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BELARUS TO ALLOW RUSSIAN RUBLE IN NONCASH DEALS. Lukashenka also promised on NTV on 19 July that he will sign a decree "within days" allowing the use of the Russian ruble in noncash transactions in Belarus, Belapan reported. The introduction of the Russian ruble for noncash settlements, one aspect of a broader plan for adopting Russia's currency in Belarus on 1 January 2005, was originally scheduled for 1 July. But the move was postponed after Lukashenka backpedaled on the plan last month (see "RFE/RL Newsline," 2 July 2003). Commenting on the recent failure to sell stakes in four major petrochemical enterprises to Russian investors (see "RFE/RL Poland, Belarus, and Ukraine Report," 17 June 2003), Lukashenka said Belarus can manage without privatizing its petrochemical sector. JM

UKRAINE, RUSSIA AGREE TO COOPERATE IN MILITARY EXPORTS. Ukrainian Premier Viktor Yanukovych and his Russian counterpart Mikhail Kasyanov signed an agreement in Yalta on 18 July on cooperation in military exports to third countries, Interfax and ITAR-TASS reported. "Russia and Ukraine will not hamper one another in third countries' markets," Kasyanov said of the deal. The men also discussed the planned creation of a Ukrainian-Russian gas consortium and the joint construction of the An-70 cargo plane. Contrary to expectations expressed in some Ukrainian media, the premiers did not sign a prepared 15-year agreement on the transit of Russian oil through Ukraine (see "RFE/RL Newsline," 17 July 2003). Russia is ready to sign the agreement only after Ukraine agrees to allow Russian oil producers to use the Odesa-Brody pipeline, Interfax reported, citing Kasyanov. JM

OPPOSITION LEADER WELCOMES UKRAINIAN PRESIDENT'S CLIMB DOWN ON CONSTITUTIONAL-REFORM BILL. Our Ukraine leader Viktor Yushchenko on 19 July welcomed President Leonid Kuchma's suggestion that he might withdraw the constitutional-reform bill he submitted to parliament last month (see "RFE/RL Newsline," 16 July 2003 and "Poland, Belarus, and Ukraine Report," 25 June 2003), Interfax reported. But Yushchenko also expressed concern over Kuchma's possible intention to defer the presidential election in 2004 in a proposal to elect parliament, local councils, and the president in the same year for five-year terms. Yushchenko said that provision is not of primary importance for constitutional reform in the country. He stressed that a proportional general election is a priority because the so-called first-past-the-post system "has proven undemocratic." JM

...AND DECREES FREE-TRADE REGIME WITH UKRAINE. On 19 July, Smirnov signed a decree establishing a free-trade regime with Ukraine, ITAR-TASS reported. The legislation would make it impossible for Moldova to impose taxes on Ukrainian goods reaching the country via Transdniester. Observers cited by the Russian news agency said the step will aggravate the already tense relations between Chisinau and Tiraspol. MS