Europe to the United States - have a duty to oppose in all cases where it manifests itself in acts of aggression, lest invasions of sovereign states like Georgia and the perpetration of barbaric tragedies like the 1932-33 Holodomor be allowed to occur once again.

Source: American Thinker

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Death Of Patriarch Alexy II Leaves Many Divisions Unresolved, Including With Ukrainian Church

MOSCOW, Russia -- In his nearly two decades at the head of the world's largest Orthodox church, Patriarch Alexy II oversaw a religious revival in Russia and healed a major church rift, but his death leaves a long-running dispute with the Vatican unresolved.

Russian Patriarch Alexy II died Friday at the age of 79.

Alexy's death Friday at age 79 deprives the Russian Orthodox Church of its dominant figure, whose stern, bearded mien gave him an almost medieval aura of inflexible righteousness.

He often complained that Roman Catholics were poaching adherents among a people who traditionally would have been Orthodox if atheistic Soviet rule had not impeded them.

Yet he and the church held many discussions with the Vatican, aiming to reach an agreement that would allow the church to accept a papal visit to Russia.

Without Alexy at the helm, the church's initiatives on that question may go dormant for several months. The church's Holy Synod is to choose a placeholder leader on Saturday, but election of a new patriarch is likely to take six months.

Metropolitan Kirill, the church's foreign relations chief who has had extensive contact with the Vatican, appears to be one of the top candidates.

The Moscow Patriarchate said Alexy died at his residence outside Moscow, but did not give a cause of death. Alexy had long suffered from a heart ailment, although on Thursday he had appeared comparatively well while conducting services.

His funeral was tentatively slated for Tuesday, according to Russian news agency Interfax, which cited his spokesman Vladimir Vigilyansky.

Alexy became leader of the church in 1990, as the officially atheist Soviet Union was loosening its restrictions on religion. After the Soviet Union collapsed the following year, the church's popularity surged.

Church domes that had been stripped of their gold under the Soviets were regilded, churches that had been converted into warehouses or left to rot in neglect were painstakingly restored, and hours-long services on major religious holidays were broadcast live on national television.

By the time of Alexy's death, the church's flock was estimated to include about two-thirds of Russia's 142 million people, making it the world's largest Orthodox church.

But Alexy often complained that Russia's new religious freedom put the church under severe pressure and he bitterly resented what he said were attempts by other Christian churches to build their flocks. These complaints focused on the Roman Catholic Church.

Those tensions aside, Pope Benedict XVI praised Alexy on Friday.

''I am pleased to recall the efforts of the late patriarch for the rebirth of the church after the severe ideological oppression which led to the martyrdom of so many witnesses to the Christian faith. I also recall his courageous battle for the defense of human and Gospel values,'' the pope said in a message of condolence to the Russian church.

Alexy lived long enough to see another major religious dispute resolved. In 2007, he signed a pact with Metropolitan Laurus, the leader of the breakaway Russian Orthodox Church Outside Russia, to bring the churches closer together.

The U.S.-based Church Outside Russia had split off in 1927, after the Moscow church's leader declared loyalty to the Communist government.

Alexy successfully lobbied for the 1997 passage of a religion law that places restrictions on the activities of religions other than Orthodoxy, Islam, Judaism and Buddhism. Under his leadership, the church also vehemently opposed schismatic Orthodox churches in neighboring Ukraine, claiming the Ukrainian church should remain under Moscow's control.

A top representative of Russia's Muslims praised Alexy's efforts to restore religion's prominence in post-Soviet Russia.

''All the activities of this man were devoted to unifying our country, developing state-religion relations and the dialogue of Russia's traditional faiths,'' said Albir Krangov, a deputy chairman of the Muslim Central Spiritual Administration, according to the RIA-Novosti news agency.

In a demonstration of the close relations between church and state, President Dmitry Medvedev canceled plans to travel from India to Italy, so he can return for the funeral.

''He was a great citizen of Russia. A man in whose destiny the whole difficult experience of our country's changes in the 20th century are reflected,'' Medvedev said.

President George W. Bush offered his condolences, White House press secretary Dana Perino said.

''The president's heart is with the community of Russian believers as they continue to rebuild the rich spiritual traditions of Russia,'' Perino said.

Under Alexy, the church's influence grew strong enough that some public schools instituted mandatory religion courses -- a move that human rights advocates criticized as likely to increase xenophobia.

''The church strengthened nationalism, without a doubt,'' said Alexander Verkhovsky of the Moscow human rights group SOVA. But he also gave the church under Alexy credit for speaking out against violent, radical nationalists.

The patriarch was born Alexei Mikhailovich Ridiger on Feb. 23, 1929 in Tallinn, Estonia. The son of a priest, Alexy often accompanied his parents on pilgrimages to churches and monasteries, and he helped his father minister to prisoners in Nazi concentration camps in Estonia. It was during those visits that Alexy decided to pursue a religious life.

Under Soviet rule, this was not an easy choice. Lenin and Stalin suppressed religion and thousands of churches were destroyed or converted to other uses, such as museums devoted to atheism or, in some cases, stables. Many priests and parishioners were persecuted for their beliefs.

The persecution eased somewhat during World War II, when Stalin discovered that the church could be used as a propaganda tool in the fight against the Nazis. But the Soviet authorities never fully loosened their grip, penetrating the church at the highest levels.

Alexy was ordained in 1950, progressed through the Orthodox hierarchy, and was consecrated Bishop of Tallinn and Estonia in 1961.

The British-based Keston Institute, which monitors religious freedom in former Communist countries, has cited research suggesting that Alexy's career may have been aided by assistance he gave the KGB while a young priest in Tallinn. Orthodox Church officials vehemently denied the allegations.

Source: AP

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U.S., Canada Place Radiation Scanners In Ukraine

KIEV, Ukraine -- The United States and Canada today marked the deployment of radiation detection equipment at Ukraine`s Kiev Boryspil International Airport, the U.S. National Nuclear Security Administration said, according to Global Security News.

Kiev Boryspil International Airport

Canada`s Foreign Affairs and International Trade Department contributed $4.5 million to nuclear nonproliferation projects in Ukraine conducted under the NNSA Second Line of Defense program.

The U.S. agency`s work in the country includes deploying radiation scanners at entry points into Ukraine, training personnel and organizing technical conferences.

“We appreciate both Ukraine’s commitment and Canada’s contribution to advancing our common international security goals,” NNSA Principal Assistant Deputy Administrator Kenneth Baker said at a ceremony.

“The commissioning of the radiation detection system at Kiev Boryspil International Airport represents an important step forward in increasing transcontinental security. We will continue to strengthen our cooperation as we work together to complete installation of the radiation detection systems at other sites in Ukraine,” Baker said.

Source: U.S. National Nuclear Security Administration

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Friday, December 05, 2008

EU Enhances 'Eastern Partnership' -- But Is There Less Than Meets The Eye?

BRUSSELS, Belgium -- The European Commission is reaching out to six former Soviet nations, proposing generous financial assistance programs and free trade deals.

European Commission President Jose Manuel Barroso has stressed that Europe isn't seeking to undermine Russian influence in the region.

The proposal represents the European Union's most ambitious program aimed at former Soviet countries since embracing Baltic and Eastern European states as EU members.

Under the scheme, which was unveiled December 3 in Brussels, the 27-nation bloc will spend an additional 350 million euros on aid to Ukraine, Georgia, Azerbaijan, Armenia, Moldova, and Belarus.

This sum would add to the almost 1.2 billion euros already pledged to these countries by 2020 in the framework of the so-called Eastern Partnership.

Katinka Barysch, deputy director of the London-based Center for European Reform, says the proposal demonstrates the EU's mounting commitment toward forging closer ties with ex-Soviet nations.

"It is a significant sum for some of the countries involved that are quite small, and a significant increase from what the European Commission had previously committed," Barysch says. "It shows that the European Union is quite serious about making a difference. It's always easy to talk, but it seems that the European Union is willing to put some money where its mouth is."

Reward For Reforms

The proposal calls for free trade deals, closer energy ties, visa liberalization, and financial assistance programs as a reward for making democratic and free market reforms.

Belarus, however -- which has been branded "Europe's last dictatorship" -- must initiate democratic reforms before it can qualify.

EU leaders will debate the program when they meet in Brussels next week.

The six beneficiary countries have warmly welcome the plan, despite concerns over its implementation.

"Who will spend this money? It's very important," asks Vefa Guluzadeh, a former foreign policy adviser to ex-Azerbaijani President Heydar Aliyev. "If the money is given to these countries' governments, who knows how it will be spent? There is a high level of corruption in all of these counties. I think it will make sense if this money goes to people who are in need, or to projects that need it."

The scheme, which stops short of offering any firm prospect of EU membership, is also bound to disappoint many in EU hopeful Ukraine and Moldova.

Some officials, like Andriy Veselovsky, Ukraine's ambassador to the EU, nonetheless view the proposal as a step toward eventually joining the European Union.

"This is definitely a step toward Ukraine's membership in the European Union," he told RFE/RL's Ukrainian Service. "Why go through the trouble otherwise?"

Gained New Importance

The Eastern Partnership was launched earlier this year but gained new importance following the August war between Russia and Georgia, which underscored Moscow's increasingly assertive stance and raised the threat of political instability in the region.

The partnership also fits into Europe's drive to secure safe energy supplies -- all of the countries involved are either rich in oil and gas or are critical energy transit routes.

European Commission President Jose Manuel Barroso admitted that the commission had felt an urgency to act after the war in Georgia. But he stressed that Europe wasn't seeking to undermine Russian influence in a region that the Kremlin continues to regard as its own backyard.

The bloc, he said, simply wants to support reforms that the six beneficiaries are willing to undertake. "There is no Cold War," he said on December 3 while outlining the initiative.

The EU plan will no doubt ruffle a few feathers in Moscow.

But Barysch of the Centre for European Reform says the Kremlin is unlikely to pay close attention to the initiative.

"I don't think that Russia is going to be overly upset by what is still essentially quite a bureaucratic process," Barysch says. "The Russians take the [EU] eastward enlargement seriously because they see that it can create new borders within the European landmass. But I don't think they take the European neighborhood policy very seriously."

Source: Radio Free Europe/Radio Liberty

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Putin: Russia May Cut Gas Supplies To Ukraine

MOSCOW, Russia -- Prime Minister Vladimir Putin warned Ukraine on Thursday that Russia will reduce gas supplies to Ukraine if it tries to siphon Russian gas intended for European consumers.

Russia's Prime Minister Vladimir Putin answers questions during his annual question-and-answer session with the Russian people in Moscow, December 4, 2008.

The tough warning, which comes amid difficult talks on a price for Russian gas supplies to Ukraine, will likely stoke fears in European nations that saw a drop in Russian gas shipments when Moscow cut gas to Ukraine in January 2006, amid a similar pricing dispute.

"We are proceeding from the assumption that we won't have any problems with transit of gas to Western Europe," Putin said during a question-and-answer session televised nationwide. "But if our partners don't fulfill the agreements or try to siphon gas from the transit pipelines as they did in past years, we will be forced to reduce supplies. What else can we do?"

Russia accused Ukraine of diverting transit gas during a 2006 supply cutoff. In another supply dispute in March, Ukrainian officials held out the possibility of siphoning off Europe-bound gas if necessary.

Putin's words contrasted with previous statements from both Russian and Ukrainian officials who said that they hope the gas dispute won't lead to a disruption of supplies to Ukraine or European consumers, as was the case in 2006. Most of the gas Russia supplies to Europe goes through Ukraine.

Putin said that state gas monopoly Gazprom has to raise the price Ukraine pays of $179.50 per 1,000 cubic meters, which is half of the price Gazprom charges its customers in Europe.

Putin didn't say how much Russia wants to charge, but Gazprom officials have suggested that the price for Ukraine could top $400 next year.

Gazprom also has demanded that Ukraine quickly pay off its debt for previous supplies, and talks on the issue are ongoing.

Source: AP

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CheckFree Customers Redirected To Ukraine Site

ATLANTA, United States -- Customers of CheckFree.com, an online bill paying site, were quietly redirected to servers in Ukraine early Tuesday morning, according to several reports.

Peter Kight, founder of CheckFree Corporation

Representatives of CheckFree told WashingtonPost.com that customers were redirected to a blank log-in page that attempted to install malware on the visiting PC.

The company said it regained control at 5 a.m. EST Tuesday, so only customers using the site overnight were likely affected.

Mike Haro, senior security analyst at Sophos told CNET News, "The fact that they used a blank page to download a Trojan (not exactly subtle) says to me one of two things: a) they fell into these credentials and chose the fastest way to get something done, expecting the breach to be quickly detected; or b) they got more than we're being led to believe."

The Post also said someone was able to steal the user name and password to make account changes at CheckFree's domain registrar.

The Domain Name System (DNS) takes the common name CheckFree.com and converts it to an online address; the criminals were able to change that online address to a server hosting malicious content.

CheckFree allows users to pay their utility bills, insurance payments, mortgage and loan payments along with 330 other kinds of bills electronically.

The company declined to say how many of its customers may have been affected, according to the Post story.

CheckFree...stressed that the attack occurred during off-peak hours when customer traffic to its Web site is typically low. Still, CheckFree has a huge customer base: The company claims that some 24.7 million consumers initiate payments through its services.

Haro said: "I guess I'm less surprised that someone got access credentials, and more surprised at what they did--or didn't do--with that level of access." For example, he hasn't seen evidence the criminals have tried to extract money directly from the exposed accounts.

As of Thursday afternoon, representatives from CheckFree had not responded to CNET News' request for further comment.

Source: CNET News

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Thursday, December 04, 2008

EU Proposes Deeper Ties To 6 Ex-Soviet Nations

BRUSSELS, Belgium -- Seeking to extend its reach into Russia's backyard, the European Union on Wednesday proposed deeper ties with six former Soviet nations, even suggesting that it could embrace Belarus, often described as the continent's last dictatorship.

European Commission president José Manuel Barroso.

Four months after the Caucasus exploded into conflict, and with growing concern over energy supplies from Russia to the EU, nations on the bloc's eastern flank have emerged as a new priority.

On Wednesday the European Commission sought to tempt them with offers of free trade deals, closer energy ties, easier access to visas and financial assistance programs worth a total of €600 million, or $760 million, over two years.

The proposed new "Eastern Partnership" with Armenia, Azerbaijan, Georgia, Ukraine, Moldova and Belarus is the boldest outreach to ex-Communist nations since the EU expanded in 2004 and 2007 to embrace the Baltics and all the former Warsaw Pact nations of Eastern Europe. Yet it will disappoint Ukraine, a country considerably bigger than France, and much smaller Moldova for holding out no firm prospect of EU membership.

The new group, which is likely to meet in a Prague summit next spring, began life earlier this year because of pressure to counterbalance efforts by the French president, Nicolas Sarkozy, to forge closer links with and between Europe's southern neighbors.

But the plan assumed greater importance after the fighting in Georgia in August, which underlined the power of a resurgent Russia and highlighted the risk of political instability in the east.

Outlining the proposal, José Manuel Barroso, the European Commission president, denied suggestions that the EU was seeking to establish itself as an alternative power center to Moscow.

"The Cold War is over," said Barroso, "and where there is no Cold War, there should be no spheres of interest."

Russia has reacted angrily to the expansion of NATO into its "near abroad" but has so far seen the EU as a less threatening prospect. The evolution of a free-trade zone on its doorstep might be beneficial to Moscow, analysts say.

A senior European diplomat, who was not authorized to speak publicly on the subject, said that if the EU did not engage with these countries, there was a growing likelihood that Moscow would.

"If you don't offer these countries a future, there's always Russia," he said.

Nicu Popescu, a research fellow at the European Council on Foreign Relations, argued that the move could force Russia to engage with the EU over the future of the six nations, all once part of the Soviet Union itself.

"The EU has a desire to cooperate with Russia," Popescu said, "but the problem is that Russia doesn't want to cooperate with the EU within the neighborhood. Only when the EU acts does Russia take it seriously - what works is forced cooperation."

But Popescu warned that the announcement has not resolved European divisions over how to handle any policy associated with Russia.

"The big problem for these countries," he said, "is not a lack of promises but a failure to deliver on those promises."

Benita Ferrero-Waldner, the European external relations commissioner, said that, while the Sarkozy plan for the Mediterranean focused on joint infrastructure projects, this plan would bring eastern nations closer to the EU by aligning them with the bloc's commercial standards.

One unanswered question is the role of Belarus. In October, the European Union lifted temporarily a travel ban on the country's president, Aleksandr Lukashenko, following the release of political prisoners.

That decision will be reviewed in March next year and, if confirmed, the Belarus president will be invited to a summit next April or May in Prague to launch the new "Eastern Partnership."

The EU imposed sanctions on Lukashenko and about 40 other Belarussian officials in 1999 after crackdowns on the political opposition. In 2002 he was refused a visa by the Czech government when he wanted to attend a NATO summit meeting there.

At the time, Lukashenko was reported to have threatened retaliation for the snub, saying he would flood Western Europe with illegal immigrants and drugs.

Belarus is not a NATO member, though it cooperates with the alliance through its Partnership for Peace program.

The issue of human rights does not feature prominently in the document published Wednesday on the proposed new partnership. The paper does, however, suggest that minimum standards need to be attained for those countries that want to negotiate an association agreement, which would intensify economic ties. That would be the next step toward EU membership.

For Ukraine, the document has the benefit of differentiating it from other neighbor nations, like Syria, which have no aspiration to join the EU. But it also means that the favored relationship on offer to Kiev will be extended to Azerbaijan and Armenia. Perhaps to compensate, Barroso described Ukraine as being in the "avant-garde" of the Eastern Partnership.

Poland has been a strong advocate of binding Ukraine more closely to European structures. Jacek Saryusz-Wolski, a Polish center-right European deputy and chairman of the Foreign Affairs Committee of the European Parliament, welcomed the move.

"The recent crisis in the South Caucasus," he said, "has once again brought to evidence the need for a strong EU presence in its Eastern neighborhood. For the sake of stability on our doorstep, we have decided to move beyond declarations, improve on our up-to-date performance and offer tangible benefits to our closest neighbors."

Source: International Herald Tribune

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Living With AIDS In Ukraine

KIEV, Ukraine -- Inadequate medicine, ineffective cooperation and low awareness exacerbate Ukraine’s soaring infection rate. If there’s anything worse than having AIDS, maybe it’s having the disease in Ukraine. Discrimination, unstable supplies of critical medicine and poor awareness are still prevalent.

Maksym Nikolayenko, an AIDS patient who also works at the government-owned Lavra AIDS Clinic at the Institute of Epidemiology and Infectious Diseases, says Ukraine needs to make more progress in fighting the epidemic.

Maksym Nikolayenko would know. He is among those HIV-positive Ukrainians whose virus has progressed to AIDS. He is no longer afraid or silent. “I am tired of hiding it. I’ve realized if people keep silent, AIDS will choke all of us,” Nikolayenko said.

Nikolayenko understands why other HIV/AIDS patients are still afraid and silent. He also doesn’t recommend that all HIV-positive people speak out and reveal their status. “Discrimination is all over the country,” Nikolayenko said. “And it’s scary.”

Ukraine observed yet another World AIDS Day on Dec. 1 with one of the fastest-growing infection rates in the world. The numbers are so alarming that many health experts still worry about whether the disease will spread from high-risk groups, where it has been concentrated, and start assuming African-like dimensions by spreading to the general population as well.

Roughly 1.6 percent of the nation’s adults, some 440,000 people, are believed to be HIV positive in Ukraine. Nikolayenko thinks the nation, both its people and government, are still living in a dream world about the epidemic.

“Both we [people] and they [government authorities] are used to thinking that AIDS is somewhere far away,” involving only people who use drugs and engage in prostitution," Nikolayenko said. “The situation is much worse. My generation doomed itself to AIDS through drugs. Now a huge percentage of those infected do not have any relation to drugs, homosexuals or sex workers.”

The figure of 440,000 HIV-positive people is an expert guess. So is the estimate that only one in four HIV-positive people knows their status.

The good news is that having HIV and AIDS is no longer the death sentence that it was, if people receive proper treatement. While no vaccine has been found and there is still no cure, people are living increasingly longer with the virus. They are even living normal life spans. But treatment is expensive and still beyond the reach of many people.

Nikolayenko learned he was HIV positive 13 years ago, but HIV is not his only positive attribute. His optimistic attitude and broad smile help him work with others of the state-run Lavra AIDS Clinic at the Institute of Epidemiology and Infectious Diseases. This is the place where Nikolayenko and others undergo anti-retroviral treatment.

Back in 1995, when Nikolayenko discovered that he was HIV-positive, “it sounded like a death sentence. HIV or AIDS: It did not make any difference.” It took him another decade to quit drugs and start anti-retroviral therapy. By then, in 2005, his HIV had progressed to full-blown AIDS.

What he described as “absolutely inadequate treatment” at the provincial level forced him to seek help from the Lavra Clinic, Nikolayenko said. “We are all lucky to be here and have these doctors.”

Katya, another Lavra Clinic patient, came to the Kyiv treatment center after being charged for supposedly free medical treatment at a provincial hospital where she was living. Katya, who didn’t want to be identified, dreads divulging her HIV status. She has an eight-year-old son and she was fired from work once after her employers learned of her illness.

“Discrimination is particularly severe in small towns,” Nikolayenko said. “People are being refused medical care. Their status gets immediately divulged by hospital personnel. Some are forced to search for medical help in other cities.”

Svitlana Antonyak, a physician and head of the HIV/AIDS department at Lavra Clinic, said the “unwillingness of those in power to notice the problem” blocks progress against the disease. “Among our patients, there are people close to power or in power and they all are terribly afraid to reveal their status,” Antonyak said. “The fear is not groundless. There is stigma at hospitals. There is stigma in society.”

Antonyak said that HIV/AIDS patients also fear not getting medications on time, as state managerial skills leave much to be desired.

Nikolayenko agreed. “People are lying in hospitals with acute need for medicines. And there are just no medicines. They were not bought or delivered or were delivered too late,” he said. “To take away therapy means to put me back into the condition I was before. It’s the same as taking away insulin from a diabetic or inhaler from an asthmatic.”

Today, about 10,000 HIV/AIDS patients are undergoing anti-retroviral therapy in Ukraine. More than 6,000 patients were supported by the International HIV/AIDS Alliance. It is, in turn, sponsored by the Global Fund to Fight AIDS, Tuberculosis and Malaria, the international institution that has committed $14.9 billion in government and private donations for prevention, treatment and care programs worldwide.

The $100 million Global Fund grant in Ukraine is expected to be spent by year’s end. The patients that the fund has been supporting will now become the government’s responsibility, a prospect that alarms health advocates.

“Today, Ukraine withstands the epidemic only because of foreign help,” said Andriy Klepikov, executive director of the International HIV/AIDS Alliance in Ukraine. “Without Global Fund support, the country would face catastrophe. The $100 million Global Fund grant enabled us to achieve significant results: we managed to slow the growth of the AIDS mortality rate, and achieved a 4 percent decrease in AIDS incidence (3,589 new AIDS cases were registered over 10 months of 2008 compared with 3,743 cases over the same 2007 period.)”

Klepikov said the state should concentrate on at-risk populations.

Antonyak said that AIDS patients need stability in treatment that the government hasn’t been able to provide.

“Anti-retroviral therapy is a lifetime treatment which can not be interrupted under any circumstances. However, state purchases [of medicines] are unstable,” Antonyak said. “Only 50 percent of the basic component for the anti-retrovirus treatment was delivered to regions. Some medicines are completely absent. Ukraine doesn’t have much experience in state HIV/AIDS epidemics] treatment. And we need to admit that. The situation requires structured cooperation among the Ministry of Health, HIV/AIDS centers, Ministry of Finance, etc. It’s incredibly important that authorities undertake political responsibility.”

Torsten Brezina, a team leader of the German Agency for Technical Cooperation (GTZ) in Ukraine, noted the same problems. “Cooperation among the ministries, state and NGOs needs serious improvement. A comprehensive informational campaign would also be very beneficial. These are the obstacles that need to be removed for HIV/AIDS prevention to be effective,” Brezina said.

The government is in the process of adopting a five-year national prevention program through 2013. “The program stresses preventive measures with an active role for mass media, the church and all educational establishments from primary schools to universities,” said Olena Yeshchenko, deputy head of the Commission of HIV/AIDS and other infectious diseases prevention at the Ministry of Health. “The goal is to promote a safe lifestyle and high standards of morality among youth. The second aim is working with most-at-risk groups” and care of those dying.

Altogether, however, Ukraine hasn’t made significant progress in its fight against AIDS since last year, when President Victor Yushchenko on Dec. 4, 2007, blamed the Cabinet of Ministers and Health Ministry for the biggest failure in the battle against HIV/AIDS. “Moreover, this failure is tragic because it is based on a system of errors, criminal inactivity, corruption, the misappropriation of state funds and their irrational use,” Yushchenko said.

While the president’s press secretary couldn’t be reached by deadline, the official presidential website cites the main improvement over the previous one as access to therapy among HIV patients. Last year, 7,700 received treatment. This year, that number increased to 10,000 people – but a total of 91,000 people needed treatment, according to estimates.

But Yushchenko still faults the Cabinet of Ministers and the National Commission on HIV/AIDS as working ineffectively and non-transparently. Most importantly, Yushchenko said, not enough money is being spent to provide treatment to all HIV-positive and AIDS-suffering people.

Source: Kyiv Post

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Wednesday, December 03, 2008

Russian Deputy Hails NATO's Decision To Deny Ukraine, Georgia Entry Into Membership Action Plan

MOSCOW, Russia -- The State Duma's foreign affairs committee head Konstantin Kosachev has said he is satisfied with a decision taken by foreign ministers from NATO member-nations in Brussels on Tuesday not to offer Ukraine and Georgia the Alliance's Membership Action Plan (MAP).

Russian Duma foreign affairs committee head Konstantin Kosachev.

"Neither Ukraine nor Georgia managed to secure the adoption of their desired decision. The U.S. was the only party that supported the aspirations of Ukraine and Georgia while the overwhelming majority of NATO member-countries, including the Alliance's founders - France, Germany, Italy and a number of other nations - did not allow these two countries to join [NATO's] MAP," Kosachev told journalists on Wednesday.

This decision backed by a majority of the Alliance's member-states was quite predictable, he added.

"Minds within NATO are getting sober again because Ukraine and Georgia, in the event of their membership in the Alliance, would not help solve most existing problems, but they would only aggravate them," the deputy said.

Kosachev said he is convinced that Washington's support of Ukraine and Georgia's NATO aspirations will not be able to considerably influence the opinion of most NATO member-countries in the future.

Source: Kyiv Post

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NATO Agrees Georgia, Ukraine Compromise: Officials

BRUSSELS, Belgium -- NATO's biggest nations reached an agreement on Tuesday that will allow the alliance to deepen cooperation with Georgia and Ukraine, without prejudice to the way they would eventually join the alliance.

NATO chief Jaap de Hoop Scheffer prior to a meeting at the alliance's headquarters in Brussels.

"We agreed -- without prejudice to further decisions about MAP, whatever they are -- that we will use the commissions to advance their reforms," a senior US official told reporters.

A European diplomat confirmed that a compromise had been found between the United States, Britain, France and Germany at a meeting of NATO foreign ministers in Brussels to an issue that has divided the alliance.

Georgia and Ukraine had been striving to win membership action plan (MAP) status, which has in the last decade been the final stepping stone toward joining the world's biggest alliance.

But a bloc of around half a dozen European countries, led by Germany believes that the two former Soviet states are not ready for such a step.

The United States has proposed that the two be allowed to continue to advance reforms through the respective NATO-Georgia and NATO-Ukraine Commissions, but Berlin insists that the MAP process be respected.

To join NATO, Georgia and Ukraine must complete political, democratic and military reforms, as well as have good relations with their neighbours.

Their citizens should also be in favour of their candidacies.

Russia, a major supplier of European energy, is vehemently opposed to their bids.

Source: AFP

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Rats Invading Ukraine's Largest Resort City

YALTA, Ukraine -- The Ukrainian resort city of Yalta is facing its largest rat invasion in some 20 years.


Mykola Leschenko, the deputy chief of Yalta's Sanitary Control Department, says the situation is "worrisome," RFE/RL's Ukrainian Service reports.

Local authorities think the wave of rats came from international vessels anchored in Yalta's port.

The Sanitary Control Department plans to start a mass disinfection campaign in various apartment blocks in Yalta in the near future, promising to solve "the rat problem" by the beginning of the tourist season in late spring.

Source: Radio Free Europe/Radio Liberty

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Tuesday, December 02, 2008

Georgia, Ukraine Set For Disappointment At NATO Meeting

BRUSSELS, Belgium -- Despite intense lobbying, Georgia and Ukraine look certain not to be offered a fast track towards NATO membership at a meeting of alliance foreign ministers in Brussels on Tuesday, diplomats said.

Russia's leadership has bitterly opposed NATO membership for Ukraine and Georgia.

The highly contentious issue of NATO expansion was taken off the table ahead of the meeting in light of the lack of unanimity among alliance members over the issue.

"A great many countries think that Georgia and Ukraine have not made enough progress to even be considered for the Membership Action Plan (MAP)," a trial period prior to being allowed into the western alliance, said Thomas Steg, deputy spokesman for the German government.

US Secretary of State Condoleezza Rice said she felt the time had not yet come to offer the two former Soviet republics a MAP.

"Georgia and Ukraine are not ready for membership. That is very clear," Rice said.

Bucharest pledge

In April, at a summit in Bucharest, alliance leaders agreed that Georgia and Ukraine would join NATO at an unspecified future date, but failed to find the consensus needed to offer them a MAP.

The summit called for progress on reforms that would bring the two states closer to membership, and tasked NATO foreign ministers with giving an initial assessment of that process in December.

'No reason' for immediate expansion

Since then, the Georgian and Ukrainian governments have lobbied intensively for a MAP, with the US their most vocal supporter.

But given the summer's war in Georgia and the collapse of the Ukrainian government, the member states which most opposed giving the two countries a MAP in April -- Germany, France and Italy -- have argued that now would be the wrong time to make a membership offer.

There is "no reason" for the alliance to go further than the April agreement at this stage, German Foreign Minister Frank-Walter Steinmeier told the German parliament Wednesday, Nov. 26.

Since it would take a unanimous decision by NATO members to offer either country a MAP, diplomats say it was highly improbable that either would receive the coveted plan Tuesday.

Commissions to weigh up expansion

Ministers now look set to use Tuesday's meeting to focus on the question of how much power NATO should give to the cooperation commissions it has set up with each country to judge their readiness for membership.

"We believe that the NATO-Georgia Commission and the NATO-Ukraine Commission can be the bodies with which we intensify our dialogue and our activities with Georgia and (Ukraine)," Rice said.

However, that question also looks set to be divisive, with the skeptics of Georgian and Ukrainian NATO membership fearing that the US and Britain were attempting to bring the duo closer to membership without following the formal MAP procedure.

Russian relations

Ministers are also set to discuss relations with Russia, after they agreed to suspend all high-level meetings with the Moscow following the Georgia war.

The Russian government is currently lobbying for the creation of a new "security architecture" in Europe which would sideline NATO, a force Moscow sees as an outmoded "product of the Cold War."

But any such security facelift would require NATO's unanimous approval, something member states seem unlikely to give at present.

The ministers are also expected to discuss operations in Afghanistan and against pirates in Somalia, after the alliance's top commander called Monday for a 40-percent boost in troop numbers in the fight against the Taliban.

Source: Deutsche Welle

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Suspected American Con Man To Do 2 Months Of Jail Time

KIEV, Ukraine -- Sanctioned U.S. citizen ordered behind bars as investigation into his alleged fraudulent ways continues.

Robert Fletcher (L) has run afoul of the law in America and Ukraine.

Following a bail hearing today, the Shevchenko District Court in Kyiv ordered American Robert T. Fletcher III to remain in jail for two months on suspicion of fraud.

Fletcher is accused of running an elaborate pyramid scheme that defrauded Ukrainians of up to $150 million, according to Victor Pavlovych, a lawyer representing 30 alleged victims.

Fletcher, however, blamed his detention on the “actions of his competitors”, Korrespondent magazine, the Russian-language sister publication of the Kyiv Post, reported.

The judge ruled in favor of prosecutors in ordering Fletcher to spend two months at the Lukyanivskiy pre-trial detention center as police continue their investigation.

Police say they have evidence that Fletcher swindled $10 million from Ukrainians by offering high investment returns on fictitious business projects.

Fletcher has run afoul of the law in America.

In August 2008, a U.S. federal court ordered Fletcher to pay more than $5 million in fines and penalties for civil violations of U.S. Securities and Exchange Commission anti-fraud regulations and laws.

Fletcher, 45, has used a fake Ukrainian passport on at least three confirmed occasions for which he admitted paying $70,000, Segondnya newspaper reported.

On one occasion he registered his marriage and on another he was caught attempting to enter Russia by train late in 2007 for which he spent 10 days in jail and was released on $6,400 bail.

Source: Kyiv Post

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President Yushchenko Seeks Warmer Links With Moscow As NATO Hopes Cool

KIEV, Ukraine -- Ukraine is moving to soothe relations with Russia as NATO loses interest in offering rapid membership of the alliance.

Viktor Yushchenko at NATO

The reappraisal comes amid debate in Kiev about the wisdom of antagonising the Kremlin, particularly after the confrontation between Russia and Georgia in the summer.

President Yushchenko of Ukraine has ordered a policy review in an effort to defuse tensions with Russia over his country’s pro-Western leanings.

The shift is an acknowledgement that friction between Kiev and Moscow has made it harder for the European Union and NATO, particularly members such as Germany and France, to embrace Ukraine.

“The majority of Ukrainians understand that strain and antagonism on our eastern border hinder the European and Euro-Atlantic integration of our country,” Oleg Voloshin, a spokesman at the Ukrainian Embassy in Moscow, said. “Now Kiev is disposed to intensify its dialogue with Russia to relieve her concerns over some priorities of Ukraine’s foreign policy.”

It is a remarkable change of tone for Mr Yushchenko, who has raised fears about Russian aggression in Crimea. He had also accused Yuliya Tymoshenko, his rival and Orange Revolution ally, of “high treason” for failing to condemn the Russian intervention in South Ossetia and Georgia in August.

Mrs Tymoshenko, the Prime Minister, is widely perceived to have softened her criticism of Moscow to reduce Kremlin opposition to her run for the presidency next year.

“Tymoshenko is a welcome guest in Moscow, unlike Yushchenko. He is not rejecting his previous pro-Western policy,” one official told The Times. “It is in our interests to show that being pro-Western is not the same as being anti-Russian.”

The new approach has emerged as NATO foreign ministers gather in Brussels today for a two-day meeting.

Condoleezza Rice, the US Secretary of State, backed Washington’s commitment to full membership for Ukraine and Georgia but confirmed that there remained “tactical differences” within the alliance over how this should be achieved. She made it clear that neither country was going to be invited this week into the membership action plan to begin the process.

Dr Rice added that the US would back the resumption of NATO links with Moscow four months after Russia invaded Georgia.

In an interview with The Times last month Mr Yushchenko appealed to NATO not to delay the offer of a membership plan.

The war in Georgia and the collapse of the Orange Coalition in Ukraine, however, has left many member states unwilling to risk a reaction from the Kremlin.

President Saakashvili of Georgia insisted that the former Soviet republics still enjoyed strong support in NATO and said that he hoped progress could be made.

Source: Times Online

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Monday, December 01, 2008

Merkel Affirms German Stance Against NATO Expansion

BERLIN, Germany -- Through a spokesman, German Chancellor Angela Merkel affirmed Monday her opposition to quickly admitting Ukraine and Georgia to the North Atlantic Treaty Organization (NATO).

German Chancellor Angela Merkel

Foreign Minister Frank-Walter Steinmeier, a political rival who is running for the chancellorship next year, had last week firmly rejected a US proposal to admit them quickly.

In Berlin, deputy government spokesman Thomas Steg said Merkel was "seamlessly" in agreement with Steinmeier on the matter. Neither candidate nation would fulfil the criteria for NATO entry in the foreseeable future, he said.

The question is on the agenda when NATO foreign ministers meet Tuesday and Wednesday in Brussels.

The outgoing administration of President George W Bush has proposed admitting them without waiting for them to qualify through a membership action plan.

Most analysts regard the action plan as a polite way of refusing the two nations entry without being seen as doing so.

Steinmeier told US Secretary of State Condoleezza Rice by phone last week that Germany would not agree to alter the procedure.

Steinmeier's spokesman, Jens Ploetner, stressed Monday that the action plan was a compromise that had been agreed at a NATO summit in Bucharest. He said Germany believed this compromise agreement was a binding one.

Source: DPA

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'Deal' To Free Ukraine Cargo Ship

MOGADISHU, Somalia -- Somali pirates have reportedly made plans to release a Ukrainian cargo ship within days, after reaching a ransom agreements.

Hijacked Ukrainian cargo ship MV Faina.

The MV Faina, a Belize-flagged vessel, was seized on September 24 and has a crew of 17 Ukrainians, three Russians and one Latvian.

It was carrying at least 30 Soviet-designed T-72 tanks to Kenya.

Andrew Mwangura, the co-ordinator of the East African Seafarers' Association, on Sunday said: "They have reached a deal but are still discussing the modalities of releasing the ship, crew and cargo."

At the time when they captured the Ukrainian vessel, pirates had demanded $20 million in ransom. However, reports remain unclear as to how much Ukrainian officials will pay for its release.

Sugule Ali, a spokesman for the pirates who captured the ship, said: "I can't tell you what the ransom is, but what I can say is that an agreement has finally been reached.

"We have no doubt this problem will be resolved and I hope the owners will honour the last remaining points."

Ali said said on Tuesday they had lowered their ransom demand to $3 million.

Supertanker hijacking

In another high-profile hijacking, pirates forcibly boarded the Sirius Star on November 15.

The Saudi supertanker was loaded with oil worth $100 million and its capture is the biggest in the history of maritime hijacking.

Pirates holding the Sirius Star said on Saturday they were hoping for a "favourable" response to their $25 million ransom demand, ahead of a deadline which expires on Sunday.

Mohammed Said, the leader of the group that seized the ship, said negotiations to free the vessel were ongoing, but he did not know when they would conclude.

Different route

Shipping firms have opted to re-route to the Cape of Good Hope because of the seizure of several ships across the Gulf of Aden, causing delays and increasing costs.

Ethiopia had called for stronger international action against piracy off the coast of Somalia.

Despite the presence of foreign navies in the Gulf of Aden and the Indian Ocean, hijackers have defied them and seized ships, the latest being the Biscaglia, a Liberia-flagged oil and chemical tanker which had been captured on Friday.

Source: Al Jazeera

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Ukraine '08 Inflation To Hit 23 Pct: President

KIEV, Ukraine -- Inflation in Ukraine should hit 23 percent in 2008, President Viktor Yushchenko said, up from 16.6 percent last year.

Inflation in Ukraine should hit 23 percent in 2008.

"In analytic terms, inflation of 23 percent is expected," Yushchenko told 1+1 television in an interview broadcast late on Sunday. "Rises in producer prices will be somewhat higher, in the area of 27-30 percent."

The president acknowledged that price rises had slowed in recent months, but not enough to meet the government's initial inflation forecast of 15.9 percent for the year.

This figure has already been exceeded, with cumulative price rises standing at 18 percent after 10 months.

The deputy head of the central bank, Oleksander Savchenko, last week predicted an inflation rate of 20 percent for 2008, declining to 10 to 17 percent next year.

Ukraine's memorandum with the International Monetary Fund to secure a $16.4 billion loan, signed last month, calls for inflation of 17.0 percent in 2009 with a rate of 25.5 percent forecast for 2008.

Source: Guardian UK

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