2004: THE YEAR IN REVIEW

U.S.-Ukraine relations: a focus on the future

While the issues of Ukraine developing a truly democratic society and government - with a free press, functioning civic institutions and a transparent election system - had been in the forefront of the U.S.-Ukrainian bilateral discussions in 2003, last year saw these issues crystallize and focus on the conduct of the presidential election scheduled for October 31 and, subsequently, re-run twice before year's end.

Throughout the 2004, it was high on the agenda of meetings with visiting officials in both capitals and the subject of official statements, congressional hearings, briefings, seminars and conferences organized by Washington think-tanks and Ukrainian American groups.

As in the previous year, the number of senior official visits in 2004 was not great. There were only two on the ministerial level: Foreign Affairs Minister Kostyantyn Gryshchenko's visit to Washington in late June and Defense Secretary Donald Rumsfeld's one-day stop-over in Crimea on August 13 on the return leg of his trip to Afghanistan and Iraq.

Presidents George Bush and Leonid Kuchma did manage to meet on June 28, during the NATO Summit in Istanbul, but reportedly could exchange only a few passing phrases as they sat on either side of British Prime Minister Tony Blair at the conference table.

The fact that the two leaders have not had an official meeting at least once during President Bush's first term has been the subject of some speculation in Kyiv, where pundits believe Mr. Bush did not want to meet with a man accused of corruption, of selling Kolchuha missile detection systems to Iraq before the war and of being complicit in the murder of the Ukrainian journalist Heorhii Gongadze.

The president's father and former president, George H.W. Bush - whom Ukrainians remember for his "Chicken Kiev" speech on the eve of Ukraine's independence, when he warned them against "suicidal nationalism" - returned to Kyiv 13 years later, in May.

In a speech to students of the Kyiv State University, he explained his infamous remarks. "I encouraged them not to do something stupid ... to restrain from doing anything that would cause them to react when things were going the right way," he said. "Because your leaders acted in the national interest and not in self-interest they avoided what could have been another Prague Spring." he added.

While in Kyiv - at the invitation of President Kuchma's son-in-law, wealthy businessman and national deputy, Viktor Pinchuk, - Mr. Bush met with President Kuchma and Prime Minister Viktor Yanukovych.

The first senior U.S. official to visit Kyiv in 2004 was Secretary of State Colin Powell's deputy, Richard Armitage. During his one-day visit on March 25, he met with the president, prime minister and Foreign Affairs Minister Gryshchenko.

Later, during a press conference, he indicated that the two countries already had a good economic and security relationship. He added, however, that they "would be able to develop a political relationship if there were fair, free, open and democratic elections."

Foreign Affairs Minister Gryshchenko, who had previously served as ambassador to the United States, returned to Washington in June for high-level discussions with Secretary of State Powell, National Security Advisor Condoleezza Rice and Deputy Secretary of Defense Paul Wolfowitz.

During a dinner hosted on June 21 by the Congressional Ukrainian Caucus and the Ukrainian Congress Committee of America, he said there were good signs of transparency in the election process in Ukraine. "There will be many candidates for the presidential elections," and paraphrasing an observation made by Dr. Zbigniew Brzezinski during his recent visit to Ukraine, he added: "Unlike Russia, we don't know who the next president of Ukraine will be months ahead of time."

Defense Secretary Rumsfeld's one-day visit in August, which included a meeting with President Kuchma at his Crimean summer residence, focused primarily on discussing the situation in Iraq and Afghanistan and the issues involved in Ukraine's developing relationship with NATO and the European Union.

He thanked Ukraine and its soldiers for their contribution and sacrifices in Iraq and added that they should not think that "the U.S. and the world have not noticed that Ukraine, a non-NATO member, has one of the largest contingents in Iraq." He added that Ukraine is on a "very constructive and progressive path to Europe and towards NATO and trans-Atlantic cooperation."

Last year brought Ukraine it's first military fatality in Iraq - on April 6. Eight more would die by the end of the year.

The participation of 1,650 Ukrainian soldiers in the U.S.-led coalition in Iraq was a topic brought up in other bilateral meetings and official statements during the year, and it was raised in Ukraine's presidential race as well, in which both Prime Minister Yanukovych and his opponent, Viktor Yushchenko, pledged to withdraw Ukraine's contingent from Iraq, if elected president.

With the presidential election in Ukraine fast approaching, some prominent American lawmakers, and former lawmakers, visited Ukraine to see how the election campaign was proceeding and to underscore their position on the need for a fair election process.

In late July, an election monitoring delegation of former members of the U.S. Congress visited the Kharkiv, Poltava and Sumy oblasts, where they reported finding significant irregularities and improprieties in the ongoing presidential campaign.

On August 18-19 Sen. John McCain of Arizona led a delegation of Republican senators, which included Sens. John Sununu of New Hampshire, Susan Collins of Maine and Lindsey Graham of South Carolina. The group cautioned Ukraine's government about alleged campaign abuses that observers were already noting.

And in Washington, the House of Representatives and the Senate made their view known in hearings and resolutions. On October 4, the House unanimously passed a resolution "urging the government of Ukraine to ensure a democratic, transparent and fair election process" for the presidential election to be held on October 31. A similar resolution passed on July 22 in the Senate, also by a unanimous vote.

Similarly, the administration was making its official view known. One week before the election, the State Department issued a statement warning that "how the campaign, voting and vote tabulation are conducted will determine the democratic credentials of Ukraine's next president." The statement added: "We are deeply disappointed that the campaign to date has fallen short of international standards."

In addition to reports from monitors and visiting delegations, the U.S. government and public was being informed about election developments in Ukraine through congressional hearings and various briefings, seminars and conferences organized by such Washington think-tanks as the Center for Strategic Studies, American Enterprise Institute and Freedom House, as well as Ukrainian American organizations: the Action Ukraine Coalition, Ukrainian Congress Committee of America and The Washington Group.

Much of what was reported was critical of the way the election process was conducted by the Kuchma government and his selected successor, Prime Minister Yanukovych. In an effort to counter this criticism, which grew after the October 31 election results narrowed the field of candidates to Messrs. Yanukovych and Yushchenko, the prime minister's advisor, Eduard Prutnik came to Washington in an apparent attempt to convince the U.S. press and policy-makers that a Yanukovych victory would be a good thing for Ukraine and its relations with the West.

As one enterprising journalist learned after researching Justice Department's Foreign Agents Registration Act documents, Mr. Prutnik's trip was part of a two-year, questionably financed million-dollar campaign to improve Mr. Yanukovych's image in Washington. The Ukrainian immigrant businessman who handled the payments to the Washington PR firms also organized and paid for a group of former congressmen to be monitors during the October 31 election. While most international observers criticized the conduct of the election, this group found the vote to be free and fair, as did observers from Russia and the Commonwealth of Independent States.

Also visiting Washington between the initial election and the November 21 run-off was the chairman of Ukraine's Verkhovna Rada, Volodymyr Lytvyn, who discussed the election and its effects on his country's future relations with the United States with Secretary of State Powell, National Security Advisor Condoleezza Rice and Sen. Dick Lugar (R-Ind.), whom President Bush named to be his representative in Ukraine during the run-off election. The meetings took place on November 15.

On the day following the November 21 run-off, in which, contrary to exit polls, Prime Minister Yanukovych came out ahead in the tally, Sen. Lugar announced that with widespread irregularities and intimidation during the campaign and the Organization for Security and Cooperation in Europe and other observers reporting serious procedural violations, "It is now apparent that a concerted and forceful program of election day fraud and abuse was enacted with either the leadership or cooperation of governmental authorities."

With Kyiv's independence square filling with thousands of Yushchenko supporters and launching what would become known as the "Orange Revolution," President Bush, while visiting Canada, urged Polish President Aleksander Kwasniewski, who was about to lead another European delegation to Kyiv to encourage the Ukrainian government and opposition leaders to work for a "political and legal solution" to the crisis. "Our common goal is to see the will of the Ukrainian people prevail," President Bush said on November 30.

After Ukraine's Supreme Court ruled the first run-off invalid and called for another run-off, which was scheduled for December 26, the leadership of Russia accused the United States and Europe of interfering in the electoral process in Ukraine in order to expand their sphere of influence deeper into former Soviet territory.

U.S. Secretary of State Powell responded on December 7 by making clear again that the United States was not asking Ukrainians "to choose between the East and the West." He said: "It is a different world we are living in, where people want freedom, they want democracy, they want to be able to select their own leaders, they want to able to select their own partners and friends."

That same day, the Bush administration notified Congress that it is making available $3 million to provide funding for OSCE election observers and non-governmental organization monitoring and other election-related efforts for the December 26 run-off.

On the day following the December 26 second run-off election - which saw Mr. Yushchenko defeat Prime Minister Yanukovych in what international observers judged to be without the serious instances of fraud evident in the previous rounds and, for the most part, free and fair - Secretary of State Powell called it "an historic moment for democracy in Ukraine" and said that, by all accounts, it appeared that the Ukrainian people "finally had an opportunity to choose freely their next president."

And, responding yet again to criticism - in the Kremlin and elsewhere - of the United States for somehow helping the Yushchenko candidacy, Secretary Powell reiterated that "the United States has supported a democratic process, not a particular candidate."

As it became evident that Mr. Yushchenko would be Ukraine's next president, some leading political figures in Washington were calling on the U.S. government to help him fulfill his plans of building a new, democratic Ukraine.

U.S. Rep. Marcy Kaptur (D-Ohio), who co-chairs the Congressional Ukrainian Caucus, underscored the moral aspect in this in her testimony before the House International Relations Committee. "America simply has a moral responsibility and, indeed, a duty, to help plant democracy where it seeks to root," she said. "No economic interest or strategic paradigm should divert our nation from standing firmly beside those who are risking all."

Sen. Hillary Rodham Clinton (D-N.Y.), in an opinion piece in the Financial Times, said that now that the Ukrainian people have won their struggle, the United States should help them integrate into Western institutions and "provide Ukraine with assistance that helps the country to consolidate the democratic progress and economic reforms that have taken place." She added, "Americans owe it them to pledge to stand by them now and in the future."

Similar calls were made during an American Enterprise Institute conference in early December by Dr. Brzezinski, two former U.S. ambassadors to Ukraine - William Green Miller and Steven Pifer - and others.

James Sherr, a fellow at the Conflict Studies Research Centre of the British Defense Academy, characterized the need for increased U.S. and Western assistance this way: "The worst-case scenario for Ukraine is not that Yanukovych would win the election on the 26th of December," he said. "The worst-case scenario for Ukraine, and I would say for all of Europe, is that Yushchenko should win, and then fail. And we perform a very important role in answering the question as to whether he will succeed or fail."

The overall U.S. assistance level for Ukraine suffered a drastic cutback last year - a reduction from $115 million to $94 million for Fiscal Year 2004. This included proposed major cuts in Ukrainian-language broadcasts by the Voice of America and Radio Liberty.

Accordingly, on February 3, VOA said that in keeping with the administration's federal budget proposals, it would decrease from two hours to one its daily Ukrainian broadcasts. Three weeks later, however - following an outcry from Ukrainian American organizations, a number of lawmakers as well as The Ukrainian Weekly - the Broadcasting Board of Governors, which oversees VOA, rescinded the decision, citing "a crackdown on media" in Ukraine as the reason for the change.

During the course of the year there were a number of small U.S. assistance allocations announced, among them $1 million to help fund the International Chornobyl Center for Nuclear Safety, Radioactive Waste Management and Radioecology in Slavutych; a U.S. Trade and Development Agency award of $300,000 to Yalta to fund a feasibility study on the development of a modern municipal solid waste management system; and U.S. Embassy grants of $24,000 each to 16 Ukrainian public libraries to open free public Internet centers as part of the Library Electronic Access Project.

Also during 2004, the Financial Action Task Force on Money Laundering (FATF) has taken Ukraine off its blacklist of non-cooperating countries. And, on April 5 U.S. State Department of Treasury Financial Crimes Enforcement Network (FinCEN) withdrew its Advisory 29 and informed U.S. banks and other financial institutions operating in the United States that enhanced scrutiny of transactions involving Ukraine were no longer necessary.

As Ukraine's prime minister and one of his predecessors were vying for the country's presidency during 2004, an earlier former prime minister of Ukraine, Pavlo Lazarenko (1996-1997), was getting his long-awaited "day in court" in San Francisco. He had been arrested in 1999 at New York's Kennedy Airport on charges of using American banks to launder $114 million he is accused of stealing from Ukraine. (This amount last year earned him the eighth ranking on the "Top 10" corruption list prepared by the British-based watchdog organization Transparency International.) Various other estimates place the total of his ill-gotten gains in Ukraine at more than $1 billion.

Mr. Lazarenko spent most of his pre-trial years in federal detention. He was released in 2003, but remained under close surveillance after posting $86 million bail. The trial began in March 2004; in May the judge threw out 23 of the charges against him; and on June 3 he was found guilty on 29 remaining counts. Facing a possible sentence of up to 15 years in prison, he remains out on $86 million bail, again, under 24-hour surveillance, while his lawyers appeal.

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

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