UKRAINE: PRESIDENT YUSHCHENKO FOCUSED ON A NATO

C O N F I D E N T I A L SECTION 01 OF 03 KIEV 003489

SIPDIS

SIPDIS

E.O. 12958: DECL: 09/11/2016
TAGS: PREL PHUM ECON ENRG UP
SUBJECT: UKRAINE: PRESIDENT YUSHCHENKO FOCUSED ON A NATO
MAP, ENERGY AND BABYN YAR COMMEMORATION

REF: KIEV 3463

Classified By: Ambassador for reasons 1.4 (b,d).


1. (C) Summary: President Yushchenko told the Ambassador
that NATO membership was an internal question for the
country, but that he was working with PM Yanukovych to make a
good case for a MAP during his September 14 visit to
Brussels. On energy, if Ukraine could liberalize and
diversify the sector, it would lead to political stability
and thus less opportunity for interference. Yushchenko said
that he had signed a series of decrees to implement an
anti-corruption program and was eager to cooperate more
closely on MCC, noting that he was ready to meet again both
on MCC and a proposed program of USG assistance for the
reorganization of the presidential secretariat. He expressed
the hope that the President or Vice-President might be able
to attend the September 27 Babyn Yar commemoration; the
Ambassador noted that the U.S. delegation would be led by a
cabinet-level official. Yushchenko conveyed a letter
addressed to President Bush regarding the fifth anniversary
of September 11 (provided septel). End Summary.


2. (C) Comment. Yushchenko appeared to be in good shape
physically, certainly better than he looked in mid-July in
the midst of political crisis and deadlock. He was focused
and engaged during the meeting, kept to the allotted time and
expressed his willingness to work closely with us on all the
key bilateral issues. Yushchenko was accompanied only by an
interpreter to the meeting, although foreign policy advisor
Tymoshenko came in and out of the room throughout. Although
the Ambassador raised Mrs. Yushchenko's planned travel to the
U.S. to attend Mrs. Bush's Global Literacy Conference on
September 18 in New York City, Yushchenko gave no indication
that he had any intention of accompanying her to UNGA or
elsewhere. End Comment.

NATO - Membership is the Goal
--------------


3. (C) After accepting the September 11 commemoration
letter on behalf of the President, the Ambassador provided
the President with a readout of the major messages delivered
by A/S Fried (reftel) during his visit here, including on
NATO membership (a decision at Ukraine's time and pace),and
relations with Russia (our only concern being that improved
relations did not result in less sovereignty for Ukraine).
On NATO, Yushchenko told the Ambassador that he had talked to
the PM last week and that they had agreed that Ukrainian
membership in NATO was the only way to guarantee Ukraine's
future national security. However, this was now an "internal
question" and the details regarding the pace and end point of
Ukraine's movement toward NATO would be a Ukrainian decision.
According to Yushchenko, Ukraine will need "several years"
and it would be up to him, the PM and the Speaker to make the
case to the people.


4. (C) In Yushchenko's view, a NATO MAP was important, but
it would take several years to achieve mebmership in NATO.
The NATO issue had been agreed in the "universal" after hours
of discussion that had ended at 5 am the day that the
universal was signed. However, "we succeeded" and now "we
have to implement it." Yushchenko said that the U.S. and
other allies could help - especially by supporting continued
public discussions, conferences, and roundtables on the
issue. U.S. advisors could also help and should meet with
the PM on this issue. Yushchenko acknowledged that he was
pushing the idea of a letter from the Prime Minister to NATO
SYG Hoop de Scheffer on Ukraine's relationship with NATO and
the question of a MAP, to be delivered during the PM's
September 14 visit to Brussels. Yushchenko implied (later
confirmed to the Ambassador by Chief of Staff Rybachuk) that
a draft of a letter had already been signed by Yushchenko and
was awaiting the PM's signature. Yushchenko commented only
that "we hope this will work." He said that it would be
"helpful" for the U.S. and other Allies to tell us what we
need to do specifically - "give me a list of 12 actions that
you want us to take." (Embassy Note: Both the Embassy and
NATO experts have had conversations with the Ukrainians about
what they need to do next to further the relationship, and we
will continue to engage. End note.)


5. (C) Yushchenko highlighted what he sees as the key
problem in Ukraine with regard to NATO membership - a lack of
real information. He noted that Ukrainian television was
"tied into" European channels regarding NATO. And that the
main effort for the government in 2007 would be to provide
more information to the Ukrainian public. However, we would
"all have to get involved in order to make this happen."


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Energy Policy
--------------


6. (C) Yushchenko described energy as a key issue for
national security. If Ukraine could liberalize and diversify
the sector, it would lead to political stability (and thus
less opportunity for the Russians to intervene). For
example, with gas prices going up, Ukraine could expand its
nuclear energy. Ukraine had uranium mines, Yushchenko noted,
and would be looking to the U.S. and Europe for cooperation
in expanding generation capacity, including new power
stations. (Comment: Importantly, Yushchenko this time did
not mention Ukraine seeking uranium enrichment or
reprocessing.)

Gas Pipeline via Ukraine?
--------------


7. (C) Yushchenko then focused on alternative energy supply
arrangements, including supplying gas and oil from Azerbaijan
and Central Asia via Ukraine to Europe. Yushchenko stated
that Azerbaijan President Aliyev was even more interested
than he in a new gas pipeline and Yushchenko described
cooperation with Kazakhstan as even more promising. He noted
that Energy Minister Boiko had met recently with EU energy
officials looking for support on the gas pipeline.

Odesa-Brody
--------------


8. (C) Azerbaijan was an ally of Ukraine's on the Odesa-Brody
pipeline, Yushchenko said. He expected Azerbaijan to be the
lead supplier of crude; some could be refined in Ukraine, the
rest supplied to European refineries via the Druzhba
pipeline. Ukraine was willing to give Odesa-Brody
concessions to make this work, but he argued a U.S. political
presence was necessary as well for success. He added that
Ukraine and the EU may soon establish a working group on
Odesa-Brody. In addition, he noted the Kazakhs were
interested in the Polish-Ukrainian consortium Sarmatia's
plans to expand capacity at the oil terminal at Pivdenniy
near Odesa, which feeds into Odesa-Brody. Overall,
Yushchenko said, it was hard to get these Odesa-Brody
projects started, but once they got going, he thought they
would roll ahead quickly.

Vanco's Tender
--------------


9. (C) The Ambassador raised recent comments by GOU officials
that had aroused concerns that the GOU might change course
after its tender award for oil and gas exploration in the
Black Sea to the U.S. company Vanco. He noted that it was
preferable to allow private firms to take this sort of risk,
rather than have state-owned companies attempt such
exploration, as some in the GOU suggested. Yushchenko
agreed, stating that since the GOU had awarded the tender,
now was the time to execute it. Yushchenko offered to meet
with Vanco chairman Gene Van Dyke and instructed his staff to
make arrangements.

Transnistria - Smirnov's Wants a Meeting
--------------


10. (C) In response to the Ambassador's urging that Ukraine
stay positively engaged on finding a resolution to the
Transnistria problem, Yushchenko noted that more progress was
needed on the "5 2" mechanism. The upcoming "independence
referendum" was taking attention away from the proposed
"election" included in the Yushchenko plan (a nationwide
election to be conducted under free and fair conditions),as
well as from other important issues. He noted that
Transnistrian leader Smirnov had requested "another" meeting
(possibly a reference to some kind of official contact with
Ukrainian officials in the future).

Fighting Corruption; Support for MCC
--------------

11. (C) Yushchenko told the Ambassador that he had recently
signed a series of "super-important" documents to implement a
full-scale anti-corruption program. He was pleased that the
MCC anti-corruption program was moving ahead and was eager to
discuss further what needed to be done so that Ukraine might
qualify for a full MCC compact in the future. The Ambassador
reviewed the outlines of the MCC program, noting to
Yushchenko that a great deal was possible to accomplish under
MCC, but that the GOU needed to first succeed in its MCC
anti-corruption program. Yushchenko said that he was ready
to meet on the issue.


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12. (C) When the Ambassador asked about speculation in the
press about upcoming personnel changes in the Presidential
Administration and the National Security and Defense Council
(NSDC),Yushchenko confirmed that changes were being
considered. (Embassy Note: Yushchenko gave no hint to the
Ambassador about the timing of these changes and/or who and
what positions might be involved. End Note.)

Babyn Yar - A High-Level U.S. Delegation?
--------------


13. (C) At the conclusion of meeting, Yushchenko urged the
USG to send a high-level delegation to the September 27
commemoration ceremony for Babyn Yar. He said that it was 90
percent certain that President Putin would represent Russia,
the Israeli President was confirmed, and there would be
high-level representatives from the Baltic states, Romania
and Germany. The Ambassador noted that the President and
Vice-President would not be able to attend, but confirmed
that the U.S. delegation would be led by a cabinet-level
official. We hoped to have more information about the
delegation in the coming days.


14. (U) Visit Embassy Kiev's classified website:
www.state.sgov.gov/p/eur/kiev.
Taylor