"Ukraine Report 2003," Number 21
Ukraine Market Reform Group
Kyiv, Ukraine; Washington, D.C.
MONDAY, March 31, 2003

INDEX OF ARTICLES:

1. UKRAINE AND USA SHOULD BOOST TRADE SAYS UKRAINE'S AMBASSADOR TO THE U.S. KOSTYANTYN HRYSHCHENKO Uryadovyy Kuryer, Kyiv, and the BBC, UK, March 29, 2003

2. THE GREAT GAMBLE Did anyone in Washington really understand just how high the stakes are in its Iraq gamble? Prof. James Mace, The Day, Kyiv, Ukraine, Tuesday, March 25, 2003

3. FORECASTS: FINANCIAL NEWS FROM UKRAINE Six financial stories from Ukraine were gathered by the Financial Times Information Limited, Interfax News Service, March 27, 2003

4. PASCUAL: UKRAINE ADDRESSED THE USA WITH DESIRE TO CONSIDER IT A MEMBER OF THE ANTI-IRAQ COALITION UNIAN News Service, Kyiv, Ukraine, Friday, March 28, 2003

5. OFFICIALS DENY UKRAINE PART OF ANTI-IRAQ COALITION Viktor Medvedchuk- Ukraine is not a member of the anti-Iraq coalition Novyy Kanal television, Kyiv, and the BBC, UK, March 28, 2003

6. A CANDLE LIT IN MEMORY AND HOPE The ashes of the Holodomor Manmade Famine tug at our hearts By Tetiana Nykytiuk, The Day, Kyiv Ukraine, March 25, 2003

7. EU NEIGHBOUR STATUS "DEGRADING" FOR UKRAINE SAYS PARLIAMENT SPEAKER VOLODYMYR LYTVYN Television first programme in Kiev, and the BBC, UK, March 27, 2003

8. UKRAINE LOOKS TO INVOLVE LNM GROUP STEEL CO IN MAJOR IRON ORE PROJECT SAYS PRESIDENT KUCHMA Interfax-Ukraine, Kyiv, Ukraine, March 27, 2003

9. MAJOR UKRAINIAN PARTY SET TO PROMOTE TIES WITH RUSSIA ACCORDING TO VIKTOR MEDVEDCHUK We believe the Russian langague should be legalized UNIAN news agency, Kiev, and the BBC, UK, Mar 28, 2003

10. AGROMASHHOLDING, LARGEST AGRICULTURAL MACHINERY COMPANY IN RUSSIA AND THE CIS BEING CREATED Additional companies in Russia, Ukraine, and Kazakhstan are about to join in, Rosbalt, St. Petersburg, Russia, March 29, 2003

11. TAKING IRAQ PRIVATE COMMENTARY, By Robert Mcfarlane and Michael Bleyzer The Wall Street Journal, New York, New York, March 27, 2003

12. KOZACHENKO CASE CAN HARM GRAIN MARKET INVESTMENT CLIMATE..HEAD OF UKRAINE'S PARLIAMENTARY COMMITTEE AgriMarket.Info, APK-Inform, Dnipropetrovsk, Ukraine, March 28, 2003

13. UKRAINIANS: REVOKE FAMINE DENIER'S PULITZER Walter Duranty of the New York Times and his Pulitzer Prize By Natalia A. Feduschak, Washington Times, Saturday, March 29, 2003

14. UKRAINE KEEN TO JOIN UN OIL-FOR-FOOD PROGRAMME UNIAN news agency, Kiev, and the BBC, UK, March 29, 2003

15. UKRAINIAN REFORMER VIKTOR YUSHCHENKO KICKS OFF PRESIDENTIAL CAMPAIGN Ukrainian Television first programme and the BBC, UK, Mar 29, 2003

The Ukrainian ambassador to the USA, Kostyantyn Hryshchenko, has pledged strategic partnership with the USA in an unattributed interview with the government newspaper. Hryshchenko did not conceal that the decision to send a decontamination unit to Kuwait was dictated by the need to improve relations with the USA. Ukraine is not satisfied with the current level of bilateral trade, according to Hryshchenko. The ambassador also named big US companies working in the Ukrainian market.

The following is an excerpt from the interview published in Ukrainian newspaper Uryadovyy Kuryer in Ukrainian on 27 March; the subheadings have been inserted editorially:

Uryadovyy Kuryer readers and many other of our fellow citizens are interested in the current position and immediate future prospects of Ukrainian-US relations. We think the best way of clarifying these questions is through the Ukrainian ambassador to the USA, Kostyantyn Hryshchenko.

US remains top partner

[Journalist] Mr Ambassador, as is generally known, the USA has completed a so called ``revision' of its policy in relation to Ukraine. Are we going to resort to anything similar?

[Hryshchenko] In contrast to the USA, Ukraine has not revised its policy concerning that country. We have been and continue to remain loyal to the principles of strategic partnership with the USA. While not closing our eyes to the current difficulties in bilateral relations, we are counting on overcoming them quickly in so far as Ukraine during its years of independence has supported the USA in all questions of principle relating to international affairs, even when it involved perceptible economic losses.

The president of Ukraine [Leonid Kuchma] has ordered measures to be taken in order to normalize our relations so as to act fully in accordance with the national interests of both countries. However the success of this matter will depend on concrete deeds of Kiev as well as of Washington.

[Journalist] How, in your opinion, can the current military conflict in the Middle East influence Ukrainian-US relations?

[Hryshchenko] Today the USA views relations with any country primarily through the prism of its attitude to the Iraqi crisis settlement. The Ukrainian president's decision approved by the Supreme Council [parliament] to send the radiological, chemical and biological defence battalion to Kuwait is an important argument for the Americans in support for the idea that our relations are strategically important. Such a position held by the executive and legislative branches of Ukraine's leadership opens up the opportunity for positive progress in their further development. Ukraine's involvement in the protection of the civilian population in the zone of conflict complies with both our interests and the USA's, a fact which Washington is well aware of.

Incidentally I must stress that Ukrainian military units are not participating and will not participate in any military operations in Iraq. Their mission is essentially humanitarian - to defend the population of a country located in the zone of conflict from the effects of possible use of weapons of mass destruction. It is important that France - the decisive opponent to the idea of Iraqi settlement by force - is sending a similar radiological, chemical and biological defence unit to Qatar.

After the conflict ends Ukraine will be ready to take part in the post-war reconstruction of Iraq. I am convinced that our presence in the Persian Gulf region for peacekeeping purposes during this difficult period will turn out to be an important factor in promoting the cooperation of Ukrainian companies in resolving such an enormous task for the world community.

[Journalist] Some Ukrainian politicians say that we are not maintaining any kind of contact at all with the USA at present. What can you say in this respect?

[Hryshchenko] I would like to stress that our cooperation with the USA has not stopped; on the contrary, it is developing in certain directions more actively than in the past. For example, the US (?Civilian Research Development Foundation) has announced the results of a competition for the joint implementation of scientific-research projects for fighting terrorism by former Soviet countries.

Of the 140 applications received six have been chosen to sponsor. Three of them will be executed jointly with Ukrainian scientists (one with Georgian scientists and two with Russian scientists).

Among the winners are the Institute of Physics for Semi-Conductors, the Institute of Monocrystals of the National Academy of Sciences of Ukraine and the Dnipropetrovsk State Technical Railway Transport University.

Cooperation in the area of information technology is rapidly developing. Last summer a serious conference on the role of information technologies in globalization took place in the embassy. It attracted over a hundred representatives of US and Ukrainian companies. Several of them are already working together successfully in the information technology field while others are interested in joint ventures in this area. Conference participants included representatives of Boeing, Eurosoft International, Hughes Network Systems, A-Ventures, Relay Software and IC Data.

We have established a working relationship with the Technology Council of North Virginia which unites approximately 1,500 high technology companies in the USA. We also have taken part in a series of events in Microsoft's regional office. It gives us pleasure to observe how the USA organizes the manufacturing of contemporary products using Ukrainian know-how. An American company in Florida is going to manufacture a new generation of lithium sources of current designed by Dnipropetrovsk scientists.

At present we are actively working with the (?US Industrial Coalition) which unites 146 US companies interested in realizing joint high technology projects with Ukrainian scientific research institutes within the framework of US government-financed programmes for preventing the proliferation of weapons of mass destruction and dual-purpose technology.

Trade insufficient

[Journalist] How would you characterize the current state of Ukrainian-US trade relations?

[Hryshchenko] Unfortunately it's impossible to be satisfied with them. According to US statistics, bilateral trade stood at 655.4m dollars [in 2002] of which more than 419m dollars accounted for Ukrainian exports to the USA. It would appear there's reason to be happy with our positive balance, however in comparison to 2000 our exports more than halved.

There are a lot of reasons behind this. The USA in response to demands from US plaintiffs launched more than ten special antidumping investigations over the past three years regarding the import of Ukraine-manufactured goods, primarily metals and chemical products. As a result the US side introduced sanctions in the form of a high dumping margin (it is usually anything from a few dozen to a few hundred per cent in size) making the delivery of the products impossible.

[Journalist] What's the way out?

[Hryshchenko] It would be worthwhile for our businessmen, who still have not gained much experience of international trading, to carefully study markets and think about prospects, rather than immediate gains. It was this very lack of careful planning in the injection of Ukrainian goods into the US market which provoked such a defensive reaction from the US business community: it pushed all the buttons given to it by the oldest anti-dumping legislation in the world. That's why now, in designing a strategy to penetrate other sectors of the US market which still remain open to us, it is necessary to draw the right conclusions and to act in such a way as not to be exposed to new antidumping investigations.

The question of Ukraine obtaining the market economy status continues to be important. This will make it possible for our manufacturers and exporters to compete with foreign entrepreneurs on equal terms. In my opinion the US Ministry of Trade has every reason now to resolve this question positively. We are continuing to work with the USA and are looking forward to receiving this status next year.

With regard to copyright protection a lot has been done here already however it remains to introduce appropriate changes to legislation regulating the production and circulation of optical information carriers.

[Omitted passage: Hryshchenko on Ukraine's efforts to join the World Trade organization]

[Journalist] Which role did the USA play in the matter of introducing financial sanctions against Ukraine [in December 2002]?

[Hryshchenko] After the terrorist acts of 11 September 2001 the USA identified the fight against money laundering as a priority for international activity and became one of the most active members of the special financial group which was set up to prevent such crime - the FATF [Financial Action Task Force]. Because of the absence of laws on money laundering in Ukraine and because of the presence of essential weaknesses in laws later on, the USA assisted FATF in approving the recommendation to introduce financial sanctions against our country. The USA was also the first member of FATF to practically introduce them.

The new Ukrainian government and Supreme Council have prepared and approved all the necessary changes to relevant legislative acts within a very tight deadline which was positively assessed by the USA and other influential members of FATF. This eventually resulted in the lifting of sanctions.

Today it is possible to begin work to make it possible to cancel our country from the list of non-cooperating states (as a rule this work takes about a year) and to join FATF in the future. However, this is only possible on condition that an anti-money laundering system is set up and that it functions effectively. And we are expecting US assistance in forming such a system.

US investors in Ukraine

[Journalist] Now about investment cooperation? What do US businessmen think about the Ukrainian market? Is it as 'terrible' and 'uncivilised' as reported in certain publications in the Western press?

[Hryshchenko] I'll give you an example which is more vivid: for a few years now US investors have occupied the first place among foreign investors in the Ukrainian economy. If it were not expedient for Americans with their particular demands in terms of work conditions, profitability and other investment factors to work in Ukraine then they would not come to us.

Yet we are observing the steady growth of US capital investment although its size is far from appropriate in terms of the two countries' potential.

Direct US investment in Ukraine (cumulatively since 1992) stood at 898m dollars on 1 October 2002 or 16.8 per cent of all foreign direct investment into our economy. The USA is in the lead also with regard to portfolio investments - these comprise almost 23.6 per cent of such capital investments.

At the year beginning 1,186 enterprises with US capital worked in Ukraine, including 724 joint Ukrainian-US ventures. The greatest interest of partners is in domestic trade, the food industry, the provision of financial services, motor vehicle assembly, metal processing, building and communications.

Approximately 250 large strategic investors have long-term plans to invest capital in Ukraine (Cargill, John Deere, Coca-Cola, Boeing, Kraft Foods and many more). In January, Procter and Gamble decided to relocate one of its factories manufacturing female hygiene products to Ukraine. Entering the Ukrainian market is US insurance giant, American Insurance Group (AIG), which through its representative office is involved in investigating private and group life assurance as well as having plans to expand its services into other sectors of the insurance market in Ukraine.

However the support of medium and small US business investment is no less significant, in fact it is this very sector that is developing the most dynamically.

As of this writing, there are reports that the Americans have found a dual-use chemical facility south of Baghdad that might have been making chemical weapons.

At the same time, the reports in local and Russian media outlets are strongly negative, while Ukrainian public opinion is overwhelming against the American action.

As was the case during the intervention in the former Yugoslavia, all the old Soviet-era anti- American stereotypes are being reinforced: America is an aggressor out to take over the world, and, as the Russians would have it, only a strong Russia can defend international order against America's evil designs.

The bottom line is not the morality of Russia accepting large amounts of US aid (only Israel and Egypt get more from the US taxpayer), then scouring the world in hopes of putting together some sort of coalition, as during President Putin's tour of China and India not so long ago, that might be able to contain the interests of the country from which it so freely takes money, or even the obvious pride with which Russia's Channel One and NTV World simultaneously display the ballots of the Chechnya referendum, where the voters seem to have a box to vote yes but nothing to mark in order to vote no.

It is the fact that the country of which I am a citizen has started a war without being able to convince most of the world that the weapons of mass destruction it claims to be protecting the world from are actually in the possession of Iraq. "We haven't found them yet, but we certainly will," say the US commanders, and then the war will be justified after the fact.

Meanwhile, Russian military intelligence says on television that Iraq does not possess such weapons.

Who will be proven right? Nobody really seems to know. Has anyone in the American establishment really calculated the damage to America's reputation should it not find the weapons it says were so dangerous that it had to go to war? This will certainly give Ukraine, a country still on the edge of moving toward Europe or Eurasia, a major push toward a center of gravity that, for all its willingness to accept American largess, is unlikely to ever be America's friend or ever evolve a socioeconomic or political system compatible with Western standards.

Russia's President Putin has called America's move against Saddam Hussein a major political mistake, and in such a case he would certainly be proven right. In this part of the world the consequences would indeed be catastrophic.

The IMF predicts real GDP growth in Ukraine at 4% in 2003 and 2004 according to a report by the IMF mission that visited Ukraine in February.

The Nominal GDP is forecast at 240 billion hryvnya in 2003 and 262 billion hryvnya in 2004. The balance of payments current account surplus is expected at $2.113 billion (4.8% of GDP) and $1.289 billion (2.7%), respectively, and inflation at 6% and 4%.

The IMF predicts that National Bank of Ukraine international reserves will be equivalent to 2.5 months of goods and services imports at the end of the year and 2.7 months at the end of 2004 (2.3 months at the end of 2002 according to preliminary estimates).

Foreign debt, according to IMF forecasts, will total 22.5% of GDP at the end of 2003 and 20.4% in 2004 (24.9% at the end of 2002).

Prime Minister Viktor Yanukovych said that Ukraine will make a foreign debt payment in mid-March.

"On March 15, [the country] will transfer a large payment on its foreign debt. We are ready repay the state's foreign debt," Yanukovych said.

The prime minister recalled that Ukraine does not plan any further foreign borrowings until it repays its previous ones and until "real interest rates" appear.

In 2003, Ukraine will have to repay $1.53 billion on its foreign debts, in addition to March and September payments on its Eurobonds estimated at $325 million each.

Ukraine posted inflation of 1.1% in February, the state statistics committee told Interfax. Inflation was 1.5% in January.

Prices for food goods went up 1.5% in February (2% in January), non- food goods did not go up (up 0.1%) and services rose 0.1% (0.8%).

The monetary base in Ukraine increased 0.34% in February 2003 to amount to 29.9 billion hryvna at the start of March, the National Bank of Ukraine said in a press release.

The money supply in February increased 3.2% to 64.9 billion hryvna. Cash in circulation outside banks increased 4.1% to 25.5 billion hryvna.

As reported earlier, the monetary base in Ukraine in 2002 increased by 34%, with the money supply up 42% and cash outside banks - up 35.7%.

According to forecasts from the National Bank, the Ukrainian monetary base will increase 17%-20% in 2003, and the money supply will increase 22%-27%.

The International Monetary Fund is wary of the idea to set up a reconstruction and development bank in Ukraine, according to the report of the IMF mission that visited Ukraine in February.

The Fund's concerns are based on the negative experience of other countries in this issue.

The Ukrainian president at the end of 2002 instructed the National Bank of Ukraine and the government to discuss the setting up of such a bank. The issue had previously been put off due to a lack of budget financing. The idea to set up a reconstruction and development bank is backed by the National Bank and the Association of Ukrainian Banks.

The main task of the National Bank's monetary policy should be to ensure low inflation, the IMF report states. For this it is important to ensure central bank independence and to make monetary policy objectives transparent.

The IMF mission believes the National Bank needs to carry out a more flexible exchange rate policy in order to react to changes in the balance of payments and demand for money. Intervention on the currency market should be aimed chiefly at increasing international reserves, the report states.

Commenting on the banking system overall, the Fund said it was necessary to strengthen sensible regulation, including raising capital requirements for banks.

The authorities should take steps to strenghten the financial position of Oshadbank and Ukreximbank.

Russia's National Reserve Bank plans to acquire a controlling stake in NRB-Ukraine, the bank's president, Alexander Lebedev, told Interfax. "I think that in the very foreseeable future we will officially register the controlling stake of the Ukrainian bank at NRB directly."

The bank plans to complete the deal in the next six months, he said. NRB-Ukraine is part of the NRB group.

The Ambassador of the USA to Ukraine Carlos Pascual announced at a press conference in Kyiv today that Ukraine addressed to the American government with a demand to consider it a member of the anti-Iraq coalition.

According to an UNIAN correspondent, the Ambassador underscored that the Ukrainian Presidential Administration, as well as Ukraine's Foreign Ministry expressed their desire to consider Ukraine a coalition member. He underlined that they were reported about it here in Kyiv, as well as in Washington.

C.Pascual said that it does not mean Ukraine is playing a battle role, quite the contrary, it is playing a defensive role. Besides, in his words, the USA consulted with the Ukrainian authorities on the questions relating Ukraine's entrance into the anti-Iraq coalition, and they are pleased they are ready to say that they regard the RCB-battalion of Ukraine, based in Kuwait, a contribution of Ukraine into the coalition.

At the same time, C.Pascual underscored that the right to give concrete orders for the use of the Ukrainian RCB-battalion belongs only to the Ukrainian military men.

As reported earlier by UNIAN, on March 27 Ukraine's Foreign Affairs Minister Anatoliy Zlenko denied the possibility of the Ukrainian RCB-battalion staying in other Persian Gulf countries, except Kuwait. In such a way the Ukrainian Minister commented on demand of journalists on the yesterday's speech of USA President George Bush, who announced that subdivisions from Ukraine, Poland, Slovakia, Czechia, Romania, and Bulgaria are sent to the region for struggle against possible consequences in case of the use of extermination weapon.

"We have an invitation from friendly to us country Kuwait, and our battalion is dislocated namely in this country", underlined A.Zlenko.

At the same time, he said that "Ukraine takes into account the assessment of the American party of its position and actions due to the crisis relating Iraq, and considers it (this estimate) only as a point of view of the USA relating the place of Ukraine in the efforts of the international community members for the regulation of the current crisis situation".

A.Zlenko underscored that Ukraine was and remains the participant of the anti-terrorist coalition, and proved its active participation in the struggle against terrorism with concrete steps and intends to make its contribution into this struggle in future.

Today, however, Carlos Pascual said official Kiev had asked Washington to interpret the involvement of a Ukrainian chemical battalion as joining the anti-Iraq coalition.

Why does my heart ache so whenever I recall that old story? I heard it from my mother when I was a little girl. Perhaps I was in a bad mood and didn't want to clean my plate. In such cases parents back in the 1950s, would say, "You must eat everything on your plate, for your dad and mom..." I don't remember, but I clearly remember what my mother told me. It had happened in her youth and the story would have a lasting impact on my mentality...

My mother, Antonina Tkachuk, was fortunate to be born in Kyiv. Although the famine after the Russian Revolution did not discriminate among its victims, it was not as ruthless in the big city. However, my mother's famished childhood, when a boiled beet and no bread was considered a festive treat in winter, would have its toll in the form of countless ills as she grew older.

After school she enrolled in an agricultural technical school in Kyiv. Together with other happily young and enthusiastic Komsomol girls, she would be sent to neighboring villages for her academic practice. It was in 1933 and food was a problem in Kyiv, so the girls expected to be better off on the collective farms.

Somehow, my mother, then 16, went to the village assigned her alone. She had to walk 60 kilometers. She had long eaten the small slice of bread she had taken from home. Her young system protested vigorously an empty stomach, and she strained her eyes, trying to spot a village by the road. If and when she found one she thought she would be sure to have something to eat; there were no people anywhere in the world as friendly and hospitable as those in the Ukrainian countryside.

Finally, she saw a village. It looked strange. No dogs barking, no chickens cackling, no children playing and shouting. There was no one in sight. As she reached the place she found it deserted and frighteningly quiet, every home standing like an old blind beggar, all the windows hastily boarded up, the boards blackened with rain and snow. And then she noticed a cabin with its door ajar. Tentatively she stepped inside. "Anyone here?" Something moved in the rags on top of a big stove.

She heard a faint woman's voice, "What do you want, little girl?" My mother looked closer and recoiled, horrified. A living skeleton was looking at her, eyes glinting in a face all skin and bones. Stammering, she explained she was on her way to such-and-such village and that she had hoped to find a place to rest and have something to eat; that this place looked so weird, so dead. "You're right, the place is dead. Some died of hunger, others left for the city to stay alive," the woman whispered and then told my mother something she refused to believe. No one would in his sound mind, with healthy instincts, above all that of self-preservation, demanding food and drink. "See that small chunk of bread on the table? Take it. You're young, you need it. I don't. It won't help me anyway. I'm dying." The woman didn't ask her to give her bread, but to take it and eat it!...

My mother took it and ate it (it was hard as stone, made from goosefoot, weeds, and acorns) as she went on her way. She ate and wept for that woman with such a big heart and because there was nothing she could do to help, because she could not understand what was happening. No one heard her...

Like so many others, she knew nothing about the manmade famine, the Holodomor. She knew that one of her friends had been told by a well- wishing chairman of a collective farm to go home, because she looked too healthy for her own good. One morning in Kyiv she had seen several dead emaciated bodies in country clothes by a bakery. A woman nearby had whispered that they had eaten fresh bread on an empty stomach...

Now we know about frequent cases of cannibalism in Ukrainian villages, about NKVD cordons on city outskirts to prevent residents finding out about the Ukrainian countryside, only yesterday the world's most industrious, hospitable, and thriving, now dying of hunger. The countryside was the nation's gene pool, the carrier of the mother tongue and age-old culture. At the time everything was officially explained by poor harvests and no questions were asked. Those that did were soon told to mind their own business and pointed to an empty chair where their colleague had sat only yesterday...

My mother survived several famines, but her story about that dying woman offering her last crust to a girl she did not know was the most arresting. No one in our family threw out any bread. My mother was always very hospitable and would make every visitor join us at the table, however low the family budget at the time.

Memories of the Holodomor decades after made her collect dry bread and carry it to the Besarabka market and give to young women selling raw meat, saying, "It's for your cattle." It took them some time to understand the intelligent-looking and well-dressed lady (she was a philologist and journalist). She, in turn, did not understand them when they refused to take her bread and tried to explain that she could not just throw it out... We kept our door open for relatives and guests, welcome and otherwise. No one would ever leave our home without being treated to some food by my mother.

It was a law she strictly observed. Her attitude toward bread was not because she had become stingy but because she felt profound respect for every tiller, every baker, and also because she harbored a deep sorrow she would retain to her dying day. It was her way to repay her debt to that starving country woman.

I told my daughter my mother's story and she was very impressed. So much so that she still keeps a sharp eye on everybody at the table, lest they leave any bread. She makes them eat it or eats it herself. I also know that she will always respect people living in the countryside and wearing simple clothes...

A reverent attitude toward bread is a tribute to all those callused hands growing wheat and rye; it is our genetic memory of the millions of men, women, and children that died because they were denied their daily bread...

Politicians at all levels now seem obsessed with some national idea capable of uniting the entire Ukrainian people, allowing each and everyone to live a decent life, as befits a European nation with a rich culture and tremendous intellectual potential.

I will allow myself an assumption: a candle should be lit in every Ukrainian window (as so timely proposed by Prof. James Mace, a leading political analyst opening our eyes on the truth about the Holodomor) on a certain day commemorating the victims, becoming a symbol of national unity. On that day one and all should remember the ordeals befalling our people.

Looking back at that grim past, we should feel happy, even if because we have been spared that tragic lot, and realize that our strength is in our unity. We should then feel inspired to build a happier future.

If we do perhaps we will make Shevchenko's dream come true:

"Then shall our day of hope arrive,
Ukrainian glory shall revive,
No twilight but the dawn shall render
And break forth into novel splendor....
Brother, embrace! Your hopes possess,
I beg you in all eagerness!"

The February 12 Verkhovna Rada hearing on the Holodomor , the Great Ukrainian Manmade Famine of 1932-33, was a triumph not of any one person, but of historical justice for millions who perished - not only in the countryside but for the Ukrainian people as a whole, for a nation literally dismembered by terror against those who had taken part in the earlier policy of Ukrainization and suppression of what they had done, dismembered by being cut off from much of its own history and culture, which were fed them in such a distorted form that the very word, Ukrainian, seemed to become second rate, an object of derision for a people that seemingly could not become a nation and could not quite make it to a supposedly superior Russian culture.

The five minutes I was given to describe the work of America's Ukraine Famine Commission did not suffice for even a fraction of what I should have said, other than that we did the best we could with what we had. Ukraine, with a few exceptions like Communist leader Petro Symonenko, has now come to basically the same conclusion we did in 1990: that Ukrainians had been the victims of genocide in the 1930s and were crippled to an extent that many of the shortcomings of their contemporary state directly result from the lack of what could otherwise have been.

As a foreign citizen I am far from comfortable making policy recommendations even in the face of catcalls from some Communists that I would do better to go back to my American Indians. Yet, the years I have spent researching this tragedy compelled me to try to give one piece of advice that I am not certain was understood.

As one who unsuccessfully attempted to establish an institute for the study of genocide a decade ago I can only welcome the current initiative by various political figures to establish an institute to study the famine.

The call by Communist Borys Oliynyk to name the names of all the guilty and all their victims, while far easier said than done, is also commendable as is the belated movement to erect a monument to the victims.

I attempted only to counsel an act of national memory accessible to everyone - that on the national day to commemorate the victims of 1933 (fourth Saturday of November) a time be appointed when each member of this nation where almost every family lost loved ones will be invited to light a candle in their window in memory of those who suffered.

It would be only a fitting response to the words of Father Oleksander Bykovets, son of a Ukrainian Autocephalous Orthodox priest who himself became a priest in America: Everybody worried about one thing - everybody was ready to be a martyr and knew that if not today they would be destroyed tomorrow but they worried whether the world would know about this and whether the world would say something. And there was another problem of a still more intimate character: Would there be somebody to pray for those who were perishing?

Even after seven decades, lighting a candle in the window seems to me a fitting answer.

Mariyana Anhelova is reporting from Rome by phone to the Ukrainian Television first programme in Kiev, in Ukrainian on March 27, 2003 and her story was published by the BBC Monitoring Service in English, UK, March 27, 2003.

Kyiv. (Interfax) - Ukrainian President Leonid Kuchma has asked the government to facilitate the involvement of the LNM Group, one of the world's biggest steel companies, in the completion of a major iron ore mining complex in Krivoi Rog.

Lakshmi Mittal, president of LNM, said at a meeting with Kuchma that the group was prepared to invest in the project, which is being delivered by Ukraine, Slovakia and Romania to finish building the Krivoi Rog Mining and Beneficiation Plant for Oxidized Ores (GOKOR), a spokesman for the Ukrainian president has said.

The Krivoi Rog complex will cost an estimated $750 million to complete. Overall project costs are $2.4 billion. The complex is approximately 80% complete.

The LNM Group produces around 38 million tonnes of steel annually.

The agreement to build the Krivoi Rog complex was originally signed on October 20, 1983 by the USSR, Czechoslovakia, East Germany and Romania. Ukraine inherited the project when the USSR broke up and then revived the deal with Romania and Slovakia.

Kyiv, 28 March: "The United Social Democratic Party of Ukraine [USDPU] should become a beachhead for friendly attitude towards Russians and Russia itself in Ukrainian politics. Such a stand absolutely coincides with the opinion of a majority of our compatriots," the USDPU leader [and head of the presidential administration], Viktor Medvedchuk, has said.

Speaking at the 27th USDPU congress today, Medvedchuk said that a majority of Ukrainian citizens has believed during these years of Ukraine's independence and keeps believing that Ukraine and Russia should be independent yet friendly states with open state borders free from customs or visa restrictions. "Almost 65 per cent of Ukrainian citizens share this view today," Medvedchuk said.

"Whether or not someone likes it, we must develop trade and economic relations with Russia. The fate of hundreds of enterprises and dozens of thousands of jobs in many regions of Ukraine depends on this. As Social Democrats, we cannot allow our citizens to be doomed to unemployment because of political games," Medvedchuk said.

He believes that recent top level Ukrainian-Russian accords on the prospects for the creation of a single economic space are absolutely in line with the national interests of our state.

In addition, Medvedchuk said that the USDPU could cooperate with the left on the status of the Russian language. "We should cooperate on this issues more closely, we should put forward joint initiatives, prepare draft laws jointly," Medvedchuk said.

"Many people are concerned about the status of the Russian language in Ukraine. The stand of the Social Democrats is clear and principled. We regard the language issue primarily as a human rights issue. The state should guarantee its citizens the right to use the language they want, to study it and to receive information in it.

As regards the Russian language, we believe that its status should be legalized because it is the native language or one of the two native languages for a majority of Ukrainian citizens. This stand is also supported by a majority of Ukrainian population," Medvedchuk said.

Krasnoyarsk, Russia, March 29. The creation of the Agromashholding private machinery building company, the largest in Russia and the CIS, by the Siberian Machinery Holding, continues. The initiative has the complete support of Alexei Gordeyev, Russia's Minister of Agriculture.

According to what Yuri Koropachinsky, President of the Siberian Machinery Holding said to Rosbalt's reporter, the new company, whose output will be cheaper than imported products, is about to begin shipping grain and other combines, diesel engines and complete sets of spare parts to agricultural producers. The company will also service what it produces.

Agromashholding already includes the Krasnoyarsk Combine Plant, the Volgograd Tractor Plant, the Altai-Diesel plant, the Agricultural Machinery Plant in Nazarov, Krasnoyarsk Territory, the Oryol Combine Plant, and the Kostanai Diesel Plant in Kazakhstan.

According to Mr. Koropachinsky, other companies in Russia, Ukraine, and Kazakhstan are about to join in. When these companies begin working as a team, they will cover 45% of the total demand for combines and up to 70% of that for caterpillar tractors and diesel engines. The holding already employs 22,000. Its annual turnover is over USD 200 million.

Imagine the day after the war has ended and Saddam Hussein is gone. Tens, if not hundreds of thousands of our uniformed men and women will be engaged in peacekeeping and humanitarian operations. These troops and other U.S. government officials (and, we hope, key allies) will be facing a highly complex, multi-year campaign to establish political, economic and social stability by helping to build the basic institutions that make democracy possible.

It's a picture both daunting and grand in its scope. Yet it's also missing a key element that could make the difference in securing genuine post-war progress in Iraq and the region: the critical role that the private sector can play in providing support -- intellectually and financially -- in the rebuilding process.

Typically in the past, when the U.S. and its Western allies were involved in wars, they assumed a major financial burden in post-war reconstruction. Official assistance became the principal source of financing, with emphasis on the reconstruction of infrastructure and utilities damaged by the war. The World Bank and other international agencies were called upon to develop plans and finance the reconstruction and revival of the economy.

In the case of Iraq, it is unlikely that this approach will be followed for several reasons. Most G-7 countries are facing considerable fiscal deficits and cannot afford to channel a significant amount of resources to the effort. The willingness of these countries to help will also be affected by the split over the decision to go to war, inevitably putting the greatest financial burden on the U.S. and others involved in military action. The international financial agencies will be putting their priority on social relief but not on stimulating long-term sustainable growth.

Since Iraq is a relatively rich country in natural resources, particularly oil, it will be able to absorb the cost of rebuilding the physical infrastructure. But the revival of the economy -- based on new investment, project development and job creation -- will have to be led by the private sectors of the global economy. At a time when President Bush and other administration leaders pursue their vision for political reform and democracy in Iraq, we in the private sector should help create and implement the policy measures that will make an attractive investment climate in Iraq.

This public-private partnership could play a critical role in making possible dramatic social and economic changes in Iraq and other countries in the region.

In order for this investment to flow, the interim government of the new Iraq must move quickly to put in place an economic policy framework that will persuade investors and lenders to take the risks involved.

Countries throughout Asia, Africa, the former Soviet bloc and South America provide vivid examples of unattractive business environments, low rates of economic growth, corruption and limited foreign capital investment. To escape this trap, successful developing countries -- and this can include Iraq -- must put in place policies founded on transparency and legal recourse that attract private investment. The private sector brings the coveted economic growth.

What concrete policy measures are we talking about that make such a difference? Empirical evidence backed by a thorough recent analysis of the economic policies of 128 countries identified several key drivers for a business environment that will attract foreign direct investment: a predictable legal system, sound corporate and public governance, liberal policies toward foreign trade and international capital movements, and the reduction of corruption and government abuse of power.

In the case of Iraq, the U.S. and its allies would be well advised to put together a team of private sector business leaders as a "steering committee" to supervise and monitor the execution of such policy measures. Private sector specialists could also help identify and develop specific oversight measures needed to maintain Iraq's performance on key elements of reform.

In the oil sector, priority should be given to improved transparency and predictability to encourage the early involvement of private international companies. Today, Iraq's oil industry is plagued by corruption and bitterly resented by the Iraqi people. Cleaning it up would boost the economy and give Iraqis some evidence that change and social benefit is coming.

Properly implemented, this effort will play a major role in accelerating the influx of investment, diversifying the economy and providing sustainable and significant job opportunities for Iraq's people. Private investment can make a major contribution to reducing poverty, improving the quality of life for the Iraqi people and eradicating this breeding ground for terrorism.

The U.S. must demonstrate that it is not only the most powerful military power on the planet, but also the foremost market economy in the world, capable of leading a greater number of developing nations to a more prosperous and stable future. Major U.S. corporations, jointly with other multinationals, should lead the effort to create capital-friendly environments in developing countries.

Foreign direct investment in Iraq will help bring prosperity and regional stability. That is as much in the interest of our own national security as in theirs.

Head of Ukrainian Verkhovna Rada's Agrarian Committee Ivan Tomych believes that the scandal around grain market in Ukraine can affect negatively investment situation in this sphere of business.

"For investors it is a signal of shaky situation in the grain market," he said in an interview on Thursday, following sitting of Pechersk District Court of Kiev, where he had been present.

The court sanctioned arrest of Ukraine's ex-Deputy Prime Minister for Agriculture Leonid Kozachenko, who had been accused of office abuses and tax evasions.

Speaking about the court's decision, Tomych said he was surprised with sanctioning of Kozachenko's imprisonment. "I don't think L. Kozachenko could be I any way dangerous for society", he said, adding that the procurator's office could have been looking into the case without arresting the ex-official.

Replying to reporters' questions, I. Tomych did not exclude that there was "political subtext" in Kozachenko's case. However, he found difficulty in naming political forces that could be standing behind the scenario.

He informed that parliament would certainly react upon the situation, and the issue would be examined either at the sitting of the agrarian committee or in the common session.

He stressed that nobody could accuse any person before legal decision of the court.

He also said that excessive secrecy about this case was causing more problems. Admission to the court sitting had prohibited to anybody but Kozachenko's solicitors, procurators' attorneys and himself as a People's Deputy of Ukraine. (www.agrimarket.info)

Ukrainian officials and Ukrainian-Americans have begun a campaign to revoke the Pulitzer Prize awarded to a New York Times writer who reported that a man-made famine that killed millions in the 1930s never happened.

"It has become a world action," said Tama Gallo, executive director of the Ukrainian Congress Committee of America, a New York-based group that began the effort to have the prestigious prize awarded to Walter Duranty in 1932 withdrawn.

Mr. Duranty, who was the Times' Moscow correspondent from 1921 to 1934, won the Pulitzer for a 1931 series of reports about Soviet dictator Josef Stalin's five-year plans to reform the economy.

His stories appeared in the Times before the Ukrainian famine of 1932-1933, which left 5 million to 10 million dead.

Western historians now generally agree that the famine was the result of Stalin's industrialization effort and an attempt to break the will of the independence-minded Ukrainian people.

To ensure cities were fed, the Soviet dictator set impossibly high grain quotas for Soviet Ukraine's collectivized farmers and removed every other source of food available to them.

Police were sent to the Ukrainian countryside to monitor compliance. Anyone found hiding grain was fatally shot, according to eyewitnesses.

Ukrainian-Americans have sporadically attempted to have Mr. Duranty's prize withdrawn.

With the 70-year anniversary of the famine being commemorated in an independent Ukraine, the movement has gained new momentum. In unprecedented hearings recently in parliament, demands were made that the prize be revoked.

The government in Kiev is expected to ask the United Nations to recognize the famine as an act of genocide against the Ukrainian people.

In his 1932-1933 dispatches, Mr. Duranty denied that a famine was occurring in Soviet Ukraine, although he has been quoted in several books as privately telling friends he had never seen such misery.

Sig Gissler, administrator for the Pulitzer Prizes, said he understands the concern regarding Mr. Duranty, who died in 1957, but past Pulitzer boards have not deemed it necessary to revoke his prize.

"I do think there is a tendency to merge the prize, which is from reporting in 1931, with events in 1932-33," he said.

Mr. Gissler said he could not speculate whether future boards would return to the question of withdrawing the prize.

The New York Times itself has criticized Mr. Duranty's reporting. In displays and materials devoted to its Pulitzer Prizes, the Times notes that writers at the paper and elsewhere have discredited his coverage.

Still, the Times has not asked that the prize be revoked.

"The Pulitzer Board has reviewed the Duranty prize several times over the years, and the board has never seen fit to revoke it," said Catherine Mathis, vice president of corporate communications for the New York Times Co. "In that situation, the Times has not seen merit in trying to undo history."

Kyiv: The Ukrainian Foreign Ministry hails the unanimous adoption by the UN Security Council of resolution 1472 (2003) modifying the UN's Iraqi oil-for-food programme, the Foreign Ministry's press service has said. Ukraine is ready to join this programme, the press service said.

The resolution paves the way for resuming the programme, which is crucial to preventing a humanitarian disaster in Iraq and providing urgent aid to suffering civilians.

The resumption of the programme is especially important in view of the military action which is under way in Iraq. "We hope that all necessary conditions, including security, will be created to implement this humanitarian programme," the press service said.

The delegates adopted a resolution supporting Yushchenko's idea of creating a new social and political force which would lay a foundation for a European-like political party [on the basis of Our Ukraine].