[Ohio UZO News] Ukraine: WSJ; FT; WoE; Jamestown blog (2)

[Deychak, Orest]

The Wall Street Journal 

http://online.wsj.com/home-page

NOVEMBER 11, 2009 


Ukraine's Leaders Fail to Overcome Funding Impasse 


By JAMES MARSON <http://online.wsj.com/search/search_center.html?KEYWORDS=JAMES+MARSON&ARTICLESEARCHQUERY_PARSER=bylineAND>  


KIEV -- A meeting between top Ukrainian government officials and a senior aide to the president Tuesday failed to resolve the political deadlock threatening to cut off International Monetary Fund lending.

The government still insists there is hope for a compromise on the social-spending increase signed into law by President Viktor Yushchenko, the major stumbling block to continued IMF cooperation.

But despite pressure from Prime Minister Yulia Tymoshenko's government, the European Commission and the IMF, there is no sign that Mr. Yushchenko is ready to change his position ahead of a presidential ballot in January. With the IMF saying it is ready to help Ukraine only if consensus is reached, its release of the scheduled $3.8 billion installment seems increasingly unlikely.

At Tuesday's meeting, attended by Oleksandr Shalpak, deputy head of the presidential administration, and officials from the central bank, Deputy Prime Minister Hryhoriy Nemyria called on the president to "cast aside populism" and work toward an agreement to secure the scheduled installment from the IMF. An agreement, he said, is "in the national interest."

Observers said Mr. Yushchenko's position shows he is determined to cripple his former ally and now bitter rival Ms. Tymoshenko in the run-up to the ballot.

Opposition leader Viktor Yanukovych, whose party was the main supporter of the bill raising social spending, is the frontrunner in the presidential race, polling at 28%, according to an October poll by the Razumkov Center in Kiev. Ms. Tymoshenko is his nearest rival, with 20%, with Mr. Yushchenko trailing far behind, with 5%.

Without the scheduled $3.8 billion installment, Ukraine will struggle to cover a widening budget deficit.

"It's clear Ukraine can survive to the end of the second round of elections in March, but it would be a serious problem for Ms. Tymoshenko," said Peter Vanhecke, head of Renaissance Capital in Ukraine. "The budget gap would have to be covered by reducing expenditures, which would be unpopular, or getting the central bank to print money, which is unlikely as it's controlled by Mr. Yushchenko."

Gas payments to Russia also could come under pressure, Mr. Nemyria said in televised comments Monday night. He added that Ukraine will continue to pay for Russian gas by converting IMF special drawing rights -- not linked to the standby loan package of $16.4 billion agreed last fall -- into dollars, as it did for the October bill.

Ukraine has said it has enough gas in storage to ensure transit of Russian gas to the European Union through winter. 

Financial Times

www.ft.com

Time nears for Brussels to give some shape to Ukraine policy

By Tony Barber in Brussels 

Published: November 12 2009 

All the European Union's happy neighbours are like each other, but each unhappy neighbour is unhappy in its own way - starting with Ukraine. What can the EU do to ensure that, unlike Leo Tolstoy's Anna Karenina , Ukraine's story will have a positive ending?

Of all the former Soviet Union countries, none bar Russia matters as much to the EU as Ukraine - and none tries the EU's patience as much.

For one thing, Ukraine is the conduit for 80 per cent of the EU's natural gas imports from Russia. As the Union learned to its cost in January, when a Moscow-Kiev dispute cut off gas supplies for two weeks, events in Ukraine can cause havoc in member states that depend entirely on Russian gas. Some experts fear another gas crisis next January.

But gas is far from the whole story. With 46m people, a 1,400km border with four EU nations and frequent tensions with Russia that have nothing to do with gas, Ukraine is pivotal to the security of the EU's eastern flank.

After Ukraine's 2004 Orange Revolution some EU strategists hoped that the path to liberal democracy, the rule of law and economic prosperity would become irreversible in Ukraine. But it has not turned out that way.

The Russian-Georgian war of August 2008 shocked the EU into realising that the Kremlin was prepared to use force if necessary to halt the expansion of western influence into former Soviet republics. With its southern peninsula of Crimea home to a restive ethnic Russian population egged on by Moscow, the implications for Ukraine's territorial integrity and independence were worrisome indeed.

Then the global financial crisis laid low Ukraine's economy, which at present survives on a $16.4bn (€11bn, £10bn) loan from the International Monetary Fund. The crisis sharpened the rivalries that paralyse its politics and give an impression of endemic instability.

Worst of all, the Orange Revolution failed to clean up the corruption that runs deep in Ukraine's business world, especially the energy sector. Corruption is bound up with the personal animosities and shadowy connections with Russian interests that bedevil Ukraine's political scene. The EU feels irritation and helplessness. Since the January crisis, Ukraine's authorities have done little to improve transparency in the energy sector.

All these difficulties explain why many in the 27-nation bloc are unwilling to offer Ukraine even a vague promise that it may one day be invited to join the EU. But the EU increasingly senses that it cannot afford to let its relationship with Ukraine drift directionless for much longer.

Ukraine's woes were the subject of a two-day conference staged in Brussels last week by Wilton Park, the UK event organisers. Several speakers predicted that the key moment in EU-Ukrainian relations would be its January 17 presidential election. Anything less than a free and fair election, and a mature acceptance of the result by winners and losers alike, would be catastrophic for Ukraine's image in EU eyes.

Ukraine is hoping to complete a so-called EU association agreement and a comprehensive free trade accord by the end of 2010. It may also be able to secure visa-free travel arrangements with the EU in advance of the Euro 2012 soccer tournament that Ukraine is to co-host with Poland. If these three agreements can be concluded over the next 12 months they will do more to "normalise" Ukraine than any steps since independence in 1991.

But an unsatisfactory election process in January could turn EU governments against Kiev, weakening support for the association and free trade accords. Even now, France and Germany are delaying Ukraine's accession to the EU's energy community treaty, which aims to create an integrated energy market in Europe and guarantee security of supply.

Moreover, Poland - which used to defend Ukraine inside the EU - is fed up with its poor progress in preparing for Euro 2012. Slovakia has been irritated with Kiev ever since its citizens suffered a mid-winter freeze because of January's gas cut-off.

Ukraine has friends in the EU, but the balance is finely positioned. It will take an effort from Ukraine's political leaders as well as the EU to make sure the scales do not tip the wrong way.

Window on Eurasia: Tensions between Russia and Ukraine Reflect Different Attitudes to History, State and Individual,  Kyiv’s Ambassador to Moscow Says

 

Paul Goble

 

            Bloomsburg, November 10 – Tensions between the Russian and Ukrainian governments are “not an argument between colonizers and the enslaved” but rather a dispute between those who see the state and its continuity as more important than the individual and liberals who put their faith in individuals and society, according to Ukraine’s ambassador in Moscow.

 

            That division, Konstantin Grishchenko argues in the current issue of “Zerkalo Nedeli,” falls “not along the line of state borders,” of course, “but within both Ukrainian and Russian society. [The two countries are] not so dissimilar in that, [but] they are different “in the proportion of supporters of the first and second sets of values” (www.zn.ua/1000/1600/67678/).

 

            “Rational” people, the Ukrainian diplomat says, “cannot but be surprised that such questions of a humanitarian nature and not problems of economics and security define the tonality and content of Ukrainian-Russian dialogue.” But the reason is that since 1991, the two countries “have become very different.”

 

            For Ukrainians, he continues, the entire Podrabinek case appears “extremely strange,” but a careful examination of it shows that over the last 18 years, Ukrainians and Russians, “while preserving a multitude of common interests have begun to set themselves apart both by models of societal development and by their worldviews.”

 

For the Russian “establishment, Grishchenko suggests, “the state is considered an important super-values, which forms around itself a system of firm values and priorities.” And equally, the Russian elite has accepted the “idea of the uninterrupted quality of the process of state construction.”

 

What that means, the ambassador says, is that “any power which has been able to achieve a strong position in Russia and to obtain legitimacy in the eyes of its own citizens will become an inalienable part of the historical fate of Russia and ‘the Russian path.’”  Thus, 1991 does not represent a moment of discontinuity for Russians the way it does for Ukrainians. 

 

Many Russians as a result do not know what the Day of Russia on June 12th means because “the Russian political leadership avoids any reference to the events of August 1991 as ‘a democratic revolution.’” For both, “contemporary Russia didn’t break out of ‘the prison house of peoples’ but only appeared in place of a system which did not withstand the test of history.”

 

This attitude does not mean that the current Russian powers that be want to restore what was, but rather it suggests that “for the Russian elite, the underlying idea remains the unbroken quality of the state forming process and an orientation on the greatness of Russia as the key goal” of the current leaders.

 

“In Ukraine,” he says, “the historical process is not conceived of as integral. On the contrary, the period in which Ukrainian lands were within the Russian Empire and the USSR are viewed primarily as stages of national historical development which had for the most part negative consequences.”

 

Such a “lack of correspondence” in the assessment of the past “naturally leads to conflicts and contradictions  between Ukraine and Russia concerning the interpretation” of any particular event.  But in saying that, Grishchenko goes on, “it is important to correctly understand the internal essence of these discussions.”

 

They are “not so much an argument between colonizers and the enslaved as a dispute between those who focus on the state as the most important thing and liberals.”  Thus, for the former, Stalin’s industrialization and the great terror “exist as it were in parallel worlds,” but for the latter, the two can never be divorced one from the other.

 

These differences in worldview, in turn, affect politics. On the one hand, Ukraine and Russia have a very different political system. In the former, voters are unwilling to give any part an overwhelming majority and thus have contributed to political instability, while in the latter, the electorate has been prepared to do just that and helped erect the power vertical.

 

And on the other, the two countries dealt with the greatest crises since 1991 in very different ways: In 1993, Moscow used force to resolve the conflict between the president and the parliament; in 2003-2004, Ukrainians dealt with their political problems in a very different and far more peaceful way.

 

Such differences, Grishchenko argues, reflect “deeply held predispositions in the consciousness of the government elites of the two related peoples,” not only concerning the goals that are the most important but equally significant between the methods that each views as appropriate to achieve its aims.

 

  The elites in each country must recognize these differences if they are to be able to live and work together as they should.  “Ukrainians,” their ambassador says, “are seeking to live with Russians as good neighbors in a well-ordered little village where people listen to advice from one another but do not seek to instruct or give orders.”

 

If one thinks about this, Grishchenko continues, “we are like adult brothers who after the age of 18 left their common home, sincerely love one another, but conduct their affairs independently, talk with one another, but resolve all questions on their own” rather than acting as they did when they were children.

 

Unfortunately, “it is sometimes suggested that we should again live in a single communal apartment where one of the residents controls the gas and the knobs in the common kitchen,” but the ambassador says, “I am convinced that ‘the times of communal apartments’ have passed away together with the Soviet Union.”

 

Moreover, he concludes, “Ukraine and Russian in their relations will inevitably move further and form new bases for cooperation and friendship if they acknowledge that we are not the same but that in our interrelationships, we can be strong and successful in the contemporary world.” 

 

Jamestown Foundation Blog

Political Farce and Fantasy Crippling Ukraine

November 12, 2009

 

Ukraine and Russia Negotiating New Intergovernmental Gas Agreement

November 11, 2009

 

Full articles: http://www.jamestown.org/blog

 

 

-------------- next part --------------
A non-text attachment was scrubbed...
Name: not available
Type: application/ms-tnef
Size: 19102 bytes
Desc: not available
URL: <http://clevelanduzo.org/pipermail/uzonews_clevelanduzo.org/attachments/20091112/dc60f04e/attachment.bin>