NEWSBRIEFS (07/25/99)

NEWSBRIEFS

U.S. and Ukraine to hold naval exercise

KYIV - Ukraine is holding a naval exercise with the United States in the Mediterranean Sea on July 21-24. The U.S. Embassy in Kyiv said the exercise is part of the NATO-sponsored Partnership for Peace program, which aims to foster ties between the nations of the former Communist bloc and the Western military alliance without offering security guarantees. Ukraine is an active member of the program, but has taken a go-slow approach to seeking full membership. (Eastern Economist)

Rada continues to kill Kuchma's bills

KYIV - Lawmakers on July 13 turned down President Leonid Kuchma's amendments to the law on value-added tax, InfoBank reported. Mr. Kuchma proposed that VAT rates for resold goods and services be determined by the original purchase price, not the sale price, arguing that the provision would generate more budget revenues. The same day, the Verkhovna Rada rejected a presidential bill on tax privileges for newly created small businesses. Intelnews reported that the Parliament also failed to ratify a Polish-Ukrainian agreement on a $20 million credit line offered by Poland last year. The loan was intended to finance joint economic projects, in particular manufacturing Polish Bizon grain harvesters in Kharkiv and Kovel. (RFE/RL Newsline)

Ukraine to pay overdue bond in full

KYIV - The Finance Ministry announced on July 14 that Ukraine will pay an overdue $155 million bond to the Dutch-based ING Barings bank on August 2. The sides agreed that Ukraine will make another issue of Eurobonds, nominated in German marks, to raise the money to meet the debt. The bonds are to be sold to a group of investors selected by both the government and ING Barings. The Cabinet of Ministers spent more than a month trying to persuade ING Barings to allow it to pay off 20 percent of the bond and convert the rest into three-year bonds. The bank did not agree to restructure the debt because it had resold the Ukrainian bond to other investors and would have had to persuade them to reschedule as well, the Associated Press reported. Although Ukrainian officials, financial experts and creditors are optimistic about the deal, the transaction has raised more than a few eyebrows in Western financial circles. "Ukraine claims that ING Barings will help it to launch a new tranche of the 2001 Eurobond, in effect rolling over the Barings note," Stuart Brown, head of fixed income research for Eastern Europe, Africa and the Middle East at Paribas, told the FT. "But I don't see the market having any demand for a reopened Eurobond, especially from a market pariah like Ukraine. If it borrows at such a ridiculous rate, that would just underline the country's fragile situation." (RFE/RL Newsline, Eastern Economist)

Paton: Ukraine scientifically advanced

KYIV - The president of the National Academy of Sciences of Ukraine, Academician Borys Paton, announced on July 14 at a UNESCO-sponsored World Science Conference that Ukraine is still regarded as a scientifically advanced nation. The academy's international role is being increasingly recognized worldwide, therefore it should be "beyond politics," said Dr. Paton. Stanislav Dovhyi, chair of the Verkhovna Rada's Committee for Science and Intellectual Property, addressed the conference on the academy's efforts to appraise intangible assets, to ensure their copyright, and to incorporate them into the statutes of enterprises and organizations. The international conference approved a declaration on science policy based on the following three principles: science for knowledge and knowledge for progress, science for peace, and science for development. (Eastern Economist)

Udovenko climbs Mount Hoverlia

KYIV - On the ninth anniversary of Ukraine's Declaration of State Sovereignty, July 18, presidential contender and Rukh Party leader Hennadii Udovenko took part in the traditional climb up to the country's highest point, Mount Hoverlia (elevation: 2,061 meters) in the Chornohora range of the Carpathian Mountains. The tradition was begun back in 1990 by the Zakarpattia branch of Rukh. (Eastern Economist)

Kuchma stresses friendly relations

KYIV - "There is and can be no alternative to the development of friendly, equal and partner relations between Ukraine and Russia," President Leonid Kuchma told an annual officers' gathering in Kyiv on July 13. He said the countries' mutual understanding has been proven by the continued presence of the Russian Black Sea Fleet on Ukrainian territory and the nearly complete delimitation of the state border. Meanwhile, Moscow's Segodnia newspaper has suggested the Kremlin will publicly question whether the Crimean port of Sevastopol belongs to Ukraine. According to the newspaper, this is a propaganda move intended to make political capital out of Russian sentiments toward Sevastopol and to undercut Moscow Mayor Yurii Luzhkov, who is a staunch campaigner for returning Sevastopol to Russia. (RFE/RL Newsline)

U.S., Poland aid Ukraine's reforms

WARSAW - On July 19 the Polish-American-Ukrainian Cooperation Initiative (PAUCI) approved four projects worth $150,000 to support small and medium-sized business and the restructuring of local government in Ukraine, the PAP news agency and the Associated Press reported. These are the first projects under PAUCI, which was set up in 1998 to make use of Poland's free-market experience and $10 million in U.S. grants for the transformation of the Ukrainian economy. (RFE/RL Newsline)

Two workers exposed to radiation

PRYPIAT - Two workers were exposed to radiation at the Chornobyl nuclear power plant as they carried out safety checks at the plant's only operational reactor on July 17. The workers were using a gamma-ray emitting device to check for radiation leaks when part of the device fell out of its protective container, according to official reports. One worker was exposed to a radiation dose of 9.8 rem (roentgen equivalent in man) and the other to a dose of 8.3 rem. Under Ukrainian safety norms, a dose of 5 rem a year is considered the upper safety limit. A Chornobyl plant spokesman told the Associated Press that the radiation doses received by the workers were "meager." (RFE/RL Newsline)

Ministry reports on unemployment

KYIV - The Labor Ministry announced on July 14 that during the first six months of this year 1,708,600 individuals registered as unemployed persons with the State Employment Service. Currently, 1,485,600 people have "jobless" status, 1.4 times more than in the same six-month period during 1998. The rate of registered unemployment among able-bodied individuals was 3.98 percent as of July 1. The Zakarpattia, Ternopil, Rivne, Sumy, Volyn, Zhytomyr, Lviv, Ivano-Frankivsk and Chernihiv oblasts reported unemployment rates ranging from 5.41 to 7.15 percent. With 1,118,200 unemployed people and 55,200 vacancies registered as of July 1, the average person per vacancy ratio was 20:1. The job category applicant ratio appears as follows: blue-collar jobs at 16:1, white-collar at 20:1, and unskilled at 37:1. (Eastern Economist)

Ukraine prods Kazakstan on launches

KYIV - The president of Ukraine has spoken by telephone with President Nursultan Nazarbayev of Kazakstan, urging him to allow the launch of a Ukrainian-made Zenit rocket with a Ukrainian-Russian research satellite from the Baikonur cosmodrome, Reuters reported on July 13. A week earlier, Kazakstan had banned space launches from the Baikonur cosmodrome after a Russian rocket crashed, supposedly polluting soil and water with toxic fuel. "Each launch of Zenit rockets is a big political issue for us," Reuters quoted President Leonid Kuchma as saying. Ukraine needs a successful launch after a Zenit crashed last September, destroying 12 satellites of the Globalstar consortium. Globalstar has said it wants to see at least one successful Zenit launch before it resumes cooperation with Ukraine. (RFE/RL Newsline)

Kazakstan, Russia reach agreement on

ASTANA, Kazakstan - Following 10 hours of talks on July 14 with Prime Minister Nurlan Balghymbaev and President Nursultan Nazarbaev of Kazakstan, Russian Vice Prime Minister Ilya Klebanov told journalists in Astana that Kazakstan has agreed to a resumption of rocket launches from the Baikonur cosmodrome, with the exception of Proton rockets. In return, Moscow agreed to pay $115 million for the lease of Baikonur, part in cash and part in barter goods, from August through November. The agreement paves the way for the launch of a supply ship to dock with the orbiting Mir space station. (Eastern Economist)

Foreign trade shrinks by 26 percent

KYIV - Ukraine's foreign trade from January to May 1999 totaled $8.8 billion, down by 26 percent from the same five-month period last year, Interfax reported on July 13, citing the State Statistics Committee. The negative trade balance amounted to $236 million or 21.7 percent of the level in the same period last year. The committee attributes this reduction largely to lower prices of Russian gas supplied to pay for gas transit across Ukraine. Russia accounted for 49.3 percent of Ukrainian imports, followed by Turkmenistan (10.5 percent), Germany (6.9 percent), Belarus (2.8 percent) and the U.S. (2.7 percent). (RFE/RL Newsline)

Ukrainian navy visits Haifa

SEVASTOPOL - The frigate Hetman Sahaidachnyi and the command ship Slavutych of the Ukrainian navy arrived in the port of Haifa, Israel, on July 16, and was to remain there until July 20. The Ukrainian expedition commander met with Israeli Navy Commander-in-Chief Rear Admiral Alex Tal and Haifa Mayor Amiram Mitsna on July 18, while Ukrainian officers visited the naval base at Haifa. This is the first visit of a Ukrainian warship to an Israeli port. (Eastern Economist)

Entrepreneur training hailed as success

KYIV - Over 300 entrepreneurs from 10 Ukrainian towns have received training during 1998 in management techniques, enterprise restructuring and attracting foreign funds within the Small Business Development project organized by the State Committee on Entrepreneurship Development. Training was conducted by the Institute of International Business Cooperation and International Center for Entrepreneurship Development, and financed by the United Nations Development Program. "In spite of current high taxation in Ukraine, the entrepreneurs who underwent this training have the chance to operate effectively in Ukraine," said Leonid Kisterskyi, IIBC head. "They deserve the trust of foreign investors." (Eastern Economist)

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