[Ohio UZO News] Ukraine: WSJ; EDM; Upcoming event

[Deychak, Orest]

The Wall Street Journal

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

 

World News: Yanukovych Asks Russia For Tight Ties, Cheap Gas 

By Richard Boudreaux 

6 March 2010

J

A11

MOSCOW -- Ukrainian President Viktor Yanukovych, ending a five-year
chill in his country's relations with Russia, told its leaders Friday he
will reverse some key policies of his predecessor. But he won no public
promise that Russia will yield what he wants most, lower prices for
natural gas.

Smiling and joking with Russian President Dmitry Medvedev during a
daylong visit to Moscow, Ukraine's new leader said he wanted to give the
relationship "a sharp turn in the right direction" from the country's
pro-Western tilt that followed its Orange Revolution of late 2004.

He said he would soon resolve the future of Russia's Black Sea Fleet in
a way that satisfies both countries, a signal that he is willing to
extend the lease on the fleet's Ukrainian base after it expires in 2017.
The previous president, Viktor Yushchenko, opposed prolonging the
fleet's stay in Crimea, a longtime region of Russia that passed to
Ukraine's hands in 1954 when both were part of the Soviet Union.

Mr. Yanukovych also hinted that he will revoke his predecessor's
decision to elevate two controversial World War II-era nationalists
reviled by Russia, Stepan Bandera and Roman Shukhevych, to the status of
"Heroes of Ukraine." In another reversal, he promised legislation to
protect the linguistic rights of Russian-speaking Ukrainians.

Mr. Medvedev, seated with his visitor at a Kremlin news conference,
welcomed the gestures as a sign that "the dark streak in our relations"
is giving way to a revival of "brotherly" ties.

Mr. Yanukovych was the Kremlin's preferred choice in Ukraine's Feb. 7
election, as he was in the tainted 2004 vote that sparked massive street
protests, overturning his victory. Now that he is in power, the two
countries are testing the limits of accommodation and grappling with
differences over energy and trade.

The Ukrainian leader wants to renegotiate a 10-year contract, signed
last year, that raised to market levels the price Ukraine pays for
Russian gas. In return for gas-price relief for Ukraine's
crisis-battered economy, he has said, Russia would be offered a role in
managing the country's lucrative system of pipelines that carry gas from
Russia to customers in Europe.

On the eve of his arrival, the Kremlin issued a statement defending the
pricing accord. On Friday, Mr. Medvedev sounded more flexible, saying a
panel of government ministers from the two countries would study the
issue before the Russian leader's promised mid-year visit to Ukraine.
But Russia's energy minister, Sergei Shmatko, said that review cannot
start until Ukraine has a government. Mr. Yanukovych's defeated rival in
the election, Prime Minister Yulia Tymoshenko, resigned along with the
rest of the cabinet after losing a vote of confidence in parliament
Wednesday.

It remains uncertain whether Mr. Yanukovych's Party of Regions can
muster a parliamentary majority and form a government. The party is
seeking support from Ukrainian nationalists whose opposition to Russian
control of the gas pipelines would limit the president's bargaining
power with Moscow.

To balance nationalist and pro-Russian constituencies at home, Mr.
Yanukovych has worked to shed his image as a Kremlin stooge and rebrand
himself as an advocate of close ties with both Europe and Russia. Rather
than travel first to Moscow, he met Monday with European Union officials
in Brussels.

A key test for Mr. Yanukovych will be his choice between a free-trade
agreement with the EU or a customs union with Russia and former Soviet
republics Belarus and Kazakhstan. In Brussels, EU officials said he
can't have both. On Friday, when he touted Ukraine's friendship in a
separate meeting at the Kremlin, Prime Minister Vladimir Putin said
bluntly: "Join the customs union."

Mr. Yanukovych chuckled and said nothing in response.

Eurasia Daily Monitor

March 5, 2010

Brussels Ready to Work with Yanukovych for Ukraine

Ukraine's newly elected President, Viktor Yanukovych, chose Brussels as
his first destination for a working visit abroad. Inaugurated on
February 25, Yanukovych held talks with European Union leaders on March
1, ahead of a March 5 visit to Moscow. This chosen sequence, as well as
the tenor of Yanukovych's remarks in Brussels, contrasted with his
pronounced tilt toward Russia, by which he had mobilized his electoral
base in the recent presidential campaign.

Unsurprisingly, Yanukovych shifted toward a more even-handed posture
between Russia and the West in the post-election period. He moved more
promptly than might have been expected of him, apparently in response to
EU leaders' broad overtures to Ukraine through him as the new president.
These overtures apparently reflect intentions in Brussels to compete
patiently with Russia for Ukraine's future (even if the EU finds it
unpalatable to acknowledge the reality of competition). During this
visit, EU leaders as well as Yanukovych decided to avoid (at least in
public) those issues on which Yanukovych had promised major concessions
to Moscow during the electoral campaign.

The presidents of the European Commission, Jose Manuel Barroso, EU
Council Herman van Rompuy, and the European Parliament Jerzy Buzek
respectively, held out to Yanukovych clear prospects for an EU-Ukraine
association agreement, as well as a deep and comprehensive free trade
area (DCFTA) and a visa-free travel agreement. The DCFTA would broaden
the access of Ukrainian products to the European market and would
encourage European investments in Ukraine. As key parts of a possible
Ukraine-EU association agreement, the DCFTA and visa-free travel
agreements could be signed by 2011, conditional on Ukraine's performance
on internal reforms (Interfax-Ukraine, March 1, 2).

The EU leaders have already agreed to draw up a road map toward
visa-free travel with Ukraine this year. The commission is also prepared
to disburse 500 million Euros in assistance funds, if Ukraine meets the
International Monetary Fund's macroeconomic reform criteria to qualify
for such assistance.

Brussels has now opened, for the first time, the prospect of Ukraine's
eventual accession to the EU. According to Barroso, "If the process [of
Ukrainian reforms] advances, we see Ukraine's future very clearly as a
European future, and Ukraine in the European integration process...
Ukraine's possible accession to the EU has always been on the agenda,"
Barroso was cited as saying at the joint briefing with Yanukovych
(Interfax-Ukraine, March 1).

This statement entails a degree of positive reinterpretation of earlier
EU positions. In fact, Brussels had traditionally stopped short of
giving Kyiv the much-desired political signal that Ukraine's eventual
accession figured on the EU's agenda. In their turn, Ukrainian leaders
(particularly Viktor Yushchenko, the now-departed president) often
solicited such political signals from the EU, to incentivize Ukrainian
reforms. In the event, incentives as well as reforms fell short. The
EU's Eastern Partnership program, launched in 2009 following a
Swedish-Polish initiative, is starting to overcome this impasse by
accelerating the negotiations toward an association agreement, and
opening the prospect of ultimate membership contingent on performance.

Yanukovych in Brussels listed the foreign-policy priorities of his
presidency as: "Integration with the European Union, resumption of
friendly and good-neighborly relations with Russia, development of
relations with other neighboring countries, and strategic partnership
with the United States" -in that order. He singled out the "key
priority, European integration" for involving foreign policy and
internal reform strategy in equal measure. Alluding to east-west
political fault lines in Ukraine, Yanukovych (the eastern candidate
repositioning as president) defined European integration as a unifying
factor for Ukrainian society (UNIAN, March 1).

At a minimum, such remarks demonstrate that Yanukovych has learned to
talk the talk, before walking the walk of reforms. His acknowledgments
that European integration involves external and internal policy in equal
measure and that it can unify society, echo almost verbatim the
statements of Moldova's former President, Vladimir Voronin, another
"eastern"-leaning politician repositioned as European from 2004 onward,
with moderately encouraging results.

The European Parliament marked Yanukovych's inauguration with a
resolution underscoring that Ukraine is a European country that can, by
adhering to principles of freedom and democracy, apply for EU membership
in the future (EDM, March 3). The resolution demonstrates that the
European Parliament (now with substantially enlarged powers under the
Lisbon treaty) will work with this president for Ukraine's future.
Significantly, European Parliament members who had earlier invested high
hopes in the Orange project are ready to work with Yanukovych after the
final Orange collapse.

Yanukovych told Brussels that he would adhere to the March 2009
agreement with the EU on modernizing Ukraine's gas transit system
(EUObserver, March 1). The outgoing government under Yulia Tymoshenko
had entered into that agreement. By contrast, Yanukovych campaigned on a
promise to include Russia's Gazprom in a consortium to operate Ukraine's
system. He seemed noncommittal about this issue while in Brussels.

Regarding NATO, Yanukovych merely stated that he would continue the
existing programs, without expanding these, at least for the time being
(UNIAN, March 1). That current level, however, compares unfavorably with
the pre-Orange years.

Russia's shadow did not loom over Yanukovych's Brussels visit. The EU
takes the position that the resumption of Ukrainian-Russian partner
relations (as Yanukovych formulates this goal) is also in the EU's
interest. Yanukovych welcomes this thesis because it does not require
Ukraine to make stark choices between Moscow and Brussels.

Such flexibility, however, will only be sustainable if Russia does not
make excessive demands on Ukraine (or Kyiv does not offer pre-emptive
concessions to Moscow, as Yanukovych signaled from electoral
calculations during the campaign). If Moscow does, however, start posing
major demands, the new Ukrainian president and his Party of Regions will
need to make some stark choices; and the EU will need to support
European choices in Kyiv.

Heads up on Upcoming Event:

Helsinki Commission Hearing

U.S. Congress

"Ukraine:  Moving Beyond Stalemate?"

Tuesday, March 16, at 10:00 am - 11:30 am.

SVC 201/200 (Capitol Visitor Center).

E Capitol St NE & 1st St NE (east side of the Capitol)

Washington, D.C.

Witnesses:

Daniel A. Russell, Deputy Assistant Secretary of State for Russia,
Ukraine, Belarus and Moldova

Damon Wilson, Vice President and Director of the International Security
Program, Atlantic Council

Anders Aslund, Senior Fellow, Peterson Institute for International
Economics

Additional witness may be added.

Hearing is open to the public.  No RSVP required.

(Feel free to contact me if you need more information. A Commission
press release will go out within next day or two.  OD)

 

 

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