End Note: MOLDOVA, UKRAINE SQUABBLE OVER OIL TERMINAL xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

KUCHMA ORDERS ANTI-CRISIS MEASURES. Ukrainian President Leonid Kuchma ordered his cabinet on 1 July to prepare measures to halt the country's economic decline, AP reported. Presidential spokesman Oleksandr Maydannyk said the measures, which are to be issued as decrees due to the standstill in the parliament, seek to stabilize the economic situation in the country. Maydannyk said Kuchma's measures will reduce taxes, give tax breaks to large foreign investors, lower the need for foreign credit, and attract international investment. Other possible steps include increased support for farmers and an amnesty for Ukrainians abroad who left with large amounts of money. Also on 1 July, the parliament failed yet again to elect a speaker. Oleksandr Moroz received the most votes in the balloting. PB

KYIV WANTS CASPIAN OIL TRANSPORT TO TRANSIT UKRAINE. Uladislau Toroshevskiy, the acting chairman of Ukraine's Committee for the Oil and Gas Industry, said on 1 July that Kyiv is trying to ensure that oil will be transported through Odessa and along the Odessa-Brody pipeline, ITARTASS reported. Toroshevskiy was speaking at an oil conference in Kyiv. He said the government has adopted a resolution to expedite the establishment of an international consortium that would promote and improve conditions for the transport of Caspian oil through Ukraine. PB

LUCINSCHI ON TRANSDNIESTER CONFLICT. President Petru Lucinschi on 30 June told the OSCE Secretary-General Giancarlo Aragona that Moldova is willing to solve the conflict with the Transdniester by granting the separatist region a special status with a large degree of autonomy, BASA-press reported the next day. He said this position coincides with that of the OSCE and the two mediating countries, Russia and Ukraine. He also said Moldova "counts" on OSCE support in its quest to solve the conflict. Aragona is participating in a OSCE-organized seminar on relations between central and local authorities. Separatist leader Igor Smirnov declined an invitation to attend the seminar. He wrote to OSCE mission chief in Moldova John Evans that "Moldova is not a central authority" for the Transdniester region. MS


Plans to build an oil transfer terminal in Moldova are stirring opposition in Ukraine, which is worried about an adverse environmental impact.

The $38 million project is scheduled for completion next year. The European Bank of Reconstruction and Development (EBRD) is providing a $25.5 million credit for the construction of the terminal, which will allow Moldova to transfer petroleum to and from tankers plying the Danube, bringing considerable savings for the small landlocked country.

"This is just the kind of project we need," noted Moldova Deputy Premier Minister Ion Gutsu at a recent EBRD conference. "It will create critical infrastructure...and enable our economy to grow."

But Ukraine sees the terminal in a very different light. "Our experts recently went to the site and inspected the project," Odessa Regional Administration spokesman Yuri Shiroparov told RFE/RL. "And they found many things wrong with it."

Situated on the Danube's left bank south of the village of Dzhurdzhulesht and snug up against the Ukrainian border, the terminal could transfer 2.1 million tons of oil annually, giving Moldova an alternative to Russian energy deliveries.

Ukraine has no problem with that. But Kyiv is arguing that because the terminal is only a few kilometers upstream in the middle of Europe's largest wetland, the project endangers the environment. "One of the most important problems our experts found is that [the terminal] threatens our ecology and vulnerable wetlands," Shiroparov said. "We need to make sure that our interests are protected."

The Danube Commission, composed of representatives from countries bordering the river, could have been a forum to iron out differences about the environmental impact of development in the basin. This proved, however, not to be the case.

The Ukrainians charge that the Moldovans may have misled them and brought to near-completion a major industrial project without providing full information on the scope of the work.

But Moldovan project managers counter that Kyiv has had ample opportunities to learn about the Dzhudzhulesht Terminal, as far back as 1994.

"Ukrainian and Moldovan commissioners met in Chisinau on 3 November 1994 to discuss the problems of the terminal," said Deputy General Director of the Terminal S.A., Yakov Mogorian, in a recent newspaper article. "Results of [an independent Dutch] study were presented in Chisinau on 9 December 1994...[and] on 23 November the Moldovan side invited [Ukrainian ecological representatives]...but no one came and no one made any comments."

There were several permutations of the project before it was finalized into a Greek/Moldovan/EBRD joint venture. The first funds were obtained in late 1996, and by 1997 Dutch general contractor Fredric R. Harris had begun construction.

Kyiv demands now that Harris's blueprints be approved by its Ministry of Ecological Protection. Protests have been made to the Danube Commission and, more recently, Ukraine has tightened border control near the frontier town of Reni. Dotted with woodlands, lakes, and swamps, the Danube frontier near Reni and Dzhurdzhulesht used to be a place where hunters could shoot ducks and fishermen hook pike, without too much attention paid to passports. Not any more.

"The Ukrainian border troops' defensive works and barbed wire opposite the terminal construction site are more intense than what you would see on the Tajik-Afghan border," said Mogorian. And there is little prospect that the dispute will end any time soon.

The author is an RFE/RL correspondent based in Kyiv.