Quotable notes

The dispute that recently erupted between Moscow and Kiev [sic] over Russian natural gas prices was a trying test of our political maturity. Corporate players threatened our sovereignty, economic independence and freedom.

We could have contributed to the rising tensions by pursuing court action to assert our contractual rights. Under the terms of an existing agreement signed in 2004 between our national gas companies, prices had been fixed until 2009.

However, we were troubled by the fact that Gazprom's unilateral decision to reduce gas deliveries to Ukraine also led to a loss of gas pressure in our pipelines to the rest of Europe. Instead of escalating the conflict we therefore sought to settle the differences with Moscow and allay the fears of both Ukrainian and European citizens. ...

Together with Russia's President Vladimir Putin, we were able to find a workable formula for the transport of Russian natural gas to European consumers. As was our strategic goal from the outset, the deal was based on mutual respect for national interests and market pricing.

For Ukraine, the compromise has several advantages. First, unlike in our neighboring countries - where Gazprom has taken control of the national gas pipelines - our strategic gas pipelines remain Ukrainian property.

Second, and maybe most importantly, the compromise finally introduces cash payments to our international gas trade, ending the murky Russian-Ukrainian barter operations for energy supplies. ...

For 14 years, though, international barter settlements had cost Ukraine hundreds of strategic assets such as factories, shipping vessels and other enterprises, which had been used as payment for Russian (and Turkmen) gas supplies. The practice of forfeiting strategic assets had fueled cronyism and corruption, enriching a few oligarchs at the expense of the rest of the nation. This intolerable practice has finally ended. ...

- President Viktor Yushchenko, writing in the January 25 issue of the Wall Street Journal (Europe).

Copyright © The Ukrainian Weekly, January 29, 2006, No. 5, Vol. LXXIV

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