Parliament members reject new state budget

Ukrainian parliament members decided on Wednesday to postpone a vote concerning the 2001 state budget, opting instead to go back to the drawing board and return for a vote in two weeks' time. The vote had been scheduled for Thursday, but after serious consideration, it was decided that the government needed to submit a different version of the draft budget. The decision came as a big surprise for Prime Minister Viktor Yushchenko.

A day before Wednesday's meeting, Yushchenko conducted meetings with most groups and factions within the parliament. As a result, the Prime Minister received many suggestions and additions to the Cabinet's budget proposal and agreed with many of them. However, during an evening plenary parliament session, it was decided to postpone the discussion of the budget for two weeks.

Five out of eleven majority factions want to conduct one more first reading of the project, and it was resolved that more time is needed before a final decision on the budget can be made.

Yushchenko, who is now in Paris for the international business forum "Ukraine and European Union: Together into the 21st Century," has not given any comments yet.

President Kuchma agreed with the parliamentary decision, telling journalists that he does not have any remarks at this time, only that he would like further reflections on the budget. The intrigue which was expected by many, and which normally ensues when the national parliament begins its annual discussion of the new budget, has not, as yet, occurred.

Deputies have several options regarding their decision on the adoption of the budget. They can adopt the budget on the first reading; reject it outright; or advance the budget proposal for a second first reading.

However, deputies are bound to the outcome of a national referendum held last spring. According to the referendum, the President can dismiss parliament if deputies are unable to adopt the state budget in time.

 

...but support freedom of speech

Members of the Communist and Socialist aligned "Left Centre," a part of the faction Bat'kivshchyna (Fatherland), and several centrist factions left the parliamentary session hall on 17 October to protest the closure of the newspaper Silski Visti. Left Centre member Ivan Bokyy prompted the walkout when he appealed to all deputies to leave the session hall for at least five minutes to demonstrate their loyalty to democracy, the Constitution and the nation, and to express their protest against persecution of journalists.

Silski Visti has periodically faced problems since the last presidential elections because of the newspaper's perceived bias towards leftist political nominees.

Currently, Silski Visti is temporarily closed down because of tax police sanctions against it. Silski Visti is accused of not paying income tax on property it received eight years ago. The newspaper has been ordered to pay UAH 1.8 million (USD 330,000) in penalties, according to a decision by the state tax administration. The newspaper's appeal to the Kyiv city arbitration court to cancel the penalty has been rejected.

 

Russian gas a cornerstone of friendship

Ukrainian problems connected to the European Union's decision to increase consumption of Russian gas are mounting daily. At the beginning of the week, it seemed that Russian President Vladimir Putin, who met his Ukrainian colleague in Sochi, was interested in the idea of modernizing Ukraine's gas pipelines so that more gas can be transferred to Western Europe. Putin expressed his interest in involving Gazprom, a Russian gas corporation, in the privatisation of Ukraine's gas transport system, according to a Radio Liberty report.

It seems that President Kuchma honestly believed in the best intentions of his Russian counterpart, because he denies any attempts on the part of Russia to begin negotiations with Norway regarding the idea of building another pipeline through Poland to Ukraine and also to the countries of Central and South Europe.

However, it seems that Russia is either distrustful of its partner and neighbour or simply wants to find the best and most profitable solution. On Wednesday, Russian Gazprom signed an agreement with several European companies to build a new pipeline which goes through Belarus, Poland and Slovakia, bypassing Ukraine altogether. Western companies that will be involved in the construction include Italian company SNAM (a division of ENI), French company Gaz de France and two German companies, Wintershall and Ruhrgas.

The participants in the agreement explain the reason for the new pipeline's construction in a simple way: Gazprom and Western buyers of Russian gas need this pipeline to avoid the potential theft of gas on the Ukrainian side.

Although such a decision would bode ill for Ukraine's economy, officials in Kyiv still have cause for optimism. Firstly, according to President Kuchma, Russian Gazprom and Western companies have signed a memorandum expressing mutual understanding, which is simply a confirmation of good will and intentions. As a rule, a lot of time passes between an agreement and its practical realisation, concluded the President.

Secondly, in order to start construction, the parties that signed the contract must obtain official permission from Poland and Slovakia before building begins. Until now, Warsaw has not given any reason to doubt the friendship between Poland and Ukraine. However, Russia can find ways to solve the "Polish problem"; Poland's desire to join the European Union, which in turn is interested in increasing its gas supply from Russia, will certainly factor into Poland's final decision.

The third hope for Ukraine in avoiding severe economic losses is the status of Gazprom as a corporate entity. Officially, Gazprom is merely a commercial structure and cannot make any decisions on behalf of the state. Negotiations concerning the building of the new pipeline on a multi-state level have not yet been announced.

 

And in other news...

• According to sociological surveys conducted by the National Institute of Sociological Research and the Centre for Social Monitoring, social tension in Ukraine is on the decline compared to recent years. The number of people who believe that the country faces strong social tension and the threat of serious conflict has dropped from 39 percent in May 1997 to 22 percent in September 2000. In 1997, 42 percent of respondents supported a revolutionary approach with regard to societal transformation and 39 percent wanted market reforms. Today, only 15 percent of respondents still have a desire to see revolutionary actions, while 67 percent agree with gradual market reforms.
• On a more sombre note, Ukrainian citizens are not likely to trust their elected officials. According to the surveys, Ukrainians trust Prime Minister Yushchenko more than other public figures—39 percent of respondents trust him; however, 46 percent claimed not to trust him. President Kuchma came in second, with 33 percent of respondents trusting him and 57 percent not trusting him. The national parliament received a more tepid rating, with only 16 percent indicating that they trust in the elected body.

Natalya Krasnoboka, 21 October 2000

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Sources:

Den', daily national newspaper
Inopressa Ru, on-line source of foreign publications on Russia and Eastern Europe
Kyiv Post, weekly national newspaper
Korrespondent, on-line weekly
Radio Free Europe/Radio Liberty
UA Today, on-line information agency
Ukrainska Pravda, on-line independent
daily newspaper