UKRAINIAN PRIME MINISTER IN MOSCOW... During his first visit to Moscow as prime minister, Valery Pustovoitenko announced that "Russia is unquestionably Ukraine's strategic partner," Russian media reported on 16 September. Pustovoitenko met with Russian President Boris Yeltsin, who said there are "no large intractable problems" between the two countries. Statements by Russian officials, however, indicate some problems still exist. Following his meeting with Pustovoitenko, Russian Prime Minister Viktor Chernomyrdin said turnover in trade between the two countries in the first half of 1997 was $7.7 billion, down 22 percent on the same period last year. No solution was found to the issue of Ukraine's debt to Russia for gas supplies. Russian presidential spokesman Sergei Yastrzhembskii told reporters that Moscow has no intention of buying from Ukraine Soviet-era Tu-160 and Tu-95MS strategic bombers.

...MAKES SUGAR A PRIORITY ISSUE. One of the topics at the top of Pustovoitenko's agenda was the export of sugar from Ukraine to Russia. Pustovoitenko urged Yeltsin to remove a 25 percent tax imposed on sugar imports last May and a 10 percent value-added tax levied in the summer. The Ukrainian premier said the problem is "seriously slowing down Russian-Ukrainian cooperation." In the past, Ukraine exported 1.1-1.3 million tons of sugar to Russia annually, but this year's contracts provide for only 600,000 tons. According to Interfax, Yeltsin promised to have Prime Minister Chernomyrdin look into the matter.

UKRAINIAN GOVERNMENT SUBMITS 1998 BUDGET TO PARLIAMENT. The government on 16 September submitted the 1998 draft budget to the parliament, Reuters reported. The document provides for a deficit of 5.2 percent of gross domestic product. Two days earlier, a spokesman for Prime Minister Valery Pustovoitenko said Pustovoitenko would not submit the draft to the parliament until deputies had made changes to various tax laws. The Finance Ministry said, however, that the draft budget is based on existing tax laws. Under the constitution, the final budget must be passed by 1 January. But the parliament did not approve the 1997 budget until June of this year.