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Diplomacy in Action

Ukraine (01/03)


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For the most current version of this Note, see Background Notes A-Z.

PROFILE

OFFICIAL NAME:
Ukraine

Geography
Area: 233,000 sq. mi..
Cities: Capital--Kiev (often transliterated as Kyiv from Ukrainian, pop. 2.6 million. Other cities--Kharkiv, Donetsk, Dnipropetrovsk, Odesa, Lviv.
Terrain: A vast plain bounded by the Carpathian Mountains in the southwest and by the Black Sea and the Sea of Azov in the south.
Climate: Continental temperate, except in southern Crimea, which has a subtropical climate.

People
Population (est.): 48.6 million.
Nationality: Noun--Ukrainian(s); adjective--Ukrainian.
Ethnic groups: Ukrainians, Russians, Jews, Belarusians, Moldovans, Bulgarians, Poles, Hungarians, Romanians, Crimean Tatars, and other groups.
Religions: Ukrainian Orthodoxy, Ukrainian Greek Catholicism, Judaism, Roman Catholicism, Islam.
Languages: Ukrainian, Russian, others.
Education: Literacy--98%.
Health: Infant mortality rate--22/1,000; life expectancy--61.6 yrs. males, 72.8 yrs. females.
Work force: 23 million. Industry and construction--32%; agriculture and forestry--24%; health, education, and culture--17%; transport and communication--7%.

Government
Type: presidential-parliamentary.
Independence: August 24, 1991.
Constitution: First post-Soviet constitution adopted June 28, 1996.
Branches: Executive--president, prime minister, cabinet.
Legislative--450-member parliament, the Supreme Rada (members elected to 4-year terms). Judicial--Supreme Court, Courts of Appeal, local courts, and Constitutional Court.
Political parties: Wide range of active political parties and blocs, from leftist to center and center-right to ultra-nationalist.
Suffrage: Universal at 18.
Administrative subdivisions: 24 provinces, 1 autonomous republic, and two cities with special status.

Economy
Nominal GDP (2002 est.): $39.65 billion.
Annual growth rate (2002 est.): 4.1%.
Nominal per capita GDP (2002 est.): $815.
Natural resources: Vast fertile lands, coal, natural gas, various large mineral deposits, timber.
Agriculture: Products--Grain, sugar, sunflower seeds.
Industry: Types--Ferrous metals and products, coke, fertilizer, metallurgical equipment, diesel locomotives, tractors.
Trade (2001): Exports--$21.1 billion: ferrous and nonferrous metals, mineral products, chemicals, machinery, transport equipment, grain, and textiles. Imports--$20.5 billion: energy, mineral fuel and oil, machinery and parts, transportation equipment, chemicals, textiles, and paper.

PEOPLE
The population of Ukraine is about 48.6 million. Ethnic Ukrainians make up about 73% of the total; ethnic Russians number about 22%. The industrial regions in the east and southeast are the most heavily populated, and the urban population makes up about 70% of the population. Ukrainian and Russian are the principal languages. Although Russian is very widely spoken--in the 1989 census (the latest official figures)--88% of the population identified Ukrainian as their native language. The dominant religions are the Ukrainian Orthodox Church and the Ukrainian Greek Catholic Church, which practices Orthodox rites but recognizes the Pope as head of the church. The largest part of the Ukrainian Orthodox Church belongs to the Moscow Patriarchy; however, following Ukrainian independence a separate Kiev Patriarchy also was established, which declared independence from Moscow. In addition to these, there also is a Ukrainian Autocephalous Orthodox Church.

The birth rate of Ukraine is declining. About 70% of adult Ukrainians have a secondary or higher education. Ukraine has about 150 colleges and universities, of which the most important are at Kiev, Lviv, and Kharkiv. There are about 70,000 scholars in 80 research institutes.

HISTORY
The first identifiable groups to populate what is now Ukraine were Cimmerians, Scythians, Sarmatians, and Goths, among other nomadic peoples who arrived throughout the first millennium B.C. These people were well-known to colonists and traders in the ancient world, including Greeks and Romans, who established trading outposts that eventually became city states. Slavic tribes occupied central and eastern Ukraine in the sixth century A.D. and played an important role in the establishment of Kiev. Situated on lucrative trade routes, Kiev quickly prospered as the center of a powerful state of Kievan Rus. In the 11th century, Kievan Rus was, geographically, the largest state in Europe. Christian missionaries, Cyril and Methodius, propagated the Christian faith and the Cyrillic alphabet. Kievan Rus Prince Vladimir converted the Kievan nobility and most of the population to Christianity in 988. Conflict among the feudal lords led to decline in the 12th century. Kiev was razed by Mongol raiders in the 13th century.

Most of the territory of what is modern Ukraine was annexed by Poland and Lithuania in the 14th century, but during that time, the Ukrainian people began to conceive of themselves as a distinct people, a feeling that survived subsequent partitioning by greater powers over the next centuries. Ukrainian peasants who fled the Polish effort to force them into servitude came to be known as Cossacks and earned a reputation for their fierce martial spirit and love of freedom. In 1667, Ukraine was partitioned between Poland and Russia. In 1793, most of modern-day Ukraine was integrated into the Russian Empire.

The 19th century found the region largely agricultural, with a few cities and centers of trade and learning. The region was under the control of the Austro-Hungarian Empire in the extreme west and the Russian Empire elsewhere. Ukrainian writers and intellectuals were inspired by the nationalistic spirit stirring other European peoples existing under other imperial governments and were determined to revive Ukrainian linguistic and cultural traditions and reestablish a Ukrainian nation-state. Taras Shevchenko (1814-1861), national hero of Ukraine, presented the intellectual maturity of the Ukrainian language and culture through his work as a poet and artist. Imperial Russia, however, imposed strict limits on attempts to elevate Ukrainian language and culture, even banning its use and study.

When World War I and the Bolshevik Revolution in Russia shattered the Habsburg and Russian empires, Ukrainians declared independent statehood. In 1917 and 1918, three separate Ukrainian republics declared independence. However, by 1921, the western part of the traditional territory had been incorporated into Poland, and the larger, central and eastern part became part of the Soviet Union.

The Ukrainian national idea persevered during the interwar years, and Soviet reaction was severe, particularly under Stalin, who imposed terror campaigns that ravaged the intellectual class. He also created artificial famines as part of his forced collectivization policies, which killed millions of previously independent peasants and others throughout the country. Estimates of deaths from the 1932-33 famine alone range from 3 million to 7 million.

When the Nazis invaded the Soviet Union in 1941, many Ukrainians, particularly in the west, welcomed what they saw as liberation from communist rule, but this did not last. German brutality was directed principally against Ukraine's Jews (of whom an estimated 1 million were killed), but also against many other Ukrainians. Babyn Yar in Kiev was the site of one of the most horrific Nazi massacres of Ukrainian Jews, ethnic Ukrainians, and many others. Kiev and other parts of the country were heavily damaged. Ukrainians began to resist the Nazis as well as the Soviets.

After the Nazi and Soviet invasions of Poland in 1939, the western Ukrainian regions were incorporated into the Soviet Union. Resistance against Soviet government forces continued as late as the 1950s. Little changed for Ukraine over the next decades. During periods of relative liberalization--as under Nikita Khrushchev from 1955 to 1964--Ukrainian communists pursued national objectives. In the years of perestroika, under U.S.S.R. President Mikhail Gorbachev, national goals were again advanced by Ukrainian officials. The 1986 explosion at the Chornobyl (Chernobyl in Russian) nuclear power plant, located on Ukrainian soil, and the Soviet Government's initial efforts to conceal the extent of the catastrophe from its own people and the world, was a watershed for many Ukrainians in exposing the severe problems of the Soviet system. Ukraine became an independent state on August 24, 1991, and was a founding member of the Commonwealth of Independent States (CIS) following the dissolution of the Soviet Union.

GOVERNMENT AND POLITICAL CONDITIONS  
Ukraine is a parliamentary democracy with separate executive, judicial, and legislative branches. The president nominates the prime minister, who must be confirmed by the parliament. The 450-member parliament (Supreme Rada) initiates legislation, ratifies international agreements, and approves the budget. Its members are elected to 4-year terms. Following free elections held on December 1, 1991, Leonid M. Kravchuk, former Chairman of the Ukrainian Supreme Soviet, was elected president for a 5-year term. At the same time, a referendum on independence was approved by more than 90% of the voters. Political groupings in Ukraine include former communists, socialists, agrarians, nationalists, and various centrist and independent forces.

Shortly after becoming independent, Ukraine named a parliamentary commission to prepare a new constitution, adopted a multi-party system, and adopted legislative guarantees of civil and political rights for national minorities. A new, democratic constitution was adopted on June 28, 1996, which mandates a pluralistic political system with protection of basic human rights and liberties.

Freedom of religion is guaranteed by law, although religious organizations are required to register with local authorities and with the central government. Minority rights are respected in accordance with a 1991 law guaranteeing ethnic minorities the right to schools and cultural facilities and the use of national languages in conducting personal business. According to the Ukrainian constitution, Ukrainian is the only official state language. However, in Crimea and some parts of eastern Ukraine--areas with substantial ethnic Russian minorities--local and regional governments permit Russian as a language for local official correspondence.

Freedom of speech and press are guaranteed by law and by the constitution, but authorities sometimes interfere with the news media through intimidation and other forms of pressure. In particular, the failure of the government to conduct a thorough, credible, and transparent investigation into the 2000 disappearance and murder of independent journalist Heorhiy Gongadze has had a negative effect on Ukraine's international image.

Ethnic tensions in Crimea during 1992 prompted a number of pro-Russian political organizations to advocate secession of Crimea and annexation to Russia. (Crimea was ceded to Ukraine in 1954 by First Secretary Khrushchev, in recognition of historic links and for economic convenience, to mark the 300th anniversary of Ukrainian union with Russia.) In July 1992, the Crimean and Ukrainian parliaments determined that Crimea would remain under Ukrainian jurisdiction while retaining significant cultural and economic autonomy.

Official trade unions have been grouped under the Federation of Trade Unions. A number of independent unions, which emerged during 1992, among them the Independent Union of Miners of Ukraine, have formed the Consultative Council of Free Trade Unions. While the right to strike is legally guaranteed, strikes based solely on political demands are prohibited.

In July 1994, Leonid Kuchma was elected as Ukraine's second president in free and fair elections. Kuchma was reelected in November 1999 to another 5-year term, with 56% of the vote. International observers criticized aspects of the election, especially slanted media coverage; however, the outcome of the vote was not called into question. In March 2002, Ukraine held its most recent parliamentary elections, which were characterized by the Organization of Security and Cooperation in Europe (OSCE) as flawed but an improvement over the 1998 elections. The pro-presidential For a United Ukraine bloc won the largest number of seats, followed by the reformist Our Ukraine bloc of former Prime Minister Viktor Yushchenko, and the Communist Party. There are 450 seats in parliament, with half chosen from party lists by proportional vote and half from individual constituencies.

Security forces are controlled by the president, although they are subject to investigation by a permanent parliamentary commission. Surveillance is permitted for reasons of national security.

Ukraine established its own military forces of about 780,000 from the troops and equipment inherited from the former Soviet Union. It has reduced this figure to about 295,000 (plus 90,000 civilian workers in the Ministry of Defense), with the goal of further reductions to around 275,000 by 2005. Ukraine's stated national policy is Euro-Atlantic integration, including with both NATO and the European Union. Ukraine has a "Distinctive Partnership" with NATO and has been an active participant in Partnership for Peace exercises and in Balkans peacekeeping. A Ukrainian unit has been serving in Kosovo, in the U.S. sector.

Principal Government Officials
President--Leonid Kuchma
Prime Minister--Viktor Yanukovych
Foreign Minister--Anatoliy Zlenko

Ukraine maintains an embassy at 3350 M Street NW, Washington, DC 20007 (tel. 202-333-0606)

ECONOMY
Ukraine has many of the components of a major European economy--rich farmlands, a well-developed industrial base, highly trained labor, and a good education system. At present, however, the economy remains in poor condition. While Ukraine registered positive economic growth in both 2000 and 2001, these came on the heels of 8 straight years of sharp economic decline. As a result, the standard of living for most citizens has declined more than 50% since the early 1990s, leading to widespread poverty. The macroeconomy is stable, with the hyperinflation of earlier in the decade having been tamed. Ukraine's currency, the hryvnia, was introduced in September 1996, and has remained fairly stable. The economy started growing in 2000, and growth has continued. GDP grew nearly 6% in 2000 and 9% in 2001. Inflation has been moderate, with 6% in 2001. While economic growth is likely to continue in 2002, Ukraine's long-term economic prospects are dependent on acceleration of market reforms. The economy remains burdened by excessive government regulation, and while small and medium enterprises have been largely privatized, much remains to be done to restructure and privatize key sectors such as energy and telecommunications.

Ukraine is rich in natural resources. It has a major ferrous metal industry, producing cast iron, steel, and steel pipe, and its chemical industry produces coke, mineral fertilizers, and sulfuric acid. Manufactured goods include metallurgical equipment, diesel locomotives, and tractors. It also is a major producer of grain and sugar and possesses a broad industrial base, including much of the former U.S.S.R.'s space industry. Although oil reserves are largely exhausted, it has important energy sources, such as coal and natural gas, and large mineral deposits.

Ukraine encourages foreign trade and investment. The parliament has approved a foreign investment law allowing Westerners to purchase businesses and property, to repatriate revenue and profits, and to receive compensation in the event that property is nationalized by a future government. However, complex laws and regulations, poor corporate governance, weak enforcement of contract law by courts, and corruption all continue to stymie largescale foreign direct investment in Ukraine. While there is a functioning and fairly well-regulated stock market, the lack of protection for minority shareholder rights severely restricts portfolio investment activities. Total foreign direct investment in Ukraine is approximately $4.9 billion as of October 2002, which, at $101 per capita, is still one of the lowest figures in the region.

Most Ukrainian trade is still with countries of the former Soviet Union, principally Russia. An overcrowded world steel market threatens prospects for Ukraine's principal exports of non-agricultural goods such as ferrous metals and other steel products. Although exports of machinery and machine tools are on the rise, it is not clear if the rate of increase is large enough to make up for probable declines in steel exports. Ukraine imports 90% of its oil and most of its natural gas.

Russia ranks as Ukraine's principal supplier of oil, and Russian firms now own and/or operate the majority of Ukraine's refining capacity. Natural gas imports come from Russia--which delivers natural gas as a barter payment for Ukraine's role in transporting Russian gas to western Europe-- and Turkmenistan, from which Ukraine purchases natural gas for a combination of cash and barter. Although Ukraine's long-running dispute with Russia over about $1.4 billion in arrears on past gas sales appeared to have been solved through a complex repayment agreement involving Eurobonds to be issued by Ukraine's national oil and gas monopoly (NaftoHaz Ukrainy) to Russia's GazProm, Russia has not yet accepted the bonds, so the issue remains open. Reform of the inefficient and opaque energy sector is a major objective of the International Monetary Fund (IMF) and World Bank programs with Ukraine.

The IMF approved a $2.2 billion Extended Fund Facility (EFF) with Ukraine in September 1998. In July 1999, the 3-year program was increased to $2.6 billion. Ukraine's failure to meet monetary targets and/or structural reform commitments caused the EFF to either be suspended or disbursements delayed on several occasions. The last EFF disbursement was made in September 2001. Ukraine met most monetary targets for the EFF disbursement due in early 2002; however, the tranche was not disbursed due to the accumulation of a large amount of VAT refund arrears to Ukrainian exporters which amounted to a hidden budget deficit. The EFF expired in September 2002, and the Ukrainian Government and IMF began discussions in October 2002 on the possibility and form of future programs.

In 1992, Ukraine became a member of the IMF and the World Bank. It is a member of the European Bank for Reconstruction and Development but not a member of the General Agreement on Tariffs and Trade/World Trade Organization (WTO). While Ukraine applied for WTO membership, its accession process was stalled for several years. In 2001, the government took steps to reinvigorate the process; however, there was less concrete progress in 2002. The WTO Working Party on Ukraine met in June 2002. The government's stated goal is to accede to the WTO by the end of 2004.

Environmental Issues
Ukraine is interested in cooperating on regional environmental issues. Conservation of natural resources is a stated high priority, although implementation suffers from a lack of financial resources. Ukraine established its first nature preserve, Askanyia-Nova, in 1921 and has a program to breed endangered species.

Ukraine has significant environmental problems, especially those resulting from the Chornobyl nuclear power plant disaster in 1986 and from industrial pollution. In accordance with its previously announced plans, Ukraine permanently closed the Chornobyl Atomic Energy Station in December of 2000. Unfortunately, in November of 2001, Ukraine withdrew an application it had made to the EBRD for funding to complete two new reactor units to compensate for the energy once produced by Chornobyl. Ukrainian concern over reform conditions attached to the loan--particularly tariff increases needed to ensure loan repayment--led the Ukrainian Government to withdraw the application on the day the EBRD Board was to have considered final approval. Work on the so-called "object shelter" to permanently entomb the reactor where the world's worst nuclear accident occurred has been slower than anticipated but continues. Design work as well as structural improvements to the "sarcophagus" erected by the Soviet Union are largely complete, and construction on the new shelter is scheduled to begin in 2004.

Ukraine also has established a Ministry of Environment and has introduced a pollution fee system that levies taxes on air and water emissions and solid waste disposal. The resulting revenues are channeled to environmental protection activities, but enforcement of this pollution fee system is lax.

FOREIGN RELATIONS
Ukraine considers Euro-Atlantic integration its primary foreign policy objective, but in practice balances its relationship with Europe and the United States with strong ties to Russia. The European Union's Partnership and Cooperation Agreement (PCA) with Ukraine went into force on March 1, 1998. The European Union (EU) has encouraged Ukraine to implement the PCA fully before discussions begin on an association agreement. The EU Common Strategy toward Ukraine, issued at the EU Summit in December 1999 in Helsinki, recognizes Ukraine's long-term aspirations but does not discuss association. On January 31, 1992, Ukraine joined the then-Conference on Security and Cooperation in Europe (now the Organization for Security and Cooperation in Europe--OSCE), and on March 10, 1992, it became a member of the North Atlantic Cooperation Council. Ukraine also has a close relationship with NATO and has declared interest in eventual membership. It is the most active member of the Partnership for Peace (PfP).

Ukraine maintains peaceful and constructive relations with all its neighbors; it has especially close ties with Poland and Russia. Relations with Russia are complicated by energy dependence and by payment arrears. However, relations have improved with the 1998 ratification of the bilateral Treaty of Friendship and Cooperation. Also, the two sides have signed a series of agreements on the final division and disposition of the former Soviet Black Sea Fleet that have helped to reduce tensions. Ukraine became a member of the Commonwealth of Independent States (CIS) on December 8, 1991, but in January 1993 it refused to endorse a draft charter strengthening political, economic, and defense ties among CIS members. Ukraine was a founding member of GUUAM (Georgia-Ukraine-Uzbekistan-Azerbaijan-Moldova).

In 1999-2001, Ukraine served as a non-permanent member of the UN Security Council. Historically, Soviet Ukraine joined the United Nations in 1945 as one of the original members following a Western compromise with the Soviet Union, which had asked for seats for all 15 of its union republics. Ukraine has consistently supported peaceful, negotiated settlements to disputes. It has participated in the quadripartite talks on the conflict in Moldova and promoted a peaceful resolution to conflict in the post-Soviet state of Georgia. Ukraine also has made a substantial contribution to UN peacekeeping operations since 1992.

U.S.-UKRAINIAN RELATIONS
The dissolution of the Soviet Union in December 1991 brought an end to the Cold War and created an opportunity to build bilateral relations with the New Independent States (NIS) as they began a political and economic transformation. On December 25, 1991, the United States officially recognized the independence of Ukraine. It upgraded its consulate in the capital, Kiev, to embassy status on January 21, 1992. The U.S. ambassador to Ukraine is Carlos Pascual, the fourth U.S. ambassador since Ukrainian independence.

The United States attaches great importance to the success of Ukraine's transition to a democratic state with a flourishing market economy. Following a period of economic decline characterized by high inflation and a continued reliance on state controls, the Ukrainian Government began taking steps in the fall of 1999 to reinvigorate economic reform that had been stalled for years due to a lack of a reform majority in the Ukrainian parliament (Rada). The Ukrainian Government's stated determination to implement comprehensive economic reform is a welcome development, and the United States. is committed to strengthening its support for Ukraine as it continues on this difficult path.

Bilateral relations suffered a setback in September 2002 when the U.S. Government announced it had authenticated a recording of President Kuchma's July 2000 decision to transfer a Kolchuga early-warning system to Iraq. The Ukrainian Government denied that the transfer had occurred. U.S. policy remains centered on realizing and strengthening a stable, democratic, and prosperous Ukraine more closely integrated into European and Euro-Atlantic structures.

U.S. Assistance to Ukraine
A cornerstone for the continuing U.S. partnership with Ukraine and the other NIS has been the Freedom for Russia and Emerging Eurasian Democracies and Open Markets (FREEDOM) Support Act (FSA) enacted in October 1992. Ukraine has been a primary recipient of FSA assistance. Total U.S. assistance since independence has been more than $3 billion. Total U.S. assistance in FY 2002 was just over $239 million, of which approximately $156 million was FSA funding. U.S. assistance to Ukraine is targeted to promote political and economic reform and to address urgent humanitarian needs. The United States has consistently encouraged Ukraine's transition to a democratic society with a prosperous market-based economy. For more detailed information on these programs, please see the "Annual Report to Congress on U.S. Government Assistance to and Cooperative Activities with the New Independent States of the Former Soviet Union,". Information also is available on the Agency for International Development's (USAID) Website at: http://www.usaid.kiev.gov.

Assistance To Support Ukraine's Transition to a Market Economy. U.S. technical assistance in this area has focused primarily on economic restructuring, tax and budget reforms, development of the private sector, and energy-sector reform. U.S. assistance priorities for Ukraine have included enterprise development, deregulation, macroeconomic reform, privatization of the electricity sub-sector, and nuclear safety. U.S. advisers have provided technical assistance in financial sector reform, tax policy and administration, bankers' training, land legislation, smallscale enterprise development, municipal services reform, agricultural development and agribusiness, privatization of the electric power sector, energy pricing and efficiency, and public education about market reforms.

Assistance to Support Ukraine's Agricultural Economy and Entrepreneurship. Entrepreneurship and the small and medium enterprise sector are closely tied to the future of the agricultural economy in Ukraine. Considerable support has been provided to the Ukrainian SME sector under past U.S. assistance programs, and programs continue in three primary areas:

  • Association building, deregulation and policy reform;
  • Making credit more accessible; and
  • Developing business and management skills, advancing the development of a national program through one-stop shops, and the expansion of microcredit outlets through the Micro-Finance Bank.

The U.S. Government has been instrumental in assisting the privatization of agricultural land and the issuance of land titles. The collective farm system has been eliminated, and 6.75 million former collective farm members have received the right to hold land titles. More industry also is being privately managed, particularly in agribusiness, where privatization of medium-sized companies is now virtually complete. U.S. Government assistance in agriculture will focus on issuing land titles and improving access to credit, strengthening business and farmer associations, and improving agricultural markets.

Assistance To Support Ukraine's Transition to Democracy. The United States is promoting Ukraine's democratic transition by supporting programs on participatory political systems, independent media, rule of law, local governance, and civil society, as well as a wide range of exchanges and training. The U.S. Agency for International Development (USAID) has provided Ukraine with technical assistance related to elections, the development of political parties and grassroots civic organizations, the development of independent media, and municipal services reform. USAID has been working with Ukrainian officials and nonprofit organizations to create a legal system supportive of a democratic government and a market-based economy. The State Department's Bureau of International Narcotics and Law Enforcement Affairs (INL) is promoting cooperation between U.S. law enforcement agencies and their Ukrainian counterparts to reform Ukraine's criminal justice system. In 1997, the U.S. Government launched a special initiative to combat trafficking in women and children from Ukraine, including efforts to promote economic alternatives for vulnerable populations, increase public awareness, and provide support for victims. See the Department of State's website at

At the 1999 meeting of the U.S.-Ukraine Binational Commission in Washington, the U.S. announced the Next Generation Initiative, with a target of doubling the number of participants in key exchange programs and refocusing U.S. assistance on Ukraine's youth. Such programs as the Future Leaders Exchange (secondary school students), FSA Graduate-Muskie Fellowships, and the FSA Undergraduate program, as well as programs aimed at teachers, have maintained expanded participant levels during the most recent fiscal years. In addition, professional exchanges--International Visitors, Community Connections--continue to bring hundreds of Ukrainians to the United States each year. Between 1993 and 2002, the U.S. Government brought nearly 18,000 Ukrainians to the United States for long-term study or short-term professional training, with about 2,000 more participants scheduled in FY 2003.

Exchange programs have enabled Ukrainian entrepreneurs, journalists, academics, local government officials, and other professionals to participate in a broad range of programs that focus on U.S. experience in fields of importance to Ukraine's democratic and market transition. In addition, the Embassy's Democracy Small Grants Program and Media Development Fund offer direct grant support to non-governmental organizations (NGOs) and non-state media outlets to carry out projects that contribute to democratic and market reforms and improved access to information.

Since 1992 the U.S. Commerce Department's Special American Business Internship (SABIT) Program together with the U.S. Department of Agriculture's Cochran Fellowship Program and Faculty Exchange Program have brought 956 Ukrainian business executives, scientists, agriculturalists and agricultural educators to the United States for internships and training programs. USAID's participant training program provides opportunities for more than 1,500 Ukrainians working with NGOs, promoting economic reform and democracy to visit the United States and other countries each year. A $5 million joint U.S.-EU civil society project is supporting civic education, NGO development, good governance and parliamentary exchanges, expanding Ukraine's contacts with Americans and Europeans. This project is now largely completed, but its goals continue to be met through many of the programs described above.

Peace Corps Volunteers are working in Ukraine with a focus on small-business development and English teaching, and the embassy is actively engaged with Ukrainian educators at all levels to support new approaches to teaching and learning.

Assistance to Strengthen Ukraine's Civil Society. Ukraine has turned a crucial corner in terms of the strength and influence of civil society, but these gains still need to be consolidated and strengthened. U.S. assistance provides technical assistance and training to a wide variety of civic organizations to help them become better advocates for their constituencies, to reduce reliance on donor funding by creating closer links to their own communities, to create greater reliance on the local community for funds and volunteers, and to improve transparency by training civic organizations about conflict of interest, board management and financial management. In addition, the FREEDOM Support Act program supports research and public opinion polls undertaken by think tanks and seeks to improve the legal and regulatory framework related to freedom of association and speech. Grant programs also support the development of civil society and independent media and facilitate access to information through the Internet. In the media sector, U.S. assistance supports TV, radio, and print media outlets, with an emphasis on strengthening regional news outlets by training journalists, news editors, and station managers, as well as NGOs that support the media.

Support for the Social Sector. The United States is assisting Ukraine's efforts to ameliorate some of the social consequences of the transition to market reform in order to sustain social welfare and stability during and beyond its market economic transition. Toward this end, USAID is providing assistance to local governments in redefining the roles of the public and private sectors in providing social services to allow government to focus limited resources on key social sectors. Training and technical assistance are being provided to Ukrainian institutions and government agencies on reforms of health care financing and delivery of medical services. A number of medical partnerships between U.S. and Ukrainian health care institutions have been established to improve both patient care and institutional management. Also, USAID is providing training and technical assistance on ways to improve reproductive health, focusing on providing family planning services and reducing the use of abortion. Finally, USAID has been instrumental in targeting Ukrainian Government assistance to the most vulnerable groups. Its work in overhauling the public pension system was instrumental in helping the government ensure prompt pension payments to eligible retirees.

Humanitarian Assistance. Since 1992, the U.S. State Department's Operation Provide Hope has provided more than $416 million in humanitarian assistance to Ukraine. In 1999, the Office of the Coordinator of U.S. Assistance to the NIS expended $3.8 million in transportation and grant funds to deliver $77 million in humanitarian assistance to targeted groups in Ukraine. In 1999, Operation Provide Hope funded a total of six humanitarian airlifts and 544 deliveries via surface transportation. A total of $18.5 million in U.S. Defense Department excess medical equipment, supplies, and pharmaceuticals was delivered and distributed during the 1999 August-October period to 18 hospitals and clinics in Ukraine's Kharkiv Oblast (region). The United States has repeatedly responded to major disasters; since 1994 USAID's disaster assistance has helped victims of 15 major natural and man-made disasters, including floods, mudslides, and mine explosions. In August 2002 the U.S. Government provided medical equipment worth $50,000 to the city of Lviv after the worst air show disaster on record. In addition, USAID has provided more than $128 million in humanitarian assistance since 1994, reaching over three million of Ukraine's most vulnerable people.

Bilateral Trade Issues. The U.S.-Ukraine Trade Agreement, effective June 22, 1992, provides reciprocal most-favored-nation tariff treatment to the products of each country. Since January 1994, the Overseas Private Investment Corporation (OPIC) has approved investment insurance totaling more than $23 million for three projects in Ukraine. OPIC also has sponsored conferences and exchanges to encourage joint ventures between U.S. and Ukrainian companies. Unfortunately, OPIC operations in Ukraine are currently suspended pending the resolution of a dispute involving the expropriation of an OPIC-insured investment. The U.S. Export-Import Bank signed a project incentive agreement with the Ukrainian Government in 1999 but has yet to approve any projects in Ukraine. A treaty on avoiding double taxation is close to completion.

Security Issues. In Lisbon on May 23, 1992, the United States signed a protocol to the Strategic Arms Reduction Treaty (START) with Ukraine, Russia, Belarus, and Kazakhstan--those states on whose territory strategic nuclear weapons of the former Soviet Union are located. The protocol makes each state a party to the START Treaty and commits all signatories to reductions in strategic nuclear weapons within the 7-year period provided for in the treaty. Ukraine, Belarus, and Kazakhstan also agreed to join the nuclear Non-Proliferation Treaty (NPT) as non-nuclear weapons states. The treaty entered into force on December 5, 1994, the same day Ukraine acceded to the NPT.

Security-Related Assistance. Through FY 2002, the U.S. Department of Defense has provided $671.1 million under its Cooperative Threat Reduction (CTR or "Nunn-Lugar") Program to eliminate strategic nuclear delivery systems in Ukraine. In 2002 alone, CTR funds facilitated the completion. CTR activities are facilitating START I implementation and are helping to eliminate all strategic nuclear weapons systems in Ukraine, including the SS-19 and SS-24 ballistic missiles and associated silos and launch control centers, heavy bombers, and air-launched cruise missiles of SS-24 silo elimination and the subsequent disestablishment of the 43rd Rocket Army. Another $6 million has been set aside for anticipated projects associated with biotechnology proliferation prevention. The United States has provided nearly $15 million to assist Ukraine in establishing an export control system; while the system works on paper, it has recently become apparent that the system can be circumvented, as there is no independent oversight and there are no penalties for trying to circumvent the export control system. In addition, the United States has provided Ukraine more than $24 million in International Military Education and Training (IMET) and Foreign Military Financing (FMF) to promote military reform and advance Ukraine's ability to participate in NATO Partnership for Peace activities, including peacekeeping in Kosovo.

Principal U.S. Embassy Officials
Ambassador--Carlos Pascual
Deputy Chief of Mission--Marie Yovanovitch
Political Counselor--Jason Hyland
Economic Counselor--Necia Quast
Public Affairs Counselor--Janet Demiray
Consul General--Lisa Vickers
Administrative Counselor--William Moser
Commercial Officer--Frank Carrico
USAID Mission Director--Christopher Crowley

The U.S. Embassy in Kiev is at 10 Yuriya Kotsyubinskoho, 25203 (tel. [380] (44) 490-4000).



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