Gazprom chairman Rem Vyakhirev conferred yesterday in Kyiv with President Leonid Kuchma and Prime Minister Valery Pustovoytenko on reimbursement of Ukrainian debts to the Russian company. Kyiv estimated the arrears at approximately US$800 million–rather than the US$1 billion figure cited by Gazprom–and assumed direct responsibility for some US$400 million. The remainder is owed by private Ukrainian entities. Ukraine ruled out issuing securities or state bonds for reimbursement purposes. Ukrainian leaders also resisted Gazprom’s familiar demand to be reimbursed through equity in Ukraine’s largest gas storage sites. Gazprom uses those underground sites for the gas it exports westward via Ukraine, but it is the latter who owns them.
The Ukrainian officials apparently proposed reimbursing Gazprom by the end of 1998 with cash, Ukrainian-made goods (in unspecified proportions), and the value of storage and transit services. The officials urged the signing of a long-term agreement that would guarantee the transit of large volumes of Russian gas via Ukraine. (Ukrainian agencies, June 24)
Pressured by the Russian government to pay overdue taxes (see the Monitor, June 24), Gazprom needs to collect debts now, not later. It also needs cash, rather than commodities, let alone IOUs for services. Kyiv’s stalling response illustrates its ability to use debtor’s leverage against this Russian natural monopoly.
RUSSIAN NAVAL BASES IN CRIMEA: POSSIBLE STORAGE PLACE FOR NUCLEAR WARHEADS.