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PUTIN, KUCHMA MOVE TO BOOST TRADE... President Putin and Ukrainian President Leonid Kuchma announced after their 18 August talks in Sochi that they have agreed to create unified checkpoints along the Russian-Ukrainian border in order to facilitate the movement of goods and people, "Izvestiya" and other Russian media reported on 19 August. Putin told journalists that bilateral relations are developing positively and that bilateral trade increased by 40 percent in the first half of this year. He also announced that he has signed a decree transferring the right to collect value-added tax (VAT) on Russian fuel exported through Ukraine, Kazakhstan, and Belarus to the governments of those countries. Putin said that this move will be very important for Kyiv, although it will cost the Russian treasury about $800 million a year. "But we believe it is worth this investment because in the future everyone will benefit from it," he said. VY

...AND LAUD IMPROVING RELATIONS. At the same 18 August press conference, Presidents Putin and Kuchma gave positive assessments of relations between their two countries, Russian media reported. "As in every family, we have our problems, disputes, and arguments, but our relations have a fraternal nature," Putin said, according to "Komsomolskaya pravda" on 19 August. Kuchma said that he cannot express just how much bilateral relations have improved over the last year. Ukrainian Prime Minister Viktor Yanukovych, who also participated in the Sochi talks, said that he recently visited a monastery and prayed for "Russian-Ukrainian friendship," ORT reported on 18 August. When Putin asked him "whose monastery," Yanukovych answered, "It was ours -- a Russian Orthodox monastery." Putin and other Russian officials have not concealed that Yanukovych is their preferred candidate in Ukraine's 31 October presidential election. VY

ANALYSTS OUTLINE MOSCOW'S PREFERENCES IN UKRAINE'S PRESIDENTIAL RACE. In an interview with "Nezavisimaya gazeta" on 17 August, Effective Politics Foundation head Gleb Pavlovskii said that Yanukovych has a very good chance of winning the 31 October Ukrainian presidential election and that he has ambitions of becoming "a Ukrainian Putin." Pavlovskii added that Putin has definitely "placed his bet on Yanukovych," but said that some major Russian companies that are active in Ukraine "are trying to sit in two chairs at once" by making contributions both to Yanukovych and to Our Ukraine candidate Viktor Yushchenko. "I hope Putin will stop them," Pavlovskii said. "We do not need a new [Georgian President] Saakashvili in Ukraine," Pavlovskii said. ORT commentator Mikhail Leontiev told polit.ru on 18 August that Yushchenko's campaign is "a special operation to detach Ukraine from Russia." "Russia supports Yanukovych not because it likes him or because he is good, but because a victory for Yushchenko would be a disaster for Russia," Leontiev said. VY

OPPOSITION LAWMAKER ACCUSES UKRAINIAN PREMIER OF USING PRESSURE IN ELECTION CAMPAIGN. Our Ukraine lawmaker Serhiy Sobolyev has said that in the Zaporizhzhya Oblast, southeastern Ukraine, "not a single signature in support of [Prime Minister] Viktor Yanukovych's [presidential bid] has been collected without pressure from the administration of various institutions," UNIAN reported on 19 August. "I can cite dozens of examples how school directors, doctors, teachers, kindergarten educators, the managers of plants, enterprises, and other state-run institutions forced [voters] to sign up for the pro-government candidate," Sobolyev said. Sobolyev speculated that Serhiy Tihipko, head of Yanukovych's presidential-campaign staff, stopped the collection of signatures for Yanukovych out of fear that the number of votes cast for Yanukovych on 31 October will be "much lower" than the number of signatures collected to confirm Yanukovych's registration. Meanwhile, the private Channel 5 television quoted on 18 August from a statement by Tihipko admitting that "zealous administrators who want to show Mr. Yanukovych their loyalty" have occasionally issued orders to collect signatures for Yanukovych and forced people to attend pro-Yanukovych rallies (see "RFE/RL Belarus and Ukraine Report," 19 August 2004). JM

U.S. SENATORS URGE UKRAINE TO HOLD FAIR PRESIDENTIAL ELECTION. A visiting delegation of U.S. senators urged Ukraine on 18 August to conduct a fair presidential election on 31 October, Ukrainian and international news agencies reported. "We are concerned that it...be a fair and open process, and the campaign...be free of government interference, intimidation, or even violence," AP quoted Senator John McCain (Republican, Arizona), as telling journalists in Kyiv. "Those nations that have failed to honor the aspirations of their people face a range of penalties, ranging from reduction of foreign investment to not being accepted in certain regional and international organizations and, in the most extreme cases, sanctions imposed by the United Nations," McCain noted. He added that he does not "predict that for Ukraine." JM

OLYMPIC SWIMMING CHAMPION BECOMES HERO OF UKRAINE. Ukrainian President Leonid Kuchma on 18 August bestowed four-time Olympic champion Yana Klochkova with the highest state award -- the title of the Hero of Ukraine -- after she won two swimming gold medals in Athens, Ukrainian media reported. Klochkova won the 400-meter individual medley on 14 August and the 200-meter individual medley on 17 August. As of 18 August, Ukraine had won five gold medals, one silver, and one bronze in the 2004 Athens Olympic Games. JM

MOLDOVAN PREMIER SAYS TRADE REGULATION IS UNRELATED TO TRANSDNIESTER NEGOTIATIONS... Prime Minister Vasile Tarlev said in a letter addressed to his Ukrainian counterpart Viktor Yanukovych on 18 August that recent measures taken by Moldova to suspend temporarily the traffic of commodities via all border checkpoints situated along the Ukraine-Transdniester border are unrelated to the ongoing conflict with the separatist region, Infotag reported (see "RFE/RL Newsline," 18 August 2004). Tarlev said Moldova is only attempting to "establish order in the sphere of exports and imports." MS

...AS TRANSDNIESTER SEIZES MOLDOVAN LOCOMOTIVES. Miron Gagauz, director-general of the Moldovan National Railroad Company (CFM), on 18 August sent a telegram to Ukrainian Transport Minister Heorhiy Kyrpa expressing "serious concern" over the situation regarding the rail line between the Transdniestrian town of Rybnitsa and the Ukrainian town of Slobodka, Infotag reported. Gagauz said the Transdniester authorities seized Moldovan locomotives after Chisinau announced it was temporarily suspending rail traffic on the line because it can no longer maintain it. Transdniester, Gagauz said, is operating the trains under the oversight of armed officers and Ukraine is accepting this situation, which he called "a gross violation of international norms and rules." The Transdniestrian town of Rybnitsa is home to the region's largest metallurgical plant (MMZ), and almost all of the raw materials used by the plant (mostly scrap metal) comes from Ukraine, where most of the plant's products are exported as well. The MMZ accounts for about half of Tiraspol's state budget revenues. MS