[Ohio UZO News] press release; NYT; FT; EDM; AP

[Deychak, Orest]

OSCE Parliamentary Assembly press release
President Emeritus Hastings appointed Chairman of US Helsinki Commission
On 11 January, the Speaker of the United States House of Representatives
appointed OSCE PA President Emeritus Alcee L. Hastings as Chairman of the
U.S. Commission on Security and Co-operation in Europe. 
As Chairman of the independent U.S. Government agency, known as the Helsinki
Commission, Congressman Hastings will play a key role in the formulation of
U.S. policy on the OSCE. 
Congressman Hastings said that he looked forward to working with the leaders
of the other OSCE participating States in fulfilling his new role. During
his two years as President of the Parliamentary Assembly, Hastings traveled
extensively and met with leaders throughout the OSCE region, presided over
all OSCE PA meetings, and led numerous OSCE election observation missions.
The Congressman also serves as the Assembly's Special Representative on
Mediterranean Affairs
The Helsinki Commission was originally established in 1976 to monitor and
encourage compliance with the Helsinki Final Act and other OSCE commitments,
and contributes to execution of American policy including through
participation in U.S. delegations to OSCE meetings.
###
(NOTE:  In his capacity as then- President of the 56- nation OSCE
Parliamentary Assembly, Chairman Hastings headed the OSCE-led  International
Election Observation Mission last March to the Ukrainian parliamentary
elections, pronounicng them as "free and fair." He was also part of the OSCE
PA observation mission in the December 26, 2004 Ukrainian presidential
elections.  Orest Deychakiwsky)
New York Times
World Briefing Europe: Ukraine: Premier's Ally Dies Of Hunting Wound 
By C. J. CHIVERS 
18 January 2007 
Late Edition - Final 
Yevhen Kushnaryov, a deputy leader of the pro-Russian Party of Regions and a
close ally of Prime Minister Viktor F. Yanukovich, died of a gunshot wound
suffered while hunting on Tuesday. Mr. Kushnaryov was shot under
circumstances not yet fully explained. Ukrainian news agencies said he was
with a group that had just finished a boar hunt when a wolf appeared,
prompting at least one unidentified hunter to fire and strike Mr.
Kushnaryov. 

Financial Times

Ukraine parliament clips Yushchenko's wings
By Roman Olearchyk in Kiev 
Published: January 12 2007 19:55 

In a major blow to Ukraine's pro-western president, Viktor Yushchenko, the
country's parliament on Friday boosted the authority of the government
headed by his arch-rival, Viktor Yanukovich, prime minister.

Legislators overcame a presidential veto to pass legislation that increases
the authority of Mr Yanukovich's government, marginalising the presidency.
The law is a turning point in a power struggle between the pair.

The two leaders have been locked in a political tussle since the Orange
Revolution of 2004, clashing over top government posts as well as foreign
and domestic policy since Mr Yanukovich assumed the premiership last year.

Mr Yushchenko's allies described the law as an attempt to "usurp" power in
the country.

Backed by a majority of legislators and enjoying the support of Yulia
Tymoshenko's opposition bloc, Mr Yanukovich's governing coalition mustered
more than the two-thirds support required to override the veto.

In return, Ms Tymoshenko garnered support for a law granting the opposition
oversight over the government and another bill permitting parties to eject
members from parliament and regional legislative bodies as punishment for
voting against the party line. 

The latter is expected to help Ms Tymoshenko's camp halt the exodus of
legislators from its faction and to form a majority in the city council in
Kiev, Ukraine's capital.

Ms Tymoshenko, a firebrand politician, played a major role in mustering
support for Mr Yushchenko during the 2004 presidential elections, but their
relations soured after was sacked as prime minister in 2005.

The votes came as a surprise. Days earlier Mr Yushchenko and Mr Yanukovich
appeared to have mapped out plans for a compromise on cabinet appointments. 

The new law undermines presidential authority in several key areas. It
authorises the government to rebut decisions by regional officials appointed
by the president. It also limits Mr Yushchenko's authority over the foreign,
interior and defence ministries.

An aide to Mr Yushchenko said the law violates twelve constitutional norms
and promised to challenge it through a constitutional court.

Oles Dony, a political analyst in Kiev, said: "This situation is proof of
the continuation of dangerous tendencies in Ukraine's political arena,
namely the lack of transparency, the inability to stick with political
agreements reached, repeated backroom dealings and violations in voting
procedures."

Mr Yanukovich, who suffered a humiliating defeat in the 2004 presidential
elections despite Russian backing, staged a remarkable comeback last August
after Mr Yushchenko nominated him as prime minister in an attempt to end
four months of political paralysis. 

Mr Yushchenko secured safeguards for his pro-western agenda, namely swift
integration with the European Union, Nato and the World Trade Organization.
His allies have since accused Mr Yanukovich of stalling reforms and blocking
Ukraine's integration with the west.

Eurasia Daily Monitor
The Jamestown Foundation
January 17. 2007

YUSHCHENKO LOSES CABINET LAW TO YANUKOVYCH AND TYMOSHENKO

Ukraine's parliament has passed a law on the Cabinet of Ministers that
strengthens the Cabinet vis-à-vis the president. The law fills in gaps left
in the national legislation by the imperfect constitutional reform of
2004-2006, interpreting in the Cabinet's favor the points dealing with
relations between the branches of power that were not clearly spelled out in
the new text of the constitution. President Viktor Yushchenko vetoed the
law, but on January 12 parliament overrode his veto. Opposition leader Yulia
Tymoshenko sided with the majority, unexpectedly for Yushchenko.

This was not the first time Tymoshenko has helped the majority coalition led
by Prime Minister Viktor Yanukovych override Yushchenko's veto. On January
9, Tymoshenko backed the majority to override Yushchenko's veto of a law
banning the sale of agricultural land until 2008. The coalition cannot
easily override Yushchenko's vetoes, as it fills significantly fewer than
the 300 seats needed to override presidential vetoes in the 450-seat
chamber. But if supported by the 121-strong Tymoshenko faction, this becomes
easy for the coalition.

Yushchenko vetoed the law on the Cabinet on January 11, saying that it
"distorted the essence of the constitution." On January 12, however,
parliament overrode the veto with 370 combined votes from the coalition and
the Tymoshenko bloc, while only Yushchenko's Our Ukraine upheld the veto.
Our Ukraine parliamentary leader Vyacheslav Kyrylenko accused Tymoshenko of
de facto joining the Yanukovych-led coalition, and Our Ukraine deputies
walked out of the chamber in protest.

Yushchenko and his team particularly object to the following provisions of
the new law:
*	that the parliamentary majority shall appoint the prime minister and
the ministers of foreign affairs and the interior (previously presidential
picks) if the president fails to do so "within 15 days"; 
*	that parliament shall pass the cabinet's action plans as
resolutions, rather than laws, so the president has no power to veto them; 
*	that deputy ministers shall be appointed by the Cabinet - Yushchenko
had insisted that his opinion should be sought first; 
*	that the cabinet may send presidential decrees back to the president
for revision; 
*	that the labor law does not apply to cabinet ministers - meaning
that ministers may not appeal against dismissal by parliament in courts; and

*	that the Security and Defense Council - a body directly subordinated
to the president - "may not interfere in the Cabinet's work." 

In return for backing the Cabinet law, Tymoshenko secured majority support
for two laws that will boost her own power. Parliament on the same day
passed the first reading of the bill on the parliamentary opposition and
approved the law on the "imperative mandate," which bans local deputies from
changing affiliation - both with 362 votes.

The bill on the opposition should give the largest opposition party
-Tymoshenko's - the right to nominate a deputy parliamentary speaker and the
chairs to several parliamentary committees. And with the help of the
"imperative mandate," Tymoshenko should be able to stanch the outflow of
local councilors from her party, which started in the middle of last year.
Also, this should allow Tymoshenko's people to set up a majority at the Kyiv
city council, one of the leaders of her bloc, MP Oleksandr Turchynov, said.
Tymoshenko does not conceal her desire to oust Yushchenko-backed Kyiv Mayor
Leonid Chernovetsky with the help of the council.

Parliamentary speaker Oleksandr Moroz confirmed at a press conference on
January 12 that the veto and laws passed on that day were the result of an
agreement between Tymoshenko and the majority. Tymoshenko, explaining her
move, said she wanted to put an end to "the political confrontation" caused
by imperfect constitutional reform. Tymoshenko brushed off Our Ukraine's
accusations of "betrayal." She also ruled out "any fundamental, consistent,
or systematic cooperation" with Yanukovych in the future.

Former interior minister Yuriy Lutsenko, commenting on the new Cabinet law
at his own press conference on January 12, accused Yanukovych of "usurpation
of power." Lutsenko, a faithful ally of Yushchenko, earlier set up a
movement called People's Self-Defense, which seeks Yanukovych's dismissal
and parliament's dissolution (see EDM, January 3).

Yushchenko will veto the laws passed by parliament on January 12 and will
not sign the law on the Cabinet, said Arseny Yatsenyuk, a deputy head of the
presidential secretariat. The president promised to appeal the Cabinet law
at the Constitutional Court. Yushchenko told a briefing on January 14 that
the law "seriously violated" the National Unity Declaration signed by
Yushchenko and Yanukovych last August, as the Declaration provided for joint
work on documents like the law on the Cabinet. He also regretted that
Tymoshenko had backed the law.

Relations between Yushchenko and Tymoshenko are seriously damaged. It is not
clear how -- or even if -- they will jointly work to achieve an early
parliamentary election and constitutional reform reversal - the goals
declared by Tymoshenko and apparently shared by Yushchenko. Meanwhile, the
law on the Cabinet, if not rejected by the Constitutional Court, should
bring Ukraine closer to a parliamentary form of government.

Channel 5, January 9, 11, 12; Ukrayinska pravda, Glavred.info, January 12;
Zerkalo nedeli, January 13; ProUA, January 14)

--Pavel Korduban

AP
UKRAINE'S ECONOMY PROVES IT CAN SURVIVE -
             AND FLOURISH - DESPITE GAS PRICE HIKE

By: Mara D. Bellaby, AP Worldstream, Kiev, Ukraine, Thu, Jan 04, 2007

KIEV - The warnings in Ukraine verged on the apocalyptic when Russia sharply
raised prices for natural gas a year ago. Many feared factories would close,
leading to mass layoffs and grinding industry to a halt. But Ukraine's
economy leaped ahead, its businesses quickly adapting to the higher costs.

Now that other former Soviet republics have been hit by price hikes for
Russian gas, Ukraine's experience offers them a ray of hope, analysts say
_but note that Ukraine has advantages that newly hard-hit countries such as
Belarus and Georgia lack.

Ukraine's economy grew by about 7 percent in 2006 despite Russia's nearly
doubling its price for gas and appears in good position to absorb this
year's further increase.

In 2005 Ukraine paid US$50 per 1,000 cubic meters of Russian gas, but now
pays US$130. The dispute led to temporary reductions of supplies to Western
Europe and raised wide concern about Russia's reliability as an energy
partner.

Proportionately, the increase was bigger than Russia imposed on Georgia and
Belarus with this year. Georgia agreed to pay US$235 per 1,000 cubic meters,
up from the US$110 it was paying previously. Belarus will pay US$100 per
1,000 cubic meters this year, slightly more than double the US$47 it paid in
2006.

But unlike Belarus, whose economy is mostly state-controlled, Ukraine's
economy was open and flexible when the gas increases hit. And unlike
Georgia, Ukraine has diversified industry and alternative resources to fall
back on.

Ukraine was the largest gas importer of the former Soviet countries, able
for years to ignore its wasteful habits due to the ready supply of cheap gas
that Moscow had provided. But once Russia forced the price hikes, Ukrainian
industry took action.

The steel industry _ the driving force of the country's economy, but also
one of the biggest energy users _ has led the push, tapping into what had
been extremely healthy profit margins to foot the bill.

Following the lead of competitors in Asia and the West, Ukraine's big
metallurgical plants began chucking out gas-guzzling furnaces for those that
use pulverized coal.

The initial investment is steep, around A20 million-A25 million (US$26
million-US$33 million) per furnace, but the payoff is a process that
requires almost no natural gas and cuts production costs considerably. It
also uses a resource that Ukraine already has in abundance.

"All of our new blast furnaces will be fueled by pulverized coal," said Ihor
Korytko, a director of Metinvest Holding's Yenakievsky Metallurgical
Factory. "Within several years, we plan to fully stop the use of natural gas
in blast furnace production. In steelmaking, we already aren't using any gas
now."

Mikhail Berger, a Russian economic analyst, told Russia's Ekho Moskvy radio
that by raising prices, Russia did Ukraine "a colossal favor."

"The Ukrainian economy has begun to arrange itself under the realities of
the market, and when it overcomes this gas withdrawal _ like a drug
withdrawal _ it will become truly competitive," he said.

Some Ukrainian businesses forged their own gas deals with Russia's natural
gas giant OAO Gazprom, in a move that helped keep them afloat but which may
ultimately hurt Ukraine by further weakening the Ukrainian state gas
monopoly's reach and bargaining power, said Vadim Karasyov, head of the
Kiev-based Institute on Global Strategies.

In the meantime, Ukrainian politicians have been flirting with other
possible energy sources. Last year during a visit to Chernobyl, President
Viktor Yushchenko used the 20th anniversary of the world's worst nuclear
accident to say that Ukraine shouldn't rule out building new nuclear power
stations.

Officials also say coal deserves a wider look. Some estimates suggest that
Ukraine has the ninth-largest coal reserves in the world. Coal Industry
Minister Serhiy Tulub recently proposed building seven new coal mines as a
way to increase production.

Previously, such an idea likely would have sparked international criticism.
Coal mining in Ukraine is notoriously inefficient and dangerous, and for
years, Kiev was advised that unproductive mines should be closed and miners
retrained.

"But with all countries trying to see if they can use their own internal
resources better, I think if Ukraine can do this in an energy-efficient and
environmentally friendly way, Europe will be much more supportive," said
Zenyo Baran, a senior fellow at the Washington, D.C.-based Hudson Institute.

Ukraine is also being pushed to develop its own gas reserves, which are
believed to be significant. The country produces about 20 billion cubic
meters of its own gas, which is meant to cover non-industrial needs and
therefore protect the population from sharp price increases.

But Ukraine lacks modern drilling equipment to develop additional gas
reserves, and Western groups ready to invest hundreds of millions of dollars
complain that their contracts aren't being honored.

Developing the gas reserves could help individual Ukrainians, who have had a
harder time absorbing the price hike than industries. Many saw their home
gas bills more then double, which triggered protests against the government.
Officials have promised to try to shield the poorest residents as much as
possible from the increases.

Belarus and Georgia might have a trickier time, analysts say. Ukraine's
export-driven industries were buoyed by high world prices and could invest
in energy-saving technology, and the country has significant alternative
energy sources to tap into _ things both Georgia and Belarus lack.

"It was easier for Ukraine to go with these market changes," said Tomas
Fiala, head of Ukraine's Dragon Capital investment house.        
 

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