Publication: Monitor Volume: 5 Issue: 228

Billed in advance as his “first visit abroad as reelected president of Ukraine,” Leonid Kuchma’s visit to Moscow turned out to be only a brief stopover en route to Western destinations, where Kuchma seeks tangible political, economic and security support for Ukraine. On December 6 in Moscow, Kuchma held a total of one hour of talks with Russia’s President Boris Yeltsin and Prime Minister Vladimir Putin, focusing on what Kuchma termed the “none-too-pleasing aspects” of Russian-Ukrainian relations. As Kuchma summed them up in Ukrainian and Russian media interviews accompanying his visit, those aspects include:

–Nonfulfillment of earlier understandings–including those reached by Kuchma with Yeltsin–on turning over to Ukraine its due share of the former Soviet Union’s real estate assets abroad and the Ukrainian hard-currency accounts deposited with the former Soviet Union’s Foreign Trade Bank (Vneshekonombank).

–Stalemate in the border delimitation negotiations regarding the Azov Sea and the Kerch Strait. The Russian side seeks a condominium regime in the Azov Sea, while Ukraine favors dividing that sea into national sectors. In the Kerch Strait, whose navigable channel runs closer to the Ukrainian than to the Russian shore, Russia wants a non-equidistant border and shared control of the channel, whereas Ukraine favors drawing the border along the median line and thus national control of the channel.

–Continuing decline in bilateral trade turnover, with a further drop of 20 percent projected for 1999. Kuchma blamed the trend mainly on Russian protectionist barriers and failure to implement previously announced plans for a CIS free trade zone. He noted that the Russian-Ukrainian economic program for the period 1998-2007, signed by the two presidents last year, is not bearing fruit. Kuchma complained also about the Russian government’s intention to double the export duties on crude oil exports to Ukraine and other countries outside the CIS Customs Union–a move bound to raise the prices on oil products in those countries. One day after Kuchma’s visit, Putin signed the government resolution imposing the new duties.

–Unavoidable restructuring of Ukraine’s trade arrears to Russia, which are estimated at nearly US$3 billion, including US$1.4 billion for gas. The sides have, however, agreed to deduct from that amount the US$285 million price of Ukrainian strategic bombers which are currently being delivered to Russia (see the Monitor, November 11). The Ukrainian government, moreover, disclaims responsibility for the debts of private Ukrainian gas importing firms, thus coming up with a US$500 million estimate of its debts to Russia for gas. But Russia’s Gazprom company on December 7 accused Ukraine of having pilfered more than 3 billion cubic meters of Russian gas from the transit pipeline in November and almost 1 billion in the first week of December.

The controversial issues of CIS reform and Russia-Belarus unification were “not considered” during the talks in Moscow. The formula, used by both Russian and Ukrainian spokesmen, implied that the sides had agreed to disagree on those topics. The two leaderships managed to agree fully on one subject: a project to jointly produce the TU-334 airliner at plants in both countries for their own use and for export. The atmosphere and outcome of his visit suggests that Kuchma is not having to pay a price for the Kremlin’s indirect, yet important endorsement of his reelection. Kuchma is today completing a two-day visit to France–focusing on Ukraine’s relations with the European Union–and proceeding to the United States (UNIAN, DINAU, NTV, ORT, Itar-Tass, December 6, 7; Kievskie Vedomosti, December 6; Eastern Economist Daily (Kyiv), December 7, 8; see the Monitor, July 9, October 12, November 17).