06.04.11. Ukraine håber på frihandelsaftale med EU inden udgangen af 2011 (eng.)

Russiahttp://www.jamestown.org/programs/edm/single/?tx_ttnews[tt_news]=37717&cHash=
bc3dcc9a2559e87ae906658a948ed3c
March 29, 2011

Ukraine finds it increasingly difficult to balance its relations between the European Union and Russia, which are viewed in Kyiv as equally important trading partners. While talks on political association and free trade with the EU slowed somewhat recently, Moscow is stepping up its pressure on Ukraine to join its Customs Union with Kazakhstan and Belarus. Membership of the Customs Union and free trade with the EU are mutually exclusive. There are signs that Kyiv may opt for the Moscow-led Customs Union if the free trade talks with the EU, which started in 2008, are not completed this year as planned.

Moscow uses all methods of persuasion at its disposal to convince Ukraine to join its trade club. Russian Deputy Prime Minister, Igor Shuvalov, argued in Kyiv early this month that Ukraine would benefit from joining the union and then negotiating free trade with the EU as part of it (UNIAN, March 3). The approach of Russian Prime Minister, Vladimir Putin, is less subtle. Speaking in Minsk on March 15, Putin made it clear that Russia would use both carrots and sticks. Putin said Ukraine would benefit from joining the union, although he did not explain how. At the same time, he made a specific threat, saying that if Ukraine opted for free trade with the EU, Russia would "be constrained to build a [trade] border" in order to protect its market from EU goods (Interfax-Ukraine, March 16).

Ukraine is interested in free trade with Russia, which is the primary market for key Ukrainian exports. In particular, the local machine-building and food industries are recovering fast after the financial crisis mainly due to growing demand for their products in neighboring Russia. Ukraine also hopes for multibillion dollar loans from Russia to help it build new nuclear power units and for Russian orders for its ailing aircraft industry, which is too weak to compete on the markets outside the CIS. If Ukraine became part of the Customs Union, it could hope for cheaper Russian oil for its refineries and discounted natural gas. Kyiv wants free trade with both Russia and the EU, but Russia is reluctant to open its market to Ukrainian goods if Ukraine refuses to join the Customs Union. Ukraine's market is larger than those of Russia's current union partners Belarus and Kazakhstan taken together, consequently taking Kyiv onboard is very important for Moscow.

On March 17, the Ukrainian daily Den cited an anonymous senior Ukrainian diplomat as saying that Ukraine's position on the Customs Union could change if a free trade agreement with the EU is not signed by the end of 2011. The source added that Ukraine could extract a temporary benefit from membership of the Customs Union although it is unclear in both capitals what exactly Ukraine would lose if it opted against joining the union. For the time being, Ukraine continues to prioritise the EU but this may change, judging by the mixed signals from Ukrainian officials after Putin's statement in Minsk (Den, March 17).

On March 17, Prime Minister Mykola Azarov, told visiting European Parliament Socialist group leader, Martin Schultz, that Ukraine would continue its free trade talks with the EU, remaining optimistic about their outcome. Azarov also regretted the fact that recent discussions of free trade between his first deputy Andry Klyuyev and EU officials in Brussels did not result in a breakthrough. Azarov suggested that the EU should upgrade the format of the talks in order to strengthen their momentum (UNIAN, March 17). Azarov went further during a meeting with British businessmen the following day, saying that Ukraine would apply for EU membership in the future (UNIAN, March 18). However, during an interview with the Austrian newspaper Der Standard, on March 20, Azarov said that although Ukraine continues to hold talks with the EU, this did not necessarily mean that Kyiv should abandon the Customs Union option. He suggested that experts should determine whether membership of the Customs Union was worth considering (Ukrainska Pravda, March 21).

Foreign Minister, Kostyantyn Hryshchenko, told students in Kyiv that Ukraine wanted to cooperate with the Customs Union in such a format that the association and free trade talks with the EU would not be harmed. He noted that Ukraine was not in talks to join the union (Interfax-Ukraine, March 18). At the same time, Klyuyev told a CIS forum in Moscow that Ukraine might join the union in the future. Klyuyev said Ukraine would participate in such economic unions from which it may benefit, such as cooperating on certain trade positions, while it would be more beneficial to be part of a free trade area with the EU on some other issues, Klyuyev added (UNIAN, March 18). Klyuyev is Ukraine's chief negotiator in the talks with the EU, and his being evasive may indicate a change in Ukraine's course.

--Pavel Korduban

06.04.11. Leaked cables show U.S. was wrong on Ukraine's Yanukovych

March 31, 2011
By Taras Kuzio

The first is that the embassy believed Party of Regions leader Viktor Yanukovych had changed from what he was during the 2004 election, when he sought to come to power through election fraud. The second is that U.S. officials believed Yulia Tymoshenko was not a better option than Yanukovych in the 2010 presidential election. One cable quotes former President Leonid Kuchma as saying the 2010 election was one of "choosing between bad and very bad" -- with Tymoshenko allegedly being the latter.

Both of these positions were fundamentally wrong -- especially as seen from the hindsight of Yanukovych's first year in power.

The WikiLeaks cables critical of Tymoshenko were a reflection of her own mistakes and of lobbying by U.S. political consultants working for Yanukovych and the Party of Regions since 2005. One of the main criticisms was that Tymoshenko is a "populist," a claim that ignores widespread populism among all Ukrainian politicians. Indeed, Yanukovych was the most populist in the 2010 elections and the prize for the most populist billboard goes to former President Viktor Yushchenko, who promised to place a 20 percent tax on yachts, limousines, and villas.

The U.S. Embassy bought into the accusation that Tymoshenko was beholden to Russian Prime Minister Vladimir Putin. Tymoshenko was allegedly the biggest threat to Ukraine's sovereignty and willing to be Russia's pawn, according to a cable quoting oligarch Dmytro Firtash. Evidence to back this conclusion was her supposed concessions on Georgia during Russia's 2008 invasion and Moscow-friendly positions on the Holodomor and the Black Sea Fleet.

In reality, Yanukovych has caved in to Russia on all three issues. During the Georgian crisis, the Party of Regions and the Communist Party (KPU) supported Russia's dismemberment of Georgia. Likewise, the Party of Regions and the KPU did not support the 2006 law on the Holodomor, and Yanukovych has adopted Russia's position that it was a Soviet (not Ukrainian) famine. As president, he has extended the Black Sea Fleet base in Sevastopol until 2042-47. A January 2010 U.S. cable reports Yanukovych telling the U.S. ambassador that he was ready to extend the base in exchange for economic preferences from Russia.

Yanukovych, The Pro-Russian Candidate

All this led to the mistaken impression that Russia supported both Tymoshenko and Yanukovych in the 2010 election, as they were both "pro-Russian" and Moscow would be satisfied with either winning the election. Yushchenko made this argument during the campaign, calling for his supporters not to vote for either candidate in the second round of balloting. That decision probably cost Tymoshenko the election, since she ended up losing by just 3 percentage points.

Other cables claimed it made no difference whether Yanukovych or Tymoshenko were elected as both are authoritarian and would allegedly seek to build a "Putinist vertical power." Such analysis contradicted the reality that Tymoshenko did not have the political machine, ability to blackmail deputies, or control of television stations necessary for such a project. In addition, since 2008 Tymoshenko has consistently argued for the need to move toward a full parliamentary system. The authoritarianism of the Party of Regions is well documented among Ukrainian sociologists and has been plain to see during the transformation of parliament into a rubber-stamp institution and the return to a presidential constitution.

U.S. cables also buy into the argument of a "pragmatic" wing in the Party of Regions that supposedly desires to unify Ukraine and is pro-European, even possibly willing to compromise on NATO. Such views were intensely lobbied by U.S. political consultants working for the Party of Regions.

But the pragmatic wing of the Party of Regions was not evident in 2005-08 when the party voted with the KPU against legislation to join the WTO. Ukraine's 2008 WTO membership paves the way for the signing of a Deep Free Trade Agreement with the EU, a process the pragmatic wing of the Party of Regions allegedly supports.

These cables also ignored the anti-NATO stances of Yanukovych and the Party of Regions, arguing that this was election rhetoric to mobilize eastern Ukrainian voters that would be ignored after the voting. Again this was wrong, as President Yanukovych is the first of four post-Soviet Ukrainian presidents to not support NATO membership. The party has also adopted contradictory positions on Ukraine's participation in NATO's Program for Peace exercises, opposing them when in opposition (leading to the cancellation of the Sea Breeze exercises in 2006 and 2009) and supporting them when in power.

U.S. cables from Ukraine also claimed that Yanukovych, if he won the 2010 election, would not be a Russian pawn and would defend Ukraine's interests, even if only in the economic sphere. Although Yanukovych defends his economic interests from Russia, he has adopted domestic, national-identity, and foreign policies that are in Russia's national interests. Russia successfully lobbied for the four candidates who became the chairman of the Security Service (SBU) and ministers of education, foreign affairs, and defense. Russian citizens illegally control the president's bodyguards and the media-analytical section of the presidential administration.

The Real Yanukovych

U.S. cables from 2005-06 were more critical of the Party of Regions, but in 2008-10 two factors changed. First, public-relations efforts by U.S. consultants persuaded many in the West, including the U.S. Embassy, that Yanukovych had changed. This ignored his unwillingness to concede the election fraud of 2004 and his continued contention that he won that election. A December 2005 cable quotes Yanukovych as complaining that a "putsch" and "Kuchma's machinations" had denied him the presidency. One cable analyzed the Party of Regions' "heavily pro-Russian campaign rhetoric" in 2006, attributing this to its co-option of Communist voters.

06.04.11. U.S. Aid has supported Ukraine's recovery from Chernobyl

http://www.america.gov

Domenick DiPasquale

Washington - A quarter-century after the disaster at the Chernobyl nuclear plant, and as world attention focuses on a similar crisis in Japan, the United States continues to provide assistance to Ukraine to help that nation deal with the consequences of one of the world's worst nuclear accidents.

That aid, some completed and some still ongoing, has taken many forms: financal support for construction of a new containment structure to entomb the damaged nuclear reactor, several studies on the long-term health effects of the radiation released during the accident, developing a mobile environmental laboratory for Ukraine, helping manage forest-fire dangers within the 30-kilometer exclusion zone surrounding Chernobyl, and other assistance to prevent nuclear smuggling from that zone.

"The Chernobyl disaster continues to present Ukraine with a complex variety of challenges: health, environmental, and containment," says U.S. Ambassador to Ukraine John F. Tefft. "Our assistance is engaged in all these areas."

The April 26, 1986, disaster in the then-Soviet Union began when a power surge caused a series of explosions in reactor four at the Chernobyl Nuclear Power Plant, sparking a 10-day fire that released into the atmosphere massive amounts of radioactive material that spread over much of Europe. The most severe contamination from the accident occurred in Ukraine and parts of neighboring Belarus and Russia.

The response to the accident included construction of a temporary concrete sarcophagus to limit the further release of radioactive material and a cleanup of contaminated areas that eventually involved 600,000 workers in all, although only a small percentage of these workers were exposed to dangerous levels of radiation.

Hastily erected in just more than six months and not designed to last more than 20 or 30 years, the existing sarcophagus, now covered with holes and cracks, needs replacement.

In 1995, the Group of Seven (G7, now G8) advanced industrial nations and the European Union committed to helping Ukraine build a stronger, more permanent containment structure over the damaged reactor. While the European Union has been the largest contributor, the United States is the largest individual donor country to this effort, known as the Chernobyl Shelter Fund. The U.S. contribution of $203 million amounts to 20 percent of the $1 billion pledged so far by the international community.

Engineering design work for the project is complete and site clearance has begun. The 108 meter-high arched structure, called the New Safe Containment and standing taller than the Statue of Liberty, is being built by a French consortium and is designed to last at least 100 years. To minimize the exposure of workers to radiation, the 20,000-ton structure is being assembled near the Chernobyl reactor; when completed, it will be slid on rails over the reactor and existing sarcophagus.

A second major safety project under way at Chernobyl, the Interim Spent Storage Facility, is designed to ensure the safe, secure storage on-site of spent nuclear fuel. Although this facility is not exclusive to Chernobyl or Ukraine, it will meet critical needs resulting from the 1986 accident and the permanent shutdown of the three remaining Chernobyl nuclear reactors between 1991 and 2000. With a contribution of $34.5 million, the United States is the third-largest donor to this initiative.

The United States has also been involved with a number of studies measuring the long-term health effects of the Chernobyl disaster. With co-funding from the U.S. Department of Energy, the National Cancer Institute (NCI), a branch of the U.S. National Institutes of Health, has conducted epidemiological research focused in particular on children and Chernobyl cleanup workers.

Two separate studies, beginning in 1996 in Belarus and 1998 in Ukraine, examined the health impact on children and adolescents from exposure to the radioactive iodine isotope I-131, which concentrates in the thyroid gland. A total of 25,000 people in the two nations were regularly screened for thyroid cancer until 2007. The Research Institute of Endocrinology and Metabolism in Kyiv and the Research Center of Radiation Medicine and Human Ecology in Belarus worked with NCI on these projects.

Besides contributing to enhanced knowledge of the carcinogenic effects of I-131, the two studies have assisted officials in both nations in developing appropriate health care programs and in screening at-risk populations for early detection of thyroid disease, when treatment is most effective. The studies determined that 10 to 15 years after the Chernobyl accident, the thyroid cancer risk was significantly increased among individuals exposed to fallout as children or adolescents; an NCI report released this March found that their risk for developing this cancer has still not declined.

A third NCI study has focused on leukemia among 110,000 of the cleanup workers in Ukraine who worked in the 30 kilometer-wide Chernobyl exclusion zone between 1986 and 1991. The Ukrainian Academy of Medical Sciences has collaborated with NCI on this research. The study has benefitted Ukraine by addressing health concerns about these cleanup workers and by establishing a leukemia registry to identify all cases occurring between 1987 and 2000.

The main objective of this study, which began in 1997 and ends this year, is measuring whether a correlation exists between the amount of radiation received and an increased risk of developing leukemia. The NCI estimates that each additional gray - a standard measure of absorbed radiation - is associated with a three-fold increase in the radiation-related risk of leukemia.

Past U.S. assistance to help Ukraine deal with the aftermath of Chernobyl included the delivery to Kyiv in the late 1990s of a mobile environmental laboratory. A joint effort of the U.S. Environmental Protection Agency and the U.S. Agency for International Development, the laboratory was housed in a tractor-trailer truck and contained scientific equipment to measure and analyze radioactivity.

Specialists from the U.S. Forest Service have met their Ukrainian counterparts in recent years to assess and reduce the risk of forest fires within the 300,000 square-hectare Chernobyl exclusion zone. To lessen the risk of a catastrophic wildfire - a concern, given the density and composition of the pine-dominated forest within the zone, and the fact that trees play a major role in sequestering contaminants - U.S. and Ukrainian forestry experts have worked together to review the hazard and recommend actions to lessen it, such as active fire monitoring.

"The Ukrainians will be in the business of containment of fallout from this disaster for years to come," said Ambassador Tefft. "Chernobyl will prove to be a long-lasting legacy from the Soviet past."

17.04.11. Kyiv Post journalists go on strike to protest new owner’s censorship

http://zik.com.ua/en/news/2011/04/15/282973

April 15, 2011

The editorial office of English-language The Kyiv Post has gone on strike in protest against tough censorship policy by its new owner, the KP Apr. 15 statement runs.

“The Kyiv Post journalists and editors protest the meddling with the newspaper’s independence of publisher Muhammad Zahur in the wake of his decision to dismiss KP chief editor Brian Bonner after the latter’s refusal to edit out the interview with Agriculture Minister Mykola Prysiazhniuk,” Ukrayinska Pravda quotes the statement as saying.

The KP editorial office demands that Bonner be reinstated in his job. The editors and journalists will continue to write and edit their articles but the publication of the newspaper will be suspended, the statement runs.

The KP editors say they will soon publicize Zahur’s comments made during his Apr. 15 conversation by telephone with the journalists.

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Kyiv Post staff goes on strike following dismissal of chief editor

http://www.interfax.com.ua/eng/main/66488
April 15, 2011

The editorial staff of the Ukrainian English-language newspaper Kyiv Post have gone on strike demanding the reinstatement of their chief editor Brian Bonner, who was fired by the owner of the publication, Mohammad Zahoor.

"The Kyiv Post's editorial staff has started a strike demanding that Bonner be reinstated as chief editor. We will continue to write and edit our articles, but won't publish any news item or issue," the newspaper's team wrote on the social networking site Facebook.

The Kyiv Post's staff said they were protesting against "interference in the independent activities of its editorial staff."

"We believe that publisher Mohammad Zahoor's decision to fire chief editor Brian Bonner due to his refusal to withdraw an interview with Agriculture Minister Mykola Prysiazhniuk was such interference," the editors' team said.

The Kyiv Post is Ukraine's leading English-language newspaper. It was founded in 1995 by a U.S. citizen, Jed Sunden. In 2009, it was bought by a British citizen and owner of the ISTIL Group, Mohammad Zahoor.

http://www.kyivpost.com/news/opinion/op_ed/detail/101443/#ixzz1IkYbORyN

The Ukrainian government appears to be the richest in the world, according to details disclosed during a public event held in Brussels, organised by the European Union-Ukraine Business Council and attended by Ukrainian diplomats.

The European Union is divided on its approach towards Ukraine, a country seen as deeply European in its culture and history but also as having gravitated towards Russia since the election as president at the beginning of last year of Viktor Yanukovich, leader of the Party of the Regions.

The mixed message of a recent European parliament resolution is that members of European Parliament back Ukraine's EU membership aspirations but warn of "worrying signs of the erosion of democracy and pluralism".

Plutocracy is rule by the wealthy. Oligarchy, which is present in Russia and in some Eastern countries, refers to the control of the state by a few prominent wealthy families. The combination of plutocracy and oligarchy is also known as plutarchy.

Speaking on behalf of online medialb.ua, which enjoys a fast-growing readership, Sonia Koshkina, considered one of Ukraine's best journalists, pointed to the wealth of individual cabinet members, but also to the tricks used by other cabinet members to avoid publicly disclosing their millions.

The lb.ua website is part of the Gorshenin Group, which consists of an analytical centre, a consultancy and a media network.

At least five of the 16 cabinet members are multi-millionaires, and one is a billionaire. According to Ukrainian magazine Fokus, First Deputy Prime Minister Andriy Klyuyev possesses - together with his brother Serhiy, who is an member of parliament from the ruling Party of the Regions - $900.8 million, through one of the largest industrial-investment corporations in Ukraine, Ukrpidshypnyk.

Deputy Prime Minister and Infrastructure Minister Borys Kolesnikov's fortune is estimated at $254 million in 2010 and at $292.5 million in 2011, after he became minister. His business interests range from confectionery to football, and he is in charge of preparations for the 2012 European Football Championships.

Deputy Prime Minister and Social Minister Serhiy Tyhypko has an estimated fortune of $795.5 million in 2011, increasing from $223.6 million the previous year. His business is mainly steel and rail-car building.

Emergencies Minister Viktor Baloha's fortune is estimated at $550 million. But his major assests are declared to belong to his wife Oksana, a co-founder of 14 companies, mostly in the field of trade.

Energy and Coal Minister Yuriy Boyko's fortune is estimated by the Ukrainian press at $3.2 billion. An expert in the oil and gas sector, Boyko has only declared $1.76 million in bank accounts.

Ecology Minister Mykola Zlochevskyy appears to be an interesting case. He declared only 30,780 dollars of income in 2009. However, he also acknowledges ownership of a 1,000 square-metre house, a Rolls-Royce and a Bentley. But this did not prevent him from taking $4,271 of financial assistance from the state.

Several ministers, including Prime Minister Mykola Azarov, reportedly have considerable wealth registered with their sons or closer relatives. Often ministers have business interests in the same field as their official activities. Mykhaylo Tabachnyk, brother of Sports Minister Dmytro Tabachnyk, is reportedly one of the owners of the Intersport company, which owns the land earmarked for the construction of a sport complex needed for the 2012 football championships.

According to a wire range of sources, Intersport leases the land to the ministry, although the value of the lease has not been disclosed.

Sonia Koshkina (which is her pen name; her real name is Ksenia Vasilenko) said that despite the complexity of their spheres of influence, the ministers seeminglymanaged to coexist and avoid conflicting with one another. Should arbitration be required then the arbiter is President Viktor Yanukovich, and not the prime minister, who has much less power, she explained.

There are also important power players outside the government, Koshkina said, citing as an example the head of the country's secret services, Valeriy Khoroshkovsky.

He does not hide the fact that he is a millionaire and that he in fact controls the TV channel with the biggest audience, she explained.

Despite media revelations, conflicts of interest in Ukraine do not appear to bother anyone, Koshkina said.

The Western audience present at the event seemed surprised both by the revelations and the fact that Ukrainian diplomats present in no way attempted to counter or challenge the facts presented.

10.06.11. Government members split on IMF borrowing

http://www.ukrainianjournal.com/index.php?w=article&id=12593
KYIV, June 3, 2011

The government split sharply on whether Ukraine needs to immediately resume borrowing from the International Monetary Fund, adding a new line of confrontation to already existing disagreement with the National Bank of Ukraine.

Prime Minister Mykola Azarov said Ukraine does not need an immediate resumption of borrowing from the IMF, and that’s why it has time to negotiate a slower hike in natural gas tariffs.

But Deputy Prime Minister Serhiy Tyhypko said the failure to resume the borrowing would have catastrophic consequences, including the possibility of default.

Tyhypko’s warning echoes the recent warning made by Serhiy Arbuzov, the governor of the NBU, who had urged Azarov and the government to speed up reforms to secure the IMF lending.

The IMF suspended its $15 billion lending program for Ukraine since March delaying its installments after the government had refused to hike gas prices for households by 50% on April 1 and also postponed the pension reform that increases retirement age for women.

Tyhypko said the failure to resume the borrowing would increase the costs of commercial borrowing for both, the government and businesses, making it harder to repay their earlier debts.

“I can tell you that in one of two such [commercial] borrowing we can come to a point that we will be facing a pre-default situation,” Tyhypko said in an interview with Inter television on Friday.

“And then we may see a situation that happened with Greece,” Tyhypko said. “We really would not want this to happen in Ukraine.”

Greece may require up to 100 billion euros in financial assistance package from the IMF, the European Union and other organizations to resolve its mounting debts problems, industry analysts said.

President Viktor Yanukovych last week also compared Ukraine with Greece when he had urged the government to accelerate economic reforms.

Meanwhile, Azarov continues to insist that Ukraine will be fine even without money from the IMF, a position that complicates talks with the Washington-based lender.

“We do not have any need to immediately receive loans from the IMF,” Azarov said Friday. “We have enough resources to be able to pay our foreign debt obligations.”

Arbuzov, in the letter to Azarov, said Ukraine may fail to receive an estimated $9 billion this year, including $6.2 billion from the IMF and $850 million from the World Bank, but added that final implications may be far greater, potentially leading to economic disaster.

“In conditions of continued current account deficit, this may lead to a considerable reduction of the foreign exchange reserves,” Arbuzov said.

The NBU’s foreign exchange reserves are currently estimated at about $35 billion, but may be soon start shrinking as Ukraine is due to repay debts, both state and corporate, by the end of the year.

The failure to resume cooperation with the IMF would “worsen Ukraine’s sovereign credit rating, increase foreign borrowing costs, reduce foreign direct investments, and increase demand for the hard currency,” Arbuzov said outlining the negative scenario.

Walter Derzko
Smart Economy
Toronto
416-819-9667
http://smarteconomy.typepad.com
wderzko@pathcom.com
walter.derzko@utoronto.ca
Skype: Scenarioman1

http://www.opendemocracy.net/od-russia/natalia-sedletska/ukrainian-politics-on-trial
14 June 2011

Natalia Sedletska

Ahead of parliamentary elections in 2012, Ukrainian President Yanukovych has initiated a number of high-profile corruption investigations against opposition leaders. While few Ukrainians consider the defendants to be angels, most understand the clear signs of hypocrisy and political motivation behind the trials, says Natalia Sedletska

Since President Yanukovych came to power almost 16 months ago, the opposition has been virtually wiped out. Criminal cases are being brought against members of the Yushchenko government, but is this Yanukovych’s fight against corruption? Or are these cases politically motivated? This question is no longer debated inside Ukraine, but an examination of the various cases highlights some basic common factors and gives pretty clear indications how the question should be answered.

Czech asylum for Bohdan Danylyshyn

The current most high profile case, which represents a stinging slap in the face for the Ukrainian authorities and the law enforcement system, is, of course, that of the former Minister of the Economy, Bohdan Danylyshyn. The day criminal charges were brought against him he fled the country to Europe. Six months later he was granted political asylum in Prague. The Czech Republic officially argued its decision by saying "the criminal case against the applicant was politically motivated by revenge for his previous activities."

In his campaign against the opposition, President Yanukovych can rely on Prosecutor General Viktor Pshonka. He is said to be godfather to Pshonka's son.

In granting asylum to a member of the Ukrainian opposition, the Czech Republic has effectively demonstrated that, in its opinion, the "anti-corruption activity" instigated by the Office of the Prosecutor General amounts to political persecution. Interestingly, there are reports in the media that President Yanukovych is godfather to the son of the Prosecutor General, Viktor Pshonka.

The reaction of the Ukrainian authorities to Danylyshyn being granted asylum deserves special attention. Firstly, the speakers of the pro-government Party of the Regions declared that this was clear evidence of Tymoshenko’s corrupt connections with European officials. Then it got worse. In May the Ministry of Foreign Affairs of Ukraine expelled two Czech diplomats from the country, accusing them of espionage! A small number of people consider this is simply revenge for the granting of political asylum to Danylyshyn.

The former Minister of Economy had, it’s true, been charged with inflicting damage on the national budget to the tune of more than $2 million. He was accused of twice giving the go-ahead for public procurement contracts using the “procurement from one participant” procedure i.e. without holding a tender. The investigation decided that the Minister had acted in his own interests and violated the law.

But the new government itself is involved in widespread abuse of the “procurement from one participant” rule. For example, absolutely all infrastructure products and services for Ukraine’s part of the "Euro 2012" football championship are being purchased using state funds without holding a single tender! Twenty billion hryvnias ($2.5 billion) have been specifically allocated to the “procurement from one participant” procedure. Numerous investigative reports indicate massive abuse and corruption in the Euro-2012 procurement. These reports lead directly to the inner circle of the President, but no one has yet been punished. This, of course, constitutes the selective application of justice.

The wave of political migration to the West did not stop with Danylyshyn. Other members of Tymoshenko’s government too are on the run. The former Head of the State Committee for Material Reserves, Mikhail Pozhivanov, has surfaced in Austria. He is accused of being involved in the embezzlement of $4.5 million’s worth of state property (grain). Taking a leaf from the book of his companion in distress, Pozhivanov has already asked Austria for political asylum. This procedure can take years in Austria; in the meantime Pozhivanov is living and working in Vienna.

The position of Tymoshenko’s other associates, who made ​​no attempt to escape and are now behind bars, is much less enviable.

Unlike her Interior Minister Yuriy Lutsenko, the former Prime Minister Yulia Tymoshenko still hopes to avoid arrest. Political opinion is divided as to whether Yanukovych will dare such a move.

The following members of the opposition are currently in jail (and this is an incomplete list): Anatoly Makarenko, former Head of the Customs Service, Igor Dydenko, former Deputy Head of NJSC “Naftogaz Ukraine”, Yuri Lutsenko, former Interior Minister and Anatoly Ivashchenko, former interim Minister of Defence.

All are accused of abuse of office and embezzlement of state funds. However, some details of the case of former Internal Affairs Minister, Yuriy Lutsenko, serve to show the extent to which these persecutions are really politically motivated.

Expensive medals for Police Day

Lutsenko is accused of illegally granting privileges to his driver and purchasing expensive medals for the Police Day celebrations at an alleged charge to the budget of 100,000 USD. Lutsenko is one of the most vociferous members of the opposition and has already spent five months behind bars awaiting trial. The former Minister went on hunger strike in protest against his detention, which he considers unlawful, as his legal right to give a written undertaking not to leave the city or the country was ignored. After a month without food, Lutsenko was admitted to hospital with complex medical problems. At the hospital he was kept under multi-level surveillance more suitable for a serial killer or a fanatical terrorist. The money spent on paying the people to guard Lutsenko day and night is hardly less than the amount the government is accusing him of spending.

Government officials most definitely should be punished for their abuse of office. Massive criminal cases against those who stole public property are certainly supposed to instil fear into those who are in control of spending public money. However, the current government is only putting its political enemies behind bars!

One simple example. Just recently Ukrainian journalists discovered that Energy Minister, Yuriy Boyko, had overpaid 150 million (!) USD on the purchase of an oil and gas drilling platform for the Black Sea. In order to achieve this, a “dummy” was created – an intermediary company (registered in Cardiff, Wales), which concluded the 150 million mark-up deal. It bought the rig in Singapore for 250 million USD and sold it to Ukraine for 400 million USD! The company is registered offshore, and there is ample evidence that someone from Ukraine was involved in its creation (the website of the intermediary company has a Ukrainian hosting domain, for instance).

With this one deal the management of Ukraine’s fuel and energy complex has inflicted damage on the state budget of not 100 thousand USD, nor even two or five million, but 150 million USD! One might wonder if a criminal case was instituted, but the answer is no! Minister Boyko continues going to work and managing the budget as he used to before. And the saddest part is that he will continue doing so.

Viktor Yanukovych’s strategy

President Yanukovych chairing an anti-corruption meeting of his Administration. So far the only cases that have been instituted are against his political opponents.

In this light the prosecution of opposition leader Yulia Tymoshenko looks even more unconvincing. We will not examine the charges brought against her (the most serious of the four criminal cases concerns her abuse of office during the signing of a gas deal with Russia in 2009). Suffice it to say that six months ago all the experts agreed that imprisoning Tymoshenko would only increase her popularity rating, so no one would dare touch her​​; today the arrest of the opposition leader seems not only quite possible, but imminent. The leader of the Yulia Tymoshenko Bloc attends the Prosecutor General’s Office for interrogation almost every other day. She has given a written undertaking not to leave Ukraine: she is not permitted to visit Brussels or Strasbourg, as the authorities are trying to pin something on her for her work on the European scene.

The arrest of the Ukrainian opposition leader will, of course, provoke a wave of resentment from European institutions. Nevertheless, the President and his Party of the Regions are now concerned with a more pragmatic task, the parliamentary elections to be held in Ukraine in autumn 2012.

Everyone understands Viktor Yanukovych’s main strategy is absolute power: he wishes to have an absolute parliamentary majority, so at least 226 seats out of 450 have to go to the members of his Party of the Regions. This is the stated aim of all Yanukovych’s cronies. The Prosecutor General’s Office has been chosen as the main tool for achieving this goal. Convicts cannot stand for election, which explains the avalanche-like campaign of persecution against the opposition in Yanukovych’s first year in office. All investigations against members of Tymoshenko’s team must be concluded before the start of the pre-election campaign is announced.

Could the persecution of the opposition, Tymoshenko's arrest and selective justice bring people out on to the streets? Maybe. However, there will most probably be no revolution, no protests. Not just because society has caught the lingering germ of political apathy, but largely because it knows nothing. Yanukovych’s team has stitched up the mass media channels that are under their control and all the cutting edge truth has been removed from the screens of the central TV channels. It has gone back to the internet, where it was before the Orange Revolution.

Viktor Yanukovych has such tight control over all information that he has every chance of not only getting his majority in Parliament, but also staying for a second presidential term.

Natalia Sedletska is Kyiv based TV and print investigative journalist.

Kyiv, 14 June, 2011

During more than a year and a half of being in power, the Yanukovych regime has focused on establishing an authoritarian, corrupt model of power in Ukraine. Herewith it has intensively rolled-back all democratic gains. As a result of legislative changes, the judicial system has been fully subordinated to the head of the state; freedom of speech has been virtually destroyed and political persecutions are taking place. For the first time since the Soviet era, modern political prisoners have emerged in Ukraine.

Today, the authorities have brought far-fetched criminal cases against the leader of the opposition, former Prime Minister Yulia Tymoshenko, former Minister of the Interior Yuriy Lutsenko, and other former members of the government. Participants in the Maidan tax protests, activists, representatives of students’ and public organizations, journalists and bloggers are being persecuted. Each month, this list of enemies is expanded by the authorities.

Human rights and monitoring organizations have repeatedly made statements regarding selective justice, the unlawful detention of political and public figures, and political motives behind the persecutions. The granting of political asylum to Bohdan Danylyshyn, the former Minister of the Economy, is recognition of political repression against dissidents in Ukraine.

Unfortunately, protest actions and other measures of pressure upon the authorities to comply with Constitutional principles are being prohibited and made impossible in Ukraine by decisions from the courts, which are fully subordinated to the Presidential Administration.

Therefore, supporting the initiative of human rights activists, and on the basis of the above mentioned, we appeal to the heads of democratic countries to apply the mechanism of banning visa issues, of freezing financial assets and to use other sanctions against state officials of Ukraine who are involved in political persecution and who are violating human rights. We would like to ask you to apply the same measures against Ukraine’s judges who are delivering knowingly unjust sentences, guided only by the will of those who are in power, as well as by the will of prosecutors who do not hide that the desires of the country’s president are more important that the Law.

Convinced that the world must support Ukraine’s young democracy and force Ukraine’s government to regard the rights and freedoms of its citizens.

On behalf of People’s Committee to Defend Ukraine

Dmytro Pavlychko

Taras Kuzio

Ukraine’s poor relations with Russia are nothing new as they also existed under the “pro-Russian” Leonid Kuchma. Nevertheless, Kuchma had to deal with the more democratic Russian President Boris Yeltsin, whereas the certainty of Vladimir Putin returning as Russian President in March 2012 means that Moscow will continue to present a hard line toward Kyiv.

“We had the illusion that everything would work out if we removed from our relations with the Russian Federation key irritants like recognition of the Holodomor [1930s famine] as genocide, plans to join NATO.

During the last two decades of Ukrainian independence, Kyiv’s relations with Moscow have followed predictable patterns. Moscow has always favored presidents elected by eastern Ukrainian, Russian-speaking voters, whether Kuchma or Yanukovych, but the promise of better relations has never appeared. With Ukrainian “nationalist” presidents, poor relations were inevitable. Leonid Kravchuk, elected in 1991 by Russophone voters, was quickly perceived by Moscow as a “nationalist” because he relied upon national democratic support and quarreled with Russia over the CIS, Black Sea Fleet (BSF), nuclear weapons and many other issues.

Yushchenko, elected in 2004, was always going to be even more suspicious in Putin’s eyes as the Russian leader had been personally humiliated by the Orange Revolution, an event viewed in Moscow and by Yanukovych as a US-backed conspiracy. Putin twice visited Ukraine in October-November 2004 to give support to Yanukovych and congratulated him on his election a day before the Central Election Commission announced the official results. Yushchenko was easy to portray as a “nationalist” villain because of his national identity and foreign policy orientation. Relations with Russia (and Poland) became especially strained over Yushchenko’s honoring of 1940s nationalist leaders and his support for Georgia during Russia’s August 2008 invasion.

In reality, Kuchma was as much of a “nationalist.” Kuchma “Ukrainianized” the country’s education system, and initiated the international campaign to designate the 1933 artificial famine (holodomor) as “genocide.” Kuchma twice requested NATO to offer Ukraine a Membership Action Plan (MAP) in 2002 and 2004 – the same number of attempts as Yushchenko in 2006 and 2008. Kuchma and Yanukovych had strained relations with Moscow for the same reason: namely, their eastern Ukrainian naivety about Russia and Slavic brotherhood. Eastern Ukrainian naivety has come face to face with Russian imperial-chauvinism, which does not accept the permanency or existence of Ukraine’s statehood. This is clearly revealed in private conversations with Western diplomats in Kyiv who are unfazed by Russian heavy handiness that they themselves have witnessed during previous tours of duty in Moscow. Putin told the NATO-Russia Council at the April 2008 Bucharest summit: “Well, you understand, George (Bush), Ukraine is not even a state,” adding “What is Ukraine? One part of its territory is in Eastern Europe, and the other part, the significant portion, was a gift from us” (UNIAN, April 18, 2008).

Putin mistakenly believes that “seventeen million are Russians,” mixing up Russophones with “Russians.” In Putin’s eyes, Ukraine is an artificial state where “one third is ethnic Russian,” which would disintegrate if tensions rose as in 2008-2009 when Russian espionage and subversion grew in the Crimea (see November 2010 Jamestown report: The Crimea: Europe’s Next Flashpoint?).

Moscow’s contempt for Ukrainian statehood has not abated despite Yanukovych’s far more pro-Russian position than Kuchma’s. Yanukovych extended the Sevastopol BSF base to 2047, dropped the pursuit of NATO membership and adopted the Russian position that the 1933 famine was Soviet-wide, denouncing the claim that the holodomor is a “genocide” or Ukrainian famine. Two years earlier, Yanukovych was the only CIS politician to support the independence of South Ossetia and Abkhazia.

A senior official in the Ukrainian government commented on the state of Russian-Ukrainian relations: “We had the illusion that everything would work out if we removed from our relations with the Russian Federation key irritants like recognition of the Holodomor [1930s famine] as genocide, plans to join NATO and the reluctance to extend the stationing of the Black Sea Fleet. But this has not happened” (Kommersant-Ukraina, June 21).

The Yanukovych administration, like every Ukrainian leadership, became exasperated by the inability of Russia to treat Ukraine on an equal footing. A senior Ukrainian official explained: “It is not we who are moving away from Russia, but the latter that pushes us off.” Yanukovych gave away so much, so quickly, for nothing – including the mythical 30 percent gas “discount.”

Yanukovych is faced by a more assertive, wealthier and aggressive Russia, which will again be led by Putin who has never hidden his disdain for Yanukovych. A January 2009 US cable from Kyiv leaked by WikiLeaks cites the then Ukrainian Ambassador to Russia, Kostyantyn Gryshchenko (now Foreign Minister), as stating that Putin hates Yushchenko and has a low personal regard for Yanukovych (Kyiv Post, March 11). Gryshchenko bemoaned to US Ambassador William Taylor that Moscow seeks a “regency” in Ukraine totally subservient to Moscow (Kyiv Post, March 11).

Putin’s hard-line policies toward Yanukovych escalated after Yulia Tymoshenko was accused of abuse of office for her signing of the January 2009 gas contract with Putin. One year earlier, the Kharkiv accords extending the BSF base had recognized the same contract. Yanukovych claimed that the Ukrainian government had taken this step because Russia had agreed to review the contract. Since then, Russia, in Yanukovych’s view, had betrayed them even though the terms of the 2009 contract “were written it seems for an enemy” (Kommersant-Ukraina, September 6).

Yanukovych complained during the Dushanbe CIS summit: “We are not poor relations…We are an independent state,” adding “At first they pushed us into a corner and then they began to dictate terms. This demeans not only myself personally but it demeans the state and I cannot permit this” (Kommersant-Ukraina, September 6).

Ukrainian officials have condemned the “information war” against Yanukovych and his economic nationalist oligarch allies (Ukrayinska Pravda, September 1). Party of Regions deputy Sviatoslav Oliynyk revealed the “mass ideological and technological parachutists” sent into eastern and southern Ukraine to turn the population against Yanukovych. “This ‘geopolitical process’ amounts to support for separatism,” he warned (Ukrayinska Pravda, September 9).

The deterioration in relations could be seen at the September 15-18 Yalta European Strategy (YES) summit, boycotted by Russia (http://yes-ukraine.org/ua/Yalta-annual-meeting/2011). In last year’s YES summit, Russia sent numerous senior figures in the firm belief that “their” man had been elected earlier that year (see analysis of this year’s YES summit by Serhiy Leshchenko in Ukrayinska Pravda, September 19, 23).

Kyiv’s strained relations with Moscow point to three conclusions. Firstly, Russia does not accept, or respect, Ukrainian sovereignty. Secondly, Yanukovych has received nothing in return for naive pro-Russian policies introduced after he was elected. These policies have given him less leverage than Kuchma possessed in the 1990s, when he used US support and cooperation with NATO to persuade Russia to moderate its position. Thirdly, by extending the Sevastopol base de facto indefinitely, Yanukovych has given Russia the ability to intervene and subvert the Crimea (Ukrayinsky Tyzhden, August 23). Tension is again growing with Ukraine, blocking the passage of Russian vessels in the Kerch straits (Ukrayinska Pravda, September 8).

Yanukovych’s inept attempts to pursue Kuchma-style multi-vector foreign policies have led to poor relations with Moscow and Brussels-Washington that have given him two potential pitfalls. Either Yanukovych can agree to join the CIS Customs Union, turning Ukraine into a Russian protectorate and in the process provoking widespread domestic instability through protests at the loss of Ukrainian independence. Or Yanukovych can mend relations with the West by releasing Tymoshenko from imprisonment leading to a Deep Comprehensive Free Trade Agreement with the EU, but risking the possibility that she may defeat him in the 2015 presidential elections.