Friday, August 31, 2007

American Accuses Kyiv Politicians, Ex-Wife Of Keeping Him From His Child

KIEV, Ukraine -- An American citizen who says his Ukrainian ex-wife is denying him access to their nine-year-old son has accused her new husband, a Kyiv city councilman, of trying to intimidate him into giving up his visitation rights.

Yury Starodubsky with his son Michael.

Yury Starodubsky, a naturalized American citizen of Ukrainian origin, told a news conference in Kyiv on Aug. 27 that Kyiv City Councilman Oleksandr Rybak has threatened and harassed him.

Starodubsky’s ex-wife Irina Fidenthal denied the accusations, which she said might be tied to the upcoming parliamentary elections.

Rybak and his father Volodymr, a deputy prime minister, are both members of Prime Minister Viktor Yanukovych’s Regions party.

“I am not seeking custody. I only want to see my boy, to be a part of his life,” Starodubsky told the Post.

Starodubsky, who also goes by the surname Star, said he has seen his son, Michael, less than a dozen times since the couple was estranged in 2002.

Some of these meetings consisted of Starodubsky’s waiting for the nine-year-old in front of his house or catching him on the beach with his grandmother in Crimea, according to the US citizen.

Starodubsky, 38, began litigation in July at Kyiv’s Pechersky Court to enforce his visitation rights.

He has also sent several letters to top Cabinet officials, including Deputy Prime Minister Rybak.

“A man identifying himself as Volodymyr Vasylevych [Deputy Prime Minister Rybak] called me and said he had nothing to do with the affair, that it was between me and his son and my wife’s family,” Starodubsky said.

Relations with 38-year-old Oleksandr Rybak, the deputy prime minister’s son, started out civilly but have deteriorated in recent months, according to Starodubsky.

Starodubsky accused the city councilman of sending him threatening SMS messages and having him followed and accosted by strangers during his visits to Kyiv.

“I am afraid for my life,” the American citizen said.

Starodubsky said his former wife and her husband are both from wealthy Donetsk families and thus capable of making him disappear.

“If they were a normal, run-of-the-mill family, we would have sat down and settled this.”

Starodubsky, who is Jewish, said his former wife and her new husband also had his son baptized as a Christian without his permission.

“We agreed before he was born that he would be raised as a Jew, so that he wouldn’t have any identity problems.”

The other side

Irina Fridenthal told the Post that Starodubsky has never been prevented from visiting his son.

“I have nothing against him seeing our child. I only found out that he was unable to when I learned about the lawsuit this year.”

According to her, Starodubsky shows up and disappears as he pleases.

She said her ex-husband was supposed to come to the US Consulate in Kyiv last September to renew Michael’s US passport but failed to appear.

“I find it strange that he suddenly shows up a year later with these accusations against my husband and his father, just before the elections. My husband, much less his father, has nothing to do with this matter.”

Fridenthal, who identifies herself as an ethnic Russian, acknowledged having the nine-year-old baptized, adding that it was done according to the boy’s wishes.

She dismissed Starodubsky’s accusations that her current husband had threatened or pressured him.

Starodubsky said his son was a US citizen and that his wife held two passports.

An insider’s spat?

Starodubsky drove up in an expensive Mercedes with a muscle-bound driver for an interview with the Post.

He said he moved to the US with his family in 1979 when he was nine years old. He now says he works as an electrician in Chicago.

A 2004 announcement by Patch Energy, a wholly-owned subsidiary of Praxis Pharmaceuticals Inc, states that Starodubsky was appointed the company’s director of business development for Ukraine and Russia.

The announcement refers to Starodubsky as “an international businessman with very strong political and business contacts in both Ukraine and Russia.”

Starodubsky said he was employed by Patch as a consultant, but currently has no business interests in Ukraine.

Starodubsky and Fridenthal, 31, met and married in the US in the mid-1990s.

“It was true love, a real marriage,” Starodubsky said.

By 2002, the couple had separated, and in 2004 Starodubsky filed for divorce.

“I only found out about the divorce after the fact,” Fridenthal said, adding that she remarried in 2005.

Fridenthal took her son Michael to Ukraine in 2002 together with Starodubsky, then returned alone to collect her things from Starodubsky a few months later.

Starodubsky said he hadn’t been able to bring legal action against Irina in the US because she left before being served a subpoena.

“They apparently planned the whole thing from the start,” Starodubsky said, referring to Fridenthal and Rybak.

Fridenthal denied this accusation.

Source: Kyiv Post

Voters Say Poll Won't Fix Ukraine

KIEV, Ukraine -- With just a month to go before voters elect a new parliament, Ukraine's election campaign is in full swing.

Same players, Yanukovych (L) and Yushchenko (R) - another election

And while some Ukrainians still believe in the romance of the Orange Revolution, many others say its leaders have failed to keep their promises.

Voters in Ukraine are facing the same choice they had at the time of the Orange Revolution and the parliamentary vote last year.

It's either the orange team headed by Viktor Yushchenko and the flamboyant Yulia Timoshenko or the Regions Party led by their bitter rival, the Prime Minister Viktor Yanukovich.

After endless power struggles and stand-offs, many voters are disillusioned, yet are likely to vote for what they think is the lesser of two evils.

The Vasiliyevs from Kiev used to have bitter spats over politics. Maryanna kept telling her parents that orange leaders abused people’s trust to win power.

But mom and dad thought they knew better and supported the revolution. Sometimes they didn't talk for weeks, but that's changed now.

Maryanna’s father, a historian, hoped his wages would go up enough to afford a holiday abroad.

But his family is still renting holiday houses build by the Soviets two hours from Kiev. It's no wonder the parents are far less enthusiastic about the revolution and its slogans this time.

The Orange Revolution is satirised in a new museum in the city of Lugansk.

A puppet of President Yushchenko has a sign that reads, “I do what I like with the constitution”.

Cartoons and photos of the orange uprising mock the election promises of a better life.

Ten toy soldiers in NATO uniforms are shown crossing a map of Ukraine, indicating what could happen if orange leaders are returned to power.

“I was at university during the election last year. And we were told who to vote for. Is that the freedom promised to us by the orange team? I said ok but voted the way I wanted,” says Galina Ananieva, organiser of the Anti-Orange Museum.

The pro-presidential Our Ukraine party does not think they have done so badly, saying it was impossible to make everything smell of roses after 70 years of communism.

“What we needed to do - shake up the system, We were not going to satisfy hyperinflated expectations of the Ukrainian people. But I don’t criticise them for this. One of the reasons the “Orange Revolution” was successful is that it shook the foundations of the system,” believes Roman Zvarych, an advisor to President Yushchenko.

And for some the romance of the revolution is still strong.

Supporters of the orange team credit the president for the freedom of the press and the growty of civic activity in Ukraine.

Yet more than half of the population say they failed to keep the promises made three years ago.

Power struggles in Ukraine are far from over. Next month ballot-weary voters will tramp to polling stations for the fourth time in less than three years.

However, the election is unlikely to shift the balance of power.

Advisers to the President and the Prime Minister are already preparing to dispute the results, and to bring their supporters to Independence Square yet again.

Source: RussiaToday

Thursday, August 30, 2007

Igor Kolomoisky Invests US$ 110 Million To Acquire An Interest In CME

HAMILTON, Bermuda -- Central European Media Enterprises Ltd. ("CME") announced today that Igor Kolomoisky, a prominent Ukrainian businessman, has acquired 1,275,227 shares of CME's Class A Common Stock for cash consideration of US$ 110 million.

Igor Kolomoisky

The price per share has been determined on the basis of a weighted average trading price.

This share purchase represents approximately 3.0% of CME's total outstanding Common Stock.

In connection with this investment, Igor Kolomoisky has been invited to join the Board of Directors of CME.

Ronald S. Lauder, Non-Executive Chairman of CME, commented on the transaction: "I've known Igor Kolomoisky for some time and admire him as an extremely knowledgeable businessman with in-depth knowledge of Ukraine. Igor understands the importance of independent television not only in Ukraine, but throughout Eastern Europe. I'm delighted to welcome him as our newest Director, and I am confident he will help CME enormously."

Michael Garin, CME's Chief Executive Officer, said: "Investors should welcome this step as a major vote of confidence. The Apax investment last year underscored their view of the growth potential of CME as a company. Similarly, this investment by Mr. Kolomoisky should confirm CME's view that Ukraine will be a powerful growth engine for the Company in the future. As I said a few weeks ago when we released our second quarter earnings, 'We are convinced that in the next few years Ukraine will become the largest market in which we operate. We remain completely committed to Ukraine and will continue to aggressively but prudently pursue opportunities to further strengthen our presence there.' Today's announcement is a major indicator of that commitment."

Igor Kolomoisky said: "CME is one of the fastest growing and best managed media companies in the world and represents an exceptional investment opportunity for me. I am impressed with the company's management team, vision and disciplined financial approach. I look forward to working with my new Board colleagues and the CME management team to build upon the CME success story at a time when prospects are so bright both in Ukraine and in the other markets in which the company operates. Ronald Lauder has been a pioneer in helping the countries of Central and Eastern Europe to establish the independent media outlets so critical to the development of their economies and political systems. I've known Ronald for a number of years, and I'm delighted to now join him on the Board of CME."

CME is a TV broadcasting company operating leading networks in six Central and Eastern European countries with an aggregate population of approximately 90 million people.

The Company's television stations are located in Croatia (Nova TV), Czech Republic (TV Nova, Galaxie Sport), Romania (PRO TV, PRO TV International, Acasa, PRO Cinema and Sport.ro), Slovakia (Markiza, Galaxie Sport), Slovenia (POP TV, Kanal A) and Ukraine (Studio 1+1, Studio 1+1 International, Kino, Citi). CME is traded on the NASDAQ and the Prague Stock Exchange under the ticker symbol "CETV".

Source: CNN Money

Ukraine Holds Firm As A Top World Arms Exporter, But Lags Far Behind Russia

KIEV, Ukraine -- Ukraine, one of the world’s top 10 arms exporting countries, earned some $750 million through weaponry sales to 19 countries in 2006, with exports to Azerbaijan and China leading the way, according to the country’s annual report to the United Nations Register of Conventional Arms.

Ukrainian T-72 tank is popular with third world countries.

Azerbaijan received 17 battle tanks, while 20 were bought by the Congo and one was purchased by the United States.

Ukraine has reported the transfer of more than 720 tanks to 11 different countries since the country joined the voluntary reporting mechanism established by the UN nearly 15 years ago.

Azerbaijan and the Congo also purchased 23 armored combat vehicles, while 50 armored combat vehicles (ACV) were delivered to Iraq and 10 to Nigeria.

Earlier this month, Ukraine won a contract to supply 96 ACVs for $117 million to Thailand, which will take two years to complete.

In addition, Azerbaijan acquired 13 units of large-caliber artillery, according to the report published this month.

Ukraine also exported 17 combat aircraft to Azerbaijan, 12 to Yemen, six to Belarus, five to Vietnam, four to Sri Lanka, three to the US, two to Great Britain, and one airplane each to Estonia, Lithuania, New Zealand, South Africa, the Czech Republic and Uganda, for a total of 55 aircraft in 2006.

Algiers imported 32 missiles and mobile missile launch systems from Ukraine, while Kazakhstan received 12.

The most Ukrainian missile systems were acquired by China – 590 in 2006. The US increased its purchases of parts of Ukrainian “mobile zenith rocket complexes” to 295 units, which include rockets and mobile launch systems.

In 2005, Ukraine shipped only six launch mechanisms and 29 rockets for the Holka zenith launch system to the US. In 2003, the US acquired 10 launch mechanisms and 29 rockets.

In the past five years, Ukraine has increased its world arms market share from 4 percent to 10 percent, earning the country $750 million annually, according to Serhiy Zhurets of the Center for Army Conversion and Disarmament Studies.

By way of comparison, Russia, earns $5-7 billion annually. Zhurets pointed out that the UN registry does not cover all military exports, like radar equipment and firearms.

“The arms export business will never be fully transparent and open in any country,” said Zhurets.

He said that in addition to the UN registry, efforts to tabulate data on exports are conducted by the US Congress and the Stockholm International Peace Research Institute, which pegged Ukraine’s arms exports for last year at only $118 million.

He said that the US Congress six-year estimate for Ukraine’s weapons exports stood at more than $2 billion.

Like Ukraine, Russia reported no conventional arms imports for last year. For 2006, Russia reported selling 30 battle tanks to Algeria, a total of 114 ACVs to Bangladesh, Colombia, Kazakhstan and Uruguay and 100 large-caliber artillery systems to Myanmar.

In terms of the sea, Russia sold two warships to China, which was also the destination for 944 missiles and missile launchers.

By contrast, Ukraine has reported shipping more than 1,000 missile and launch systems to China since 2000.

Export data from Ukraine and Russia are among the few open sources available to the international community regarding Chinese military imports and exports.

China, a permanent member of the UN Security Council, stopped participating in the voluntary reporting program more than 10 years ago, after the US included arms exports to Taiwan in its 1995 and 1996 reports.

Meanwhile, Russia’s South American ally Venezuela was empowered with four combat aircraft and 14 attack helicopters in 2006, according to the UN’s disarmament website.

Ukraine delivered 320 T-80UD tanks to Pakistan during 1996-1999 in a deal that was reportedly worth $550 million.

The UN’s Register of Conventional Arms is a voluntary reporting mechanism established in 1992 aimed at promoting transparency in the international arms trade.

On average, more than 115 of 192 UN member states have reported each year since 2000.

In the late 1990s, a governmental investigation found that the military equipment inherited by Ukraine after the demise of the Soviet Union was worth nearly $90 billion.

Source: Kyiv Post

Wednesday, August 29, 2007

Akhmetov Snaps Up Energo Stake

KIEV, Ukraine -- Ukraine’s richest man has significantly increased his stake in a major electricity generating company as the result of a controversial share emission deal that calls into question the state’s sell-off of lucrative assets.

Billionaire Rinat Akhmetov

Shareholders at Dniproenergo, Ukraine’s largest thermoelectric generator, agreed on Aug. 27 to increase the company’s share capital by 52 percent, watering down the state’s 76 percent stake to 50 percent plus one share.

The only company effectively allowed to purchase the new shares was Donbass Fuel-Energy (DTEK), the energy arm of Donetsk billionaire Rinat Akhmetov’s System Capital Management holding company.

DTEK increased its holding in Dniproenergo as a result of the share emission from 8.7 percent to 40 percent, paying a total of $208 million.

The current market value of the shares received by DTEK, however, amounts to around $700 million, with the share price expected to continue rising.

Proponents of the emission, including the government, point to the need to pay off Dniproenergo’s debts.

The Zaporizhya-based company has been debt-ridden since 2003, but it’s unclear exactly how much it currently owes and to whom.

A Zaporizhya court appointed a financial restructuring manager for Dniproenergo, a position that is currently occupied by a former board member of a coal mine owned by DTEK.

“We don’t know the exact debt distribution, though we do know that DTEK’s coal mines are not the largest Dniproenergo debtors. As far as I know, the State Reserve along with Gas Ukraine are the largest,” Dennis Sakva, an energy sector analyst at Kyiv-based investment bank Dragon Capital, told the Post.

Almost 99 percent of shareholders approved the emission during the meeting on Aug. 27, which was attended by a representative of the state.

The government of Prime Minister Viktor Yanukovych, whose Regions parliamentary faction includes Akhmetov as a deputy, approved the emission in June.

Ukrainian President Viktor Yushchenko issued a decree on Aug. 6 ordering the government to prevent asset stripping of state-controlled energy companies by imposing a ban on share capital dilutions.

However, the only politician to have questioned the emission publicly and aggressively is Yulia Tymoshenko, the leader of the opposition Byut faction.

In a statement released by her party’s press service, Tymoshenko asked why the state’s representative had voted in favor of the emission.

“The question is why, on what basis? Why Akhmetov? I have a lot of questions,” she said.

Some analysts say that Dniproenergo will gain from the emission, which will bring the company fresh cash.

If the state had auctioned off the shares in an open tender, the money earned would have gone into the state budget rather than to the company.

In addition, the arrival of DTEK as a strategic shareholder will likely benefit Dniproenergo providing it with access to thermal coal and improving management, analysts said.

Dragon’s Savka, however, believes that DTEK will try to take full control of Dniproenergo, thus reducing the likelihood of a strategic Western investor coming in.

“We don’t expect it to happen soon, maybe closer to 2009. But I would say that DTEK is currently controlling Dniproenergo’s management, as people loyal to it are controlling the company’s supervisory board and can hire or fire almost anyone in the company,” he said.

Dragon estimates the electricity generator to be worth about $2.2 billion, based on the current share price.

Dniproenergo, one of five electricity generating companies in Ukraine, had a net income of $20 million in the first half of this year.

The State Antimonopoly Committee has yet to give final approval to the emission, but no one expects it to be blocked.

In addition to the $208 million it is paying for its increased stake, DTEK has also agreed to invest another $200 million into Dniproenergo.

But the pledge doesn’t appear to be legally binding.

“We didn’t see any legal documents (like contracts) that prove that DTEK will invest another $200 million. The copy of amendments to Dniproenergo’s financial rehabilitation plan state that they need to invest at least $20 million. The financial restructuring manager showed us two copies of letters from DTEK where they agree to invest another $200 million but their legal status is unknown,” Sakva said.

Dniproenergo minority shareholders, whose stakes have been reduced from 15 percent to 10 percent as a result of the emission, could also appeal.

But most are expected to take advantage of a share buyback scheme on offer or hold on to their reduced stakes in anticipation of the share price continuing to increase.

Akhmetov has led the transparency campaign in Ukraine since the country’s Orange Revolution in the hopes of encouraging continuing investment in his aging industrial assets.

Protection of minority shareholders’ rights has also been shown more attention in Ukraine recently.

But shady privatizations in which the state comes out short continue apace in the country.

Earlier this year, the State Property Fund auctioned off a lucrative locomotive plant, LuhanskTeplovoz, for at least half its market value to Russian investors during a highly questionable tender.

Other assets privatized during questionable tenders in years past, such as the Nikopol Ferroalloy Plant, look likely to remain in the hands of their well-connected owners.

In the meantime, tenders for state fixed-line monopoly Ukrtelecom were cancelled several times this summer.

Tymoshenko and Yushchenko touted the transparent privatization of Ukraine’s biggest steel mill, Kryvorizhstal, in late 2005, the same year the two Orange politicians came to power.

After a court decision overturning an earlier privatization of the plant, it fetched $4 billion more in a sale to international steel giant Mittal Steel (now Mittal-Arcelor).

Since then, Ukraine’s privatization record has been less gleaming.

By boosting his stake in Dniproenergo through the bargain emission, Akhmetov could significantly increase the value of DTEK, yielding him the strongest position in the power-generation market in Ukraine’s highly industrialized eastern regions.

At the same time, the commitment of Ukraine’s government to ensure transparent privatization of state assets to the highest bidder to finance the country’s cash-strapped public sector continues to remain in doubt.

Source: Kyiv Post

Prochnik Focuses On Ukraine

LODZ, Poland -- Prochnik, the clothes producer from Lodz, wants to have sixty shops in Poland and 15 abroad. It also dreams about its first income in many years.


Prochnik, the producer and distributor of men’s clothes, raised the capital in its Ukrainian subsidiary by USD 150,000.

The funds will be spent to develop the shop network.

Today, there is only one Prochnik shop in Ukraine but within two years, the company wants to increase the number to five, and then to 15.

The company wants to develop quickly in Poland.

“We will launch 10 new shops annually”, Krzysztof Okonski, Prochnik deputy CEO said.

Today, the network consists of 21 shops. There are planned to be 60.

Prochnik will develop its Polish network from the funds raised in the previous issue.

It cannot count on bank credits because it has had no income recently.

Last year, the company and PLN 10.9m (EUR 2.8m) of sales and PLN 3.7m of net loss.

There are no forecasts for this year but the management hopes that the company will get out of the red.

In the first half, the company had a loss of PLN 621,000 against PLN 12.2m of sales.

“The fourth quarter is usually the best for us. Up to 40 percent of sales are generated then”, the CEO said.

Investors did not react enthusiastically to Prochnik’s plans. Yesterday, the stock closed at PLN 1.25, or 1.6 percent lower.

Source: Portal Biznesowu

Lessons In Democracy For Ukraine

PARIS, France -- The International Centre for Policy Studies (ICPS) paper remarks that political competition now exists in Ukraine, with a system for dividing powers currently under development.

The Orange revolutionaries who gave democracy a start in Ukraine, Yulia Tymoshenko and Viktor Yushchenko

However, the author claims that Ukraine's transformation is "spontaneous" and "disorganised" as a result of the country having to go through in a short space of time what other countries experienced over hundreds of years.

Thus, Ukraine should proceed with caution, warns ICPS – drawing on the experiences of western democracies not to "copy certain models or practices", but instead "to avoid the typical mistakes other countries have made" in order to deduce what political principles and practices make a country a real democracy.

ICPS examine the precedents set by the evolution of other democracies, concluding that a political system can be described as successful if it is focused "on the needs of the country and learns from its past mistakes" – citing the eventual adoption of a "semi-presidential" model in France and the reluctance of Romania to centralise power in the hands of one person as examples of this.

The author claims that although western democracies employ different systems, the principles that underpin them are identical – leading to the development of similar institutions on which democracy is based, including a professional civil service and robust parliamentary opposition.

Finally, the article adds that in the western tradition, parliamentary opposition generally guarantees rights for participation in governing the country, and that legislation is "not mandatory" in order for democracies to function, with many countries establishing the rights of the opposition only informally.

Source: EurActiv

Monday, August 27, 2007

Finnish Fish, Mushrooms Still Toxic From Chernobyl

HELSINKI, Finland -- Twenty-one years after the Chernobyl nuclear disaster in Ukraine, fish and mushrooms in parts of Finland are still toxic due to radioactive fallout, Finnish authorities said on Monday.

Lakes in the Vammala, Finland area

The concentration of cesium-137 exceeded the EU maximum recommended level in 20 percent of fish and more than half of the mushrooms tested in 2005 by the Radiation and Nuclear Safety Authority and Finnish Food Safety Authority Evira.

The tests were conducted in the lakes and region around Vammala, 230 kilometers (145 miles) northwest of Helsinki in southwestern Finland -- the Finnish area most affected by the fallout from the Chernobyl disaster on April 26, 1986.

Radioactivity levels reached nearly three and a half times the maximum recommended level in fish and up to nine times the maximum in mushrooms, with significant variations depending on where the tests were carried out and other factors.

Seventeen percent of fish also had elevated levels of mercury.

Finnish authorities recommend consumers eat lake fish no more than once or twice a month -- expectant mothers are advised to stay away from pike entirely during their pregnancy -- and to wash mushrooms well before eating.

Source: AFP

Fraud Fear For Ukraine Elections

KIEV, Ukraine -- Ukraine's opposition leader Yulia Tymoshenko has said she believes that the early parliamentary ballot due to be held in September will be rigged. Election officials have already tried to bar her party from running.

Yulia Tymoshenko has fears over electoral legislation

Mrs Tymoshenko, along with President Viktor Yushchenko, helped to lead the country's 2004 Orange Revolution, which was sparked because of vote-rigging.

This election was called after a power struggle between the president and Prime Minister Viktor Yanukovych.

The start of her campaign was delayed because election officials appointed by the Prime Minister refused to allow her party to take part in the ballot, until they were ordered to do so by a court.

Mrs Tymoshenko said that she was worried that the election would not be free and fair because laws which were introduced to try to stop vote rigging were recently reversed by election officials.

She said: "It seems to me that the country has started moving backwards in respect to its election legislation."

International observers have already expressed concern that next month's vote could be open to fraud.

She added: "After the changes that the prime minister's team made to the election rules, Ukraine is again facing the threat of massive falsification."

But Mr Yanukovych has denied that his party has tried to rig the ballot.

It is running a high profile campaign and the opinion polls all predict that the prime minister's party will win the largest share of the vote.

Source: BBC News

Sunday, August 26, 2007

Ukraine's President Seeks To Revise Constitution

BUDAPEST, Hungary -- Ukraine's president, Viktor Yushchenko, says he wants to change the constitution in a bid to restore his presidential powers.

Ukraine's President, Viktor Yushchenko, watches soldiers parade during Ukraine's Independence Day celebrations in front of St. Sofia Cathedral in Kiev, Friday, Aug. 24, 2007.

The announcement comes as the country prepares for elections in September aimed at ending a power struggle between him and Prime Minister Viktor Yanukovich. Stefan Bos reports for VOA from Budapest.

President Yushchenko announced plans to revise the constitution at a ceremony marking the 16th anniversary of Ukraine's declaration of independence from the former Soviet Union.

Speaking in front of Kyiv's Saint Sofia Cathedral, he said the changes could be introduced after an election on September 30.

Parliament three years ago adopted legislation transferring significant powers from the president to the prime minister. This led to a stalemate between Mr. Yushchenko and Prime Minister Viktor Yanukovych.

The two sides agreed to hold the September 30 election in a bid to resolve the impasse.

Mr. Yushchenko says changes are needed in the constitution to restore his presidential powers and end the deadlock with Mr. Yanukovich, who favors closer ties with Russia.

The president says he hopes his actions will boost efforts to introduce Western-style reforms, including closer ties with NATO and the European Union, as well as bring an end to what he sees as high-level corruption.

"Political experiments led to an avalanche of corruption and the destruction of the minds of this and much younger generations," said Mr. Yushchenko. "This year's early election is my very straight forward reaction on a plot against Ukraine launched by corrupt politicians. I know how to make order in our Ukrainian house. We are starting the renewal of the constitution, and I am calling for the convening of a constitutional council that will start to write down the draft of a new constitution."

The president said the revisions will be presented to citizens for approval in a nationwide referendum.

The September 30 elections for parliament mark the fourth time in less than three years that Ukrainians will be voting in a national election. Polls show Prime Minister Yanukovich's Regions Party slightly ahead of parties allied with President Yushchenko.

Source: Voice of America News

Tymoshenko Bloc Gains Support In Ukraine

KIEV, Ukraine -- Public backing for Ukraine’s opposition Yulia Tymoshenko Bloc has increased as the Party of Regions (PR) has lost momentum, according to a poll by FOM-Ukraine.

Yulia Tymoshenko signing autographs in Kiev on Independence Day

29.5 per cent of respondents would back the PR of prime minister Viktor Yanukovych in September’s legislative election, down 1.5 points since June.

The Yulia Tymoshenko Bloc is second with 18.3 per cent—up 3.3 points in two months—followed by the coalition of president Viktor Yushchenko’s People’s Union-Our Ukraine (NS-NU) and the People’s Self-Defence Bloc with 14 per cent.

Support is lower for the Communist Party of Ukraine (KPU), the Volodymyr Lytvyn Bloc, and the Socialist Party of Ukraine (SPU).

Ukrainian voters renewed the Supreme Council in March 2006.

The PR won 186 seats in the legislative branch, followed by the Tymoshenko Bloc with 129, the NS-NU with 81, the SPU with 33, and the KPU with 21 mandates.

Parties require at least three per cent of the vote to qualify for proportional representation seats in the Supreme Council.

In July, the "anti-crisis" coalition—which includes Yanukovych’s PR, Oleksandr Moroz’s SPU and the KPU—was formally announced.

In August, Yanukovych was confirmed as prime minister, while Yushchenko remained as president.

On Apr. 2, Yushchenko dissolved the Supreme Council and called an early ballot.

On May 27, Yushchenko and Yanukovych agreed to hold the election on Sept. 30.

On Aug. 24, Yushchenko called for a new constitution in order to resolve disputes over the powers of the different branches of government.

The president said he would call for a constitutional council to begin the revision process, and then call for a public vote to ratify the changes to the charter.

Yushchenko declared: "I know how to restore order in our Ukrainian house. (...) This process will take longer than a day but nobody will be able to make it too long. It also cannot be a hostage of the election, as it is very important for each of us. I firmly repeat what I said two months ago on Constitution Day: our constitution will be adopted at a nationwide Ukrainian referendum."

Polling Data

Which of these parties would you vote for in the legislative election?

Party of Regions - 29.5%(Aug) 31.0%(Jun)

Yulia Tymoshenko Bloc - 18.3%(Aug) 15.0%(Jun)

People’s Union-Our Ukraine - 14.0%(Aug) 14.3%(Jun)

Communist Party of Ukraine - 3.6%(Aug) 4.1%(Jun)

Volodymyr Lytvyn Bloc - 2.1%(Aug) n.a.(Jun)

Socialist Party of Ukraine - 0.9%(Aug) 1.7%(Jun)

Methodology: Interviews with 2,000 Ukrainian adults, conducted from Aug. 9 to Aug. 19, 2007. Margin of error is 2.2 per cent.

Source: Angus Reid

Saturday, August 25, 2007

Ukraine's Delicate Balance

KIEV, Ukraine -- Ukrainian Finance Minister Mykola Azarov says people want a fairy tale, but real economic change will take a long-term united effort. Ukraine has been lurching from one political crisis to another since the so-called Orange Revolution of late 2004.

Mykola Azarov

On Sept. 30, voters will head to the polls yet again in an attempt to resolve a protracted power struggle between President Viktor Yushchenko and his former presidential rival Viktor Yanukovych, who has been Prime Minister for a year.

Yet despite the political standoff, Ukraine's economy is doing surprisingly well.

BusinessWeek's Moscow bureau chief Jason Bush asked Ukrainian Finance Minister Mykola Azarov, a close ally of Yanukovych, to explain the disconnect between his country's unstable political situation and its impressive economic performance. Here are edited excerpts.

How is the economic situation in Ukraine? Should foreign investors be interested in this country?

Our government has worked for about a year. In that time we've been able to restore the growth rate of the economy. GDP [gross domestic product] has risen by 8% over the first six months [of 2007]. Inflation was about 4%. Investment has increased by 30%. Exports have risen by around 34%. So I think the economy is developing quite well. Of course, it could probably work even more effectively if it weren't for the political crisis that was provoked by the President's decision to dissolve parliament [earlier this year]. It was an absolutely unprovoked decision, which has effectively brought structural reforms to a standstill. It puts future rapid economic growth in doubt.

Why is the economy developing so well despite the political situation?

You know, the economy is operating under inertia. It has developed a certain momentum, and political instability doesn't particularly affect it. But maybe without the political crisis we'd have growth of 12% or 13%. The main thing is that the political crisis has interrupted structural reforms: pension reform, tax reform, judicial reform, which Ukraine badly needs as a post-Soviet state.

What are the general principles of this government's economic policy?

Our principles are, first of all, the creation of an innovative economic model. The global economy is based more and more on services, and high technology. We have to restructure our typical industrial economy into a post-industrial economy, a knowledge economy. We have to speed up economic growth because Ukraine is significantly behind in economic development. Our annual GDP per capita is only $3,000. It's very low. We have to reach $30,000. So we have to increase GDP by 10 times. And you can't produce 10 times more steel, or 10 times more wheat. So we have to change the structure of the economy.

What is the external economic policy? How important are relations with the West or with Russia?

Our government has taken very serious steps to enter the World Trade Organization. We are supporters of a liberal and open economy. We haven't just made declarations, we have taken real steps. We're in favor of very good relations with both the East and the West. We don't see any contradictions here. It's strategically important for us to have good relations with both Russia and the European Union.

How do people of this government regard the Orange Revolution?

It's a kind of paradox that the people who were opposed to Yushchenko are now back in government. The events known as the Orange Revolution were an entirely natural attempt by people to achieve justice. It reflected the people's aspirations for a more honest and more just government, capable of fulfilling the promises that were generously offered by the leaders of the so-called Orange Revolution. [But] there wasn't a revolution because nothing changed. There were no reforms carried out by the leaders who came to power, and people were very quickly disillusioned. Of course, you can't say there hasn't been progress. If you compare the situation today to 10 years ago, the progress is absolutely obvious. But it isn't fast enough to satisfy people. People want rapid results. The economy doesn't work like that.

What will be the way out of this political situation? Will a compromise be found?

No, I don't think the elections will solve anything. The same configuration of political forces will be repeated. The last elections were only a year ago. How much can change in one year? It means the confrontation will continue, because I don't see any constructive forces that will work with us to carry out reforms. We have a Ukrainian fairy tale: If you lay out the table cloth, all the food will appear on it [by magic]. It reflects the mentality of our people. If we want to catch up with Europe, we have to understand that it's a very long and difficult path, requiring the united efforts of our society and of our political elite. If someday we manage that, Ukraine is [destined] to succeed.

Source: Business Week

Friday, August 24, 2007

Ukraine Marks Independence Day

KIEV, Ukraine -- Honor guards marched across a main Kiev square, bells tolled and religious leaders led prayers for the country Friday as Ukraine marked the 16th anniversary of its independence from the Soviet Union.

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Scenes from Kiev's Independence Square

President Viktor Yushchenko called for unity ahead of next month's parliamentary elections, which come as the country faces continuing political turmoil and sparring among major parties.

"Tens and hundreds of years will pass but this day will always be a triumph of our freedom," Yushchenko said in his speech, as several hundred people _ some clad in traditional peasant-style shirts and skirts _ waved blue-and-yellow flags in front of Kiev's landmark St. Sofia Cathedral.

Yushchenko also signaled he would seek to push new constitutional amendments on the distribution of political power.

Constitutional changes that went into effect last year watered down presidential powers in favor of the prime minister and Yushchenko has sought to reverse that.

Ukrainian lawmakers declared independence on Aug. 24, 1991, days after the hard-line Communist coup against Soviet President Mikhail Gorbachev failed.

More than 90 percent of Ukrainians approved the decision in a referendum that December, when the Soviet Union officially ceased to exist.

Source: Washington Post

Thursday, August 23, 2007

Deja Vu For Ukraine Voters, Who Face Fourth National Election In 3 Years

KIEV, Ukraine -- In some countries, the joke here goes, the national spectator sport is soccer or tennis. In Ukraine it is elections.

Ballots from one of the last Ukraine elections. The September 30 election ballot will be about one meter (3.3 feet) long.

Ballot-weary Ukrainians trudge to voting booths yet again next month, this time to vote for parliamentary candidates, the nation's fourth national ballot in less than three years.

But judging by the polls, the vote may do little to resolve the nation's seemingly permanent political crisis.

All that is new, perhaps, is that candidates are focusing on everyday issues — poverty, corruption, and potholes — rather than in previous elections, where the main issues were culture wars over whether Ukraine should strengthen historic ties to Russia or build new ones with the West.

The Western-leaning president Viktor Yushchenko called for the Sept. 30 early election, hoping to end a marathon power struggle with his archrival, Prime Minister Viktor Yanukovych, seen as more sympathetic to Russia.

But the vote seems unlikely to shift the balance of power and resolve the key issue of who is in charge in this former Soviet republic of 47 million people.

"These elections are an extension of the battle for power between the president and the prime minister and the various groups they represent," said Ivan Lozowy, president of the Kiev-based Institute of Statehood and Democracy. "I don't see these elections settling the disputes for the simple reason that the results won't be terribly different from what they were a year and a half ago."

The coalition government consists of Yanukovych's big business party, the communists and the socialists.

Yulia Tymoshenko, a former prime minister and leader of the opposition, has compared it to a male rabbit trying to mate with a male squirrel in hopes of having a baby.

Polls suggest all three major parties could win about the same number of seats as in March 2006. If so, the main question will be what a new coalition government might look like.

The Party of Regions, led by Yanukovych, seems poised to repeat its 2006 victory.

Then, the prime minister staged a remarkable comeback after his defeat in the 2004, when he saw the mass protests of the Orange Revolution overturn his earlier disputed election victory.

The bloc chaired by Tymoshenko, an important leader of the Orange Revolution, is expected to finish second.

Polls predict the Yushchenko bloc, Our Ukraine-People's Self Defense, will finish third.

If Yushchenko's and Tymoshenko's parties try to form a government, their coalition seems likely to be riven by the same disputes that caused Yushchenko to accuse Tymoshenko of corruption and incompetence and fire her as prime Minster in 2005.

A cabinet made up of Prime Minister Yanukovych's and Yushchenko's supporters, meanwhile, could erupt into the same tug of war between the two leaders that led to this early vote in the first place.

If minor parties win few seats in the new parliament, Yanukovych could win a majority in the 450-member Verkhovna Rada.

But even that would be unlikely to resolve the deadlock, since President Yushchenko could still thwart Yanukovych through presidential decrees and his right to appoint several key ministers and regional leaders.

During the Orange Revolution, Ukrainians were obsessed with the political drama being played out on the streets of Kiev.

Today, many are disillusioned with politics.

Many say they would prefer that their leaders settle their differences and start to try solving some of the country's problems.

Despite a booming economy — seven percent growth is forecast for this year — many Ukrainians are struggling to make ends meet.

The average monthly wage of $258 (€190) is four times lower than in neighboring Poland and up to 10 times lower than in western European countries.

Corruption is endemic.

Traffic police often take bribes instead of issuing tickets.

Members of parliament and senior judges have been accused of selling their votes on key bills and cases.

Meanwhile, the country's highways, railroads and gas pipelines are decrepit, leading to frequent pipeline explosions and train derailments.

Hospital buildings, treasured churches and museums are crumbling.

In previous campaigns, voters split mainly over Ukraine's foreign policy — should it look to the West or Russia?

This time, the candidates are focusing on bread-and-butter issues.

All three parties are offering to raise child support payments to reverse the country's population decline.

This has turned into a virtual auction for votes.

President Yushchenko's party has come out with the highest offer of 12,000 hryvna ($2380 or $1760) for the family's first child.

But Yanukovych has offered more for the second.

With so many politicians making similar promises, voters are, naturally, confused — and uninspired.

"I don't believe anyone; all they do is lie," said Stanyslav Oryshchenko, 19, a management student in Kiev who is undecided whether he will vote at all. "All they care about is stealing as much money as possible for themselves. What happens to ordinary people doesn't interest them."

Mikhail Mishchenko, a sociologist with the Razumkov Center, said that although many voters sound disillusioned, the turnout next month is expected to be large.

A June poll based on answers of 10,956 respondents with a margin of error of 1 percentage point found that 62 percent of voters said they would cast ballots — yet again.

But there are signs of eroding interest in politics.

In March 2006, about 70 percent of voters turned out. In 2004, the turnout was 77 percent.

Those voters who do go to the polls will do so with lowered expectations.

"A significant part of society has become disillusioned with politics," Mishchenko said. "The choice won't be about which political force will best solve my problems, but it will be based on the fact that another political force will be even worse."

Source: International Herald Tribune

Pre-Election Polls Produce Mixed Results, Yulia Could Be Inching Up On Regions

KIEV, Ukraine -- Recent polls show that four parties and blocs are poised to win seats in parliament, with the Party of Regions leading the way.

The charismatic Yulia Tymoshenko on the campaign trail in the Chernivtsi region.

According to results released by FOM-Ukraine on Aug. 22, the Donetsk-heavy Regions would have 203 seats in the 450-member parliament, followed by the oppositionist Yulia Tymoshenko Bloc (Byut) with 126, the pro-presidential Our Ukraine-People’s Self-Defense (OUPSD) with 96 and the Communists with 25.

Combined, Byut and OUPSD would just fall short of creating a majority in the next Rada with 222 seats, according to FOM-Ukraine. The pollsters conceded, however, that at this stage of the election game, the “orange” and “blue” forces have equal chances of forming the next government.

Meanwhile, Kyiv-based investment bank Concorde Capital reported that in recent polls, “the Yulia Tymoshenko Bloc appeared to have closed the gap with the leading Regions Party.” The election update cites findings from three firms that show Regions’ support in the 26-28 percent range and Byut with 20-26 percent of the potential vote. The polls gave OUPSD between 11-15 percent.

In the past three parliamentary elections, Byut has performed better on election day than pre-election polls indicated.

Regions want Rada session

Regions leader Raisa Bohatyriova flexed her party’s political muscle on Aug. 22, saying that she is ready to initiate an extraordinary session of parliament next month. Bohatyriova was the coordinator of the Rada majority comprised of the Regions, Communists and Socialists.

She called upon President Viktor Yushchenko and Our Ukraine to attend the Sept. 4 session and vote on canceling blanket immunity from prosecution for legislators. Opposition political forces have made cancellation of that immunity an election issue.

If Byut and OUPSD refuse to show up in parliament, that will “show to the nation that they are not open and they are manipulating societal moods and ready for everything to be in power,” Bohatyriova said.

Earlier this month, the Regions ignored two orders by Rada chairman and Socialist Party leader Oleksandr Moroz on convening the Rada. Meanwhile, nearly 120 opposition MPs have already resigned their seats in parliament.

Yushchenko has repeatedly expressed his view that the parliament he dissolved earlier this year had no right to convene for session. If Regions pursue such plans, it would set the stage for a tense standoff with the president and opposition groups just weeks ahead of the Sept. 30 vote.

Voting at home

The Kyiv district administrative court ruled that the Central Election Commission (CEC) must specify procedures for voting at home.

On Aug. 13, the CEC decided that a simple declaration from anyone physically disabled is enough to arrange a mobile voting stop. Opposition forces OUPSD and Byut challenged the CEC decision and won on Aug. 20.

The court ruled that the CEC must standardize declarations for voting at home and procedures for verifying information therein. In past elections, votes cast outside of polling stations have been a source of massive fraud. In round two of the 2004 presidential elections, more than a quarter of votes in the entire region of Mykolayiv were home-cast ballots.

Regions’ CEC representative Vladyslav Zabarsky promptly criticized the court’s decision.

“Really, there can be no reason to use voting at home for falsification,” he said, adding that as many as 2 million voters (around 8 percent) may be deprived of their democratic right as a result of the stricter measures.

Meanwhile, OUPSD candidate Mykola Onishchuk said the court decision would prevent 2 million falsified votes.

Meter-long ballots

By Aug. 21, the CEC had registered more than 3,000 candidates from nine parties and blocs for the snap election. But voters may have to choose from as many as 35 parties and blocs when they show up to vote.

CEC member Mykhailo Okhendovsky said that 35 parties and blocs had formally informed the CEC about their conventions. However, only 10 parties and blocs paid the deposit required to run in the race. Okhendovsky said that Aug. 25 would be the last day for the commission to register election participants. In the March 2006 elections, 45 parties and blocs ran for seats in the Rada.

Administrative resource

The Committee of Voters of Ukraine’s (CVU) monitoring report for Aug. 10-20 reiterated its concern over the number of government officials actively involved in the campaign, who have not taken leaves of absence despite having promised to do so.

“Odessa Oblast (Region) state administration head Ivan Plachkov was appointed regional campaign chief for Our Ukraine-People’s Self-Defense and said he has no intention of taking a vacation,” said the report, which mentions similar cases for other political parties.

“We are disturbed by the fact that more than half of regional election headquarters for OUPSD are headed by oblast governors,” said Elena Bondarenko, a candidate for Regions.

“This is administrative resource to the maximum,” she said, adding that governors can influence local law-enforcement officials.

Meanwhile, practically all cabinet ministers are running on various party lists, 18 of whom are candidates for the Party of Regions.

Tymoshenko targeted

The report noted separate incidents of campaign vandalism and “black PR, but these incidents were isolated and were not systemic in nature.”

Election watchdogs in Zaporizhya Region found copies of a 26-page brochure called “Yuliada” that portrays Tymoshenko in a “negative and insulting form.”

The CVU noted that Kyiv city officials showed bias in their decision to take down Byut billboards lining the Paton Bridge in the capital on Aug. 16.

The NGO also said that certain CEC members showed bias in their treatment of electoral law in the issue of Byut’s candidate registration, but pointed out that Byut itself “escalated a conflict that could have been quickly resolved.”

The CVU also said that Byut’s call to hold a simultaneous referendum on Sept. 30 is “impossible according to existing law.” The CEC rejected Byut’s referendum application, which Tymoshenko appears intent on pursuing.

The left

The Communists, who some polls show crossing the 3 percent qualifying barrier, are building their campaign around the premise that the Leninists will form a majority together with the Regions in the next Rada. They’re claiming the next speaker of parliament will be a Marxist and are demanding a referendum of their own – on making Russian the second state language and on NATO membership.

Those two issues are also being championed by ultra-radical leftist Nataliya Vitrenko in the eastern regions. Regions’ Bondarenko said Vitrenko is actively campaigning and accusing Bondarenko’s party of being “traitors” on both issues.

The Regions clearly address both issues in their electoral program, saying that the language issue is subject to approval by the Rada, while NATO membership should be decided via referendum.

Televised debates and hotlines

The NGO encouraged parties and blocs to focus on expert discussions of policy programs and said that “live television debates should be held between the leaders of the four main political forces: Prime Minister Viktor Yanukovych, Tymoshenko, Yushchenko and [Communist Party leader Petro] Symonenko.”

Meanwhile, the SBU state security service has created a special hotline for Kyiv residents to report any violations of electoral rights they may encounter. The phone number provided by the Ukrainian News information agency is (044) 253-1656.

Source: Kyiv Post

Wednesday, August 22, 2007

Ukrainian Independence: Easy Come, Easy Go

KIEV, Ukraine -- Ukraine marks 16 years of independence on August 24th. Although the Cossacks had managed to fight off encroachments on their freedom from Poland, Russia and Turkey for a couple of hundred years, the closest thing Ukrainians had to a modern state before 1991 was a brief, three-year stint following the Bolshevik Revolution.

Fireworks on Independence Day 2006

It took the collapse of the Soviet Union, just as it had taken the downfall of Czarist Russia, for Kyiv to reassert its authority over the lands of Kyivan Rus.

The medieval kingdom on the Dnipro River, which Ukrainians look to as their beginning, was itself on the verge of disintegration before the Mongols leveled it in the 13th century.

For the past 16 years, the country has been given a new lease on life, with connections to European Christendom stronger than ever.

European concepts of freedom, however, differ significantly from the Cossack ideal.

The ability of Ukraine's leaders and people to embrace the former rather than the latter will ultimately be the greatest assurance of their continued independence. So far, the record has been mixed.

One measure of freedom long cherished in the West is freedom of speech.

In the modern world, this primarily equates to an independent media and the ability of private citizens to organize public protests.

Since Viktor Yushchenko became president in 2005, Ukraine has scored high marks in this area.

Promising his people European integration, Yushchenko was swept into power by throngs of street protesters during the country's Orange Revolution.

Not only did Ukrainians express their will in the purest democratic form, but their revolution was more peaceful than many less fateful demonstrations recently held in Europe, such as anti-global rallies.

Ukrainians, in fact, were so proud of their Orange spectacle, that they have taken every opportunity to repeat it ever since.

The lines between the Orange and blue have become blurred, but that doesn't stop politicians of all persuasions from continually trying to re-ignite revolutionary fervor among the masses in their incessant battles with one another.

The result has been record public apathy and the transformation of the capital's public squares into permanent political tent camps.

Ironically, public apathy and obfuscation of issues was a key weapon of Yushchenko's predecessor and Ukraine's second president, Leonid Kuchma.

Controlling the nation's television stations, Kuchma and his supporters could make the most passionate of protests in the capital look like a three-ring circus of malcontents to the majority of the country's citizens sitting in their living rooms in the provinces.

Media that refused to tow the official line were shut down over trumped up violations, while journalists were subject to violence.

Before the Orange Revolution, the rallying cry of the opposition was murdered Ukrainian journalist Georgiy Gongadze, who had published articles critical of Kuchma and his cronies before being found beheaded in late 2000.

Now, Ukraine's media is a lot freer.

Yushchenko himself had his family dragged through the mud by homegrown paparazzi soon after taking office, but reporting remained unfettered.

In fact, as with the street protests, many feel that Ukraine’s better-than-ever media freedom is being abused.

Gone are the days, when television stations received their stories from the presidential administration.

Instead, many journalists still take orders from the highest bidder.

The Cossacks also enjoyed the freedom to serve as mercenaries for one, then another of the great powers that surrounded them.

As a result, they ended up losing all their freedoms.

Already there are signs that the rich and powerful are reining in rambunctious writers. Ukrainian tycoon Rinat Akhmetov has put his money where his mouth is, threatening lawsuits in European courts.

The few Ukrainian media not already owned by an oligarchic clan can barely afford to defend themselves in court.

An independent judiciary, another major pillar of true freedom, is also sorely lacking in Ukraine.

It was the Supreme Court that ensured Yushchenko got a fair chance during his struggle for the presidency in 2004.

Earlier this year, the country’s Constitutional Court showed itself too divided by partisan politics to resolve a legal crisis rooted in that same struggle for power during the Orange Revolution.

It was as if the democratic gains of the street protesters were being slowly eroded.

In fact, rule of law has never existed in Ukraine.

And it’s not just a matter of poorly written legislation and even more poorly paid judges.

The average Ukrainian scoffs at the obligation to pay taxes or even cross the street in the right place.

Call it a legacy of the Cossacks if you like. The net result is the same.

If Ukrainians – its leaders or its people – cannot rule themselves, then someone else will do it for them. Laws are for everyone, and free speech is a responsibility as much as a right.

In the 16th century, Ukraine was surrounded by Muscovy, Poland and the Turkish empire.

There was no place to hide and few allies to depend on for mutual security.

Today, the country is largely sandwiched between the European Union and the remnants of the Soviet Union.

Being strong and thus independent is as important as ever if Kyiv wants to preserve its medieval inheritance.

In addition to a responsible media and working legal system, Ukraine has to equally ensure a free market.

Recent moves by the government of Prime Minister Viktor Yanukovych to restrict grain and gas sales hurt the country’s food and energy security.

Just like the squabbling sons of Yaroslav the Wise, Ukraine’s so-called oligarchs are endangering their own interests and the independence of their country while seeking short-term, selfish goals.

According to a recent poll, only just over 50 percent of Ukrainians consider August 24th a real holiday, while around 42 percent think it's just a day off.

With that kind of attitude, one wonders whether Soviet apologists who accuse the West of engineering the dissolution of the Soviet Union and Ukrainian independence, were right.

According to the same poll, over 67 percent of Ukrainians are proud of being Ukrainian, with only 13 percent saying they would like to emigrate to another country.

This is more encouraging. But patriotism is not enough.

A poll taken in 1600 would have likely produced similar results.

If Ukrainians really value their independence, they would do well to ponder from whence it springs.

The Cossacks were nothing if not fighters, but that didn’t give them a state.

Instead, independence for Ukraine has been the product of external circumstances, a gift without a giver.

Easy come, easy go.

Source: Eurasian Home

Yulia Tymoshenko: Democracy Is Beginning In Ukraine

KIEV, Ukraine -- In a Deutsche Welle interview, Ukrainian opposition leader Yulia Tymoshenko said the current political crisis in Ukraine shows democracy is developing there.

The always beautiful Yulia Tymoshenko

Deutsche Welle: What are Russia's aims when it comes to Ukraine?

Yulia Tymoshenko: Russia is trying to keep Ukraine within its sphere of influence. It's taking advantage of all of Ukraine's historical dependencies to do so, energy dependency among others. And it's using the quarrelling of Ukraine's elites. The longer Russia intends to maintain this system of dependency, the longer our relations won't be able to normalize.

Do you think Russia deals too harshly with its former satellite countries?

All the countries of the former Soviet Union are independent today. They have the right to formulate and to realize their own national interests. I believe it's the wrong tactic if Russia tries, with the help of various instruments, to restrict the freedom of these states.

At the same time, Russia is not alone responsible for how relations develop. Above all, the political leaders and elites in the post-Soviet countries -- who, despite their dependency, still haven't shed the role of vassals and politically and economically subordinate themselves to Russia -- are guilty. I cannot respect such politicians, and I believe that they should leave the political arena. Ukraine needs politicians who strengthen the independence of the country and, at the same time, are in the position to build harmonious, fair and honest relations with neighboring countries.

You say there's a tendency in Russian politics to rekindle expansionism. What role should Ukraine take in the fight against Russian expansionism?

Ukraine's role is important in the field of energy above all. Ukraine is the bridge between the countries that possess lots of resources and the European Union, countries that need those resources. Ukraine is a transit country, and that's why we see our role in the development of numerous transport routes that allow diversification of the supply of energy resources to Europe and to Ukraine. We know that Ukraine can build the necessary transit pipelines for gas -- in addition to the necessary oil pipelines that already exist. We know that we can supply the EU with a large amount of electricity at affordable prices. And Ukraine should be able to carry out this function freely.

Why does your political platform include integration into the European Union and not integration with Russia in the framework of a uniform economic area?

The European countries, especially those of the old Europe, don't want to see Ukraine in the EU soon. At the same time, two-thirds of our country is not prepared to see themselves as part of the authoritarian entities that currently surround Russia. That's why, in the short or mid-term, Ukraine will put things in order and introduce European standards at home, and only then discuss all the possible processes of integration.

Russia is pursuing a tougher foreign policy at the same time as Ukraine is sinking under the weight of internal crises and possesses no consolidated foreign policy line. Aren't you jealous of Russia in this respect?

No, on the contrary, I think that order can come to Ukraine much sooner than to Russia. We are in the midst of a certain amount of chaos, but this chaos is the beginning of a genuine democracy. Sometimes strict order -- which our neighbors have -- is an impediment on the route to harmony within one's own society. And that's why I think many post-Soviet states will soon envy Ukraine. I reckon we need another two or three years to develop our own strategic line and to choose the right direction.

What do you think of Ukraine joining NATO?

Ukraine is quite divided on this question. You can't overlook that when you make policy. That's why the political powers in Ukraine should start a broad discussion about all the world's security systems. Not all politicians are familiar with the work of this or that security system -- let alone the people. That's why all discussion of joining NATO is very speculative. Our parties will take up this discussion, and we are sure that Ukraine can only approach this or that collective security system through a referendum. Whether politicians like it or not, in such strategic questions they should rely on the opinion of the people. Personally, I think Ukraine fits with the European collective security system.

Do you see yourself as president of Ukraine in 2009?

To be honest, I don't see it so narrowly. Not because it would be too small a goal for me, but rather because my thoughts are only directed towards far-reaching changes in Ukraine. From which position I can best bring about these changes depends on the political situation: whether in power as president, prime minister or at the head of the opposition. But the main goal for us is a Ukrainian breakthrough.

Source: Deutsche Welle

Ukrainian Court Rules Investigators Failed To Prove Missile Downed Russian Passenger Jet

KIEV, Ukraine -- Russian investigators failed to prove a Ukrainian missile brought down a Russian passenger jet plane in October 2001, a Ukrainian court said Tuesday in upholding an earlier court ruling.

Ukrainian court rules investigators failed to prove SA-5 missile downed Russian passenger jet.

Four Israeli families had filed the lawsuit seeking compensation after the crash of the Tu-154 jet belonging to Sibir airlines, now called S7, while it was flying from Tel Aviv to the Siberian city of Novosibirsk.

The plane went down in the Black Sea, killing all 66 passengers and 12 crew members aboard.

Investigators from the Interstate Aviation Committee, or IAC, a Moscow-led air safety group linking 12 ex-Soviet republics, later determined that the plane had been unintentionally shot down by a missile fired by Ukrainian forces during military exercises on the Crimean Peninsula, which juts into the sea.

But Kiev's Appeals Court rejected the Israeli families' appeal, upholding a lower court's January ruling that the agency's findings did not support its determination.

The plane was carrying mostly Russian-born Israeli immigrants headed back to Russia to visit relatives. The four Israeli families were seeking US$1.1 million (¤820,000) each from the Ukrainian government.

The court decision challenges the account of the crash widely accepted in Russia, and could anger Moscow, which dominates the IAC.

The group investigated the accident on Russia's behalf.

The court, which did not consider what caused the crash, has several days to release an explanation for its ruling.

But a lawyer representing the Ukrainian government asserted that the plane was not downed by a missile.

«It couldn't have been that missile,» Andriy Kozlov told The Associated Press.

Kozlov said the IAC's conclusions were rife with errors, contradictions and severe procedural violations.

He said its documents contain discrepancies ranging from several seconds to one minute about the exact time the missile was fired and about its subsequent movement.

In court, he also said that Russian investigators miscalculated the distance the missile would have covered based on the average speed of such missiles.

The IAC report also contradicted itself with some documents saying the plane was destroyed in the air, while others said the plane broke apart after hitting the water, Kozlov told AP.

Some materials indicated that «control over the missile had been lost,» while elsewhere the report said «surveillance of the plane was performed by radar until the moment the missile initiated its explosive mechanism,» according to the lawyer.

«We don't know what brought the plane down,» he said. «It was the job of the investigators and special services to find out what really exactly happened.

Unfortunately, they failed.

Kozlov said some victims' bodies contained small metal balls that resemble those of the missile payload, but no floating components or other traces of the missile were found at the crash site.

He said the balls could have been taken from other sources and used in any explosive device.

Ukrainian investigators determined that the metal balls used in such missile payloads are usually identical to one another, while the balls found at the crash site were varied, suggesting no such missile was involved, Kozlov said.

An S-200, also known as SA-5, a large surface-to-air missile built to shoot down aerial targets, in particular heavy bombers and AVACS planes flying at high altitudes, was fired during the exercise just minutes before the plane went down.

Such missiles work by exploding near the target and riddling it with shrapnel.

The IAC investigators had concluded that an explosion took place about 50 feet (15 meters) above the plane and 5 feet (1.5 meters) to the left of its tail, but some fragments of the plane indicated the blast rocked the jet from within, while the bodies of passengers sitting in the back of the plane had wounds going from right to left as well as frontal wounds, Kozlov said.

Ukraine first denied that its missile was involved, and Russian officials initially said they trusted their Ukrainian colleagues, while investigators focused on the possibility of a terrorist attack.

But then Moscow shifted tack, with Russian President Vladimir Putin saying he considered the proof offered by Ukrainian officials inadequate.

Ukraine later conceded that its military was involved in the accident, and paid families US $200,000 for each victim.

Some Israeli families, however, did not accept the compensation and filed the suit.

Representatives of the families did not attend Tuesday's hearing.

A separate lawsuit against the Ukrainian government, filed by S7 airlines, is still being considered.

Source: PR Inside

Tuesday, August 21, 2007

Ukraine's Communists Open Museum For U.S. Imperialism Victims

SIMFEROPOL, Ukraine -- Ukraine's Communists opened Tuesday a makeshift museum to victims of U.S. imperialism in the central square of Simferopol in the Crimea, as a riposte to anti-Soviet memorials in Kiev and Washington.

A Communist museum to US Imperialism - must be a joke.

Communist Party leader Leonid Grach said the new museum, housed in a marquee, "Is our response to George Bush, who opened the Victims of Communism Memorial in Washington, and to [pro-Western Ukrainian President] Viktor Yushchenko, who initiated the construction of the Museum of Soviet occupation in Kiev."

The new exhibition features photographs, maps, and copies of documents showing crimes against humanity in the United States, from massacres of Native Americans to slavery, racism and lynch law.

The museum also highlights U.S. military interventions in foreign countries, including Vietnam, Cuba, Yugoslavia, Afghanistan and Iraq, and displays photographs showing U.S. violence in the countries, and documents illustrating the large numbers of fatalities.

Grach earlier said he hoped the initiative to set up the museum in the Russian-speaking Crimea, where support for the country's pro-Western President Viktor Yushchenko is low, would be backed by other regional Communist branches.

Plans to set up the museum in the ex-Soviet country were announced after the Victims of Communism Memorial was opened in Washington on July 12.

The dedication ceremony, at which U.S. President George W. Bush compared Communists to terrorists and blamed the ideology for the deaths of 100 million innocent people, also provoked the ire of China.

The Crimean museum is open 24 hours, and a mobile exhibition will later tour the peninsula's main cities.

Source: RIA Novosti

Monday, August 20, 2007

EBRD Supports Municipal Transport In Ukraine

LONDON, England -- In its first long-term financing for municipal transport in Ukraine, the European Bank for Reconstruction and Development is providing €100 million ($135 million) to municipal transport companies Kyiv Metropolitan (metro) and Kyiv Pastrans (buses and trolleybuses).

Kiev Metro station "Zoloti Vorota"

A €40 million loan to Kyiv Metropolitan will finance up to 15 new metro trains, which will operate on the Syretsko-Pecherska Line, while a €60 million loan to Kyiv Pastrans will finance up to 225 new trolley-buses and up to 125 diesel buses and associated infrastructure.

40 per cent of each loan will be syndicated to commercial banks DEPFA Investment Bank Ltd, Dexia Crédit Local Dublin Branch and HYPO Investmentbank AG.

In the rapidly growing Ukrainian capital with 2.7 million residents, the financing should significantly improve efficiency and overall quality of local transport, stressed Kamen Zahariev, EBRD Director for Ukraine.

According to him, with this transaction EBRD continues to support environmentally clean and sustainable public transport alternatives to increased private car usage.

“The project builds on the EBRD’s expertise in structuring new infrastructure projects in partnership with municipalities, providing an example that other financially sound transport companies and municipalities in Ukraine and the region can follow”, said Oxana Selska, EBRD Senior Banker.

Technical co-operation funds, provided by the governments of France and Italy, have been used to help the companies to prepare technical feasibility studies, develop long-term business plans, conduct financial audits and develop pilot public service contracts between the city and the companies.

Such contracts will be instrumental in helping to establish a transparent structure and in fostering the development of new standards for the provision of public transport.

Additional technical co-operation advice will be provided to the City on electronic ticketing system.

Leonid Chernovetsky, Mayor of Kyiv, said the city’s strong economy is a result of good local businesses and growing foreign investment, and to boost this further, the City needs to improve local transport infrastructure.

“The EBRD has a good reputation for working with local municipalities in Central and Eastern Europe, and we want to build on that to achieve our objectives”, he added.

The European Bank for Reconstruction and Development is the biggest financial investor in Ukraine.

As of the end June 2007 it had committed over €2.9 billion through more than 140 projects.

Source: Infrasite News

PepsiAmericas and PepsiCo Complete Joint Acquisition Of Leading Juice Company In Ukraine

PURCHASE, NY -- PepsiAmericas, Inc. and PepsiCo today announced that they have completed the joint purchase of 80 percent of Sandora, LLC, the leading juice company in Ukraine.


The joint venture expects to acquire the remaining 20 percent interest in Sandora in November 2007.

“We’re excited to extend our strong partnership with PepsiCo and begin working with the Sandora team and its market-leading brands to capture the growth opportunity in Ukraine,” said Robert C. Pohlad, Chairman and Chief Executive Officer of PepsiAmericas. “We have a clear strategy to grow and expand our international business and Sandora is a great fit, providing immediate scale in a high growth market.”

“We now serve consumers in over 10 countries in Central and Eastern Europe, in both developing and emerging markets. Combined with our scale and profitability in the U.S., we have a balanced portfolio of markets that position us well for long term sustainable growth.”

As previously announced, PepsiAmericas expects the acquisition to be $0.02 to $0.03 dilutive in 2007. This is included in its previously announced full year earnings per share outlook. The Sandora transaction is expected to add approximately 4 percentage points to volume, lower net pricing by 2 points and cost of goods sold per unit by 1 point, while adding a point to selling, delivery and administrative expenses.

The company forecasts that Sandora will add an estimated 1 percentage point to operating profits, driving estimated reported operating profit growth to 15 to 18 percent.

This operating income contribution in 2007 will be offset by higher related interest expense and the minority interest recorded primarily for PepsiCo’s 40 percent interest in the joint venture.

PepsiAmericas will consolidate the joint venture into its financial results.

The transaction is not expected to have an impact on PepsiCo's previously announced earnings per share guidance for 2007.

Sandora has established itself as the leader in the high growth juice category with a range of distinctly positioned brands that represent approximately half of the total juice volume consumed in Ukraine.

With over 3,500 employees, Sandora has a powerful sales and distribution organization and two modern production facilities located in Nikolaev.

PepsiAmericas is the world’s second-largest anchor bottler in the Pepsi system and in the U.S. serves a significant portion of a 19 state region, primarily in the Midwest.

Outside the U.S., the company has operations in Europe and Caribbean, specifically in Poland, Hungary, the Czech Republic, the Republic of Slovakia, Romania, Ukraine, Puerto Rico, Jamaica, the Bahamas, and Trinidad and Tobago.

The company also has distribution rights in Moldova, Estonia, Latvia, Lithuania and Barbados.

The company serves areas with a total population of more than 150 million people.

PepsiAmericas manufactures, distributes and markets a broad portfolio of PepsiCo and other national and regional beverage brands.

PepsiCo is one of the world’s largest food and beverage companies, with 2006 annual revenues of more than $35 billion.

The Company employs approximately 168,000 people worldwide, and its products are sold in approximately 200 countries.

Its principal businesses include: Frito-Lay snacks, Pepsi-Cola beverages, Gatorade sports drinks, Tropicana juices and Quaker foods.

The PepsiCo portfolio includes 17 brands that generate $1 billion or more each in annual retail sales.

PepsiCo’s commitment to sustainable growth, defined as Performance with Purpose, is focused on generating healthy financial returns while giving back to communities the company serves.

This includes meeting consumer needs for a spectrum of convenient foods and beverages, reducing the company’s impact on the environment through water, energy and packaging initiatives, and supporting its employees through a diverse and inclusive culture that recruits and retains world-class talent.

Source: Business Wire

UKRAINE: Election Set to Bring Another Crisis

BUDAPEST, Hungary -- The political crisis that has ravaged Ukraine since President Viktor Yushchenko decided to dissolve parliament is not likely to end with the early elections scheduled for Sep. 30.

Viktor Yushchenko

On Apr. 2 President Yushchenko issued a decree dissolving parliament and calling for fresh parliamentary elections, which was disobeyed by the pro-governmental majority.

The President claimed the government was usurping power after some opposition parliamentarians moved to the ruling coalition.

The number of pro-government deputies was getting dangerously close to 300, and that would be enough to make constitutional changes that could weaken the President's power and set aside any presidential veto.

With both sides feeling that the slightest concession to the opponent meant a public admission of guilt, finding a compromise became a daunting task.

Prime Minister Viktor Yanukovich and the President bickered for weeks over the legality of their actions, and even over the loyalty of Ukraine's uniformed agencies, creating widespread fears of a violent escalation of events.

Unlike on previous occasions, both the West and Russia refrained from intervening in Ukraine's domestic affairs, opting to adopt the stance that the post-Soviet republic should sort out its own problems.

Yushchenko's decree raised many eyebrows among legal experts, and the country's Supreme Court was expected to rule against him.

Repeated dismissals of judges by the President, and what the head of the Ukrainian Supreme Court Vasyl Onopenko termed as "unprecedented pressure", presumably from both sides of the conflict, contributed to paralysing the court's procedures.

Nevertheless, Yanukovich was likely to accept the early election anyway, using it as an extra trump card in negotiations with the opposition.

While the May 27 agreement to hold an early election in September is a victory for the national-liberal opposition, the date of the election is to the ruling Party of the Regions' liking.

The government will have time to increase its support ratings by raising pensions and the minimum wage.

"The Party of the Regions agreed to the election because they think they can play this game and win even more votes," Ivan Presniakov, political analyst at the Kiev-based International Centre for Policy Studies told IPS.

On Jun. 27 Yushchenko temporarily agreed to suspend his decree dissolving parliament to allow deputies to approve amendments to the election law which are needed to conduct the elections.

After the session one-third of the members of parliament gave up their mandate, giving Yushchenko legal grounds to sign a fourth decree dissolving parliament on Aug. 1 and legitimising the upcoming election.

Experts have, however, warned that inconsistencies in the law will provide fertile ground for any losing force to contest the election result, something which populist opposition leader Yuliya Tymoshenko, leader of the bloc named after her, has already begun to suggest.

Ukrainian politics remains shady and closed, and the multitude of behind-the-stage deals and possible alliances are the subject of constant and often contradictory speculation by Ukrainian journalists and pundits.

The uncertainty over the election outcome and the similar support rates of both sides gives strength to the idea that more important than a few more votes will be the coalition-forming negotiations.

The Party of the Regions will run on its own, but leaving open the possibility of re-enacting the coalition if communists, socialists or both make it into parliament.

Much of the Ukrainian media has speculated on dissension within the ruling Party of the Regions, but the recent publication of the Party's list did not indicate any significant power loss for Yanukovich, who was also confirmed as the Prime Minister candidate for the party.

A grand coalition has also not been excluded by Yanukovich's party, which is striving to be seen as a mainstream pro-European force, and has to cope with the socialists loss of popularity and the communists' radical demand of eliminating the presidency altogether.

But so far opposition forces are dismissing a joint cabinet with elements of the current government. The question in the 'orange' liberal camp backed by Yushchenko remains which party will put forward the Prime Minister candidate in case of victory.

Yuliya Tymoshenko's bloc is expected to take the biggest chunk of opposition votes, but Yushchenko's Our Ukraine Party has strengthened its support base by joining forces with the People's Self-Defence bloc, a popular movement set up by former interior minister Yuriy Lutsenko.

Moreover, pro-presidential forces are hoping that thanks to the President's recent bold steps, Tymoshenko can be outplayed by presenting an "image of a strong President who is struggling against Yanukovich, which is also a good start for his presidential campaign in 2009," Presniakov told IPS.

In the meantime, the public continues to grow cynical as the idealism of past years fades away. Ukrainian media speculates that television channels might refuse to allow key political figures to debate on television, and instead expose their populist tendencies.

Some claim that behind the ideological battle lie purely economic interests. Kost Bondarenko, a Ukrainian political analyst, wrote in the local media that "it is precisely the economic factor that was definitive in sparking the crisis" after the government prevented the 'orange' side from benefiting from privatisation deals.

Still, in Presniakov's view, "there is no single reason for the conflict; on all sides there are different people with different goals and incentives. The structural conflict between the Prime Minister and the President is more important."

The existence of a structural political problem has been admitted by all main sides in the political conflict, and there is relative consensus on the need for a new constitution.

The opposition and the pro-presidential forces want to introduce a binding mandate in parliament to avoid future desertions, whereas the Party of the Regions would like to see the new constitution envisaging that only parliament, and not the President can initiate the legislative branch's dissolution.

Both sides have also suggested that high-ranking officials should be stripped of immunity.

There is no unanimity on how and when to approve a new document, but Tymoshenko is demanding a referendum on the same day as the elections, and is collecting signatures in support of the idea.

Nobody will be surprised if Ukrainian politicians fail to agree once again.

Source: Inter Press Service

Sunday, August 19, 2007

Magazines Turn To Ukrainian

KIEV, Ukraine -- Responding to growing public demand for Ukrainian-language publications, KP Media, a major player on the Ukrainian print media market, has been forging ahead with plans to introduce Ukrainian-language magazines into a market long dominated by Russian-language publications.

Olga Kryzhanovska, the chief editor of the soon-to-be-launched Ukrainian-language news magazine Novynar.

KP Media, which publishes the Kyiv Post, currently boasts a portfolio of more than a dozen print titles and around the same number of top-rated websites, giving it around a 15 percent share of the print market and an estimated 50 percent share of the Internet market in Ukraine, according to an April equity research report by Kyiv-based investment bank Dragon Capital.

KP Media’s Pani, Ukraine’s first weekly Ukrainian-language women’s magazine, has enjoyed considerable success since its launch earlier this year, particularly in the Ukrainian-speaking western regions of the country, according to the company.

KP Media invested more than $1 million into the launch of Pani and plans to introduce to the market a total of four more Ukrainian-language print and Internet projects this year.

“For September, we plan to launch Novynar, a Ukrainian-language news weekly, and Vona, a women’s monthly. We believe that these will be top 20 magazines in Ukraine,” said KP Media director Jed Sunden.

Plans also call for the launch of the first instant messenger with a Ukrainian interface, BigmirICQ, and Novynar.com.ua, the Ukrainian-language web version of the new news magazine.

“This is a huge market which has been traditionally underrepresented in terms of publications and Internet projects focused on them,” said Sunden.

“We believe Ukraine is a bilingual country. Whether it is 60-40 [percent] Russian or 50-50 Ukrainian, we notice there is a huge untapped market at present,” he added.

According to the Dragon Capital report, KP Media plans to boost its 2007 sales 70 percent year-on-year to $24.7 million through the expansion of its print-title portfolio, the launch of new revenue-generating websites and continued strong organic growth.

New print projects are expected to generate $5 million of total sales revenues this year.

Advertising revenues accounted for 74 percent of KP Media’s sales in 2006 and are set to remain a vital revenue source for the company in the coming years, the Dragon report said.

The company’s core market segment, print publications, attracted $169 million from advertisers in 2006, or 23 percent of the Ukrainian advertising market for that year.

The Dragon report forecast $217 million in advertising revenues for KP Media in 2007, an annual increase of 28 percent.

Concorde Capital, another Kyiv-based investment bank, reported in its daily newsletter Aug. 7 that KP Media saw 46 percent year-on-year growth in second quarter revenues this year to nearly $4.7 million.

“While revenues from publishing grew by around 40 percent, those from Internet projects surged by 115 percent to $750,000. KP hopes for further growth in revenues from the Internet segment in the third quarter of this year, as its Bigmir.net website has reached a strategic agreement with Google to upgrade its email, search and AdSense advertising placement program,” the Concorde Capital report said.

Quality counts

Merely churning out new titles, however, may not satisfy the growing demand for Ukrainian-language publications on the market if the quality of the language itself is poor, according to Viktor Luhovyk, one of the analysts who carried out market research for Dragon’s April KP Media report.

“A lot will depend on the quality of such titles in terms of both editorial and language,” Luhovyk said.

“At present, a number of local Russian-language newspapers and magazines produce Ukrainian duplicates, but the quality of translated text in these publications is low and therefore discourages people who would prefer to read in Ukrainian, such as myself,” he said.

“Therefore, an original, creative and clever Ukrainian-language publication can be successful, but its success will be limited as long as a majority of the population in large cities prefers to use Russian and the distribution network outside large urban areas remains underdeveloped.”

Olga Kryzhanovska, the chief editor of the soon-to-be-launched Novynar, said that the publication of such titles as Novynar represents an important development for Ukraine.

“For years KP Media has been getting letters from readers who were asking it to launch a Ukrainian-language news publication. Really, isn’t it strange that 16 years after [Ukraine] declaring independence, there are so few Ukrainian-language publications on a national scale in Ukraine,” Kryzhanovska asked rhetorically.

Kryzhanovska said that while around 67 percent of Ukrainians consider Ukrainian their native language, newspapers and magazines in Ukraine have largely ignored the needs of this segment of the population.

She said that the Ukrainian-language media market is characterized by a considerable lack of quality publications.

“We hope that with the launch of new magazines we can somewhat fix this unbalance. Novynar will continue the tradition of impartial, balanced reporting that had been started by other publications of KP Media,” said Kryzhanovska, who worked as a journalist at KP Media’s anchor publication, the Kyiv Post, before moving on to an editing position with the company’s highly popular Russian-language news magazine Korrespondent.

Kryzhanovska said she hoped other publishing companies would follow suit, launching Ukrainian-language publications of their own, which “should put an end to the [feeling of] inferiority of Ukrainian-speaking readers to Russian-speaking readers.”

More market growth expected

Inna Kovtun, the chief editor of one of Ukraine’s most popular Russian-language business publications, Delovaya Stolitsa, said that Delovaya Stolitsa has considered publishing a Ukrainian-language version of the magazine, but added that the possible payback for such a publication would not be immediate.

Kovtun said that with the economic standing of Ukrainian speakers improving in the western and central regions of the country, advertisers were becoming more interested in those segments of the population.

“Besides, the western Ukrainian audience has always read more, which is why new [Ukrainian-language] projects have a future, especially in the social, political and entertainment segments,” she said.

Currently leading the print segment by advertising revenues are women’s magazines, general news and business publications, as well as entertainment titles, “which together account for more than half of total print adspend,” according to Dragon Capital.

Dragon said that the Ukrainian newspaper and magazine market would benefit from continued regional growth, as local consumer-oriented companies, such as banks, cellular operators and retail chains expand their networks nationwide, “which should be reflected in their advertising budgets.”

According to Dragon Capital, KP Media is Ukraine’s only stock-listed media company and the only Ukrainian publisher to date to have successfully integrated Internet-based products in its portfolio.

KP Media is a holding company that owns a 100 percent interest in KP Advertising, KP Publications, BigMir Internet, and Omega, and is a 49 percent partner in Formax Publications.

Source: Kyiv Post