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UKRAINIAN BUSINESSMAN BUYS 'MOSKOVSKIE NOVOSTI.' The Media International Group holding company of Ukrainian businessman Vadim Rabinovich has purchased 100 percent of the weekly newspaper "Moskovskie novosti" for an undisclosed sum, Russian news agencies reported on 3 July, confirming rumors that had circulated in Moscow for several days. Previous owner Leonid Nevzlin announced plans to sell the weekly following a protracted conflict involving Editor in Chief Yevgenii Kiselev (see "RFE/RL Newsline," 28 June and 30 June 2005). Kiselev announced his resignation on 4 July, and Interfax on 6 July quoted Rabinovich as promising to consult with the newspaper's editorial staff and board of directors before naming a new editor in chief, probably on 11 July. Rabinovich made his fortune in nonmedia business interests but has been a major player in the Ukrainian media for a decade, "Kommersant-Daily" reported on 4 July. He was a co-founder of the private television company 1+1 in 1995. LB

UKRAINIAN PARLIAMENT HOLDS LAST SESSION BEFORE SUMMER. The Verkhovna Rada on 8 July held its last plenary session before the summer recess, Ukrainian news agencies reported. Lawmakers discussed the nomination of judges and the fate of those of their colleagues who simultaneously hold positions in the government. During a tumultuous session the previous day, when Communist Party lawmakers tried to stop the debate by blocking the presidium, sounding sirens, and punching other legislators, the legislature managed to pass two bills from the package of 14 bills that the government deems necessary in order for the country to join the World Trade Organization. On 6 July, the parliament endorsed seven bills from this package. JM

UKRAINIAN OLYMPIC CHAMPIONS READY TO RETURN PRIZES. Several Ukrainian gold medallists of the Olympic Games in Athens in 2004 have declared their readiness to hand back financial prizes from the government, thus expressing their support for former Prime Minister Viktor Yanukovych, who was also head of the Ukrainian Olympic Committee in 2004, Reuters reported on 7 July, citing a Kyiv-based newspaper. Prosecutors are now investigating irregularities in government awards to athletes while Yanukovych was in office. Athens 2004 gold medallists received $100,000 each. The champions, who include wrestlers Elbrus Tedeyev and Iryna Merleni as well as gymnasts Valeriy Honcharov and Yuriy Nikitin, signed an appeal to the Ukrainian leadership and International Olympic Committee President Jacques Rogge. They urge Rogge to "use [his] great international authority to stop government pressure" on Yanukovych, and call on Ukrainian President Viktor Yushchenko "to take the right decision, which will enable the athletic community to work to good advantage." JM

MOLDOVAN WINE EXPORTS ON THE RISE. Moldova exported $128.8 million worth of wine in January-May 2005, which is 8 percent more than in the same period of 2004, BASA reported on 7 July. Russia accounts for more than 80 percent of Moldovan wine production, and is followed by Ukraine, Belarus, Poland, and Germany. Moldova is the 11th largest wine exporter in the world, accounting for some 1.2 percent of world wine exports. JM

RADIO FREE EUROPE/RADIO LIBERTY, PRAGUE, CZECH REPUBLIC

A Survey of Developments in Belarus, Ukraine, and Moldova by the Regional Specialists of RFE/RL's Newsline Team.

UKRAINE

PORA POISED TO ENTER PARLIAMENTARY RACE. A Kyiv court on 29 June ordered the Ukrainian Justice Ministry to backdate the registration of the Pora student movement as a political party. In theory at least, the decision allows Pora, which spearheaded last year's Orange Revolution that brought President Viktor Yushchenko to power, to take part in the upcoming parliamentary elections.

The Pecherskyy District Court ruled that Pora should be retroactively registered as a political party as of 24 March 2005.

By doing so, the judiciary is paving the way for Pora's participation in the upcoming legislative polls due to take place in March 2006. Ukraine's election law says a political party cannot compete for parliamentary seats unless it is registered at least 365 days before the polls.

Yuriy Polyukhovych is the leader of Pora's Kyiv branch. In comments made to RFE/RL, he hailed the 29 June court ruling. "This is a renewal of justice and people are beginning to believe that common sense can prevail," he said. "This ruling shows that the 10,000 signatures that Pora had collected to register as a party were a fair decision."

The court decision puts an end to a two-month struggle between Pora and the Justice Ministry. Pora had been seeking registration since 24 March, when it held its founding congress as a political party.

Arguing that only one-third of the signatures of support collected by Pora activists could be authenticated, the Justice Ministry first refused to register the student movement. It did so only on 1 June. But the belated decision came too late for Pora, which was effectively barred from taking part in the upcoming election.

Pora leaders have blamed Justice Minister Roman Zvarych for the delay and organized street protests to demand his resignation. Zvarych eventually voiced support for Pora against his own administration. Yet, relations between Ukraine's newest political party and the justice minister remain sour.

On 25 June, Zvarych reportedly shunned a planned television debate with Pora leader Vladyslav Kaskiv, prompting an angry reaction from the organization. Zvarych was not immediately available for comment today.

Polyukhovych suspects many government officials -- and not only in the Justice Ministry -- are looking at Pora with suspicion. "It seems that in today's Ukraine, the new government doesn't want to see young, promising politicians on its side and that's why we sometimes have to resort to different methods, such as the protests we had to organize when the Justice Ministry absurdly refused to register us, checked our documents four times and finally registered us, but did so on such a date that would have disqualified us from participating in the elections," he said

In a speech delivered at RFE/RL's Prague headquarters earlier this month, Pora leader Kaskiv explained why in his view it is so important that Ukraine's student movement continues the political fight.

"Today, with [our] new president, Ukraine is a reborn nation," Kaskiv said. "However we understand that this is not a final, [decisive] victory. [It is just] one more chance to become a great European nation with a new outlook and a reenergized people with an outstanding future. This is why we pledge today to not [repeat] the mistakes of the past. Pora will not allow the corrupt political old guard that ruled over Ukraine in the past 14 years to change its course again. We will not allow corrupt officials to seize power in Ukraine by putting on the orange color. Pora will protect the democratic victory of the people."

Polyukhovych agrees, saying the organization had vowed to keep a watchful eye on the government.

"The situation forces us to participate in [the upcoming parliamentary] elections," he told RFE/RL. "It is especially true for those of us who have shown by their actions -- and not just by words -- that we, the youth, are well organized and capable of toppling any system that is against its own people. This is why Pora, together with other parties, must take part in these elections as they certainly will not be any less important – perhaps they will be even more important – that the last presidential elections in Ukraine."

Polyukhovych says that provided Pora wins parliamentary seats it will not blindly support Yushchenko's government, even though Kaskiv currently works as an adviser to the Ukrainian president.

"I believe this may not be necessarily an opposition, but a young, fresh viewpoint that will be heard, if not by the government, then certainly by the people, and if not in parliament, then certainly in local government councils," Polyukhovych said.

Polyukhovych says Pora has still not decided whether to run for parliament on its own, or in an alliance with other political parties. (RFE/RL staff)

CHISINAU TABLES STABILIZATION PROPOSALS FOR TRANSDNIESTER. Moldova presented a list of proposals on 30 June intended to stabilize the situation in the country's security zone -- a long, narrow strip of land along the Dniester River separating the secessionist region of Transdniester from the rest of the Republic of Moldova.

The proposals were sent to the mediators in the Transdniester conflict: Russia, Ukraine, and the OSCE mission in Moldova. Chisinau conditioned the resumption of its participation in the Joint Control Commission (JCC) -- an international body exercising control over the peacekeeping operation in the security zone -- on the approval of these proposals by the OSCE, Russia, and Ukraine.

Both the JCC and Transdniester's security zone were established in 1992, following a brief war between the Moldovan and secessionist forces. The conflicting sides on 21 July 1992 signed an accord called the "Convention Regarding the Principles of a Peaceful Resolution of the Armed Conflict in the Transdniester Region of the Republic of Moldova." The JCC, which currently includes delegations from both Chisinau and Tiraspol as well as from Russia, Ukraine, and the OSCE, was created to ensure the practical implementation of that convention.

The security zone was determined to be 225 kilometers in length, 12-20 kilometers in width, and divided into three sectors: north (Rabnita), central (Dubasari), and south (Bendery/Tighina). More than 30 stationary checkposts were set up on both sides of the Dniester, with Russian and Transdniester troops deployed on the left bank, and Russian and Moldovan troops on the right bank. There were also mobile checkposts within the security zone. In 1999, at an OSCE summit in Istanbul, Russia obliged itself to withdraw all its troops and military equipment -- estimated at 50,000 weapons and 40,000 tons of ammunition -- by 2002. There are still some 1,200 Russian troops remaining in the Transdniester security zone.

Politically, the Transdniester settlement process has been bogged down for years and seems to be no closer to a conclusion satisfying both Chisinau and Tiraspol than it was 13 years ago. Chisinau, which some time ago was close to accepting a Russia-proposed federal model for reintegrating the secessionist region within the Republic of Moldova, has recently adopted a tougher stance. Earlier this month the Moldovan Parliament endorsed the so-called Yushchenko plan (named after Ukrainian President Viktor Yushchenko) for Transdniester, which postulates a "special status" for the region within Moldova, leaving the determination of political parameters of this status to Chisinau and Tiraspol (see "RFE/RL Belarus, Ukraine, and Moldova Report," 15 June 2005). Simultaneously, the parliament called on Russia to pull out its troops from Transdniester by 2006.

Last month, Chisinau withdrew its delegation from the JCC, charging that this body wields no real authority in the security zone and has in time been transformed into a window-dressing organization to cover Tiraspol's illegitimate moves to establish customs and other checkpoints and deploy military units in the security zone with Russia's connivance. The direct pretext for the Chisinau withdrawal was the JCC's inability to stop the Transdniester authorities from blocking the access of Moldovan farmers to their fields on the left bank. The unresolved dispute over the fields have reportedly left hundreds of farmers without a livelihood.

Chisinau says that it can resume its activity in the JCC after Transdniester, as well as Moldovan, customs and other checkpoints are removed from the security zone. Order in the security zone should be maintained exclusively by the Joint Peacekeeping Force (Russian, Moldovan, and Transdniester troops) with contributions from Moldovan and Transdniester police. All sides involved in the conflict settlement should freely share information about troops and armaments in the security zone and have trouble-free access to all military units deployed in the area. Chisinau also suggests removing all obstacles to the movement of people and goods in the security zone and resuming motor traffic over a recently repaired bridge across the Dniester at Gura Bicului.

Any progress on both the Yushchenko plan and the most recent list of stabilization proposals hinges on the Kremlin's stance toward them. In principle, Russia has not rejected the Yushchenko plan, but there have already been signals that the Kremlin is not particularly enthusiastic about it. Grigorii Marakuta, the head of Transdniester's Supreme Soviet, said earlier this month that Russia is going to propose its own plan for the Transdniester conflict settlement in the following months. The Russian plan, according to Marakuta, is to be based on the so-called Kozak Memorandum that was agreed upon by Tiraspol and Chisinau in 2003 but later that year renounced by Moldovan President Vladimir Voronin. The Kozak Memorandum, worked out by Russian official Dmitrii Kozak, called for turning Moldova into a "federalized" state.

Russia's possible reaction to Chisinau's stabilization proposals could be predicted from recent comments by Russian Foreign Ministry spokesman Aleksandr Yakovenko on Transdniester. The comments, posted on the Russian Foreign Ministry website (http://www.ln.mid.ru) on 30 June and apparently not related to Chisinau's proposals made the same day, suggest that the Kremlin has decided to pursue taking an unwelcoming stance vis-a-vis Chisinau.

"Chisinau has taken a position to block the JCC activities and refuses to participate even in emergency sessions [of the commission]," Yakovenko said. "It is difficult to speak with certainty about motives behind such a position of [our] Moldovan partners, but one has an impression that the intentional aggravation of the situation is directed toward isolating Tiraspol and removing it from the negotiating process.... The whole difficult complex of causes that resulted in bloodshed in 1992...is now being presented exclusively as a manifestation of 'aggressive separatism' of the Transdniester administration."

In short, there is hardly a ray of hope from Moscow for quick progress on Transdniester. As regards Kyiv, it seems to be more cooperative and friendly toward Chisinau. On 1 June, Ukraine and Moldova started operating four joint checkpoints on the Ukrainian-Moldovan border. Chisinau has demanded a tighter border with Ukraine for a long time in a bid to curb the smuggling of arms, ammunition, and other goods from Transdniester and thus to undercut one of the main sources of sustenance for the regime in Tiraspol. The Ukrainian-Moldovan border stretches for 1,200 kilometers and has nearly 50 other checkpoints in addition the four that will now be monitored more closely. But even a small step forward is better than nothing at all. (Jan Maksymiuk)

AN INSIDER LOOKS AT THE PASAT CASE. On 27 June, the trial of former Moldovan Defense Minister Valeriu Pasat in connection with the sale by his government in 1997 of 21 MiG-29 jet fighters to the United States got under way. The ostensible offense for which Pasat, who served as defense minister from 1997-99, is in the dock is that he defrauded the Moldovan state of $54 million by selling the planes to Washington for a mere $40 million.

The arrest and trial are widely viewed as politically motivated, due to Pasat's association with a previous Moldovan administration and his current connection with Russia's Unified Energy Systems (EES), for which he works as a consultant. The image of a political trial is reinforced by the fact it is being held behind closed doors at the request of the prosecution, purportedly for national security reasons.

Whatever else Pasat may have on to account for, the MiG sale was a good financial deal for Moldova. I oversaw the purchase as Regional Director for Russia, Ukraine, and Eurasia in the office of the U.S. Defense Secretary. I conducted the initial negotiations with Pasat, although I left the Pentagon for a Congressional staff assignment a few weeks before the final purchase.

This acquisition involved confidential matters that I am not at liberty to discuss, but the intention of the U.S. government was to remove the planes from any potential illicit sales on the international arms market and to assist Moldova during a period of extreme economic hardship. The Pentagon saw the transaction as, in part, a type of assistance to Moldova. The amount the United States was willing to pay for the aircraft and associated equipment seemed generous to U.S. officials involved.

The Moldovan side, including Pasat, did not understand the concept of "fair market value," to put it mildly. Officials in Chisinau felt the planes must be worth at least what they had cost the Soviet Union to build, rather than what anyone with real money was currently willing to pay for them. They wanted much more that $40 million, and it took months for them to recognize the limitations of the market.

The aircraft in question had been left in Moldova by the Soviet collapse. Although local mechanics kept the planes in good repair, they were of no practical use to the Moldovan state, which could not even afford fuel for training. The planes had no viable military purpose, as Moldova barely has enough airspace for high-performance fighters to turn around in the sky.

There were no other legitimate buyers for the aircraft, my research at the time revealed. Several other governments operated MiG-29's, but none wanted to add to their inventories; indeed, most were shifting to NATO-standard aircraft. The Moldovan planes lacked a source of spare parts and support/repair systems, making them of little value for a new customer. Russia, the producer of the MiG-29, made clear to potential customers that it would supply parts only for planes purchased from it or with its concurrence. Russia would not encourage the competitive sale of MiG's from sources like Moldova, which might cut into its own export market.

The only other potential customers for the Moldovan planes were the so-called "rogue states." Washington felt it had legitimate concerns about the leakage of Soviet-made weaponry of all types from the arsenals of post-Soviet and former Warsaw Pact states to rogue governments. For Moldova, such an option would have been a disaster because the United States would have terminated its bilateral assistance programs if the MiG's fell into rogue-state hands as required by U.S. law. I have no doubt Washington would also have used its influence in international financial institutions to punish Moldova severely as an object lesson to other countries to discourage this kind of commerce.

The Moldovan government in 1997 was informed of these realities and came, although slowly, to understand the United States was its only serious potential customer, that the offer was a fair one, and that the United States would pay real money immediately in contrast to the vague promises so common in the global arms trade. After several months of negotiations and high-level interventions from the U.S. side, the deal was done. It was a good deal for Moldova.

The sale was a disappointment to many in Chisinau who imagined the aging aircraft to be a goldmine of astronomical worth. In fact, $40 million was more than many people in Washington wanted to pay. I remember having a hard time finding so much money for a country of less-than-primary importance to the United States. The Pentagon proceeded as part of its policy to develop cooperative defense relationships with all the former Warsaw Pact and Soviet states.

I do not know how the $40 million was used. The payment was a simple inter-state financial transfer with no cash or funny business involved. The money went to the Moldovan Finance Ministry.

Anyone with experience of Moldova knows how far short it falls in comparison to Western standards of business practices. Corruption and malfeasance have been rife there throughout its years of independence. However, the sale of 21 aircraft for $40 million was an entirely legitimate transaction. The thinly veiled accusation behind the Pasat trial that the United States in some way defrauded or swindled Moldova in this matter is false.

(The article was written by E. Wayne Merry, a former U.S. State Department and Pentagon official and current senior associate at the American Foreign Policy Council in Washington.)

"RFE/RL Belarus, Ukraine, and Moldova Report" is prepared by Jan Maksymiuk on the basis of a variety of sources including reporting by "RFE/RL Newsline" and RFE/RL's broadcast services. It is distributed every Tuesday.