2004: THE YEAR IN REVIEW

In other developments from Ukraine...

Ukraine began 2004 with a focus on the economy as Minister of the Economy and European Integration Valerii Khoroshkovskyi, the political boy wonder who became a national deputy at 29 and a Cabinet minister at 33, resigned his post on January 3. He cited his inability to work in the current government and blamed First Vice Prime Minister Mykola Azarov, who also holds the post of finance minister, with shackling his ability to work successfully by forcing all the government ministries to concentrate their efforts on fulfilling budget requirements rather than on the development of longer term strategies and goals.

"The post of minister of finance in the new government structure has become the dominant one," explained Mr. Khoroshkovskyi in an open letter announcing his departure. He added that the current situation in the Cabinet of Ministers had not allowed the Ministry of the Economy to "properly execute its policies regarding the development of free markets and the need to increase the competitive level of the domestic economy."

Mr. Khoroshkovskyi had waged a political battle over the last year with Mr. Azarov on how to develop the Ukrainian economy. While Mr. Khoroshkovskyi, a Western-oriented businessman who had interests in Mercks Furniture and UkrSocBank, wanted to develop European markets, Mr. Azarov, a remnant of the Soviet era and ex-director of Ukraine's State Tax Administration, believed strong economic ties with Russia were in Ukraine's best interest. Mr. Azarov played a key role in the development of the Single Economic Space, the agreement proposed by Ukraine's President Leonid Kuchma and Russia's President Vladimir Putin, along with the state leaders of Kazakstan and Belarus, to organize their countries into a common market.

Nine days after Mr. Khoroshkovskyi's resignation, President Leonid Kuchma tapped Mykola Derkach to serve as minister of the economy and European integration.

The controversial agreement on the Single Economic Space (SES) comprising Russia, Kazakstan, Belarus and Ukraine was ratified by the Verkhovna Rada on April 20 amid cries from the national democratic opposition that the country could lose its sovereignty in such a setting. The ratification, which occurred as a couple of thousand demonstrators of the treaty protested outside the Rada Building, came in tandem with two other international agreements: the border delimitation agreement between Russia and Ukraine, and the treaty on the Azov Sea and the Kerch Strait. "Today we will surrender the final barricade: sovereignty," warned Yulia Tymoshenko, before the Verkhovna Rada vote during her appeal to the lawmakers not to support the creation of a common market across an extensive portion of the former Soviet Union. The agreement calls for the establishment of a free trade zone in the region in its first stage, followed by the development of a customs union. Eventually Russia would also like to see a single currency for the SES.

National Deputy Viktor Pynzenyk, an economist and a leading member of the Our Ukraine faction, said that contrary to the way the accord had been presented to the public, it was an exclusively political document. "The SES has no relationship to economics, and it will not solve any economic problems, whether those of Russia or Ukraine," he pointed out. He explained that Russia had refuted every attempt on the part of Ukraine to establish a free trade zone for the exchange of non-taxable commodities because it was not in Moscow's interest to do so. The lawmaker said that while Russia had every right to look out for its self interest, Ukraine had to be wary that it didn't lose the ability to control its economy, in effect handing that authority over to Moscow, which the treaty on a Single Economic Space could be interpreted as doing.

Several days later, Presidents Kuchma and Putin met outside of Yalta on Ukraine's Crimean Peninsula to discuss the new economic alignment they had introduced in February several months after Mr. Kuchma had taken over as head of the Commonwealth of Independent States (CIS) from Mr. Putin. Messrs. Putin and Kuchma exchanged the instruments of ratification for the SES treaty on April 23 at the Livadia Palace in Yalta before the beginning of an inter-parliamentary conference between Duma and Verkhovna Rada lawmakers titled, "Ukraine and Russia: The Strategic Partnership." President Kuchma called the exchange of ratification documents "the most important event in the modern history of relations between Ukraine and Russia" - "These are not simply relations within the framework of economic cooperation. We see this as a matter of common, fundamental research and a common policy in the area of science, engineering and technology." The Ukrainian president called for bilateral cooperation in the development of high technology, while Mr. Putin emphasized the need to avoid losing "the ground our countries had gained during Soviet times," according to Interfax-Ukraine.

A month later, on May 24, the presidents of the four states of the former Soviet Union that intend to form a common market, expressed satisfaction with the pace at which the new economic ties were developing. However, little was said about the timetable for the implementation of a free-trade zone, which Ukraine considers the keystone in the development of the trade partnership. Mr. Kuchma, speaking during a press conference in Yalta at the end of a special three-day summit on the SES agreement, said that now that the Parliaments of Ukraine, Russia, Belarus and Kazakstan had ratified the document, it was time to prepare the legal framework. He said that experts were working on some 80 international documents that would be required to make the Single Economic Space a reality. Many of them would need parliamentary approval.

Also in the news, and a subject of controversy, during 2004 was the Odesa-Brody pipeline. On January 28 Ukraine's fuel and energy minister, Serhii Yermilov, said that the consulting firm charged with looking into the most profitable way of running the oil through the transport corridor had done a turnabout and now recommended that the crude should flow westward, as was planned before Russian oil companies began to push their own interests. The energy minister said that an option to reverse the oil flow, as requested by Russian oil giant TNK-BP, also had received consideration, but "it does not rank first." The statement contradicted a preliminary announcement made via a press release on January 15 by Energy Solutions, a little-known firm registered in Ukraine that claimed to be U.S.-based. At that time the firm stated that its initial recommendation would be to support a reverse flow of oil from Brody to Odesa. The decision would allow TNK-BP to move some 9 million tons of Ural heavy crude through the Odesa oil terminal into the Black Sea and on toward southern Europe.

The matter of reversing the direction of oil flowing through the Odesa-Brody tube had become a viable option for some Ukrainian leaders because a year after its completion no major oil company working in the Caspian Basin had signed on to utilize it. Many politicians believed that the TNK-BP proposal to temporarily use Odesa-Brody in reverse for a three-year period while the Caspian Basin oil producers were brought aboard was a good idea. Those opposing the idea said that by allowing TNK-BP use of the line for three years, Ukraine would take itself out of consideration during a time when the transportation routes of Caspian oil would be decided.

In February Ukraine's Cabinet of Ministers approved a recommendation to use the Odesa-Brody oil pipeline in direct mode, ending months of controversy over which way oil should flow in the yet-to-be utilized oil transportation tube. "The direction will be Odesa to Brody," announced First Vice Minister of Energy Andrii Kliuyev after a meeting of the Ukrainian government that unanimously approved the recommendation. TNK-BP, which wielded a fierce political battle to obtain the right to reverse the line, said it was not about to give up its effort. Oleksander Horodetskyi, chief executive officer for TNK-Ukraine, told Interfax-Ukraine that he believed the Ukrainian government decision is a mistake and expressed doubt that Caspian oil would be supplied via the pipeline in the near future.

Later in the year, on July 5, the government of Prime Minister Viktor Yanukovych gave the go-ahead for the reverse use of the Odesa-Brody pipeline, thus rescinding the decision made in February to use the oil transportation pipeline only in the direct mode. Poland, the European Union and the United States officially questioned the purpose and need for again bowing to pressure from a Russian oil company to move oil through the pipeline in a direction not originally intended. UkrTransNafta, the quasi-governmental agency responsible for developing the Odesa-Brody pipeline, announced on July 8 that it would support the new government recommendation, inasmuch as there was no hope of utilizing the oil transportation tube to move oil from the Caspian Basin to Central and Western Europe in the near future.

On August 18, Russia gained exclusive long-term use of Ukraine's oil and gas pipelines to Europe in exchange for canceling an 18 percent tax on the export of gas and oil to Ukraine. Repeal of the oil and gas VAT has been held to be a keystone in the development of a free trade zone in the region, a critical first stage in the development of the SES. President Kuchma had repeatedly stated that without a free trade zone no SES could exist. Mr. Putin called the decision "a milestone in forming a Single Economic Space." The Odesa-Brody pipeline in late September started transporting oil in the reverse direction, from Brody to Odesa, where it was loaded onto oil tankers for transport to Europe via the Dardanelles and the Mediterranean. The first 80,000 tons of Russian oil reached the Pivdennyi Oil Terminal near Odesa on September 28, and the first tankers began to load the next day.

Ukraine's improving business climate made headlines during 2004, especially after the European Business Association on April 27 reported that, while there were still some problems with murky and contradictory legislation, as well as a need for more land ownership rights the country's business climate had improved markedly in the previous two years. Ukraine had managed to attract a paltry $6.6 billion in foreign investment since 1992 - a dismal figure that barely approached the numbers claimed by Ukraine's western neighbor, Poland, which had taken in more than $60 billion in the same period. Foreign businesses may finally have begun to understand where Ukraine lies on the investment map, however. In 2003 the rate of annual capital investment increased by 1.3 times to nearly $1.2 billion. Jorge Intriago, vice-president of the EBA, said that tax reform, anti-trust reform and new civil and commercial codes had greatly improved the stability, predictability and transparency of the Ukrainian market. He explained that he considered these three elements essential for a healthy business environment.

In late June the State Statistics Committee of Ukraine reported that the country's economy continued to sizzle in the first five months of 2004, marking the sixth consecutive year of steady and at times spectacular growth. In January through May 2004 the Ukrainian economy grew 11.3 percent over its energetic expansion from the same period of last year. Inflation, which was at four-digit levels in the early 1990s and remained at around 25 percent as recently as 2000, had dipped to below 10 percent. In 2003 inflation finished the year at 8.2 percent. Government predictions 2004 put the pace of inflation at 5.8 to 6.3 percent. The development of the industrial sector, which grew by 17 percent in the first five months of 2004, continued to drive Ukraine's strengthening economy. The highest production increases were registered in the machine-building industry (36.5 percent) and the pulp and paper sector (32.1 percent). Construction material production rose by 29.9 percent, while the lumber industry expanded by 25.1 percent.

There was more good news in early August when the International Monetary Fund said Ukraine's economic growth in 2004 could reach 12.5 percent. An August 3 statement noted that "buoyant exports and a surge in investment will boost Ukraine's real GDP growth." Meanwhile, the Ukrainian government announced on August 2 that it had raised its own projections from 9.5 percent to 10.5 percent growth in 2004, a figure slightly less optimistic than the one presented by the IMF. "We are observing a qualitative breakthrough. The economy is beginning to develop according to investment and innovation models," explained First Vice Prime Minister Azarov.

Also in August, the controversial newly constructed No. 2 nuclear reactor at Khmelnytskyi was finally commissioned during a ceremony attended by President Kuchma. After giving the official command that brought Ukraine's newest, most modern and ostensibly safest atomic power plant on line at noon on August 8, the president again criticized the West, and particularly the Group of 7 most economically advanced countries, for failing to extend needed credits to Ukraine to complete the project, which Ukraine finally did so on its own. Ukraine had requested money to help finish the second reactor at Khmelnytskyi (K2), as well as the fourth reactor at the Rivne nuclear plant (R4), in a deal struck with the G-7 in 1995 whose central focus was the closing of the Chornobyl nuclear power plant in 1999. Mr. Kuchma called the completion of the second nuclear block at Khmelnytskyi "our common victory." He identified K2 as "one of the most modern energy-producing facilities in the world."

There was controversy also over the sale of a major steel producer in Ukraine. On June 14 Ukraine's State Property Fund (SPF) announced the results of the tender for the sale of a 93.02 percent stake in the Open Joint Stock Company Kryvorizhstal. According to the SPF, only two companies met the tender requirements. Much of the controversy over the sale was due to the conditions that were set, which some say were geared toward shutting out the possibility of a foreign buyer. One of the terms, for example, was that the bidder must have a controlling interest in a profitable coke plant in Ukraine, which had been operating over the last three years and was capable of producing not less than a million tons of coke per year. The only two bidders that met this requirement were the Industrial Group (Donbas Industrial Union) and the Investment-Metallurgical Union (IMU), an organization that was recently formed between the Interpipe Corp., headed by Viktor Pinchuk, the president's son-in-law, and System Capital Management, headed by Rynat Akhmetov, Ukraine's richest man. The IMU won the bid by offering 4.26 billion hrv, around $800 million (U.S.).

The sale price drew the ire of both Ukrainian legislators and foreign bidders. In fact, the bid presented by the consortium made up of London-based LNM Corp., the world's second largest producer of steel, and Pittsburgh-based U.S. Steel, the seventh largest producer, was much higher at 14.31 billion hrv, or about $2.7 billion (U.S.). The consortium issued a press release on June 14 which read, "the consortium is disappointed with the fact that the State Property Fund chose to ignore this opportunity and believes Ukraine has missed a real opportunity by effectively ruling out foreign bidders from the privatization of Kryvorizhstal." LNM said the consortium's bid also addressed social and environmental issues. The LNM-U.S. Steel consortium called on President Kuchma and Prime Minister Yanukovych to look into the sale.

Indeed, Ukrainian opposition lawmakers had made several unsuccessful attempts to block the sale of the giant steel maker that employs some 52,000 people. According to RFE/RL, the sale was seen as yet another privatization, at a price well below the real value of the privatized company, intended to enrich the already-rich circle of pro-government oligarchs. On June 3 the legislature fell just eight votes short of the 226 needed to approve a resolution halting the Kryvorizhstal tender. The controversial sale of Kryvorizhstal remained in the news at year's end with presidential candidate Viktor Yushchenko stating that his administration would investigate the matter and would prosecute the guilty. "Kryvorizhstal was stolen," he told The Washington Post in an interview on December 8.

On the political front, too, Ukraine was in crisis mode.

On January 15, Verkhovna Rada Chairman Volodymyr Lytvyn prematurely closed the winter parliamentary session after opposition lawmakers for the fourth consecutive day continued paralyze the work of the legislative body amid charges that the Rada had passed legislation illegally in order to move along a process of political reform the majority supports. Mr. Lytvyn brought the session to a close merely seven minutes into the legislative day, after opposition lawmakers again jammed the front of the session hall and did not allow parliamentary activity to begin. Afterwards, Mr. Lytvyn criticized what he deemed the inappropriate behavior of the opposition in demanding that the Parliament reconsider a political reform bill it passed last week. "Today they did not give us even the ability to close the fourth session in a civilized way," stated Mr. Lytvyn.

The opposition lawmakers who stopped the last week of legislative work, were demanding that the Parliament reconsider its December 24, 2003, passage of a political reform bill - the first stage of a process of constitutional change that would give the legislative body the right to elect the head of state and bypass a direct popular vote. The bill was part of a plan of political reforms that President Leonid Kuchma was pursuing in order to turn Ukraine into a parliamentary/presidential state, more in line with European traditions. Included were constitutional amendments that would give a parliamentary majority the right to appoint a prime minister and government - plus a new provision that would empower the Rada to elect the president - should they receive approval by a two-thirds parliamentary majority in the next session. Opposition lawmakers, however, believed the political reform was nothing less than an effort by state authorities to ensure that power remains in their hands.

Foreign diplomats and international organizations stated that the reforms themselves would be democratically valid if pursued constitutionally, but questioned whether it was proper to push the changes in a presidential election year. Council of Europe representatives responsible for monitoring Ukraine's movement towards democracy warned on January 20 of a looming constitutional crisis in the country and did not rule out the leveling of sanctions by the quasi-governmental European human rights organization should specific political forces use constitutionally unauthorized means to push through political reforms. The representatives expressed serious concern regarding the manner in which the constitutional change process was being undertaken by the pro-presidential majority in the Parliament. Hanne Severinsen, rapporteur for the Parliamentary Assembly of the Council of Europe (PACE), said during a press conference that after a procedurally questionable hand vote in the Parliament to change the Constitution of Ukraine, as well as several Constitutional Court rulings - one allowing President Kuchma to run for a third term even while the Constitution of Ukraine limits a state leader to two terms - Ukraine was in political crisis. Ms. Severinsen said she questioned whether it was acceptable to initiate constitutional changes just 10 months before major elections.

By the end of the month, responding to a critical evaluation by the PACE, Ukraine's Verkhovna Rada retreated from the initiative to give itself the authority to elect the president on behalf of the nation. "In 2004 and thereafter, Ukraine's president will be elected to a five-year term by a nationwide vote," explained Verkhovna Rada Chairman Lytvyn after presiding over a short but stormy extraordinary session of Parliament on January 30. The Our Ukraine and Yulia Tymoshenko factions, two of the four parliamentary groups that are in opposition to the Kuchma administration, refused to take part in the vote because, in their estimation, it was simply an amendment to the December 24, 2003, bill that they said was passed illegally - via a hand vote, which is not foreseen in the Constitution.

A resolution passed on January 29 by PACE during a special session on the "political crisis in Ukraine," stated that it was "deeply troubled by the recent developments in the Verkhovna Rada of Ukraine." The resolution warned that any constitutional reforms taken on the eve of presidential elections would be "biased and divisive," and said it therefore considered the initiative ill-timed. It noted that the draft proposals on political reform were voted upon without serious consideration and debate, which should have included, "proper public information and a nationwide discussion of the issues." PACE also criticized the tactics used by the opposition to paralyze the work of the Parliament. The resolution further criticized the Constitutional Court of Ukraine for its recent rulings and called on President Kuchma to allow PACE to review his nominees for the Central Election Committee. Finally, PACE stated that a vote by hands is not recognized in the Verkhovna Rada Rules of Procedure, which meant that the Parliamentary Assembly also did not recognize the vote of December 24, 2003, that paved the way for constitutional reform.

On January 28, the European Union also expressed its concern regarding constitutional changes in Ukraine. "While the European Union acknowledges Ukraine's sovereign right to modify its institutional framework within the procedures laid down by its Constitution, it is concerned that under present political circumstances, the proposals for constitutional change will have an adverse impact on the trust and confidence of voters in relation to representative democracy in Ukraine, particularly in this election year. The legitimacy of constitutional change should be derived from genuine public support for its aims," the EU noted in its declaration.

Then, on March 18, Ukraine's Constitutional Court ruled that the political reform bill recently pushed through Parliament for preliminary approval by the majority coalition did not violate provisions within the Constitution of Ukraine. The court approved the wording of the bill by a 14-3 vote. The political reforms foreseen in the draft legislation called for the Rada to have its term extended from four to five years, to bring it in line with the presidential term of office. It legislation would also authorize the Parliament to form a majority coalition that would then elect a prime minister who would form a government and appoint local and regional authorities. It would cede a good portion of presidential authority to the prime minister.

The drama over constitutional reform continued into the fourth month of 2004 as the Verkhovna Rada on April 8 could not ratify the proposed changes to Ukraine's Constitution. The pro-presidential majority coalition in the Verkhovna Rada fell six votes shy of the required two-thirds majority, or 300-vote minimum, needed to amend the Constitution. National deputies from the opposition jumped to their feet, erupted in a chorus of cheers and promptly broke into a verse of the Ukrainian national anthem as their victory became clear. The celebration continued with chants of "Yushchenko, Yushchenko," as the oppositionist national deputies surrounded the leader of the Our Ukraine faction, who along with Yulia Tymoshenko of the eponymous political bloc, led the successful effort to kill the amendment legislation. Mr. Yushchenko was already seen at that time as the favorite choice to replace President Kuchma.

But the attempt to pass constitutional reform still was not over PACE reacted negatively on June 23 to word that the pro-presidential majority coalition in the Verkhovna Rada had successfully moved a new effort at Constitutional reforms, with 276 national deputies approving the first draft of a new piece of legislation introducing changes to the Constitution. National Deputy Borys Oliinyk, head of the Ukrainian delegation that had returned from the weeklong summer session of PACE on June 24, said PACE members were "shocked" to hear that the pro-presidential forces in the Ukrainian Parliament had attempted to revive the political reform legislation.

The work of the Verkhovna Rada was once again paralyzed as the year wound down - but this time by the parliamentary majority. Verkhovna Rada Chairman Volodymyr Lytvyn accused members of the crumbling majority coalition in Parliament of succumbing to the manipulations of pre-election strategies on October 12 and contributing to the political chaos that has descended upon the country two weeks before election day. "When will you stop letting yourselves be manipulated by your handlers?" asked a frustrated Mr. Lytvyn. As he spoke, members of the six parliamentary factions that make up the remnants of the majority - Regions of Ukraine, the Social Democratic Party-United, Democratic Initiative, Labor Ukraine, the National Democratic Party and the Party of Industrialists and Entrepreneurs - abandoned the session hall, stating that they would not be back until after the presidential election.

Earlier, the remnant of the majority coalition had adopted the often-used tactics of the opposition: surrounding the main microphone and presidium dais at the front of the hall to paralyze the work of the legislative body, which they did for several hours while calling for a parliamentary recess until December 7-10, when the newly elected president would have been sworn in. The unique situation - with the majority working to paralyze the body it ostensibly controls - occurred in the final week of parliamentary work before the presidential vote. It marked a widening rift between Rada Chairman Lytvyn, who had increasingly distanced himself from the formerly pro-presidential and now pro-Yanukovych majority coalition that he helped found and which elected him chairman in 2002. Mr. Lytvyn expressed his frustration with the way the Parliament had become even more politicized in the last months prior the national vote than even the most cynical predictions had forecast.

Mr. Lytvyn voiced his opinion that the parliamentary majority no longer existed as a united force. He added that those lawmakers closest to Prime Minister Yanukovych would like to see the Parliament dismissed soon after their candidate is elevated to head of state so that a new body - one that would better reflect the new president's own philosophies and aims, might be elected. Mr. Lytvyn said the majority was playing out the two-pronged scenario that many political observers earlier had suggested might occur within the Rada in order to manipulate the elections: first, the legislative body would become overtly and unacceptably politicized before election day; then, it would be deemed "unable to function" by the "powers that would be" and would be dismissed by the president. "The attempt to place a lock on the Parliament will not succeed," he said.

At year's end, in the wake of the political crisis that occurred after the second round of the presidential election, Parliament passed a package of laws that included a new law on presidential elections and changes to the Constitution of Ukraine (see previous section on Ukraine's election). President Kuchma was on hand to immediately sign the bills into law. In accordance with the new amendments, Parliament would approve candidates for prime minister, minister of defense and foreign affairs minister nominated by the president, and would approve other members of the Cabinet nominated by the prime minister. (Under current legislation, Parliament approves the prime minister only, and the president appoints and fires members of the Cabinet of Ministers.) The amendments also would extend the term of office for national deputies from four to five years, following the March 2006 parliamentary elections. The constitutional changes would go into effect either September 1, 2005, or January 1, 2006, with the timing dependent upon when Parliament approves a law that will reform the country's system of local self-governance. On December 8 that bill received preliminary approval in the Verkhovna Rada and was sent to the Constitutional Court for its consideration. Parliament will have to vote on the bill at least one more time before it becomes law.

Media issues, too, were in the forefront during 2004.

Effective February 17, Ukrainian radio Dovira removed RFE/RL Ukrainian Service programming from its FM schedule. RFE/RL President Thomas A. Dine condemned the decision by the broadcaster's new management: "This is a political act against liberal democracy, against free speech and press, against RFE/RL, and shows, once again, that Ukraine's political leadership is unable to live in an open society and is compelled to 'control' the media as if it were the good old days of the Soviet Union."

In a letter from TV and Radio Company Dovira First Deputy Director V. Reznychenko to RFE/RL Ukrainian Service Director Alexander Narodetskyi, the privately held Ukrainian network said its decision to end radio re-broadcasting of RFE/RL programming was motivated by a decision that the RFE/RL programs "have to be changed in terms of format." Mr. Reznychenko continued by stating that "Until such time as that takes place, we are obliged to exclude" RFE/RL programming from Dovira's schedule.

Dovira had been the focus of official Ukrainian pressure to drop RFE/RL Ukrainian Service broadcasting since 2001, soon after the decapitated body of Ukrainian journalist Heorhii Gongadze was found in a forest near Kyiv and after secretly recorded conversations allegedly involving President Kuchma and his senior advisors became public knowledge - both stories extensively covered by the Ukrainian Service in programs re-broadcast by Dovira. In January a new management team was put in place at Dovira by the station's new owner, Ukrainian Media Holding.

On March 3 Ukrainian government representatives unexpectedly and without a court order removed the transmitting equipment of Radio Kontynent, claiming the radio station had been transmitting without a proper license. The move came only five days after Radio Liberty, a U.S.-financed, private radio broadcasting, had moved to that radio station. Other Western media organizations, including Voice of America, the BBC and Deutsche Welle also had used Radio Kontynent, which had long been in disfavor with government authorities over its oppositionist political stance, for their transmissions. They, too, went off the air on March 3.

Some 10,000 to 15,000 Ukrainians demonstrated in Kyiv on March 9 to protest the authorities' attempts to shackle press freedom by closing down mass media outlets that do not toe the government political line. Mass protests by the opposition have become an annual tradition on the anniversary of Taras Shevchenko's birth over the last three years as thousands have marched through the downtown streets of Kyiv calling for democracy and free speech in the country and the resignation of President Kuchma. The 2004 protests took on renewed urgency after recent efforts by the authorities to limit foreign broadcasts to Ukraine. Several large Ukrainian media outlets also had been forcibly shutdown or threatened with closure in recent months. Meanwhile, Channel 5 Television, owned by one of Mr. Yushchenko's closest advisors, National Deputy Petro Poroshenko, said that its broadcast signal had been tampered with in the past and that it was under the close scrutiny of Ukraine's tax police.

The opposition demonstrations also followed the death in a car crash of the director of a Poltava regional radio station, which occurred the same day that Radio Kontynent's transmissions were pulled. Yurii Chechyk of Yuta Radio had been on his way to Kyiv for talks with Radio Liberty executives on providing them with airtime on his radio station when his car and an oncoming vehicle collided outside Kyiv. Many in the opposition movement, while acknowledging that there was no concrete evidence suggesting that Mr. Chechyk's death was planned, cited a pattern of "death by automobile accident" of several political and press representatives over the years, including prominent Rukh leader Vyacheslav Chornovil. They demanded an independent investigation.

There was another furor concerning the news media when, on January 28, Judge Iryna Saprykina of the Shevchenkivskyi District Court in Kyiv ordered the closure of the opposition newspaper Silski Visti, the country's largest newspaper, after finding it guilty of fomenting inter-ethnic strife via a 2003 article on Jews in Ukraine. The article, titled "Jews in Ukraine Today: Reality Without Myths," was penned by Vasyl Yaremenko, whom Ukrainian media identify as a professor of the Interregional Academy for Personnel Management. RFE/RL's Jan Maksymiuk reported: "The court's ruling has caused an outcry of indignation on the part of the opposition - Our Ukraine, the Socialist Party and the Yulia Tymoshenko Bloc - which see the presidential administration as an agent behind the closure of the largest anti-government newspaper, which has a circulation of some 520,000, in the presidential-election year. While not denying that the closure may play into the hands of the government, many Ukrainian observers agree, however, that the court's decision is fully supportable. Mr. Yaremenko's article, which was published by Silski Visti on November 30, 2003, can doubtless be categorized even by non-jurists as rabidly anti-Semitic."

A statement signed by Our Ukraine leader Viktor Yushchenko said the shutdown was a "manifestation of totalitarian policy" of the government vis-à-vis undesirable media and accused the court of following instructions of the authorities to eliminate the opposition media outlet. "We condemn the cynical reprisal against the opposition newspaper and express our support for the Silski Visti editors," read Our Ukraine's statement. Mr. Yushchenko later released a second statement in which he said that Silski Visti needed "to find courage to apologize to those people whose ethnic sentiments were offended by its publications." He added, "There should be no discussion about this apology." At the same time he repeated his assertion that the court, by ignoring other legal possibilities for dealing with the newspaper, was following an order from higher up whose intent was to destroy the largest opposition paper in the country. Mr. Yushchenko's reaction to the Silski Visti closure would later haunt him when some circles derided the presidential candidate as soft on anti-Semitism.

On March 15, President Kuchma decreed a moratorium on any sort of government inspections of mass media outlets in Ukraine. The presidential decree banned inspections of print, radio and television media outlets by the State Tax Administration, the Procurator General's Office, the Internal Affairs Ministry and the Emergency Situations Ministry until after the October 31 presidential election. U.S. Deputy Secretary of State for European and Eurasian Affairs Steven Pifer said that such a move would help to create the needed conditions for free and fair elections. However, Canadian Ambassador Andrew Robinson said that, while he was satisfied with the moratorium, it did not resolve the problems surrounding the shutdown of certain radio stations. Mr. Robinson explained that he was particularly concerned that no official had mentioned restoring the radio transmissions of Radio Liberty, BBC, Voice of America or Deutsche Welle in Kyiv.

On March 31 the directors of the two major U.S. broadcast services - David Jackson, Voice of America director, and RFE/RL's President Dine - held a joint press conference in Kyiv on March 31 to level heavy criticism on the current state of Ukraine's press freedoms. They said the closing of radio stations that carried their broadcasts had forced them to travel to Ukraine in order to assess the extent to which Ukraine's state leadership may have been involved in the closings, as had been alleged, as well as to find new avenues for the broadcast of their news and information programs.

Early in the year, Ukraine and the diaspora were rocked by rumors that President Kuchma had died. By the time Mr. Kuchma returned to Kyiv on January 17 from Baden-Baden, where he was undergoing medical treatment and rehabilitation at the world-renowned German health resort, rumor had it that his death was being kept secret from the public. Rumors abounded that a sick Ukrainian president had gone to Baden, Baden in a desperate attempt to save his life. The rumor also spread quickly beyond Ukraine to the Ukrainian diaspora, and was the subject of countless telephone calls and e-mail exchanges beginning on January 16. It was bolstered by a report carried by a Russian-based news service, News-Info, which reported on its website that its sources in Baden-Baden said President Kuchma had died on an operating table in Baden-Baden.

Soon thereafter, on January 23-24, Russian President Vladimir Putin visited Kyiv to commemorate the end of the "Year of Russia in Ukraine" and the 350th anniversary of the Pereiaslav Treaty. Presidents Putin and Kuchma co-hosted a jubilee concert at the Ukraina Palace of Culture, formally intended to mark the end of the Year of Russia in Ukraine, a series of cultural exchange and development events celebrating the Russia-Ukraine friendship, which had been preceded by a similar yearlong series of events in Russia in 2002 held under the banner of the "Year of Ukraine in Russia." Originally the concert was also to have put a spotlight on the 350th anniversary since Hetman Bohdan Khmelnytsky in 1654 signed a treaty of military alliance with Tsar Aleksei of Muscovy. For centuries afterwards Russian leaders used the treaty to legitimize their control over Ukrainian lands. The Pereiaslav anniversary was moved off center stage and downplayed after Ukrainian national democratic political leaders criticized the commemoration by a Ukrainian president of an event that began a process of centuries of imperial domination of Ukrainian lands by Moscow.

On the second day of his visit the Russian president visited the historic Pecherska Lavra (Monastery of the Caves), the holiest religious site of Ukrainian Orthodoxy, which is controlled today by the Kyiv Metropolitan See of the Russian Orthodox Church. The two presidents attended a specially called Holy Synod of the ROC in Kyiv, which goes by the name Ukrainian Orthodox Church - Moscow Patriarchate and is headed by Metropolitan Volodymyr Sabodan. Interfax-Ukraine reported that during the meeting Mr. Kuchma expressed support for a single Orthodox Church in Ukraine.

Perhaps as a harbinger of the important role that Poland would assume vis-à-vis Ukraine toward the end of 2004, Poland's President Aleksander Kwasniewski and Ukraine's President Leonid Kuchma on March 30 opened the Year of Poland in Ukraine by noting the historic ties between the two countries and the need to stimulate much closer and deeper economic development between them.

The presidents' statements at the Shevchenko National Opera House in Kyiv were followed by a concert of Polish classical music. President Kwasniewski emphasized that the fates of the two countries were historically entwined and would continue to be in the future. He said that Poland and Ukraine needed to continue to develop along the same path. "There is no independent Poland without an independent Ukraine, and no independent Ukraine without an independent Poland," asserted Mr. Kwasniewski, who added "Poles and Ukrainians are unified by a deep European likeness." The Year of Poland in Ukraine, which was to be followed by a similar program in Poland in 2005, proceeded under the motto "Poland and Ukraine Together in Europe."

By year's end, of course, Poland was a key supporter of democratic and free elections in Ukraine, and a key participant in negotiations between presidential candidates Viktor Yushchenko and Viktor Yanukovych (see preceding section on the presidential election in Ukraine).

Another staunch supporter of Ukraine during 2004 was Dr. Zbigniew Brzezinski who traveled to Kyiv in mid-May. The former national security adviser to President Jimmy Carter, who currently is a professor at Johns Hopkins University and an advisor at the Center for Strategic and International Studies in Washington, met with government and political leaders and gave a lecture on "Ukraine and the World" at the National University of Kyiv Mohyla Academy. The message he brought during his four-day stay in Kyiv: Ukraine should not wait for an invitation to enter the European Union; it must make the EU want Ukraine as a partner. Dr. Brzezinski's visit came after the previous week's comments by European Commission President Romano Prodi that Ukraine had no prospects for joining the EU, which were echoed by Gunther Verheugen, EU commissioner for enlargement, on May 12 during an interview on Germany's Deutsche Welle public radio.

Dr. Brzezinski noted that the Single Economic Space agreement would hinder Ukraine's entry into the EU - especially since its ratification came just as 10 new member-states had entered the EU. However, he also pointed out that European Union officials should have realized that both Russia and Ukraine need to have prospects for entry into the EU in order for the region to maintain security. He called Ukraine much further ahead in democratic development than Russia. He also said that as long as Ukrainians could not say with a high degree of confidence who would be their next president democracy exists in the country. He made a comparison to Russia, where it was widely understood that President Vladimir Putin would get re-elected months before the actual day of the vote.

Dr. Brzezinski also visited Bykivnia Forest, located on the outskirts of Kyiv, to take part in an annual commemoration for the tens of thousands of Ukrainian intellectual and cultural leaders who were slaughtered during Joseph Stalin's reign of terror in 1937-1938. An official U.S. delegation headed by Ambassador John Herbst was there for a memorial service and to lay a commemorative wreath at the site, which continues to be vandalized and still does not have an appropriate monument erected to the memory of the victims. Dr. Brzezinski told the few hundred gathered in Bykivnia that he had thought he knew much about the crimes of communism, inasmuch as he had done his doctoral thesis on the work of the early Soviet secret police, but that he was taken aback by the horror of Bykivnia. "Bykivnia has left a far deeper impression than all that I had heard beforehand," he commented. "I am taken by the spirit of the members of the [Vasyl Stus] Memorial Society (which has fought to make the forest a national memorial complex). I believe that children and young people should travel here on an annual pilgrimage."

On July 30, from Ukraine's neighbor to the West, Poland, came appeals to Europe and the United States to support Ukraine's Euro-Atlantic integration. In an interview with Polish Radio 1 in Warsaw, President Kwasniewski noted that Ukraine "is still searching for its place and is under strong Russian influence and pressure to integrate into this country." Ukraine, he said, would like to integrate with Western Europe, "however, unfortunately, not the whole of Western Europe wants to help Ukraine on this issue." The Polish president expressed bitterness that the EU and the West "haven't understood the significance of the Ukrainian issue," and he pointed the finger specifically at "the three great leaders" - the prime ministers of France and Great Britain and the chancellor of Germany, noting that in Istanbul [at the NATO summit] "there was a lack of understanding and determination, or perhaps there is a conviction that Ukraine is in the sphere of Russian influence."

That same day, 13 Polish political leaders and activists issued an appeal calling for support of Ukraine's aspirations for membership in European and Euro-Atlantic structures. Their statement underscored: "A new iron curtain on the eastern border of the EU would be harmful and dangerous for Europe. Ukraine today stands at a crossroads, and its European orientation seems to be threatened. This has happened in great measure through the stance of those European governments and circles that are taking away Ukraine's hope for future membership in the EU and NATO." The appeal's signatories - former government ministers, members of Parliament, ambassadors and activists of the Polish-Ukrainian Forum - argued that taking away this hope from Ukraine "deprives it of the motivation to undertake difficult reforms ..., weakens the position of those Ukrainian politicians who declare the necessity of integration with Europe ... [and] on the other hand strengthens the forces desiring a return to the situation before the disintegration of the USSR."

The appeal from Poland came just days after Ukraine confirmed on July 26 that it had changed its recently approved defense doctrine, omitting wording that had specifically stated that NATO and European Union membership were a central foreign policy priority. The phrasing was replaced with a more general statement that alludes to Ukraine's continued Euro-Atlantic integration. The changes came after Ukraine failed to achieve any perceptible progress in its quest for membership in the two most important European institutions, during summits held separately by NATO and the EU in June. The defense doctrine had originally been approved on June 15 in preparation for the NATO summit.

During its Istanbul summit, NATO refused to consider a Membership Action Plan for Ukraine - the first step in the process toward membership - until the country showed that democratic changes, including notions of the rule of law, free and fair elections, and freedom of the press, had taken root. As for the EU, it continued to refuse to recognize Ukraine as a free market economy, even though it has already extended such status to Russia. Mr. Prodi, the head of the EU's executive body, the European Commission, expressly stated in the spring that Ukraine would never become an EU member.

The announcement in the defense doctrine changes came in Yalta, where Ukraine's President Leonid Kuchma was hosting Russia's President Vladimir Putin during a Russian-Ukrainian economic summit, with persons who could be considered the captains of industry of both Russia and Ukraine in attendance. President Putin caused more international waves when he told the economic summit attendees during his presentation that intelligence operatives from Western governments for too long had attempted to derail closer relations between Russia and Ukraine. "Their agents within our countries and outside are trying to discredit the integration of Russia and Ukraine in various ways," charged President Putin during his address to the economic summit.

Several significant milestones were marked in 2004.

Nearly 30,000 Crimean Tatars gathered in Symferopol on May 18 to mark the 60th anniversary of the mass deportation of Tatars ordered by Joseph Stalin. The day began with the laying of commemorative wreaths at several sites around the city where memorials to the deportation had been erected, including Grigorenko Park, named for Petro Grigorenko, a Soviet general-turned-dissident who had supported the Crimean Tatars' quest for a return to their native land during the Soviet era. During the rally on Lenin Square thousands of young and old alike wearing traditional Crimean Tatar fezzes and head scarves listened to Mustafa Jemilev and fellow Verkhovna Rada national deputies from the Our Ukraine faction, including the chairman of the Parliamentary Committee on Minority Rights, Hennadii Udovenko, assert the right of the Crimean Tatars to live on their ancestral lands. The largest ceremony took place before the Symferopol train station, where the deportation of the Tatars had begun. Nearly 200,000 Crimean Tatars - mostly women, children and the elderly - were shipped in 76 freight trains out of Crimea to Uzbekistan and Kazakstan by force over a three-day period beginning at 4 a.m. on May 18, 1944, after Stalin decided that the Crimean Tatar nation had sided with the Nazis in the "Great War for the Motherland." Thousands more, mostly hardy, work-aged men, were either drafted into military work battalions or sent off to Siberia. Sources say up to 90,000 died during the forced trek eastward and in the year afterward.

The National Rukh of Ukraine Party commemorated 15 years since it was created as a civic organization on September 8, 1989 - an event that historians believe hastened the demise of the Soviet Union and the establishment of an independent Ukrainian state. Rukh, which registered as a political party in 1992 after Ukraine achieved independence, was the uniting and driving force behind a multi-faceted movement of various social and political forces whose common element was the desire to create a sovereign and independent Ukraine. Since then it had suffered its ups and downs, among them its inability to capitalize on its early successes and take the reins of state power in its hands in 1992 after the Soviet Union collapsed. It had also gone through several internal schisms, most notably in 1999, just prior to the death of its most prominent member and longtime leader, Vyacheslav Chornovil, which left the party depleted and disorganized. However, the last two years had seen a Rukh resurgence in its fortunes, as the party has found new strength in current leader Borys Tarasyuk, a former minister of foreign affairs and a close associate of Mr. Yushchenko, leader of the Our Ukraine movement, of which Rukh is a primary member.

Speaking in Kyiv at Rukh Party headquarters, Mr. Tarasyuk said that state authorities had engaged in a protracted battle aimed at the destruction of the Rukh Party. Nonetheless, today the Rukh Party has 19 of its members in the Verkhovna Rada, three of whom are committee chairmen, and that its national deputies had sponsored 550 pieces of legislation since the last Parliament was elected two years ago. Mr. Tarasyuk underscored that among the many contributions to Ukraine's development that Rukh could claim, one of the most prominent was its role in the development of a multi-party system. "Several political parties developed from the Rukh Movement, some of which remain today, and some of which have become part of history."

Four years after the disappearance and death of Ukrainian journalist Heorhii Gongadze, there was a notable lack of progress in the government's inquiry into the case. "It is reprehensible that President Leonid Kuchma's government continues to obstruct the official inquiry into Gongadze's death," said Ann Cooper, executive director of the Committee to Protect Journalists. Mr. Gongadze, editor of the Internet news site Ukrainska Pravda, disappeared on September 16, 2000, after several weeks of harassment by police officials. In early November 2000 a headless corpse believed to be his body was discovered in a forest outside the capital, Kyiv.

Several weeks later, tapes recorded by a former presidential security officer, Mykola Melnychenko, were released, implicating the Kuchma government in Gongadze's disappearance. Sergey Tran, director of the Kyiv-based non-governmental press watchdog Institute for Mass Information, told CPJ, "It is interesting to note that independent experts in a number of Western countries, including the United States, have conducted open examinations of the tapes and pronounced them authentic, and the Ukrainian Justice Ministry claims they are doctored." He continued, "We demand a new, and open, examination of the tapes." Some 250 journalists and opposition activists gathered on September 16 at a memorial for the slain journalist near Kyiv.

Ukraine celebrated its 13th anniversary of independence as tens of thousands of Ukrainians lined the Khreschatyk on August 24 to watch a parade of approximately 5,000 soldiers from all the military branches. In the main address, Minister of Defense Yevhen Marchuk said, "The last 13 years are witness to the fact that the Ukrainian nation made the right choice." He enumerated a list of Ukraine's accomplishments and emphasized that "Ukraine is taking on the attributes of a democratic society. Its international authority is strengthening."

The previous evening the entire Ukrainian state leadership took part in an evening of music at the Palats Ukraina concert hall. President Kuchma gave the main presentation and decreed August 23 as State Flag Day. On the morning of August 24 Mr. Kuchma, along with Prime Minister Yanukovych and Chairman of the Verkhovna Rada Volodymyr Lytvyn, under tight security, laid flowers before memorials to Taras Shevchenko, considered the country's national bard, and President Mykhailo Hrushevsky, leader of the first independent Ukrainian state in 1918. After the parade, Ukrainians frolicked on the Khreschatyk and walked the shores of the Dnipro to watch the 13th annual Independence Cup Regatta. As dusk approached, people watched the annual fireworks show and enjoyed an outdoor concert by Ukraine's most popular musicians on the Khreschatyk.

Copyright © The Ukrainian Weekly, January 16, 2005, No. 2, Vol. LXXIII

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