Security Council is Against “Monuments to Political Intrigues”
Having almost finished constructing the terminal and pipeline to transport Caspian oil to Europe, Ukraine still risks being left without any alternative to Russian energy. This conclusion was made by the National Security and Defense Council of Ukraine at its session July 3 chaired by the President Leonid Kuchma. It appears that until now nobody has held specific negotiations on making agreements with oil exporting countries. As for now there was nothing but verbal agreements of the Ukrainian president with his Azerbaijani and Kazakh colleagues. The situation concerning the search for European customers for Caspian oil is even more complicated. Though an agreement was signed on working out a scientific and technical basis for constructing the Brody-Plock (Poland) pipeline, the work has yet not begun. The NSDC also recognized as unsatisfactory the implementation of the Presidential decree on activating Ukrainian participation in the Europe-Asia oil transporting corridor. The reason for it, in the words of Yevhen Marchuk, NSDC Secretary, is the “excessive politicization” of the issue about constructing the Ukrainian part of Odesa-Brody pipeline. At the same time, he believes that the project “can be saved so that it would not become a monument to our political intrigues... That is how the question was put at the NSDC meeting.” Recognizing the situation as threatening to national security, the NSDC charged the Cabinet of Ministers to implement a new governmental post, Special Plenipotentiary for Europe-Asia Oil Transport Corridor Issues, in a week. The plenipotentiary would secure the coordination of state bodies’ activities in order to solve all problems connected with this project. In addition, the government is to take measures during the next month to ensure effective use of the Dnipro main oil pipelines. The issue is that because of Russia’s construction of bypassing branch lines the Ukrainian pipes could be left empty.
Meanwhile, the countries granting alternative ways for Caspian oil transit are not asleep, of course. Ukraine faces a serious risk of losing its transit income after construction of the Tengiz-Novorossiysk pipeline is completed. Today Kazakh oil is exported precisely through the old Odesa terminal, and if this flow stops, annual losses are estimated as approximately 100 million hryvnias. Meanwhile, smart Romanians managed to get loans from the European Bank for Reconstruction and Development to increase the capacity of the Constan ю ta seaport. Deep water ports in Trieste (Italy) and Omisal (Croatia) are also ready to handle Caspian oil. Romanians, Italians, and Croats assure that their transit route is much cheaper than the Ukrainian one. Let us hope they are bluffing. However, the exporting countries themselves, Azerbaijan and Kazakhstan are declaring their intention to take full advantage of all the suggested transit lines. At least that is what the leaders of these countries stated at their meetings with Leonid Kuchma. The only thing is that such promises have been given by Caspian leaders to many countries. According to expert estimations, the preliminary contracts the Kazakhs have signed will themselves be enough for the next ten years. And Ukraine has not yet made up its mind on how oil will be delivered to the brand-new Odesa Pivdenne Terminal. First it was decided not to waste time on trifles and build a tanker fleet of our own. Incidentally, this was provided for by a presidential decree issued last year. However, corresponding expenditures were not included in state budget. Now Mykolayiv shipbuilders are waiting for next years’ orders, but it seems that we will still have to freight foreign tankers.
That same day the NSDC examined the problem of putting scientific projects into production, admitting that now because of the brain drain and uncontrolled export of inventions to Russia, the US, Israel, Germany, etc., Ukraine is suffering great damage. The NSDC decided to implement tax privileges for research and design work conducted by scientific institutions. In particular, the value added tax was mentioned. The Cabinet of Ministers was instructed to create an Information Technologies Bank to be directed by a state organ specially created for this purpose, the major function of which will be the purchase and sale of inventions. It will also be engaged with exporting and importing modern technologies.
The third issue discussed by the NSDC was not so global but still acute: jobs for retired military officers. The council’s documents stress that leaving this problem unsolved makes retired military personnel “a source of social tension.” In reality the conversion problem can be supervised by the National Coordinating Council of the Defense Ministry. Due to the administrative reform, this body has lost its governmental statute and now is hanging in midair. The council recommended the president restore the center’s statute. Incidentally, it is planned to discharge 25,000 persons by 2005. Another 20,000 army positions in four years will be occupied by civilians instead of soldiers.
