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Thursday, February 18, 2010

Public Statement of Victor Yanukovych... President Elect of Ukraine

Greetings to all -- on February 14, the Central Election Committee of Ukraine officially recognized Victor Yanukovych as the winner of the country's February 7 presidential elections.  Here is Mr. Yanukovych's first official international statement to the West.  It is apparent that the new President understands and appreciates initial Western misgivings about the outcome of the recent elections... and what it could mean for Western interactions with Ukraine.  In the statement below he seeks to address these concerns and to lay a platform for future Western investor and country engagement.

We are a nation with a European identity, but we have historic cultural and economic ties to Russia as well. We can benefit from both.

Opinion Europe: By Victor Yanukovych
The Wall Street Journal, NY, NY, Wed, Feb 17, 2010 

Over the past month, Ukraine has demonstrated twice that it cherishes the values of democracy and the belief that it is important for people to vote. Ukraine's presidential election was validated by all of the major international observer groups as free, fair and transparent, which attested to the Ukrainian people's resolve for a democratic election. The people of Ukraine desired change and their voices were heard. Now we have the great responsibility to help our fellow countrymen, who have cast votes for me hoping for a better life.

This election was defined by a financial and economic crisis that has devastated our country. Before the global economic crisis, Ukraine was one of Europe's top emerging markets, and economic prosperity did not seem beyond our reach in the near term. Now all that has changed, and the people demanded change in the way our Government works in Ukraine.

We must still put an end to the political turmoil that has crippled Ukraine and held our country hostage for so long. I will work ardently to do this as president. The only way that this can be accomplished is for the top political forces and their leaders, immediately after the presidential election results have been declared and certified, to avoid confrontation and unite for the sake of saving our country. We are a nation capable of great things but we will accomplish none of them if we continue to bicker among ourselves and ignore the enormous challenges that we must confront.

Let me say here, a Yanukovych presidency is committed to the integration of European values in Ukraine. Ukraine should make use of its geopolitical advantages and become a bridge between Russia and the West. Developing a good relationship with the West and bridging the gap to Russia will help Ukraine. We should not be forced to make the false choice between the benefits of the East and those of the West. As president I will endeavor to build a bridge between both, not a one-way street in either direction. We are a nation with a European identity, but we have historic cultural and economic ties to Russia as well. The re-establishment of relations with the Russian Federation is consistent with our European ambitions. We will rebuild relations with Moscow as a strategic economic partner. There is no reason that good relations with all of our neighbors cannot be achieved.

If we hope to become a bridge between two important spheres we cannot merely talk and make promises; we must deliver concrete policies and achieve real progress. If we hope to join the European Union we must secure political stability and establish ourselves as an economically viable nation. We must be pragmatic and focused to achieve EU membership. We must create transparent policies that allow our economy to thrive and demonstrate that Ukraine will add value to the EU as a new member state.

I am committed to conducting a policy that would strengthen our links with respected international financial institutions, and increase our standing in the world economic community. My election program, "Ukraine for the People," is a deep and comprehensive plan that clearly specifies how to achieve social and economic progress. It is not an easy task. We will be confronted with the same conflicts as Europe and Washington have faced—how to stimulate our economy to create jobs while not decreasing the social protections needed by our citizens. We must defeat corruption, which has become rampant over the last several years and has damaged our ability to attract foreign investment.

If we hope to join the EU and raise the standard of living of Ukrainians to that of other European nations, we must restore our economy from within. There are three fundamental objectives the Ukrainian economy must achieve in order to thrive: First, we must create jobs; second, we must stabilize prices so people can afford the necessities that they need to live; and third, we must ensure our citizens receive adequate wages and pensions. Giving our citizens a basic economic foundation is a critical first step to restoring the broken bond between the people and the government of Ukraine.

And so that is my agenda—to restore economic vitality and calm the political turbulence that has plagued our nation; to enable Ukraine to take advantage of its natural positioning as a thriving bridge between Russia and the West; and finally, to prepare a free and open Ukraine, economically and politically, to join the European Union when the time comes.

Ukraine is a beautiful country with hard-working and virtuous people who ask only for a chance at a better life. I know that if we can come together, we will achieve great things. As president, I plan to give Ukrainians the nation they deserve—a Ukraine for the people.

(Best regards from Kiev -- Jon)

Saturday, February 6, 2010

Ukraine's Pre-Election Day Presidential Candidate Comparison (One Is A Jedi)

Greetings folks -- February 7, 2010 is a very important day in Ukraine, for reasons completely unrelated to the NFL Superbowl. It is the scheduled date for the final runoff Presidential elections! With the election spirit in the air, I thought I would re-post an excellent article from Reuters and the U.S.-Ukraine Business Council.

Here is a brief breakdown and insight into the two principals, may the best candidate win... to be decided in the polls on Sunday and the constitutional courts thereafter, most likely... cheers.

IMF, Currency Market, Fiscal Policy, Gas, Energy Security

Sabina Zawadzki, Reuters, Kiev, Ukraine, Mon, Jan 18, 2010

KIEV - Ukrainian opposition leader Viktor Yanukovich and Prime Minister Yulia Tymoshenko will face each other in a run-off presidential election on February 7 and official results from Sunday's first round suggest a close contest ahead.

The election will define how Ukraine, a former Soviet republic of 46 million people wedged between the European Union and Russia, handles relations with its powerful neighbours, and may help unblock frozen IMF aid for its ailing economy. Despite fierce accusations and recriminations in the run-up to the vote, analysts say the differences between Tymoshenko's and Yanukovich's economic policies are few and nuanced.

Both say they aim to fight poverty and improve the lot of ordinary Ukrainians through a generous state safety-net first, putting emphasis on investment and modernisation second.

Yanukovich and Tymoshenko have sought to balance improved relations with Russia with closer economic integration with the European Union -- both potential lenders.

Whoever wins, their priority will be to bring the International Monetary Fund and its billions that have propped up state finances, helped stem the weakness of the hryvnia currency and provide funds for timely payments for Russian gas.

[1] Ukraine agreed to an unprecedented bailout programme of $16.4 billion (10 billion pounds) with the International Monetary Fund but on several fiscal and economic conditions.
[2] Although Yanukovich's supporters have demanded "vital" changes to the IMF programme, they have not detailed them and the majority of their criticism has been levelled at Tymoshenko's fulfilment of the conditions.
[3] Tymoshenko has promised to keep to the IMF programme -- she was against the minimum wage rises passed by parliament that led to the suspension of the bailout on grounds that it breached promises of keeping the budget deficit under control.
[4] But she has not fulfilled her highly unpopular promise of raising gas prices last year and this.
[5] The IMF is unlikely to change the conditions, whoever wins.

[1] Tymoshenko has repeatedly attacked the central bank, accusing it of facilitating illegal speculation on the hryvnia currency and demanding that Central Bank chief Volodymyr Stelmakh step down.
[2] Stelmakh, as central bank chief nominated by the president, has held his position beyond the retirement age of 60 so is very likely to step down.
[3] "If Tymoshenko becomes president, then the banks will start selling the dollar. How many times has she promised to install her own central banker, (how many times) has she said that there is no chance the dollar will rise? She will start bringing it down artificially," a dealer said.
[4] "If Yanukovich, then it is not clear whom he will bring on as the head of the bank. But it could be that because there are export-driven producers amongst his circle who are interested in an expensive dollar ... they will insist on a high dollar rate."

[1] Both Tymoshenko and Yanukovich have promised lower taxation and increased minimum wages, pensions and social benefits.
[2] Yanukovich has said he wants to cut the Value Added Tax (VAT) to 17 percent by 2011 from 20 percent and corporate tax to 19 percent from 25 percent. He wants banks to offer mortgages with no more than 7 percent interest rates.
[3] Tymoshenko wants to cut the number of taxes by a third, simplifying the system. She wants to cut VAT and offer tax breaks to importers of new technologies as well as poor regions to boost investment. She has not mentioned any figures.

[1] Tymoshenko struck a gas supply and pricing deal with Russia at the start of last year to end a three-week dispute that led to cut-offs to Europe. Ukraine paid European price at 20 percent discount in 2009 and this year the full market price.
[2] Moscow and gas export monopoly Gazprom have so far shown willingness to amend that deal, allowing Ukraine to import less as its demand plunged due to an economic recession and waiving for now fines for under-buying.
[3] Yanukovich says he had always been able to strike better pricing deals with Moscow and that he wants to renegotiate the 10-year contract.
[4] Tough negotiations on any new contract may cause another row, risking more supply cuts to Europe. But neither are there any signs that Russia would negotiate, nor that it will continue to be lax on enforcing the contract's conditions.

[1] Both Tymoshenko and Yanukovich believe Ukraine, site of the world's worst nuclear disaster at Chernobyl, could gain energy security through the development and construction of more nuclear power stations.
[2] Tymoshenko wants to speed up exploration and extraction of oil and gas on the Black Sea shelf, to shore up Ukraine's energy security, while Yanukovich wants to modernise the coal industry, that could fuel much of steel production -- key to the economy. (Editing by Stephen Nisbet)