Publication: Monitor Volume: 7 Issue: 95

On May 10, Russian President Vladimir Putin appointed Viktor Chernomyrdin as ambassador to Ukraine and, concurrently, as plenipotentiary envoy of the Russian president for trade and economic cooperation with Ukraine. The concurrent post seems weightier and suggests that Chernomyrdin will be reporting directly to the Kremlin. The choice of Chernomyrdin and the double appointment reflect–as Putin stated in his televised announcement–the importance Moscow attaches to “strengthening the ties… first and foremost the economic ties” with Ukraine.

Chernomyrdin replaces Ivan Aboimov, a dour, lackluster career diplomat of the old Soviet school, midway through Aboimov’s term. Both Aboimov and his predecessor Dubinin had poor personal relations with Ukrainian President Leonid Kuchma. By contrast, Chernomyrdin is known to enjoy excellent personal rapport with the Ukrainian president.

Officials and commentators in both Moscow and Kyiv tend to describe the appointment as testifying to “pragmatism” in the Kremlin’s policy toward Ukraine. In the process, some commentators explicate that concept as applied to Russian policy toward CIS countries. “Putin supports the principle of economic pragmatism regarding Ukraine, [meaning] that Russia is going to exert political influence via economic influence,” Vremya MN’s analyst Dmitry Chernov observed. In Kyiv, the Institute of Politics director Mykola Tomenko similarly forecast that Moscow “will seek to establish its dominance not through direct political pressures, but through economic instruments, on the principle that economics pave the way for politics.”

Chernomyrdin, 63, is a former minister of the Soviet Union’s gas industry, prime minister of Russia (from 1992 to 1998) and chairman of the board of the Gazprom monopoly from 1989 to 1992 and again from 1999 to 2000, as well as a major stockholder in Gazprom. Chernomyrdin’s sole diplomatic experience is his ephemeral stint–criticized by Russian nationalists, overrated by some in the West–as presidential envoy for Yugoslavia. Gazprom, on the other hand, personifies as does Chernomyrdin the enduring interrelationship of the Russian energy business and government, both of which have major interests with regard to Ukraine.

The Russian government and favored business interests will, through Chernomyrdin, pursue three major economic aims in Ukraine. First, control of Ukraine’s gas transit system, which carries Russian gas to Europe and forms the single most valuable economic asset on Ukrainian territory. Moscow will probably offer relief on Ukraine’s arrears–estimated at US$1.5 billion or more–in return for Russian co-ownership of that system. Second, to bring about the unification of Ukraine’s electrical power system with that of Russia, aiming for joint operation of the distribution systems in the first stage and a Russian takeover of Ukraine’s generation system in a second stage. In that effort, Gazprom and Chernomyrdin are the allies of Anatoly Chubais’ United Energy Systems of Russia. And, third, to accelerate the shadowy privatization of Ukrainian industrial plants by Russian capital. To that end, Russian financial-political groups have already begun operating through counterpart–though weaker and vulnerable–Ukrainian circles, and now expect to regularize that process by placing it on an intergovernmental basis. For that, Moscow expects to capitalize on Chernomyrdin’s top-level political and business contacts in Kyiv.

Ukraine’s National Security and Defense Council’s secretary, Yevhen Marchuk, anticipates that “some in our government will come under strong pressure” from Chernomyrdin as the ambassador in Kyiv. Citing, however, his own experience while prime minister in negotiating with Chernomyrdin, Marchuk suggests that Kyiv can again hold its own and that it has “no grounds for fear.” He preemptively dismisses “horror stories in Ukraine and particularly in the West” about the Chernomyrdin appointment’s significance for Ukrainian-Russian relations.

For his part, former Foreign Affairs Minister Borys Tarasyuk cites Chernomyrdin’s personal rapport with Kuchma as an asset “of which any ambassador can only dream, and which is meant to be used solely in Russia’s interest.” That and similar comments in Moscow suggest that the Chernomyrdin appointment is intended also as a charm offensive on the embattled Ukrainian president.

Kuchma and his top aides–notably Marchuk and Volodymyr Horbulin–have over the years compiled a convincing record in standing up to Moscow for Ukraine’s interests on a wide range of issues. A slippage began, however, last September with the dismissal of the outspokenly pro-Western Tarasyuk, and continues with concessions on the economic front. That downslide has not impacted on foreign and military policies in any clear ways thus far, but it will do so if Ukraine’s economic assets continue being handed over to Russian government-connected financial groups. The Ukrainian government’s capacity to resist will in great measure depend on internal political stabilization and resumption of the economic reforms initiated by the deposed Yushchenko government (Itar-Tass, May 10; UNIAN, May 11-12, 14-15; Den, Vremya MN, May 11; Ukraina Moloda, Kommersant Daily, Nezavisimaya Gazeta, The Financial Times, May 12; TV-6, May 13; see the Monitor, November 14, 21, 2000, February 15-16, April 17; Fortnight in Review, November 17, 2000, April 27).

[Correction: In the Armenian-Russian story in the May 3, 2001 issue of the Monitor, we incorrectly cited the date of a Robert Kocherian interview with Le Figaro as April 28, 2001. The interview was given on February 12, 2001.]

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