Matiyeshyn on Europe, through a Ukrainian eye

If we take into consideration the fact that the Ukraine-EU Summit has taken place on December, 19, it is a success for Ukraine. Two months ago the conduction of the summit was being doubted. Ukrainian officials even discussed a possibility of V.Yanukovych’s participation in the session of the Council of the Eurasian Economic Community in Moscow that same day.

If we take into consideration the essential content of the Ukraine-EU Summit, then it has ended up in vain. Not a single important decision has been signed. Ukraine expected to launch the Free Trade Area Agreement with the EU. Also Ukrainian governmental officials announced a possible signing of the Association Agreement. Expectations of Ukraine haven’t been realized.

According to Herman Van Rompuy, the President of the Council of Europe, the uncertainty concerning Y.Tymoshenko’s case is among the main reasons of such results of the summit. European officials are concerned with the existing restraints on free meetings of people in Ukraine. They expect that the situation improves during parliamentary elections in 2012. A requirement towards Ukraine has been laid down again. Till the situation with democracy isn’t improved, the EU won’t sign and ratify the Association Agreement with Ukraine.

The secrecy of the Ukraine-EU Summit arouses certain concerns. The information concerning the adopted decisions and the course of the session itself is practically absent. If this is the initiative of the Ukrainian authorities, why then official EU representatives adhere to the same line of behaviour? After all, freedom of speech, transparency and access to information are the main democratic principles. The EU espouses them and demands that Ukraine sticks to them.

Introduction of democratic values by Ukraine upon demand of the EU is a long-term process. And the necessity of forming and filling the budget of Ukraine for 2012 is the reality of the present time. The effect is intensified also by the conduction of the parliamentary elections that same year. In this context, the necessity of revising gas contracts with Russia becomes actual as never before.

On November 24, V.Yanukovych declared that Ukraine and Russia will agree upon the price of gas before the end of 2011. However, on December 12, the chairman of “Gazprom” O.Miller announced that his company and “Naftogaz” won’t sign the agreement before the end of December. Therefore, the order of M.Azarov, voiced on as far back as December 7, to prepare a tough variant of the state budget for 2012 with no less than $400/thousand cubic metres gas price looks not that groundless.

Taking this into account, it is hard to escape a conclusion that the results of the Ukraine-EU summit are directly connected with Ukraine-Russia negotiations on the price of gas. In this context the example of Belarus is revealing. Recently, “Gazprom” paid $2,5 billion for another 50 % of “Beltransgaz” and became the owner of the whole stock of shares of this company. That is, today Russia controls the whole Belarusian gas transport system in exchange for 20 % gas discount. This was preceded by Russia’s purposeful assistance to Belarus in accumulating considerable debts. And in the critical moment of their accumulation Russia became the owner of the gas transport system.

The situation completely repeats itself with Ukraine. The price which Ukraine pays for gas now is certainly high. And a financial load of “Naftogaz” in terms of payments for Russian gas grows every month. The Ukrainian company constantly has to take credits for payments. A possibility of paying in roubles and switching to credits of Russian banks complicates the situation even more. Each time the question of a discount for gas is touched upon, Russia demands something in return. Now, the Ukrainian gas transport system is the subject of talks.

On the eve of the Ukraine-EU Summit information on the project of a new interstate Ukrainian-Russian gas agreement appeared in the Ukrainian mass-media. It foresees the creation of two joint ventures (JV) with “Gazprom” on the basis of the Ukrainian gas transport system. The first JV, a gas-transport one, should include directly main gas pipelines and underground gas storage facilities of Ukraine. The second JV, a gas distribution one, is planned to be created with “Gazprom” on the basis of internal networks of Ukraine. It is foreseen that European energy companies will join the gas-transport JV. But already after it begins to work. Formally the project provides for an equal share participation of all JV parties (33 % – “Gazprom”, 33 % – eurocompanies and 34 % – “Naftogaz”). There is no information on the mentioned eurocompanies yet. However, already now the majority of Ukrainian experts focus attention on the close relation or affinity of these companies with “Gazprom”.

Today, Ukraine became the hostage to the two international integration projects. The first one – joining the European commonwealth is again postponed for a long-term prospect. The second one – the Eurasian Economic Community is gradually being materialized. In the realization of both projects pragmatic economic calculations and arrangements between the EU and Russia come to the fore. Ukraine has nothing left but to continue the declarative course on foreign policy maneuvering at the international arena.

Ukrainians need to put questions for themselves today. 20 years of independence, 20 years the nation is paying taxes to state and salaries to state’s servicemen. If the result of their work is well known in whole Europe then what should be done during the next parliamentary elections?

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