Yanukovych Resets Ukraine’s Kremlin Relations After Yushchenko

**Ryan Ruck** · March 14th, 2010, 05:44

March 04, 2010

Ukrainian President Viktor Yanukovych arrives in Moscow today after winning last month’s election on pledges to recalibrate relations with Russia.

Yanukovych plans to meet President Dmitry Medvedev and Prime Minister Vladimir Putin in the first visit by a Ukrainian head of state in two years. His predecessor Viktor Yushchenko angered the Kremlin by backing Georgia during its five-day war with Russia and agitating for Ukraine’s membership in NATO.

“There’s an understanding that Ukraine should reset the general mood in relations,” said Oleg Voloshin, a spokesman for the Ukrainian embassy in Moscow. “Both sides want to discuss the direction of the political and economic dialogue.”

Yanukovych, a Russian speaker from eastern Ukraine, has said he will improve relations by cooperating with gas producer OAO Gazprom and holding off on membership in the North Atlantic Treaty Organization. At the same time, he’s kept the door open to Europe, taking his first trip as president to Brussels earlier this week.

“Technically this isn’t so significant, but symbolically it is,” said Dmitry Oreshkin, an independent political analyst in Moscow. “Having won the election on a Russophile campaign, he now has to turn to the West to avoid a split in Ukraine.”

Yanukovych, who won 48.95 percent of the vote in the Feb. 7 run-off election, dominated in the eastern half of the country. His opponent, Yulia Tymoshenko, drew 45.47 percent of ballots thanks to voters in the more Europe-oriented west.

Sidelines

Compared with Ukraine’s 2004 elections, when Putin actively campaigned on Yanukovych’s behalf, the Kremlin watched from the sidelines in this year’s vote. Neither Medvedev nor Putin attended Yanukovych’s inauguration in Kiev last week.

Relations deteriorated after Yanukovych lost out to Yushchenko in the 2004 Orange Revolution. Russia responded to the country’s pro-western course by slashing energy subsidies and planning pipelines to Europe that would make Ukraine’s role as a transit country insignificant.

Yanukovych has expressed interest in setting up a venture with Gazprom and other foreign companies to upgrade and operate the Ukrainian pipelines that currently deliver 80 percent of Russian gas exports to Europe.

He has also expressed interest in participatiing in Gazprom’s Nord Stream pipeline project, which is designed to bypass Ukraine by crossing the Baltic Sea to Germany.

Other issues are the fate of Russia’s Black Sea Fleet based in Crimea and the possibility of a loan to Ukraine’s cash- strapped government.

“The Russians aren’t just going to open their checkbook,” Oreshkin said. “Of course it won’t be a meeting between fraternal Orthodox nations, that’s a fairy tale.”

**Ryan Ruck** · March 14th, 2010, 05:45

Yanukovych Opens Door To Russian Navy Keeping Base In Ukraine

2/13/2010

Viktor Yanukovych, the expected next Ukrainian president, says he cannot rule out Russia's Black Sea Fleet remaining in Ukraine after its lease on the Sevastopol naval base expires in 2017.

Preliminary results showed Yanukovych narrowly winning Ukraine's presidential election, and although the official count has not been released he has been congratulated by world leaders including the Russian and U.S. presidents.

The Party of Regions leader is expected to move Ukraine away from the determinedly pro-Western stance of President Viktor Yushchenko, who vowed that Russia would have to find a new main base for its Black Sea Fleet once the current deal expires.

"I do not rule it out," Yanukovych said in an interview with the Russia 24 TV news channel when asked if the Black Sea Fleet could remain in the Crimean port of Sevastopol after 2017.

"We will discuss this issue in the near future. This matter will not be decided at Russia's expense, it will be decided in the national interests of Ukraine. We will find a solution," Yanukovych said, noting that there were many issues involved that needed addressing.

He added that Ukraine's relations with NATO are currently well-defined, and said they would not be expanded. Yushchenko stoked Russia's ire with his pursuit of NATO membership, but despite strong U.S. support many alliance members were lukewarm on the idea.

NATO Secretary General Anders Fogh Rasmussen on Friday congratulated Yanukovych on his election as president and said the alliance was "committed to deepening our strategic partnership with Ukraine."

Yanukovych said on Friday that there was "no question of Ukraine joining NATO," telling Russia's Channel One that Ukraine supported Russian President Dmitry Medvedev's proposals for a new European security architecture, and he reiterated the point on Russia 24 on Saturday.

He said the issue of Ukrainian membership of NATO might "emerge at some point, but we will not see it in the immediate future."

"If it does arise, it will be decided by a national referendum," he added.

"I think that the initiative of Russian President Dmitry Medvedev on the preparation of a new European security concept...is one in which we are willing to participate," Yanukovych said.

Yanukovych defeated his bitter rival Prime Minister Yulia Tymoshenko by a mere 3.5% in Sunday's polls, with official results to be announced by February 17.

**Ryan Ruck** · March 18th, 2010, 16:58

Yanukovich Offers To Keep Russian Navy In Ukraine After 2017

March 5, 2010

Ukraine’s new President, Viktor Yanukovich, has offered to extend the lease of military bases to the Russian Navy past their expiration in 2017.

Yanukovich himself made public this offer during his joint news conference on Friday with Russian President Dmitry Medvedev in Moscow.

The Ukrainian President stated that soon the military bases issue will be resolved in a way which satisfies both Russia and Ukraine.

The question of whether to allow the Russian Black Sea navy to remain in its Crimean Peninsula bases after 2017 is a particularly thorny one especially as far as the prospects of Ukraine joining NATO are concerned.

The first ripples of the loss of Ukraine to the pro-Russia Yanukovich.

**vector7** · April 27th, 2010, 14:43

Putin Proposes Russia, Ukraine Nuclear Energy Merger

April 27, 2010, 2:21 AM EDT
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(Adds Yanukovych comment in fifth paragraph)
By Anna Shiryaevskaya

April 27 (Bloomberg) -- Russian Prime Minister Vladimir Putin proposed creating a nuclear power holding company with Ukraine as the two former Soviet republics rebuild ties.

“We have made massive proposals, referring to generation, nuclear power engineering, and nuclear fuel,” Putin told reporters after a meeting with Ukrainian President Viktor Yanukovych in Kiev today. Any cooperation may be phased, Putin said after the surprise visit to Kiev.

Russia and Ukraine have reached agreements on natural gas subsidies and a navy base since Yanukovych’s election in February improved ties between the neighboring states. Putin also met yesterday with his Ukrainian counterpart, Mykola Azarov, to discuss industrial cooperation.
Putin and Azarov plan to meet in Sochi on the Russia’s Black Sea coast on April 30, where an intergovernmental commission will meet, Putin said. Russia and Ukraine are also discussing aviation and shipbuilding, he said.

Yanukovych said the proposals are “interesting.”

Ukraine currently operates four nuclear power plants with 15 reactors, according to the World Nuclear Association database. It was the site of the world’s worst nuclear accident when a reactor at the Chernobyl facility exploded on April 26, 1986, spewing radiation across eastern and northern Europe.

Nuclear Upgrades

Russia is ready to take “an active part” in upgrading Ukrainian reactors and will allow Ukrainian partners on the Russian market, Putin said.

Nuclear cooperation in third countries is also possible, he said.

Russia plans to boost the share of nuclear power in total output to 25 percent from 15 percent to 16 percent now, Putin told reporters near Milan yesterday.

Ukraine will get $40 billion to $45 billion of investment from Russia in the next ten years because of a gas agreement reached last week, with fuel supplies subsidized by Russia’s budget, Putin said. This year, Russia will run a deficit that is wider than Ukraine’s, if the neighboring country takes into account the reduced gas price, he said.

Russian President Dmitry Medvedev and Yanukovych reached the gas agreement in Kharkiv, eastern Ukraine, on April 21. Russia agreed to cut the price of gas for Ukraine by as much as 30 percent, and in exchange Ukraine agreed to allow Russia to keep its Black Sea fleet at the Ukrainian port of Sevastopol until 2042, with a possible five-year extension. The fleet’s lease was set to expire in 2017.

“The price they proposed to regulate the issue is excessive,” Putin said.

“I could eat Yanukovych and the prime minister together for that money.

Not a single military base in the world costs as much.”

The Ukrainian government may ratify the accord today.

Debates planned on the fleet in Ukraine are “surprising,” as Russia discussed the extension with the previous government led by Yulia Tymoshenko and received no objections, Putin said.

“But it is not just about money to us,” Putin said. “Cooperation with Ukraine and cooperation in the military sphere improves the level of trust between our countries.”

--With assistance from Daryna Krasnolutska in Kiev. Editors: Torrey Clark, Will Kennedy

To contact the reporter on this story: Anna Shiryaevskaya in Kiev at ashiryaevska@bloomberg.net
To contact the editor responsible for this story: Will Kennedy at wkennedy3@bloomberg.net