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					  Ilko Kucheriv Democratic Initiatives Foundation




Focus on Ukraine
  January 17-22, 2011




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                            Ilko Kucheriv Democratic Initiatives Foundation




                                           TABLE OF CONTENTS

І. OVERVIEW OF POLITICAL EVENTS OF THE WEEK…………………………………. 3

ІІ. ANALYTICAL REFERENCE .………………………………………….………………….5

Foreign policy.
President Yanukovych’s visit to Japan:
establishing Ukraine’s far east vector..............................................................................5




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   І. OVERVIEW OF POLITICAL EVENTS OF THE WEEK

    January
      17
                   Leaders of opposition parties Arseniy Yatsenyuk (Front of Changes),
Anatoliy Hrytsenko (Civil Position), Mykola Katerynchuk (European Party of Ukraine)
and Anatoliy Matvienko (Sobor) are holding talks on “building a single powerful political
force on the basis of four parties. The doors are open to other political parties and talks are
being held with the Batkivshchyna Party of Yulia Tymoshenko and Svoboda. Matvienko says
Our Ukraine has not yet matured to unification processes.

Political experts comment that “the issue is not about the unification of equal political forces,
rather annexation of smaller parties such as Yatsenyuk party, which has the highest ratings, to
the Front of Changes.

The State Employment Service of Ukraine named professions that are in highest demand in
Ukraine. As of January 1, 2011, the number of vacancies in the database of the employment
service is 63,900, specifically 29,700 for manual labor, 24,300 for positions in the civil service
and 9,900 for individuals without a special training. Today there is a demand for highly skilled
manual laborers, such as locksmiths, turners, electrical welders, drivers, cooks, sales personnel
and other similar professions. Experts with a high level of qualifications, top managers,
economists, doctors, bookkeepers and lawyers with commensurate work experience are also in
high demand. Analysts forecast that 5-10 years from now there will not be sufficient manual
laborers to work in plants and on farms.

  January
    18
                    VR Vice Speaker Mykola Tomenko stated at a press conference that 17
deputies of the Verkhovna Rada did not show up for a single convening of the parliament
during the last session, 12 of which are members of the Party of Regions. At the same time,
Tomenko stressed that according to the Labor Code, deputies that failed to show up at a single
session, which the absence of their written registration testifies to, should not have been eligible
to receive their pay. The vice speaker noted that certain deputies “are guilty before the
parliament and the people” as they failed to show at a single session and hold other official
positions despite their deputy mandate. At the same time, their voting cards were used to uphold
the “party line”.

President Viktor Yanukovych went on an official visit to Japan. During his visit the president
agreed with Japan’s Prime Minister Naoto Kan on Japan issuing Ukraine a loan of 8 billion yen.
This is fixed in the Loan Agreement between the Japanese Bank of International Cooperation
and UkrExImBank signed on Tuesday. The two sides also signed joint statements on the
possibility of a simplified visa regime for Ukrainians and Japan sending its observers for the next
elections in Ukraine. In his address at the Ukrainian-Japanese Business Forum “Investment
Potential of Ukraine”, Yanukovych called on Japanese businessmen to more actively invest in
Ukraine, which he labeled as an ideal variant under the banner “Ukraine today is 3 in 1: the right
place, the right time and the right decision”.

   January
     19
                Former people’s deputies and other former members of the government
were asked to submit their diplomatic passports to the Ministry of Foreign Affairs for safe

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preservation. Head of a VR body Valentyn Zaichuk stressed the need to submit diplomatic
passports to the MFA within 10 days after returning from an official business trip.

This way the MFA is trying to ensure stricter control over the usage of such passports by today’s
officials. MP Lesya Orobets assumes that such a measure is being applied to avoid the situation
with Bohdan Danylyshyn, who was granted political asylum in the Czech Republic. The MP
stressed, “The ministry fears diplomats will flee to the Czech Republic.” After all, a diplomatic
passport allows visa-free entry into the Schengen Zone.

President Viktor Yanukovych met with Japanese Emperor Akihito. During the talks
Yanukovych expressed his confidence that his official visit to Japan will help raise bilateral
relations between the two countries to a higher qualitative level. Ukraine’s president thanked
Japan for the fact that it is one of the greatest donors of assistance in renewal of the Chornobyl
AES and asked Japan to help Ukraine build a new shelter over the 4th reactor of the Chornobyl
station. Yanukovych invited representatives of Japan to participate in a forum on the safety of
nuclear energy that will be held in Ukraine under the patronage of the government of Ukraine in
April dedicated to the 25th anniversary of the Chornobyl nuclear accident.

   January
     20
                      On Thursday two bombs exploded at 4:00 am near the administrative
building of MakiyivVuhillya and the Golden Plaza shopping mall in the city of Makiyivka
(Donetsk oblast). The Ministry of Internal Affairs said there were no fatalities or injured. Not
far from the scene of the explosion investigators found a letter demanding euro 4 mn and
containing further bomb threats. A decision was made to impose a special security regime at all
life-support facilities in the Donetsk oblast starting Thursday. Head of the Donetsk Oblast State
Administration Anatoliy Blyzniuk sees no political motives behind the bombs that exploded in
Makiyivka. “I discard political motives… this is purely a criminal incident,” say Blyzniuk.
President Viktor Yanukovych decided to cut short his official visit to Japan in connection with
the explosions in Makiyivka.

   January
     21
                      Authorized Advocate of the Ukrainian Government in the European
Court of Human Rights Viktoria Lutkovska informed that Ukraine is in third-fourth place
in terms of the number of appeals that its citizens have filed with the court. She said citizens
of Ukraine mostly file claims with the European Court for the non-fulfillment of the rulings of
Ukrainian courts. Overall, since 1997 the European Court has approved 718 decisions regarding
Ukraine. In 2009, it approved 126 decisions and in 2010 – 109.

In the global rating of quality of life compiled by the Irish journal International Living,
Ukraine dropped from 68th to 73rd place. Ukraine ended up between Namibia and Botswana.
The value of life, cultural development, economic situation, ecology, climate, civil freedoms, the
quality of healthcare, infrastructure, safety of life and risks that citizens of every country face are
the main criteria of the rating. The United States topped the global rating of the quality of life
Life-2011, in which 192 countries were rated.

  January
    22
                  On January 22, Ukraine marked the Day of Unity. In 1919, the Act on
Unification of the Ukrainian National Republic and the Western Ukrainian National
Republic, which at the time were part of different state formations – namely, the Russian
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and Austro-Hungarian Empires – was proclaimed. In 1990, patriotic forces organized the
Human Chain action having foreseen the impending downfall of the USSR. From 1-3 million
people joined hands to create a chain along the roads and highways between Kyiv and Lviv as a
symbol of the spiritual unity the eastern and western lands of Ukraine.

On January 22, a number of events were held in Kyiv dedicated to the Day of Unity. An
official ceremonial gathering was held in the Palace of Ukraine, where President Viktor
Yanukovych gave a speech. Also, a ceremonial concert on Independence Square in Kyiv was
organized by the Kyiv City State Administration.

Opposition forces held their own acts on different squares throughout Kyiv. Leader of the
Batkivshchyna Party Yulia Tymoshenko and other renowned opposition politicians Anatoliy
Hrytsenko, Vyacheslav Kyrylenko, Mykola Katerynchuk, Boris Tarasiuk and Taras Stetskiv took
part in a candlelight vigil and a gathering of the people.
A resolution of national resistance with demands to hold snap elections of the president and
parliament, cease persecution of participants of the protest of entrepreneurs on Maidan, put a
stop to anti-Ukrainian humanitarian policy, dismiss Minister of Education Dmytro Tabachnyk
and a number of other demands were voiced and approved at the gathering.
The leader of the Front of Changes Arseniy Yatsenyuk, Sobor party leader Anatoliy Matvienko,
leader of the “Za Ukrainu” party Vyacheslav Kyrylenko, head of the NBU Council Petro
Poroshenko and leader of the Our Ukraine faction Mykola Martynenko all took part in the act of
protest on Kontraktova Ploshcha organized by the Front of Changes.

_____________________________________________________________________________



ІІ. ANALYTICAL REFERENCE

    Foreign policy

PRESIDENT YANUKOVYCH’S VISIT TO JAPAN: ESTABLISHING UKRAINE’S FAR EAST
VECTOR?

January 18-21 President of Ukraine Viktor Yanukovych paid an official visit to Japan. During
his visit he meet with the Emperor, Prime Minister and Speaker of the Parliament, attended
business forums in which representatives of Japanese corporations participated and visited
the cities of Tokyo, Kyoto and Osaka.
The main objective of his visit was to attract Japanese investments and heighten cooperation
between the two countries.
At the same time, Yanukovych’s visit to Japan produced more questions than answers.




                     What results did the visit of President Viktor Yanukovych to Japan yield?
                                         Did the president’s visit testify to the existence of an
                                                     Eastern vector in Ukraine’s foreign policy?
                                                  From the vantage point of timing of
On the eve of the visit                           Yanukovych’s visit to Japan, there are a
                                                  number of nuances that could have had an
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impact on its results. First of all, the visit   which could have led to a more moderate
took place on the backdrop of a criminal         position of the new head of the government.
case opened against former premier Yulia         Besides that, the visit of the Ukrainian
Tymoshenko for untargeted spending of            president to Japan was preceded by last
money received from Japanese companies           year’s visit to China, which is not exactly on
within the framework of the Kyoto Protocol,      good terms with Japan.
which could have elicited dissatisfaction of     Accordingly, Yanukovych’s decision to visit
the Japanese side. Secondly, Yanukovych’s        Japan hardly demonstrated a balanced
visit took place immediately following the       approach in Ukraine’s foreign policy.
changing of the Japanese prime minister,         Moreover, notwithstanding the first two
                                                 factors, certain political experts described
                                                 the visit to Japan as unsuccessful.



Results of the visit
                                                 votes in the IMF, and thereby increase its
The better part of Yanukovych’s official         chances of receiving loans from the IMF in
visit to Japan was for the most part symbolic    the future. In any case, the signing of this
in nature. Furthermore, the documents            agreement should be exploited as the first
signed during the visit came as no surprise      step on the path to realization of much larger
to Ukrainian commentators. This applies in       scale joint projects.
particular to the Joint Statement on
Ukrainian-Japanese Global Partnership            During his visit, the president of Ukraine
signed by the president of Ukraine and the       emphasized the attractiveness of the
prime minister of Japan, which is purely         Ukrainian market for Japanese investments
declarative.                                     on more than one occasion and called on
                                                 Japan to more actively invest money in
The most important document signed during        Ukraine. After the global financial crisis
the visit was a loan agreement between the       came to and end, Japan had accumulated
Ukrainian state-controlled UkrExImBank           significant volumes of free capital, which it
and the Japanese Bank of International           plans to invest in other countries. However,
Cooperation. According to it, the Japanese       in the opinion of experts the appeals of
bank issued a loan of 8 bn yen (nearly US        President Yanukovych will have no effect
$100 mn) to UkrExImBank to foster the            whatsoever if Ukraine does not improve the
export of Japanese goods to Ukraine and          investment climate inside the country. This,
support the development of the Ukrainian         in particular, applies to the need to
economy.                                         overcome large-scale corruption, guarantee
                                                 the independence of justice and improve the
Experts very cautiously evaluated the signed     system of regulating state activity and the
loan agreement. On the one hand, the sum of      normative base on the whole.
the loan is rather insignificant compared to
the billions of US dollars in loans granted by   If these measures are not realized, Japanese
the International Monetary Fund. On the          private companies are not likely to increase
other hand, this agreement will most likely      the volumes of their investments in Ukraine,
bring higher benefits to Japan that will allow   which at the moment constitute 0.3% of total
it to increase export volumes of its domestic    foreign investments. Accordingly, the
goods, which has of late has become a            intensification of economic relations
serious problem for the country. At the same     between the two countries will depend, first
time, certain experts presume that in this       and foremost, on Ukraine’s ability to
way Ukraine attempted to improve relations       implement the necessary reforms.
with Japan, which has a large number of
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Visit to Japan: manifestation of Far Eastern vector policy?
                                                   Japan, Yanukovych tried to attract foreign
At the end of 2010, certain Ukrainian              loans and investments without proposing
experts presumed that next year Ukraine’s          anything in exchange.
foreign policy will be more actively oriented
towards the Far East. Greater interest             Clearly, such an approach to relations with
towards this direction could be observed last      other countries is not likely to yield any
year, given the extended visit of                  positive changes in the long run.
Yanukovych to China, his meetings with the         Accordingly, Ukraine’s relations with
presidents of Kazakhstan and Azerbaijan            Eastern countries are predominantly
and the visit of Minister Mentor of                utilitarian and fragmented, rather than being
Singapore Lee Kuan Yew to Ukraine in               based on a concise strategy. At the same
September 2010.                                    time, it is worth noting that Ukraine does not
                                                   have sufficient potential to conduct an
                                                   effective foreign policy in the Eastern vector
For this reason, the visit of Yanukovych to        from the vantage point of the necessary
Japan can be assessed as a continuation of         number of qualified personnel.
this Eastern vector. All the more, from the
vantage point of Ukraine’s national interests
such a vector could be advantageous to             The distinctive features of politics and
Ukraine as it would allow it to limit the          international relations with countries of the
excessively powerful influence of Russia           East in Ukrainian higher learning
and take advantage of the potential of             institutions are given little attention, which
cooperation with countries of the Far East         makes these subjects of secondary
by gaining realistic economic profits and          importance on the overall state level.
thereby reinforcing its own sovereignty. Be        While many universities began introducing
that as it may, political analysts express their   specialization on issues of European and
doubts that there is an eastern vector in          Euro-Atlantic integration, the problem of
Ukraine’s foreign policy.                          Ukraine’s relations with countries of the
                                                   East has fairly weak representation in their
First of all, the visit of Yanukovych to China     curricula. The Kyiv-Mohyla Academy
and Japan did bring about major positive           deserves particular attention. Its master’s
changes in mutual relations between the            program in political science offers a major
countries and were purely formal in nature.        “Highly valued and socio-cultural principles
Similarly, the talks between Yanukovych            of politics dedicated to the social, political
and the heads of state of Kazakhstan and           and cultural distinctive features of Eastern
Azerbaijan produced little results.                countries”. Clearly, without introducing a
Secondly, in order to conduct a successful         system of training of specialists from
policy with countries of the East, Ukraine         countries of the East, conducting an
must propose to them concrete projects of          effective foreign policy in this direction is
cooperation. During his visits to China and        practically impossible.


   Conclusions and recommendations

   Considering the aforementioned, the visit of President Viktor Yanukovych to Japan should
   be evaluated very cautiously. On the one hand, the president demonstrated the interest of
   the two sides in mutual cooperation, at least from the formal vantage point. On the other
   hand, the prospects of such cooperation will depend largely upon the efforts of the
   Ukrainian side in improving its country’s investment attractiveness.
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   At the same time, this visit clearly demonstrated the flaws of Ukraine’s foreign policy,
   particularly in the eastern direction. Just as during his visit to China, Yanukovych focused
   his attention on attracting investment into Ukraine’s economy without any reciprocal
   proposals for mutual cooperation in major projects.

   As such, in the future representatives of the Ukrainian leadership must visit such
   powerhouses as Japan with the aim of not only attracting foreign loans and investments,
   but also concluding agreements on cooperation in specific sectors of the economy.
   Besides that, Ukraine must develop a clear-cut strategy of relations with countries of the
   East, which will not be limited to periodical visits with purely pragmatic aims and
   designate a separate place in the overall system of its foreign policy.




“Focus on Ukraine” – a weekly publication of the Democratic Initiatives Foundation that offers
insight into the main political events in Ukraine, as well as commentary and recommendations of
experts in a narrow field.

                                                   Experts:
                                               Ihor Burakovsky
                                                Valeliy Hladky
                                              Oleksansr Potiekhin
                                                 Valeriy Chaly

                                                 DIF Analysts:
                                               Iryna Bekeshkina
                                               Oleksiy Sydorchuk

                                             Project Coordinator:
                                             Natalya Yakymchuk

                                                Editor-in-chief:
                                                Iryna Filipchuk

The “Focus on Ukraine” is published by Ilko Kucheriv Democratic initiatives foundation (DIF) as part of its project
implemented under Ukraine National Initiatives to Enhance Reforms (UNITER) program, which is funded by the
United States Agency for International Development (USAID) and implemented by Pact Inc. This information product
is made possible by the generous support of the American people through the United States Agency for International
Development (USAID). The contents of the publication are the responsibility of DIF and do not necessarily reflect the
views of USAID, Pact Inc. or the United States Government. No part of this report may be reproduced or transferred
in any form or by any means, graphic, electronic, or including photocopying or by any information storage retrieval
system, without the proper reference to the original source.




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