[Ohio UZO News] Ukraine: WP; State Department; EDM; RFE/RL

[Deychak, Orest]

The Washington Post

Op-ed

No 'Grand Bargain' 

David J. Kramer 

6 March 2009

FINAL

A15

Russian officials should like what they are seeing from the Obama
administration: President Obama has exchanged public comments and
personal letters with President Dmitry Medvedev. Vice President Biden
declared last month that we ought to press the "reset button" on
U.S.-Russian relations. In her meeting today with Foreign Minister
Sergei Lavrov, Secretary of State Hillary Clinton is expected to
continue ratcheting down tensions. But while improved ties with Moscow
are desirable, the Obama team should rein in expectations and avoid the
"grand bargain" that some in the United States and Europe have
recommended.

The "bargain" is simple: In exchange for Russian cooperation on
containing the Iranian nuclear threat and other strategic issues, the
United States would, to varying degrees, scale back its relations with
Russia's neighbors, pause on missile defense plans and stay quiet about
Russia's deteriorating human rights situation. For the United States to
hush up about the crackdown would have been unthinkable before Clinton's
disappointing suggestion in China last month that we should not allow
human rights problems to "interfere" with more important matters. If
they are smart, the Russians will seek a similar arrangement.

Many questions are raised by such a trade-off: What price would secure
Russian cooperation on Iran? Who exactly is going to tell Ukraine or
Georgia that we have returned to a "Russia first" policy? Does anyone
believe that saying nothing about Kremlin crackdowns on domestic
opponents would keep Moscow on board? And what if all this isn't enough?
Moscow is likely to keep raising the fee for its cooperation -- in
effect, extorting the United States.

For years, Bush administration policy toward Russia revolved around
efforts to work with Moscow wherever possible but to push back whenever
necessary, especially after the invasion of Georgia. Our Russia policy
was far from perfect the past eight years, but the chief problems lie in
Moscow, and improved relations are unlikely until they are sorted out.

Moscow sees its surroundings in revisionist, zero-sum terms. Russia has
tried to maintain a "sphere of influence" along its borders, regardless
of neighboring states' desires to lean westward. Moscow is threatened by
Ukrainian and Georgian ties with NATO, even though NATO's eastward
growth has been a source of stability over the past decade. Russia views
multiple pipeline routes from Central Asia and the Caucasus as a risk to
its monopolistic hold on regional energy resources. It has supported
secessionist movements in Georgia and Moldova, and it even wants to
establish military bases in the separatist regions of Abkhazia and South
Ossetia, both of which it has recognized. And Moscow's role in
Kyrgyzstan's decision to close a key U.S. air base last month raises
questions about what sort of cooperation Russia's leaders would offer on
Afghanistan. Moscow's thinking must change if the principal source of
friction between Russia and the West and Russia and its neighbors is to
disappear.

Just after Obama's election victory, Medvedev threatened to install
short-range missiles near Poland if the United States continued with a
missile defense system that the Bush administration advanced to counter
an Iranian nuclear threat. Russia cannot accept that Poland and the
Czech Republic are independent states -- much less members of NATO and
the European Union -- that are cooperating with the United States on a
missile system focused on Iran. Nor can it accept that they are not a
threat to Russia's own (massive) nuclear capability.

The United States and Russia should be working together to counter Iran.
It is in neither country's interest for Iran to become a nuclear state.
Yet despite eventually agreeing to watered-down U.N. resolutions on
Iran, Russia has sold Tehran anti-missile systems and threatens to sell
the mullahs more advanced weaponry. In February a Russian deputy foreign
minister rejected the idea that Moscow would get "tougher" with Tehran.
And this week Medvedev rejected any missile defense-Iran deal. Russia's
deteriorating economy and domestic discord are spooking Kremlin
authorities, as was clear from Moscow's decision to send special forces
to shut down protests in Vladivostok in December because local
authorities weren't trusted to maintain control. Murders of journalists
and human rights activists continue with no accountability and amid a
growing sense of fear. Cracking down is the only approach Russian
leaders seem to know.

Any "grand bargain" the United States makes with Russia would be viewed
in Moscow as a sign of U.S. desperation. A major American shift in
missile defense policy absent a real retreat by Iran would be seen as a
sign of weakness and would undercut friendly governments in Warsaw and
Prague. Yes, the United States should work with Russia on issues
including Iran, North Korea, counterterrorism, arms control and
Afghanistan. But both sides must show interest in cooperation; above
all, we must not bargain away our relations with Russia's neighbors or
our own values.

The writer was assistant secretary of state for democracy, human rights
and labor as well as deputy assistant secretary of state responsible for
Russia, Ukraine, Belarus and Moldova in the George W. Bush
administration.

http://www.washingtonpost.com <javascript:void(0)> 

Department of State

Press Availability after NATO Meeting 

Hillary Rodham Clinton

Secretary of State

Brussels, DC, Belgium

March 5, 2009

http://www.state.gov/secretary/rm/2009a/03/120068.htm

 

Excerpt:

...

QUESTION: Thank you. Madame Secretary, as you know, some of the new NATO
members have interpreted your recent overtures to Russia as potentially
the U.S. making deals behind their back. I wonder - I know that you've
been emphasizing that you'll be consulting before any decisions are made
anywhere - in Asia, in Middle East and Europe, everywhere you go. But
what did you do today to give assurances to those allies that you will
not indeed make any deals over their heads, whether it be with the
Lithuanians, the Czechs or the Poles? Thank you.

 

SECRETARY CLINTON: I think I reiterated that as members of this
alliance, we share a common defense commitment - an Article 5
requirement - that we take very seriously. We intend to work with and
support all of our NATO allies. We are well aware of the particular
concerns that a number of nations in Europe's east, who have long
experience with Russia, have voiced about any kind of dialogue with
Russia, whether it be NATO-Russia, the United States-Russia, or any kind
of discussion. 

 

I certainly have emphasized, not only today but repeatedly, as have the
President, the Vice President, and others that we support the rights of
sovereign nations to make their own decisions. As Vice President Biden
said in his well-received speech in Munich, the United States will not
recognize any nation having a sphere of influence over any other nation.

 

I reiterated again today - in our meetings with Ukraine and Georgia -
the United States' firm commitment to each of those nations moving
toward NATO membership and our equally strong commitment to work with
them along with NATO to make clear that they should not be the subject
of Russian intimidation or aggression.

 

But I think - as we decided today after lengthy, thoughtful debate -
there are benefits to reenergizing the NATO-Russia Council, just as
there are potential benefits for the discussion that I will begin with
Foreign Minister Lavrov tomorrow in Geneva. We have areas where we
believe we not only can, but must cooperate with Russia -
nonproliferation, arms control, antiterrorism, anti-piracy efforts.
There are a number of important matters that should be discussed between
us and Russia.

 

There are equally serious matters that we need to not stop talking to
Russia about. I don't think you punish Russia by stopping conversations
with them about matters, whether it be the misuse of energy supplies or
the failure to comply with the requirements set forth by the OSCE and
others concerning their actions in Georgia. 

 

I think that what we have to be is willing to vigorously press the
differences that we have while seeking common ground wherever possible.
That's what we intend to do. I believe that our allies understand that.
They are well aware that the United States supports them and their
national aspirations. 

 

We think that this kind of dialogue with Russia has the potential of
easing tensions and solving problems and we pursue it with our eyes wide
open. We are certainly not in any way speaking for any other nation
whose sovereignty and territorial integrity we respect. We also intend
to stand firmly behind our values and principles. That's our position
and that's how we will proceed. 

 

 

Eurasia Daily Monitor 

http://www.jamestown.org/programs/edm/

Security Service Raids Ukrainian State Gas Companies

Volume: 6 Issue: 44

March 6, 2009 

Category: Eurasia Daily Monitor, Ukraine, Energy, Home Page 

By: Roman Kupchinsky
<http://www.jamestown.org/articles-by-author/?no_cache=1&tx_cablanttnews
staffrelation_pi1%5Bauthor%5D=485> 

 

On March 4 and 5 armed units of the Security Service of Ukraine (SBU)
conducted raids on the headquarters of Naftohaz Ukrainy, the state-owned
oil and gas company, and UkrTranshaz, the operator of the Ukrainian gas
pipeline company. According to a March 5 report by the UNIAN press
service, the raids were part of a recent SBU investigation into the
acquisition by Naftohaz of 11 billion cubic meters of gas that once
belonged to RosUkrEnergo (RUE), the shady Swiss-based middleman company,
50 percent of which is owned by Gazprom and 50 percent by Dmytro Firtash
and Ivan Fursin, two Ukrainian businessmen. 

The gas is kept in Ukrainian underground storage facilities and was
formally taken over by Naftohaz after RUE's $1.7 billion debt to Gazprom
was transferred to Ukraine as prepayment for the transit of Russian gas
to Europe. Ukrainian authorities took possession of this gas and began
clearing it through customs, when the head of the Customs Service,
Valeriy Khoroshkovskyi, a wealthy businessman with ties to Dmytro
Firtash, blocked the clearance. 

In response, the government headed by Yulia Tymoshenko relieved
Khoroshkovskyi of his post, but Ukrainian President Viktor Yushchenko
then appointed him deputy head of the SBU, apparently as part of his
ongoing conflict with Tymoshenko. 

Khoroshkovskyi told parliament that the seizure of RUE's gas was illegal
and was carried out by "a criminal group that included the government
leadership" (Itar-Tass March 4). Interestingly enough, Gazprom, the 50
percent of owner of RUE, did not file any complaint about its gas being
stolen by the Tymoshenko government. The only objection apparently came
from Firtash, who was caught in the desperate situation of not being
able to meet his contractual obligations to deliver 5 million cubic
meters of gas a day to Poland or to supply his clients in Hungary. 

Kommersant reported on February 20 that Gazprom had accused Firtash's
Hungarian company EMFESZ Kft of illegally importing gas from Ukraine and
had filed an official complaint with the Hungarian Energy Commission.
One high-level manager of Gazprom Export was quoted in Kommersant as
saying, "We need to sort out why the Hungarians are receiving gas that
was not contracted for." However, Alexander Medvedev, the head of
Gazprom Export, is also a member of the RUE coordination council and was
probably fully aware of what RUE was doing in Hungary. 

During the raid on Naftohaz headquarters on March 4, members of
parliament from the Yulia Tymoshenko bloc rushed to the building to
intervene with the armed SBU unit and prevent them from seizing the
original signed copy of the January 19, 2009, contract with Gazprom on
gas purchases and transit. Serhiy Davydenko, the chief of Naftohaz's
legal department, told the press that the original contract was needed
in order to clear customs for Russian gas bound for Europe and for
domestic Ukrainian consumption (Moscow Times, March 5). 

First Deputy Prime Minister Oleksandr Turchynov told a press conference
that he had urged the security agents to ignore their orders: "You must
not become a tool of criminals and corrupt officials who, with the
consent of the president, run the [security] service or coordinate its
activities" (Moscow Times, March 5). According to the Ukrayinska Pravda
website, the SBU agents eventually left the building without the
original contract. 

The key question in the dispute is why Gazprom, an interested party, is
not contesting the legality of Naftohaz taking possession of the gas.
The entire episode points to the possibility that Yushchenko and
Khoroshkovskyi are, in fact, protecting Firtash's interests. This would
support Tymoshenko's long-held view that Firtash was not only helping
the pro-Russian Ukrainian Party of Regions but also Yushchenko
personally. What Tymoshenko carefully avoids mentioning is that Firtash
enjoyed the long-time support of Vladimir Putin and Gazprom. As
Gazprom's (and Putin's) reputations began to suffer from their
association with Firtash and RUE, they decided to break ties with the
company. The RUE scheme was so muddled and opaque, however, that when it
began unraveling it backfired on all the involved parties. 

In a related matter, the Russian and Ukrainian auditing chambers
announced that they had begun a joint investigation into the financial
dealings of RUE (UNIAN, March 5). The Russian auditing chamber will look
into RUE's books for 2007 and 2008, while the Ukrainian auditors intend
to begin looking as far back as 2006. One unnamed Ukrainian expert told
UNIAN that the use of the state auditing commission to conduct such an
investigation was highly unusual, since legally it could only audit
state-owned companies, which RUE is not. 

The 11 billion cubic meters of gas formerly owned by RUE, which is
hidden in an underground cave in Western Ukraine, is critically
important as technical gas for powering the compressing stations that
keep Russian gas flowing to Europe. If the Yushchenko administration
returns it to Firtash, it would only harm Ukraine's ability to transit
gas reliably and would give aid and comfort to one of the most bizarre
gas scams of the century.

RFE/RL

March 06, 2009 


Ukrainian Parliament Approves Security Chief After Raids 


KYIV (Reuters) -- Ukraine's parliament has backed the appointment of
Valentyn Nalyvaichenko as head of the SBU security service, days after
its officers raided gas industry offices.

The vote, with 230 deputies voting in favor in the 450-seat assembly,
amounted to a small sign that embittered relations between President
Viktor Yushchenko and Prime Minister Yulia Tymoshenko might be on the
mend.

Nalivaichenko, a career diplomat, had been acting head of the SBU since
2006.

Tymoshenko's group in parliament voted in favor of the appointment
together with the bloc of parliament speaker Volodymyr Lytvyn and the
pro-presidential Our Ukraine party.

The SBU is responsible under the constitution to the president, who
approved a raid by officers in riot gear this week on the national
energy company Naftogaz as part of what officials said was a criminal
investigation. The company was at the time preparing to settle a bill
for imported Russian gas.

SBU officers this week also tried to enter the offices of Ukrtransgaz,
which oversees Ukraine's pipeline network.

Tymoshenko, the president's ally from the 2004 pro-Western Orange
Revolution, but now his archrival, denounced the raids as illegal and
groundless.

Her allies had long blocked the president's bid to secure
Nalivaichenko's approval in parliament and had called on him to propose
an alternative candidate.

Tymoshenko has for weeks promised to proceed with a cabinet shuffle,
particularly after the resignation last month of her finance minister
after public differences between the two.

But she has not made any formal proposals as negotiations on candidates
likely to win parliamentary approval proceed.

The president also needs to win parliamentary backing to appoint a new
foreign minister, one of his appointments to the cabinet, after
Volodymur Ohryzko was sacked by the chamber this week. 

 

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