EU, UKRAINE HOLD FIRST-EVER SUMMIT.

The first-ever summit meeting between the European Union and Ukraine, held in Kyiv on September 5-6, marked a political milestone but produced disappointing results. Prime Minister Jean-Claude Juncker of Luxembourg, current holder of the EU’s rotating chairmanship, and EU Commission chairman Jacques Santer, who is also a Luxembourger, headed the EU delegation. Ukrainian president Leonid Kuchma and prime minister Valery Pustovoytenko restated Kyiv’s long-standing wish to conclude a free trade agreement between the EU and Ukraine. Pending such an agreement, they requested broader access for Ukrainian products to EU markets and other steps to expand as well as to balance Ukraine-EU trade. In the first half of 1997 Ukraine exported $1.1 billion worth of goods to EU countries while importing $1.5 billion. The Ukrainian leaders observed that although the EU and G-7 countries have recognized Ukraine as a "country with a transitional economy," they continue to treat it in practice as a "country with a centrally-planned economy."

The EU leaders asked for and received assurances that Kyiv would accelerate economic reforms and improve conditions for foreign investment. They confirmed the European Commission’s April decision to allocate 100 million ECUs toward reconstructing the leaking sarcophagus of the decommissioned 4th reactor of the Chornobyl nuclear power plant. And they discussed EU and G-7 aid for completing reactors at the Rivne and the Khmelnitskaya nuclear power plants, on the condition that Chornobyl is closed down on schedule by the year 2000. The EU leaders also offered expert assistance in restoring the historic center of the city of Lviv. The sides signed an agreement on avoidance of double taxation and prevention of tax evasion. (DINAU, Eastern Economist Daily, September 8; UNIAN, September 6)

EU financial assistance aimed at closing Chornobyl and building compensatory capacities covers only a fraction of the costs, far below the levels promised in the European Commission’s and the G-7 countries’ December 1995 memorandum with Ukraine. The Kyiv meeting produced no indication that EU disbursements would adhere to the stipulated schedule, although the EU leaders insisted that Ukraine close down Chornobyl according to that schedule. EU-Ukraine summits are to be held annually from now on.

Russian-Georgian Tensions Deepen Over Alcohol Convoy.