[Ohio UZO News] Ukraine: NYT; AP; VOA remarks; Jamestown

[Deychak, Orest]

New York Times

www.nytimes.com

International Monetary Fund Withholds $3.5 Billion Loan to Ukraine 

By JUDY DEMPSEY 

11 December 2009

Late Edition - Final

3

The International Monetary Fund has decided to withhold the latest
installment of a $16.8 billion loan to Ukraine until after the
presidential election next month, reflecting its growing frustration
over the inability of the country's politicians to get the budget under
control.

The installment, $3.5 billion, would be the fourth since last year to be
paid to Ukraine, which is facing its worst economic crisis in nearly two
decades. The fund had already disbursed almost $11 billion to the
country by July.

Despite a rising deficit, President Viktor A. Yushchenko and Prime
Minister Yulia V. Tymoshenko have been trying in recent weeks to outdo
each other in new spending.

The last straw for the monetary fund appeared to be Mr. Yushchenko's
decision last month to enact wage and pension increases of about 20
percent, despite objections that such measures would feed inflation and
unemployment.

The monetary fund has forecast that Ukraine's economy will contract 15
percent this year, with inflation running above 16 percent.

''It's the same old story,'' said Igor Burakovsky, director of the
independent Institute for Economic Research and Policy Consulting in
Kiev. ''Everything is politicized. Actually, the I.M.F. has become very
frustrated with the leadership because there is no consensus and no
coordination.''

Ceyla Pazarbasioglu, the monetary fund mission chief to Ukraine, said on
a November visit to the country that the fund was not abandoning
Ukraine.

''We stand ready to continue our help, of course, should Ukraine choose
to go on with the program and implement the policies needed now to build
on the early gains,'' she said. ''But there is serious disagreement
among the authorities on how to proceed.''

An official of the fund said on Thursday that it was ready to go back at
any time when the main political players reached a consensus. ''Without
consensus, it really is just very difficult to proceed,'' the official
said on condition of anonymity because of the delicacy of the situation.

Mr. Yushchenko and Ms. Tymoshenko were allies during the so-called
Orange Revolution democracy movement in 2004, but have since become
political enemies in a way that has polarized Ukraine and jeopardized
chances of introducing major economic and social legislation.

With the election campaign now well under way, the main candidates --
Mr. Yushchenko, leader of Our Ukraine, Ms. Tymoshenko, leader of the
Yulia Tymoshenko Bloc, and Viktor F. Yanukovich, a former prime minister
and leader of the Party of Regions -- have all resorted to populist
measures.

The proposals for wage and pension increases were presented to the
Parliament, or Rada, by the Party of Regions, which is based in the
eastern half of the country. The party was able to push them through
because Ms. Tymoshenko leads a minority government.

For her part, Ms. Tymoshenko had already proposed other spending
measures, which also could have been financed only by raising the budget
deficit.

Despite the monetary fund's reservations, Mr. Yushchenko signed the wage
and pension bill.

Ms. Pazarbasioglu, the fund mission chief, said the social standards
law, as it is called, would cost as much as 7 percent of gross domestic
product in 2010. ''It is totally unsustainable,'' she said.

Even if it were modified to limit the increases to low-wage workers, she
added, ''we estimate a cost of as much as 2.5 percent of G.D.P., a very
large addition to Ukraine's budget deficit.''

Much of the monetary fund loan package was intended to make up for lost
revenue. According to the Finance Ministry, Ukraine government receipts
were supposed to total $30 billion this year. By last month, only $18.4
billion had been received.


On the other hand, hot off the presses: 


Associated Press 


December 11, 2009

1:31 EST


Kyiv gets $2 billion more from IMF


KYIV, Ukraine - Ukraine's deputy prime minister says he has secured an
urgent loan of some $2 billion from the IMF that should help pay for
Russian natural gas. 

Hryhoriy Nemyria said Friday he secured the deal with the International
Monetary Fund after meeting with its leadership in Washington, D.C.,
earlier this week.

Nemyria's spokeswoman Nataliya Lysova says that part of the money will
be used to make gas payments to Russia that are next coming due in early
January. Lysova says that the $2 billion will come out of the final
portion of the IMF bailout loan to Ukraine, which the lender froze in
October due to concerns over Ukraine's budget deficit.

Reuters

December 11, 2009


Ukraine Cities Get UEFA's Euro 2012 Green Light 


By REUTERS

 

FUNCHAL, Portugal - Ukrainian cities Kiev, Lviv, Donetsk and Kharkiv
will host matches in the 2012 European soccer championship, UEFA said on
Friday, with the capital confirmed as the venue for the final.

European football's governing body had delayed the decision over hosting
matches in all the proposed Ukrainian cities except Kiev after the slow
progress of infrastructure projects.

"I'm pleased to tell that thanks to the tremendous efforts of the
Ukrainian government we can finally give the green light to a
symmetrical tournament with four cities in Poland, and Kiev, Lviv,
Kharkiv and Donetsk in Ukraine," UEFA president Michel Platini told a
news conference.

"There remain considerable work to be done and considerable hoops to
jump through. I entirely trust Ukraine and Poland as hosts," he added.

The tournament is being co-hosted with Poland, where four cities --
Poznan, Wroclaw, Warsaw and Gdansk -- had already been confirmed by UEFA
as able to host matches.

"Today Ukraine won, the people of Ukraine won," Ukrainian Prime Minister
Yulia Tymoshenko told local television.

UEFA has been frustrated by the slow progress of work in Ukraine and in
May gave the four cities six months to show significant improvement,
with Platini decrying 'huge' problems with airport infrastructure,
transport networks and suitable accommodation for a huge influx of fans.

NEW OPPORTUNITY

"Mr. Platini, the great player and president, has given us a new
opportunity, an opportunity to show what we are made of," Ukrainian FA
president Grigoriy Surkis told the news conference.

"We are going to make sure that Euro 2012 will be at least as successful
as the previous two tournaments. Now isn't a time to rest on our
laurels.

"We've suffered a great deal in the runup to this decision, a lot of
difficulties have been experienced but...the red light has been averted
because those warnings were heeded," he added.

"We're going to modernise our infrastructure, build what remains to be
built, prepare for a wonderful spectacle. We're going to leave no stone
unturned to maintain the prestige of UEFA.

"It would have been so terrible to let this tremendous opportunity slip
through our fingers. This enables us to ensure a promising future for
our country. It's not a Christmas present for me, it's a Christmas
present for all Ukrainians."

Surkis said he had missed his father's 90th birthday to attend the
meeting on the island of Madeira.

"Elderly people understand the importance of these transformations. He
was present when World War Two was won. My father has had a very
difficult life; this is a heart-warming decision for him."

VOA Ukrainian 60th anniversary Event - Ukraine on the Eve of
Presidential Elections

(Note:  the entire commemoration, including remarks by other panelists -
Adrian Karatnycky, Morgan Williams, Nadia Diuk,  and Steve Pifer, David
Kramer and James Green is to appear on VOA Ukrainian's website:
http://www.voanews.com/ukrainian/)

December 11, 2009

Orest Deychakiwsky

U.S. Helsinki Commission

Let me join my fellow panelists in offering congratulations to VOA
Ukrainian on your 60th anniversary and wishing you success in your vital
mission.   I'm reminded of one just one invaluable service you provided
during Soviet rule -providing sustenance to imprisoned Ukrainian
political prisoners who would find out, through VOA and other coverage
of their plight, that they were not forgotten by the West.  

I'd like to say a few words about the election process itself, first,
the international election observation efforts in Ukraine, focusing on
the OSCE; then briefly compare Ukraine's elections with others in the
region; and last, touch upon potential issues and concerns with respect
to the upcoming presidential elections, 

The 56-nation Organization for Security and Cooperation in Europe (OSCE)
- which has become the premier international observation organization in
Europe and Eurasia -- has been observing elections in post-Soviet
countries since the mid-'90's, including every Ukrainian presidential
and parliamentary election since 1998 and its assessments have
increasingly become the authoritative proclamation of the international
community,  The OSCE election mission to Ukraine for the January 17
elections started its work last month, and deployed 60 long-term
observers throughout Ukraine, and expects to field at least 600
short-term observers representing the majority of OSCE countries
(including OSCE parliamentarians and other parliamentary partners). 

Other international observers have had serious election observation
efforts in past Ukrainian elections, especially the highly respected IRI
and NDI (IRI will have election observation delegation in Ukraine next
month), as will the Ukrainian diaspora from the United States and
Canada, among others.

How have past Ukrainian elections compared with elections in post-Soviet
countries?    

 

Other than the infamous fraudulent first phases of the 2004 presidential
elections, OSCE and other international assessments of Ukrainian
elections have compared quite favorably with those in post-Soviet
countries - indeed, very favorably to many we've seen, especially
Belarus, Central Asia, Russia.  This especially applies to the last
three:  the '04 runoffs which elected Yushchenko, and the March '06 and
September '07 parliamentary elections.  The March, '06 elections were
described by our Helsinki Commission Co-Chairman, Rep. Alcee Hastings,
who led the OSCE short-term observers, as "free and fair", an extremely
rare unqualified characterization for elections in that part of the
world.  And the September 2007 parliamentary elections also got positive
assessments from OSCE and others. 

 

Ukraine has always welcomed OSCE observation missions, and even many of
the countries in the region where OSCE assessments of previous elections
were less than positive (eg Azerbaijan, Belarus) accept them.  A recent
exception is Russia, which didn't permit a full-fledged OSCE election
mission for their parliamentary elections of 2007 and presidential of
March 2008, due to President Putin's displeasure at OSCE assessments of
previous Russian presidential elections, in which he was elected, as
well as criticism of the fraudulent 2004 Ukrainian elections.  

What are some of the issues and concerns that Ukraine may be facing with
respect to the current election process? 

Can Ukraine's presidential election be stolen again as it nearly was in
2004?  Most observers think not, although things could get complicated
if you have a very close margin in the run-offs.  After all, compared to
five years ago, the political environment is more conducive to
democratic elections - there is no longer an authoritarian regime - you
have an open and pluralistic political system.  And Ukraine's media are
more pluralistic and diverse (notwithstanding concerns regarding the
influence of political/ economic groups on the media).  Many observers,
however, don't rule out the possibility that the upcoming elections will
see more problems than the last three "good" Ukrainian elections, given
the flawed electoral framework. 

 

According to some analysts, the legitimacy and transparency of the
upcoming vote remains threatened by the Rada's failure to pass revisions
to last July's amended presidential election law -- which was supported
by the Regions and BYuT.  The law was vetoed by Yushchenko, subsequently
overturned by the Rada. The CoE's Venice Commission recommended that
numerous election law provisions be revised. And the Constitutional
Court recognized as unconstitutional several clauses of the law.
Attempts to improve the law were turned down by the Rada as recently as
last week. Some fear that this vagueness could limit the right to lodge
complaints and challenge election results in court and complicate the
adjudication of disputes. OSCE Parliamentary Assembly President Soares
summed it up during his visit there last month: "Clarity is absolutely
vital if the upcoming election is to proceed smoothly and if the voters
are to have confidence in the system".

 

Other concerns center on election administration - there are some
problematic election commission procedures regulating the composition
and work of the election commissions which can tilt the advantage to the
strongest candidates (i.e. the two front-runners); concerns about the
use of commission members representing "technical candidates" to control
additional seats on district and precinct electoral commissions for the
biggest parties.

 

There are also concerns relating to voter lists:  Ukraine finally has a
centralized electronic registry (State Voter Register) and there are
safeguards, including the ability of voters to check the lists, but
still concerns about quality; and a key concern is that voters can apply
for inclusion on voter lists in polling station on election day itself -
increases chances of irregularities, including multiple voting and the
possibility of the kind of bussing of voters to different polling
stations so that they could vote multiple times, reminiscent of 2004.
Yesterday,  deputy Zvarych from BYuT told us in a meeting with Helsinki
Commissioners Rep. Alcee Hastings and Rep. Chris Smith yesterday that he
is introducing an amendment in Rada that would fix this problem, so this
could be a good thing); also, as in 2004, non-party domestic observers -
those most qualified and knowledgeable of election tricks are banned,
forcing many of them to register as journalists to bypass the law;
there are also concerns about the lack of financing, as Ukraine's 2010
Budget has not yet been approved.

 

As for the ongoing campaign - it appears to be generally competitive,
free and transparent to date, although there are some reports emerging
citing problems regarding distribution of free goods and services to
voters (vote-buying, not unknown in recent elections in new EU countries
Romania, Bulgaria); local officials campaigning for candidates/using
undue influence on voters (admin-resurs), and black PR. 

To conclude, no elections are perfect, even in developed democracies,
including our own.  Ukraine has, for the most part, done quite well with
respect to holding democratic elections, certainly in comparison to
other post-Soviet countries.  However, there are some legitimate
concerns with respect to January 17 elections and the highly probable
run-offs 3 weeks later, and hopefully these will be addressed.  While
free and fair elections in and of themselves do not make a democracy,
they are an essential component and are important to Ukraine's further
Euro-Atlantic integration.  


Jamestown Blog


http://www.jamestown.org/blog


Hot Air During Ukraine Winter


by Tammy Lynch

European Union, United States and Ukraine leaders did a lot of talking
over the last week. The end result ...... more talking. And it wasn't
necessarily a series of friendly chats. 

First, the good news (of a sort).

Following a meeting with Ukraine Foreign Minister Petro Poroshenko, US
Secretary of State Hillary Clinton "reaffirmed" her country's "broad
partnership" with Ukraine. "A strong and independent Ukraine is good for
the region and good for the world," she said. She further expressed the
hope that the new US-Ukraine Strategic Partnership Commission would help
the two countries make progress on a host of areas, including economic
development, rule of law, trade, security and energy reform. 

Of particular interest, in her statement, Secretary Clinton made no
mention of any progress that has already occurred or is occurring now
under the auspices of this Commission, which was formed in July. 

She also signaled concern about the tenuousness of Ukraine's gains in
the area of electoral democracy by gently but clearly stating that the
US "looks forward to free and fair elections." 

Unlike the US, it seems the EU is done tip-toeing around the reform
issue in Ukraine. "Too often, it seems, promises are only partly met,
commitments are only partly met, words are not always matched by
actions," EU President Jose Manuel Barroso said during the annual
EU-Ukraine Summit in Kyiv last week.

The summit was held amid low expectations - and met them. 

In the wake of the freezing of IMF and World Bank stabilization funding,
and following repeated statements by President Yushchenko calling for
the renegotiation of a Russia-Ukraine gas deal supported by the EU,
there wasn't much to talk about, apparently. It seems EU leaders believe
Ukraine hasn't lived up to its side of the negotiated bargain. This is
true - but the EU hasn't been in a collaborative mood itself.

The EU's refusal to even mention the far distant possibility of EU
membership for Ukraine has consistently irked the country's leadership
who years ago needed some hope on which to hang reforms. 

More recently, the EU and Ukraine signed a Joint Declaration at the
EU-Ukraine International Investment Conference on the Modernization of
Ukraine's Gas Transit System. Among other things, the declaration
commits Ukraine to ensure transparent operation of its gas network, and
set tariffs at a rate that will "reflect actual costs incurred." 

In return, the European Commission, Ukraine, and "creditors" commit to
"cooperate in seeking to establish a technical co-ordinating (sic)
council unit within Naftogaz of Ukraine." This council would create an
EU-approved "full modernization business plan" for Ukraine's gas
transportation system, and would help arrange the funding to undertake
the system's modernization. 

The modernization was said at the time to be able to create an
additional transit capacity of 60 bcm of gas per year - far more than
the floundering South Stream pipeline's proposed 47 bcm, and at much
less cost - although that figure was never confirmed. 

But neither side has fulfilled any commitments related to this deal.
Ukraine, in particular, shows little interest in reform-oriented
proposals. It's no wonder, then, that although there has been
substantial cooperation in the past, meetings now between Ukraine and
Western political entities like the EU and the US have an almost
perfunctory feel, designed to demonstrate "partnership" but, at the
moment, without a lot to show for it.

 

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