Geopolemics.com :: Ukraine

Countries: Ukraine
Posted on Monday, March 31, 2008 - 11:39 AM
	Gas cut-off by Russia Russia effectively halved its supply of gas to Ukraine in early March. This is not for the first time. A similar dispute between Moscow and Kiev in 2006 had sent jitters through customers in Europe, after Gazprom cut all gas supplies to Ukraine. Ukraine sits on the main transit route for Russian gas exports to Europe, accounting for the transmission of a quarter of the continent's gas supply. Ukrainian President Viktor Yushchenko has urged the government to resume gas talks with Russia immediately. "This is the only way to settle the Ukrainian-Russian gas dispute," Yushchenko said in a letter to Prime Minister Yulia Tymoshenko, according to a presidential press service statement released Tuesday night. Yushchenko asked the government to order state gas company Naftogaz to immediately resume negotiations with Russia's gas monopoly Gazprom, in line with the agreement on simplifying gas supplies reached by the leaders of the two nations in Moscow in February. "The gas row has caused concern in the European Commission," Yushchenko emphasized. A debt dispute prompted Gazprom to cut supplies to Ukraine by a further 25 percent on March 4, doubling a 25-percent cut already in force since the previous day, as the two countries slide toward a new energy war that has put Europe on alert. Naftogaz said that it may have to divert some of the Russian gas earmarked for Europe that transits through Ukraine if the country's own energy security comes under threat. Yushchenko versus Timoshenko The two dominant figures in Ukrainian politics are constantly at loggerheads. Indeed they are dire enemies. President Yushchenko has forwarded a letter to Prime Minister Yulia Timoshenko. He called attention to the fact that the government "withdrew from the solution of a number of topical problems," Prime-Tass reports. "The problem has emerged with ensuring the balanced character of the movement of financial resources of Naftogaz Ukrainy," the president wrote. "The government's proposals on the additional financing of the company from the state budget, dividends etc. leave without balance the revenues and expenditures of Naftogaz Ukrainy to the sum of at least 3.5 billion hrivnas." Yushchenko pointed to the fact that the financial plan of Naftogaz Ukrainy had not yet been adopted, in violation of the presidential decree. Yushchenko agreed with the proposals of the government on a number of problems, specifically "the beginning of the building of dwellings available for the population, the need for the legal settlement of the sale or lease of plots of land on the competition-free basis, as well as the increase of budget allocations for VAT compensation payments." At the same time, Yushchenko wrote that "the government has actually withdrawn from the solution of problems in some other spheres, including the growth of expenditure for the needs of the defence ministry, the financing of projects of the Ukrainian State Service on Road Construction, the beginning of the comprehensive reforming of relations between budgets on various levels, etc." Note: To read more, click here

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