IN THE SPOTLIGHT - Gorshenin Institute
INTHESPOTLIGHT ©GorsheninInstituteApril2015Allrightsreserved ISSUE54(217) 04/06/2015 INTHESPOTLIGHT VNATIONALEXPERTFORUM «UKRAINE.STRESSTEST» ISSUE54(217) 04/06/2015 On31March,inKyivtheGorsheninInstituteheldtheVNationalExpertForum «Ukraine.Stresstest».Duringthethreepanelsofficials,expertsandjournalists discussedhowUkrainehasgonethroughthedifficultyear. SpeakersofthePaneldiscussion#1:“TheFirstUkrainianWar:OneYear underNewConditions”:ValentynNalyvaychenko,ChairmanoftheSecurity ServiceofUkraine;ArsenAvakov,MinisterofInternalAffairsofUkraine;Yuriy Stets,MinisterofInformationPolicyofUkraine;PetrasAuš trevič ius,memberof theEuropeanParliament,memberoftheEPCommitteeonForeignAffairs, founderofthegroupFriendsofEuropeanUkraine;ChristineDugoin-Clément, expertofFrenchstrategicthinktankSogdian. 2 ©GorsheninInstituteApril2015Allrightsreserved INTHESPOTLIGHT ISSUE54(217) SpeakersofthePaneldiscussion#2:“WartimeEconomy”:DmytroShymkiv, 04/06/2015 DeputyHeadforReformsofthePresidentialAdministration;Volodymyr Demchyshyn,MinisterofEnergyandCoalIndustryofUkraine;IhorUmanskyi, FirstDeputyMinisterofFinance;SerhiyTaruta,UkrainianMP,businessman; PeterBalas,HeadoftheSupportGroupforUkraineattheEuropean Commission;IhorPetrashko,DeputyCEOofUkrLandFarming;Rostyslav Shurma,CEOofOJSCZaporizhstal. SpeakersofthePaneldiscussion“EnergySecurity.UkrainianContext”: MykolaMartynenko,UkrainianMP,ChairmanoftheParliamentaryCommittee onEnergySector;OleksiyTymofeyev,CEOofSmart-Holding;IhorDidenko, DeputyMinisterofEnergyandCoalIndustryofUkraine;AlanRiley,expert, ProfessorofLawattheCityLawSchool(London),AssociateResearchFellowof theCentreforEuropeanPolicyStudies,Brussels;OliksiiLeshchenko,Vice PresidentoftheGorsheninInstitute. Youcanfindmoredetailedinformationintheforumreport. 3 ©GorsheninInstituteApril2015Allrightsreserved INTHESPOTLIGHT ISSUE54(217) 04/06/2015 CONTENT 1.Topnews…page7 2.ArmedconflictinUkraine`seast…page7 Pro-RussianseparatistscontinuetoshellUkrainianmilitary Some75Ukrainianservicemenkilledsincecease-firebeginninginDonbas Russiamasses55,000troopsalongUkrainianborder,saysfirstdeputyspeaker Trilateralcontactgroupholdsvideoconferencewithseparatistleaders 3.Internationalpolitical…page8 Ukraine-Russia RussiathreatensNATOwithnucleararmsoverCrimea,Donbas-massmedia RussiaordersinspectionsofUkrainian-madeproductsagain RussianInvestigationCommitteeopenscaseoverembezzlementofstatebudget fundsbyUkrainianpresident'scompany RussiarefusestorecognizediplomaticimmunitystatusofdetainedUkrainian pilot UkrainianpresidentsignslawbanningRussianfilms AustraliaenactsnewsanctionsagainstRussia Crimeanissue RussiarefusestoregisterCrimeanTatarmassmedia RussianauthoritiessearchhouseofCrimeanTatarself-styledgovernment's deputyhead Crimeanauthoritiesgivechildren'scampArtektoRussia LeaderofCrimeanTatarself-styledgovernmenttobecomeUkrainianlawmaker Ukrainedeliversproductsworth500mdollarstoCrimeasinceSeptember2014 CrimeanbudgetsubsidisedfromRussiaby85percent-expert Ukraine-Georgia UkrainianprosecutorsrefusetoextraditeSaakashvilitoGeorgia 4.Domesticpolitical…page12 Ukrainianpresidentrulesoutpostponementoflocalelections 4 ©GorsheninInstituteApril2015Allrightsreserved INTHESPOTLIGHT ISSUE54(217) 04/06/2015 Ukrainianpresident:constitutionalcommissiontocommenceincomingdays Ukrainiangovernmentannouncesroadreform Over60investigatorsatInteriorMinistrytobepaid1,250dollarsmonthly Healthministerdismissesheadsofallregionaloffices CourtsayssuspensionofsocialpaymentstoDonbasillegal InteriorMinistryopenscaseagainstemployeesofFirtash'sholding CouncilofEuropeissuesreportonMaydanmurdersinvestigation FormerKievpolicechief,hisdeputyputonwantedlist UkrainiancabinetdismissesheadofStateFinancialInspectorate FormerStateEmergenciesServicechiefreleasedonbail StateAutomobileInspectorateheadresigns InteriorMinistryputsAzarov'ssononwantedlist Kharkivmayor'scasetobeheardinPoltava MayorofLyubotyn,KharkivRegiondetained UkrainianCommunistleadersummonedforquestioning ConscriptionstartsinUkraine 5.Economy…page16 UkrainetofulfilseveralconditionstogetsecondIMFtranche-FinanceMinistry EU,USapproveaidallocationtoUkraine UkrainetohostinvestmentsummitinJuly Economycontractionslowsinfirstquarter Inflationhikesto34.5percentinFebruary Fiscaldeficitgrowsby1.7times Ukraineboostsutilitiesprices Poroshenkosignslawoneasingconductofbusiness UnemploymentinUkrainerisesto10percent UkraineintroducesOpenSkiesruleatLvivairport 5 ©GorsheninInstituteApril2015Allrightsreserved INTHESPOTLIGHT ISSUE54(217) 04/06/2015 6.Energy…page18 Naftohaz,Gazpromstrikegasdealforsecondquarter NaftohaztransfersGazprom30mdollarsasadvancegaspayment RussiaurgesUkrainetopayforgasdeliveriestooccupiedDonbas FirsthearinginNaftohaz-GazpromgasdisputeheldinStockholm Ukrainetoboostreverse-flowgassuppliesfromEurope-minister Ukrainestopsgaswithdrawalfromundergroundstorages NaftohazestimatesitsliabilitiestoUkrnaftaat155mdollars 6 ©GorsheninInstituteApril2015Allrightsreserved INTHESPOTLIGHT ISSUE54(217) 04/06/2015 1.TOPNEWS InDonbas,75Ukrainianservicemenkilled,400injuredsincestartof cease-fire ThemajorityofUkrainiansdonotexpectthecease-fireineastUkrainetohold. ReadmoreinARMEDCONFLICTINUKRAINE'SEAST. RussiadeniesregistrationtoCrimeanTatarmedia Russia-annexedCrimeaissubsidizedby85percentin2014. ReadmoreinINTERNATIONALPOLITICAL. Naftohaz,Gazpromagreeongaspriceof248dollarsforApril-June UkrainecontinuestoincreasegasimportfromEurope. ReadmoreinENERGY. 2.ARMEDCONFLICTINUKRAINE'SEAST Pro-RussianseparatistscontinuetoshellUkrainianmilitary Pro-RussianmilitantsandRussiantroopscontinuetoviolatetheMinsk agreementsbyshellingresidentialareasandpositionsoftheUkrainianmilitary intheareawheretheUkrainiangovernmenthasbeencarryingoutan antiterroristoperation,theantiterroristoperationHQhasreported. ThemostactiveshellingbyseparatistswasobservednearDonetskand Shyrokyne. Meanwhile,Russiacontinuestodeliverequipment,weapons,andammunition tooccupiedterritoriesinDonbas.Additionally,separatistfighterskeepsending toRussiaequipmentfromUkrainianindustrialcompanies. TheresultsofapollcarriedoutbytheGorsheninInstitutesuggestthat75.8 percentoftheUkrainiansbelievethatthecease-fireintheeastofthecountry, whichisenvisionedbytheMinskagreements,willnothold.Only15.9percentof respondentsexpressedconfidencethatitwillbemaintained. Some75Ukrainianservicemenkilledsincecease-firebeginninginDonbas Sincethebeginningofacease-fireintheeastofUkraineon15Februaryandas of3April,75Ukrainiansoldiershavebeenkilledandmorethan400wounded, theUkrainianGeneralStaffhasreported. Thetotalnumberofsoldierswhohavebeenkilledduringtheantiterrorist operationexceeds1,750. 7 ©GorsheninInstituteApril2015Allrightsreserved INTHESPOTLIGHT ISSUE54(217) 04/06/2015 TheUNhasestimatedthat6,100peoplehavediedand15,400havebeen woundedsincethebeginningofthearmedconflictinUkraine. TheUNICEFreportedthatatleast42childrenhavebeenkilledinUkraineasa resultofexplodinglandminesand109woundedsinceMarch2014. Russiamasses55,000troopsalongUkrainianborder,saysfirstdeputy speaker Thereare55,000RussianservicemenalongtheborderwithUkraineand40,000 morecanbefoundintheoccupiedterritoriesofCrimeaandDonbas,Ukrainian firstdeputyparliamentaryspeaker,AndriyParubiy,hassaid. HeaddedthattheoddswerehighthatRussiawouldlaunchalarge-scale offensiveagainstUkraineby9May. TheUSAsaidearlierthataccordingtoestimatesoftheUSmilitary,Russiahad sent12,000soldierstoUkrainetoassistrebelfighters. EuropeanParliamentmemberPetrasAustrevicius,wholeadsthegroup FriendsofEuropeanUkraine,saidduringthe5thNationalExpertForumthat thesituationinDonbaswasnotjustaUkrainianwar,butratheranall-European conflict.Inhisturn,anexpertoftheFrenchstrategicthink-tankSogdian ChristineDugoin-ClémentnotedthatEUmemberstatesdidnothaveenough informationaboutwhatwashappeninginUkraine. Trilateralcontactgroupholdsvideoconferencewithseparatistleaders On1April,membersofthetrilateralcontactgroup(Ukraine,Russia,andthe OrganizationforCooperationandSecurityinEurope)heldavideoconference withrepresentativesoftheself-proclaimedDonetskandLuhanskpeople's republics. RepresentativeoftheDonetskpeople'srepublicDenisPushylinsaidthatthe negotiationswereconstructivebuttheparticipantsfailedtoagreeonthework ofbodiesfortheimplementationoftheMinskagreements. TheresultsofapollcarriedoutbytheGorsheninInstitutesuggestthatthe majorityofUkrainians(69.2percent)opposedialoguewiththeDonetskand Luhanskpeople'srepublics.Around23.2percentofthosepolledapproveof negotiationswithrebelfighters. 3.INTERNATIONALPOLITICAL UKRAINE-RUSSIA RussiathreatensNATOwithnucleararmsoverCrimea,Donbas-mass media QuotingWesternintelligenceagencies,TheTimeshasreportedthatRussian PresidentVladimirPutinbelievesthatitisacceptabletousenucleararmsin thefollowingthreecases:iftheWestmakesanattempttoreturnCrimeato Ukraine;iftheWeststartstodeliverlethalweaponstoUkrainetofighttheselfproclaimedDonetskandLuhanskpeople'srepublics;and,finally,ifNATO continuestomasstroopsinBalticcountries. 8 ©GorsheninInstituteApril2015Allrightsreserved INTHESPOTLIGHT ISSUE54(217) 04/06/2015 CommentingonthematerialpublishedbytheBritishnewspaper,Gorshenin InstitutePresidentVadymOmelchenkostressedthatforthefirsttimein modernhistory,thereisaheadofstatewhobothcanandwantstousenuclear armsnotasadeterrentbutasanoffensiveweapon. Intheexpert'sopinion,thekeyhereisthepsychologicaldesireoftheRussian presidenttobethefirsttousenucleararms.“Unlikehiscolleaguesinthe'nuclear club'andhispredecessors,Putinisarepresentativeofadifferentpolitical culture.Russia'scurrentmanagerialrealityisdifferent,anditdiffersfrom,for example,theSovietone.Itisalsoimportanttopointoutthatthepsychological preparationofRussiancitizenstotheinevitabilityofnuclearWWIIIhasbecome oneofthemajorpropagandatrendsintherecentmonths,”theGorshenin Institutepresidenthassaid. Omelchenkoaddedthatthesituationdeservedthemostseriousattentionofthe worldleaders“sinceitiswaymoredifficulttoworkwithsubjectiveintentions thanwiththeobjectivereality”. “Letmesuggestthatthesiteofusingnucleararmsisnotthatimportant.Itcanbe eithertheBalticsorsiteswheremilitantsoftheIslamicStategroupareamassed. Inthiscase,whatmattersforPutinisthefactofitsuse,ahistoricalprecedent,” theGorsheninInstitutepresidentsaid. RussiaordersinspectionsofUkrainian-madeproductsagain On3March,theRussianFederalServiceforSupervisionofConsumerRightsand HumanWelfare(Rospotrebnadzor)sentalettertoitsregionaldirectorates,in whichitordereditslocalstafferstocarryoutaninspectionof15kindsof productsmadeinUkraine,theRBKpublicationhasreported.Thelistofproducts tobeexaminedfeaturescosmetics,hygieneproducts,detergents,wallpaper, furnitureandothers. Wewouldliketopointoutthaton23MarchtheRussianauthoritiesbanned importsofproductsmanufacturedbytheUkrainiancompanySCJohnson,which abranchoftheUScompanySCJohnson. RussianInvestigationCommitteeopenscaseoverembezzlementofstate budgetfundsbyUkrainianpresident'scompany TheRussianInvestigationCommitteehaslaunchedacriminalcaseoverthe embezzlementof180mroubles(3.17mdollars)fromtheRussianstatebudgetby meansofanillegalreimbursementtotheLipetsk-basedconfectionarycompany Roshen,ownedbyUkrainianPresidentPetroPoroshenko,thepressserviceof thecommitteereportedon1April. Thesameday,theinvestigationcommitteeblockedtheworkofthefactoryin Lipetskwhilecarryingoutasearchonitspremises. 9 Russiarefusestorecognizediplomaticimmunitystatusofdetained Ukrainianpilot TheRussianForeignMinistryhasrefusedtorecognizediplomaticimmunity statusofamemberoftheUkrainiandelegationtotheParliamentaryAssemblyof theCouncilofEurope,NadiyaSavchenko,herlawyerNikolayPolozovhassaid, citingaprosecutor'sdecreetothiseffect. ©GorsheninInstituteApril2015Allrightsreserved INTHESPOTLIGHT ISSUE54(217) 04/06/2015 Wewouldliketopointoutthaton3MarchSavchenkosuspendedahungerstrike inordertoappearincourtduringhearingsofhercase. WealsolearnedthattheRussianInvestigationCommitteehasstartedapre-trial checkofalawyeroftheUkrainianpilot,MarkFeygin,oversignsofextremism. UkrainianpresidentsignslawbanningRussianfilms On2April,UkrainianPresidentPetroPoroshenkosignedalawwhichimposesa banonbroadcastingoffilmsontheterritoryofUkrainethatpromotelawenforcementagenciesofanaggressorstateandSovietstatesecurityagencies. Currently,onlyRussiahassuchstatus.Thebanisimposedonfilmsproduced after1August1991regardlessofthecountrywheretheyweremade. Filmsthathavebeenproducedbyphysicalandlegalentitiesofanaggressorstate sincethebeginningofRussianaggressionagainstUkrainesince1January2014 arealsosubjecttotheban. Thelawwillbeenactedtwomonthsafteritspublication. AustraliaenactsnewsanctionsagainstRussia On31March,AustralianauthoritiesimplementednewsanctionsagainstRussia thatmirrorthosethathadbeenimposedbytheEU,theUSA,andCanada. Thesanctionsbannedexportandimportofweapons,aswellasoilandgas equipmentfromandtoRussia.Additionally,Russianbankswereprohibitedfrom enteringAustraliancapitalmarkets.TheAustraliangovernmentalsoprohibited thecountry'scompaniesfromtradingwithCrimeaandfrominvestinginthe economyofthepeninsula. TheresultsofapollconductedbytheGorsheninInstituteinFebruary2015 suggestthattwo-thirdsoftheUkrainians(66.7percent)areinfavourofWestern sanctionsagainstRussia.Some20.4percentoftheUkrainianpopulationoppose anti-Russiansanctions. CRIMEANISSUE RussiarefusestoregisterCrimeanTatarmassmedia On1April,theonlyCrimeanTatarTVchannelATRsuspendeditsbroadcastsdue totherefusaloftheRussianauthoritiestoapproveitsregistration. OthermassmediaoutletsthatarepartofthemediaholdingATR,suchasthe CrimeanTatarchildren'sTVchannelLale,theradiostationsMeydanandLider, theInternetwebsite15Minut,endedupinthesamesituation. TheCrimeanTatarnewsagencyQHA,thenewspaperAvdet,themagazinesYildyz andArmanchykalsofailedtosecureregistration. TheYanyyDyunyanewspaperhasbecometheonlyCrimeanTatarmassmedia outlettoberegisteredbytheRussianauthorities. WeshallremindyouthatUkrainianwebsiteandTVchannelswereforcedtostop theirworkinCrimealastyear. 10 ©GorsheninInstituteApril2015Allrightsreserved INTHESPOTLIGHT ISSUE54(217) 04/06/2015 RussianauthoritiessearchhouseofCrimeanTatarself-styled government'sdeputyhead On31March,theRussianInvestigationCommitteesearchedthehouseofthe deputyheadoftheCrimeanTatarself-styledgovernmentMajlis,IlmiUmerov, inBakhchysaray. Beforethesearch,hewasquestionedforsevenhoursovertheso-called26 Februarycasewhichhastodowitharallyofafewthousandsofsupportersof theCrimeanTatarMajlisnearthebuildingoftheCrimeanparliament. Umerovhasbeenalreadyquestionedasawitnessinthecase. Crimeanauthoritiesgivechildren'scampArtektoRussia On31March,thecouncilofministersoftheannexedCrimeanpeninsuladecided totransferthelargestCrimeanchildren'scampArtekintothestateownership ofRussia. WewouldliketopointoutthatafterCrimea'sannexationbyRussia,Ukrainehas lost118children'scamps. LeaderofCrimeanTatarself-styledgovernmenttobecomeUkrainian lawmaker TheleaderoftheCrimeanTatarself-styledgovernmentMajlis,Refat Chubarov,willbecomeamemberoftheVerkhovnaRadaofUkraineaspartof thelistofthePetroPoroshenkoBlocinsteadofStepanBarna,whowas appointedasTernopilRegion'sgovernoron2April. On3March,UkrainianPresidentPetroPoroshenkoappointedChubarovas headoftheCouncilofCrimeanTatarrepresentatives. Ukrainedeliversproductsworth500mdollarstoCrimeasinceSeptember 2014 SincealawontheCrimeafreeeconomicareawasenactedon27September 2014andasoftheendofFebruary2015,continentalUkrainiancompanieshave deliveredtoCrimeaproductsworth526.34mdollars.Thisissuggestedbythe dataoftheUkrainianStateFiscalService,theUkrainianweeklyZerkaloNedeli hasreported. CrimeahassoldtoUkraineproductswhosevalueisestimatedat39.29mdollars overthesameperiodoftime. CrimeanbudgetsubsidisedfromRussiaby85percent-expert In2014,theRussiangovernmentspent125bnroubles(1.76bndollars)on Crimea,aprofessoroftheRussianStateUniversity,NatalyaZubarevich,has saidontheRussianTVchannelRBK. Sheaddedthat85percentoftheCrimean2014budgetconsistedofsubsidies fromRussia. 11 ©GorsheninInstituteApril2015Allrightsreserved INTHESPOTLIGHT ISSUE54(217) 04/06/2015 UKRAINE-GEORGIA UkrainianprosecutorsrefusetoextraditeSaakashvilitoGeorgia TheProsecutor-General'sOffice(PGO)ofUkrainehasconsideredtherequestof theGeorgianMainProsecutor'sOfficetoextraditeex-PresidentMikheil Saakashvili,currentlyanaidetoUkrainianPresidentPetroPoroshenko,and rejectedit. ThePGOisconcernedthattherequestmighthavetodowithpolitical persecution. 4.DOMESTICPOLITICAL Ukrainianpresidentrulesoutpostponementoflocalelections PresidentPetroPoroshenkoisconfidentthatdespitethemilitaryconflict Ukraine,thelocalelectionsplannedfor25October2015willnotbepostponed. EarliertheVeniceCommissionurgedUkrainetoholdlocalelectionsassoonas possible. AccordingtoLB.uaeditorinchief,SonyaKoshkina,VitaliyKlitschko'sUDAR party,whoseMPsaremembersofthePetroPoroshenkoBlocfactionin parliament,areconsideringrunninginlocalelectionsontheirown. Ukrainianpresident:constitutionalcommissiontocommenceincoming days TheconstitutionalcommissionheadedbyspeakerVolodymyrHroysmanwill commenceon6April,UkrainianPresidentPetroPoroshenkosaidon3April 2015. Earliertheheadofstateinvited59Ukrainiansand13representativesof internationalorganizations,aswellasthreeformerUkrainianpresidents LeonidKravchuk,LeonidKuchmaandViktorYushchenko,tojointhis commission. YuriyLutsenko,headofthePetroPoroshenkoBlocfactioninparliament,said atthe5thNationalExpertForumorganizedbytheGorsheninInstitutethathe hopedthatiftheconstitutionalcommissiondevelopedlegalsuggestionson decentralizationofpower,parliamentmighthaveadoptedthembeforelocal elections. However,LB.uaeditorinchiefSonyaKoshkinadoubtsthereis300votesin parliamentrequiredforpassingamendmentstothemainlaw. Ukrainiangovernmentannouncesroadreform On31March2015,InfrastructureMinisterAndriyPyvovarskyypresenteda conceptofroadinfrastructurereform.ItisplannedthattheStateMotorway AgencyUkravtodorwillonlyberesponsibleforstateroads,whileotherroads willbemanagedbylocalauthorities.Thegovernmentisconsidering constructionofconcreteroadsinsteadofasphaltones. 12 ©GorsheninInstituteApril2015Allrightsreserved INTHESPOTLIGHT ISSUE54(217) 04/06/2015 UkravtodordirectorSerhiyPidhaynyysaidthatforstatemotorwaysto undergooverhaulalonewouldrequire500bnhryvnyas(20.83bndollars).This year'sbudgethas3.4bnhryvnyas(142mdollars). UkrainianPrimeMinisterArseniyYatsenyuksaidthattheWorldBankwas goingtoallocate800mdollarsfortheconstructionofthePoltava-Kharkiv motorway,whilePolandisreadytoinvest50meurosintoroadsapproaching checkpointsontheUkrainian-Polishborder. Over60investigatorsatInteriorMinistrytobepaid1,250dollarsmonthly UkrainianPrimeMinisterArseniyYatsenyukhassaidthat63investigatorsat theInteriorMinistrywillbepaidamonthlysalaryof30,000hryvnyas(1,250 dollars). HesaidthisisyetanotherstepinfightingcorruptionwithintheInterior Ministry. AUkrainianinvestigator'scurrentsalaryis2,300hryvnyas(96dollars). Healthministerdismissesheadsofallregionaloffices HealthMinisterOleksandrKvitashvilihasdismissedhisdeputyOlena Tereshchenkoanddismissedallheadsoftheministry'sregionaldepartments duetoreorganization. Theministersaidthatapackageofbillsregulatinghealthcarereformwasbeing preparedandislikelytobereferredtoparliamentinthecomingdays. CourtsayssuspensionofsocialpaymentstoDonbasillegal On2April2015,theKievadministrativecourtofappealconfirmedaslegitimate thecancellationbytheKievdistrictadministrativecourtofthegovernment decisiontosuspendsocialpaymentsintheareasofeasternUkrainecontrolled bypro-Russianseparatists. TheJusticeMinistryisplanningtoappealthisrulingwiththeSupreme AdministrativeCourtbecauseitseesnowaytoensuresafedeliveryofcashto theoccupiedareas. InteriorMinistryopenscaseagainstemployeesofFirtash'sholding TheInteriorMinistryhasopenedacriminalcaseagainstanumberofmanagers ofDmytroFirtash'sOstchemGroupsuspectingthemofembezzlingover2.3bn hryvnyas(95.83mdollars)ofstatefunds. TheheadofthenationaloilandgascompanyNaftohazUkrayiny,Andriy Kobolev,saidthatFirtash'schemicalcompaniesowe360mhryvnyas(15m dollars)toNaftohazand3.7bnhryvnyas(154.17mdollars)toNaftohaz's subsidiaries.Headdedthatthesedebtsareclaimedthroughcourts,partof themarebeingpaidwithgas. EarlierNaftohaz'ssubsidiaryHazUkrayinysaidthatFirtash'sregionalgas distributionandchemicalcompaniesowedit9.3bnhryvnyas(387.5mdollars) forthesuppliedgas. 13 ©GorsheninInstituteApril2015Allrightsreserved INTHESPOTLIGHT ISSUE54(217) 04/06/2015 AccordingtothenewsandanalysiswebsiteLB.ua,allthementionedallegations inUkraineconcernFirtash'smanagersbutnothim. TheUSAaccusesFirtashofbriberyinIndia,asaresultofwhichhewasplaced underhousearrestinVienna.On30April,acourtwillconsiderhisextradition totheUSA. CouncilofEuropeissuesreportonMaydanmurdersinvestigation TheInternationalAdvisoryGroupundertheCouncilofEuropeon31March presentedareportontheeventsthatoccurredonMaydan(Kiev's IndependenceSquare)inFebruary2014. ThereportsaysthattheUkrainianlawenforcershavefailedtotakenecessary stepstoinvestigatetheMaydaneventsandinsomecasesdirectlyimpededthe investigation.ThegroupalsonotedthenegativeroleoftheProsecutorGeneral'sOfficeundertheleadershipofVitaliyYarema. Accordingtothereport,theresponsibilityformostofthemurderscommitted on20FebruarylaysonBerkutriotpoliceofficersunderthecommandofMaj DmytroSadovnyk. FormerKievpolicechief,hisdeputyputonwantedlist TheProsecutor-General'sOffice(PGO)hasservedformerKievpolicechief ValeriyMazanandhisdeputywithnoticesofsuspicionoforganizingthe stormingoftheMaydanprotestcampintheearlyhoursof19February.The policemenarenowwanted,itadded. Theprosecutorsalsosuspectfourpersons,someofwhomaremembersofthe Oplotfightingclub,ofattackingandabductingEuro-MaydanactivistsinJanuary 2014.Threeofthemwerearrested,oneiswanted. ThePGOwillcreateandmakepublicasingledatabaseofcriminalcases connectedtotheEuro-MaydanprotestsalsoknownastheRevolutionofDignity. UkrainiancabinetdismissesheadofStateFinancialInspectorate Basedonmultipleviolationsoflawrevealedbyanofficeinvestigation,the CabinetofMinistersofUkraineon4April2015decidedtodismisstheheadof theStateFinancialInspectorate,MykolaHordiyenko. EarlierHordiyenkoaccusedArseniyYatsenyuk'sgovernmentofcorruption. Thecabinetsaidthatallfinancialviolationsmentionedbytheofficialdated backtoViktorYanukovych'stimes.TheProsecutor-General'sOfficeopeneda criminalcaseoverabuseofofficeinthegovernment. FormerStateEmergenciesServicechiefreleasedonbail On1April2015,aformerheadoftheStateEmergenciesService,Serhiy Bochkovskyy,wasreleasedfromapre-trialdetentioncentreafter1.1m hryvnyas(0.047mdollars)wasdepositedasbailforhim. 14 ThesameamountofbailwasearlierdepositedforhisdeputyVasylStoyetskyy whowalkedouton31March. ©GorsheninInstituteApril2015Allrightsreserved INTHESPOTLIGHT ISSUE54(217) 04/06/2015 On25March,BochkovskyyandStoyetskyyweredetainedattheCabinetof Ministersmeetingonsuspicionofinvolvementincorruption.Theywerethen dismissedfromtheirposts.TheKievPecherskyydistrictcourtplacedthemunder arreston28March. StateAutomobileInspectorateheadresigns On4April,InteriorMinisterArsenAvakovhasacceptedtheresignationofthe headoftheStateAutomobileInspectorateofUkraine,AnatoliySirenko. OleksandrYershovwillfillinforSirenko. Thesameday,theheadoftheStateAutomobileInspectorate'sKievdepartment wasarrestedwhileacceptingabribe. Asreportedearlier,theInteriorMinistryuncoveredacriminalschemein registrationofcarswiththeStateAutomobileInspectorateinKiev.Theheadof theKievoffice,MykolaMakarenko,whoissuspectedofinvolvement,fledto Belarus. Italsotranspiredthatpolicehaduncoveredacrimeringinsidethepolice departmentforfightinghumantraffickingwhichwasallegedlyinvolvedin prostitutionprocuring.AdeputyheadoftheKievdepartment,Dmytro Olkhovyk,wasdetained. InteriorMinistryputsAzarov'ssononwantedlist TheInteriorMinistryofUkrainehasputOleksiyAzarov,thesonoftheformer primeminister,onwantedlist. Heissuspectedofreceivinganespeciallybigbribe. Kharkivmayor'scasetobeheardinPoltava On2April2015,theSupremeSpecializedCourttransferredahearingofKharkiv mayorHennadiyKernes'scasefromacourtinKharkivtoPoltava. Kernesandtwoofhissecurityguardsaresuspectedoftheabductionandbeating oftwoEuro-Maydanprotesters. MayorofLyubotyn,KharkivRegiondetained VolodymyrTelychko,mayorofLyubotyn,KharkivRegion,wasdetainedon1 April2015whenhewasacceptingabribeofover250,000hryvnyas(10,420 dollars). UkrainianCommunistleadersummonedforquestioning TheSecurityServiceofUkraine(SBU)hassummonedtheheadoftheCommunist PartyofUkraine,PetroSymonenko,forquestioningon6March2015. 15 ©GorsheninInstituteApril2015Allrightsreserved INTHESPOTLIGHT ISSUE54(217) 04/06/2015 TheSBUischeckingthedetailsofSymonenko'sattendanceoftheRussian CommunistParty'sCentralPlenummeetingandhisstatements,whichcanbe interpretedascallsforcrimesagainstthefoundationsofthenationalsecurityof Ukraine. TheJusticeMinistrysuggestedanadditionalinvestigationintoSymonenko's allegedinvolvementinfinancingoftheterroristorganizationsDonetskand Luhanskpeople'srepublicsandtherecognitionofCrimea'sannexation. ConscriptionstartsinUkraine ConscriptionintotheUkrainianarmystartedon1April2015.Over21,000are expectedtojointhearmedforcesinApril-May. 5.ECONOMY UkrainetofulfilseveralconditionstogetsecondIMFtranche-Finance Ministry ToreceivethesecondcredittranchefromtheInternationalMonetaryFund, Ukrainewillhavetopassanumberoflawsandholddebtrestructuring negotiationswithcreditorsbytheendofMay,FinanceMinisterNatalieJaresko hassaid. Particularly,accordingtoher,itisplannedtoadoptprogrammesforreforming state-ownedenterprises,lawsonstrengtheningtheindependenceofthe NationalBankandchangingthehealthcarefinancingsystem,andtopassalaw onthenaturalgasmarket. DeputyFinanceMinisterIhorUmanskyyduringtheGorsheninInstitute's5th NationalExpertForumnotedthattheIMFprovidesfinancialassistanceto Ukraineinordertostabilizeitseconomy,nottoensuregrowth.Accordingto him,toensureeconomicgrowth,theUkrainiangovernmentneedstowork closelywithdomesticinvestorsandcooperatewithotherorganizationssuchas theWorldBankandtheEBRD. EU,USapproveaidallocationtoUkraine TheCounciloftheEuropeanUnionhasapprovedtheallocationof1.8bneuros toUkraineunderthesecondmacro-financialassistancepackage.Thefundswill beprovidedintheformofloansforaperiodoftwoandahalfyears. Inaddition,theEuropeanCommissiondecidedtoallocatetoUkrainethelast trancheof250meurosaspartofthefirstmacro-financialassistancepackage.It isexpectedthatUkrainewillreceivethefundsinthecomingweeks. Also,USPresidentBarackObamahasorderedtotransfer87.7mdollarstoa dedicatedUSgovernmentfundtoprovideassistancetoUkraine. UkrainianFinanceMinisterNatalieJareskohasreportedthatinthecoming daysKievandWashingtonwillsignadocumentontheprovisionof1bndollars inaidtoUkraine. 16 ©GorsheninInstituteApril2015Allrightsreserved INTHESPOTLIGHT ISSUE54(217) 04/06/2015 UkrainetohostinvestmentsummitinJuly UkraineisplanningtoholdamajorbusinesssummitinJuly2015toattract investmentintothecountry. Also,anotherinternationalconferenceinsupportofUkraineisscheduledfor28 April.Inparticular,theeventparticipantswilldiscusshumanitarianaidtothe residentsofDonbas. Economycontractionslowsinfirstquarter AccordingtotheFinanceMinistry,Ukraine'sGDPinJanuary-March2015 droppedby10percentagainstthefirstquarterofthelastyear,ascomparedtoa 14.8-percentdeclinerecordedinOctober-December2014. Asforecastedbytheministry,theUkrainianeconomyshouldfallby7percent overthecurrentyear. Itshouldbenotedthat,accordingtotheNationalBank,thecontributionof DonetskandLuhanskregionsinUkraine'sGDPbecauseofthewardropped from14.9percentin2013to5.6percentin2015. Inflationhikesto34.5percentinFebruary AsreportedbytheNationalBank,inflationinUkrainereached34.5percentin February2015. Accordingtoregulator'sforecasts,theinflationrateshoulddeclineto13percent bytheendoftheyear. Fiscaldeficitgrowsby1.7times ThestatebudgetdeficitinJanuary-February2015amountedto8.743bn hryvnyas(364.3mdollars),whichis1.7timesmorethaninthesameperiodof thelastyear,accordingtotheFinanceMinistry. TheconsolidatedbudgetinJanuary-February2015showedadeficitof272m hryvnyas(375,630dollars)against2.4bnhryvnyas(100mdollars)recordedin January-February2014. Ukraineboostsutilitiesprices From1April,Ukrainehassharplyincreasedtariffsforhousingandutility services.Specifically,thepriceofnaturalgashasincreasedthreefoldto3.6 hryvnyas(0.15dollars)percu.m.fortheheatingseasonandby6timesto7.19 hryvnyas(0.3dollar)percu.m.forthewarmseason. Theelectricitytariff,dependingonthelevelofconsumption,hasgoneupfrom5 to50percent(from0.37to1.4hryvnyasperkWhorfrom0.02to0.06dollarper kWh),whilethetariffforhotwatersupplyhasincreasedby55percent. 17 ©GorsheninInstituteApril2015Allrightsreserved INTHESPOTLIGHT ISSUE54(217) 04/06/2015 Itisalsoplannedtoraisethecoldwatersupplyandheatingratesfrom1May. Itshouldbenotedthatthegaspriceforindustrialconsumersandbudgetfundedorganizationshasbeencutby19.1percentto7.2hryvnyas(0.3dollar) percu.m. Poroshenkosignslawoneasingconductofbusiness PresidentofUkrainePetroPoroshenkoon2Marchapprovedthelawonthe deregulationofeconomicactivity,whichwasadoptedbyparliamentin February. Thedocumentfacilitatesproceduresforopeningandconductingbusiness, simplifieslicensingandconciliationprocedures,andreducesthegovernment's influenceonbusinessactivity. UnemploymentinUkrainerisesto10percent AccordingtotheStateStatisticsService,theunemploymentrateinUkraine (excludingCrimea)in2014reached9.7percent(1.8mpeople). UkraineintroducesOpenSkiesruleatLvivairport LvivInternationalAirporthasintroducedtheOpenSkiesruleonitsterritory, effectivefrom2April,theInfrastructureMinistryhasreported. ThedecisionwillremaininforceuntilUkrainejoinstheCommonAviationArea agreement. 6.ENERGY Naftohaz,Gazpromstrikegasdealforsecondquarter On1April,thestate-runenergycompanyNaftohazUkrayinyandRussia's Gazpromsignedanadditionalcontract,underwhichthesideshaveextended thetermsofthe“winterpackage”forthesecondquarterof2015andapproved thepriceofRussiannaturalgasforUkraineintheamountof247.18dollarsper 1,000cu.m. Earlier,theRussiangovernmentadoptedaresolutionthatextendstheeffectof thegasdiscountforUkraineuntil30June.Thediscountisprovidedintheform ofaspecialexportduty. ThepriceofRussiangasforUkraineinthefirstquarterof2015was329 dollars. NaftohaztransfersGazprom30mdollarsasadvancegaspayment On2April,thestate-runenergycompanyNaftohazUkrayinytransferredan advancepaymentof30mdollarstoRussia'sGazpromfornaturalgassuppliesin April. 18 ©GorsheninInstituteApril2015Allrightsreserved INTHESPOTLIGHT ISSUE54(217) 04/06/2015 AccordingtoRussianEnergyMinisterAleksanderNovak,Naftohazisplanning topurchase1bncu.m.ofgasfromGazprominApril. RussiaurgesUkrainetopayforgasdeliveriestooccupiedDonbas RussiaisinsistingthatUkraineshouldpayforthegassuppliedtotheDonbas territoriesoccupiedbythepro-Russianmilitants;otherwisetheissuewillbe resolvedincourt,RussianEnergyMinisterAleksanderNovakhassaid. ItshouldberecalledthatMoscowon19Februaryannouncedthelaunchof Russiangassuppliestotheself-proclaimedDonetskandLuhanskpeople's republics.KievhasrefusedtopayforthesesuppliesastheUkrainian governmenthasnopossibilitytocontrolthem. FirsthearinginNaftohaz-GazpromgasdisputeheldinStockholm TheArbitrationInstituteoftheStockholmChamberofCommerce(Sweden)has heldthefirsthearinginthegasdisputebetweenthestate-runenergycompany NaftohazUkrayinyandRussianGazprom,headoftheUkrainiancompany AndriyKobolevsaidon2April. Asreportedearlier,Gazpromon16June2014appealedtotheArbitration InstituteinordertorecoverfromNaftohazanallegedgasdebtinexcessof 4.5bndollars. Onthesameday,NaftohazappliedtotheStockholmarbitrationcourt demandingrevisionofthegasprice,refundsfortheoverpaymentsmadesince 20May2011intheamountofnolessthan6bndollars,andabolitionofthe contractprovisionwhichprohibitstheresaleofsuppliedgasoutsideUkraine. AsGazpromreported,theStockholmarbitrationrefusedtocombineNaftohaz's claimsagainstGazpromintoonecase. Itisexpectedthatthefinaldecisiononthesecaseswillbetakenin2016. Ukrainetoboostreverse-flowgassuppliesfromEurope-minister UkrainewillcontinuetoincreasenaturalgasimportsfromEuropedespite reachingthegasagreementswithRussia,accordingtoUkraine'sEnergy MinisterVolodymyrDemchyshyn. AccordingtoUkrtranshaz,theoperatoroftheUkrainiangastransportsystem, UkraineinMarchimportedfromEurope1.35bncu.m.ofgas,whichis11 percentmorethaninFebruary. TheaveragepriceofEuropeangasforUkraineis280dollars. Ukrainestopsgaswithdrawalfromundergroundstorages Ukraineon30Marchsuspendedwithdrawalsofnaturalgasfromunderground gasstorages,thestate-runcompanyUkrtranshazhasreported. 19 ©GorsheninInstituteApril2015Allrightsreserved INTHESPOTLIGHT ISSUE54(217) 04/06/2015 Duringtheheatingseasonof2014-15,Ukrainewithdrew9.09bncu.m.ofgasfrom thestorages,whichis11percentlessthanduringthepreviousseason. Asof30March,thegasreservestotalled7.71bncu.m. NaftohazestimatesitsliabilitiestoUkrnaftaat155mdollars Thefinancialobligationsofthestate-runenergycompanyNaftohazUkrayinyto Ukrnaftafor10.1bncu.m.ofnaturalgastotal3.75bnhryvnyas(156.25mdollars), accordingtoNaftohaz's2012-13financialreport. Ukrnaftaofficialssaythattheestimateisunderstated. Asreported,theUkrainianparliamenthasadoptedamendmentstothelawonjointstockcompanies,deprivingPrivatGroupheadIhorKolomoyskyycontrolover Ukrnafta,inordertoreceivedividendsfromthecompanyfortheextractedcrude. Kolomoyskyypreviouslystatedthatthegovernmentwillnotreceivethedividends untilitrepaysthegasdebt. FoundedinJuly2010,GorsheninWeeklyisaweeklydigestofexpertanalysiscovering themostimportantpolitical,socialandeconomiceventsinUkraine.Itisthekey sourceofinformationaboutopinionpollscarriedoutbytheGorsheninInstituteas wellasthebestprofessionalcommentariesonrecentdevelopments. GorsheninWeeklyisavailableinRussianandEnglish. GorsheninWeeklyhasover700subscribersintheEU,theUSA,Russia,Ukraineand othercountries.Itsregularcustomersarerepresentativesoftheembassies,the EuropeanCommission,theEuropeanParliament,theUSDepartmentofState,leading internationalanalyticalcentres,Ukrainianandinternationalmassmedia. IfyouwishtosubscribetoGorsheninWeeklypleasesendyourrequesttothefollowing e-mailaddress:[email protected]. Ourcontactinformation: 18bMalaZhytomyrskast., Kiev01001,Ukraine +380442304962 +380442304966f [email protected] Formoreinformationpleasevisitourwebsite http://gorshenin.eu/ 20 ©GorsheninInstituteApril2015Allrightsreserved
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