UKRAINE/RUSSIA: DEFENDING NATIONAL INTERESTS

C O N F I D E N T I A L SECTION 01 OF 04 KYIV 004425

SIPDIS

SIPDIS

E.O. 12958: DECL: 11/21/2016
TAGS: PREL MARR PBTS PINR RS UP
SUBJECT: UKRAINE/RUSSIA: DEFENDING NATIONAL INTERESTS
WITHOUT THE RHETORIC

REF: A. KYIV 4415

B. KYIV 4295

C. KYIV 4302

D. KIEV 2590

E. KIEV 1913

F. KIEV 1062

G. 05 KIEV 4908

H. 05 KIEV 4478

I. 05 KIEV 4462

J. 05 KIEV 4149

K. 05 KIEV 1354

L. MOSCOW 12666

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


1. (C) Summary/comment: PM Yanukovych came to office on a
campaign promise to improve relations with Russia, but,
although he has toned down the rhetoric towards Russia, like
his predecessors, he must find the right balance between
close ties to Moscow and protecting Ukrainian sovereignty.
While some joked that Yanukovych's unscheduled November 30
visit to Russia to meet with Putin was an effort to "get
instructions" for his December 4-7 U.S. visit, it is more
likely that the quick trip was intended to reassure Russia
that he intends to maintain this balance between Ukraine's
eastern and western interests. The effort to balance each
step toward the West with a nod to the East, without
sacrificing Ukrainian national interests, is a tried and true
pre-orange Ukrainian political tradition.


2. (C) In recent weeks, as plans for the PM's U.S. trip
unfolded, Russian PM Fradkov and FM Lavrov have come to Kyiv
to re-energize the dormant bilateral commission, and the
long-postponed Putin visit to Kyiv is now scheduled for
December 22. Despite these small steps forward on the
diplomatic front and the corresponding warming up of the
rhetoric between the two countries, we believe that
Ukraine-Russia bilateral friction will continue, albeit at a
reduced level, even with a Yanukovych government in control
and in the absence of outspoken Russia critic Borys Tarasyuk
as Ukrainian foreign minister (although this Rada decision
will be challenged in court). Despite, or perhaps because
of, the close historical and cultural ties, differences
between the two countries will continue to arise due to
intractable problems that are the legacy of the break-up of
the Soviet Union, conflicting and competing national security
interests, and fundamental differences in outlook. End
summary/comment.

No Mirror Images
--------------


3. (C) When many Ukrainians describe Russian attitudes toward
Ukraine, they suspect Russians see a country that they firmly
believe does not exist. They accuse Russians of holding
revanchist views, regretting the separation of Ukraine (and
Belarus) from the Russian motherland, and scheming to keep
Ukraine in the Russian orbit. While the Orange Revolution
was a major setback for the Kremlin's designs on Ukraine,
some knowledgeable Ukrainian officials claim that Putin's
team has not given up and are using every available tool to
circumscribe Ukrainian independence. They argue that the
Kremlin wants to keep Ukraine out of NATO and EU, delay WTO
accession, maintain the Russian Black Sea fleet presence in
Crimea past 2017, gain control over valuable Ukrainian
infrastructure (especially the natural gas pipeline system)
and other assets, and persuade Ukraine to join the Single
Economic Space joining Russia, Ukraine, Belarus, and
Kazakhstan. Allegedly, the Russians are also intent on
removing Ukrainian FM Tarasyuk from government. Ukrainians
claim the Kremlin not only is willing to use natural gas
supply arrangements but also black propaganda "dirty tricks,"
ties to political parties, and even the Russian Orthodox
Church to influence and destabilize Ukraine (note: septel
will focus on related elements of the situation in Crimea).


4. (C) Ukrainians, whether from East or West, ethnic
Ukrainians or not, stoutly affirm their sovereignty and
independence. They recognize the importance of friendly
relations with Russia, a country with which they share
important economic, cultural, and historical ties. However,
they insist that Ukraine will shape its relationship with
Russia on Ukrainian national interests and, above all, refuse
to be Russia's puppet. (Refs D-J report on meetings with a
range of Ukrainians during which these views were expressed.)
The discrepancy between Russian views that there is a
special relationship and common interests with Ukraine and
Ukrainian insistence on their own sovereignty remains the
underlying cause behind continuing friction between the two
countries.


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PM Seeks A Balance
--------------


5. (C) Whenever asked about ties with Russia, the PM and his
team consistently argue that while the new government wants
both good relations with Moscow and progress on Euro-Atlantic
integration, Ukrainian national interests drive the
government's policies. When asked about Yanukovych's
decision to make an unscheduled November 30 trip to Russia to
meet with President Putin and PM Fradkov, nearly on the eve
of the his departure for the U.S., the PM's top foreign
policy advisor Konstantin Gryshchenko told the Ambassador
that this was all about "defending Ukrainian national
interests." It certainly was an attempt by Yanukovych to
reassure his counterparts in the Kremlin about his intentions
in the U.S. -- in line with a traditional pre-orange
Ukrainian political strategy of publicly balancing each step
toward the West with a step toward Moscow.


6. (C) Ukrainian conspiracy theorists have mooted the
possibility that PM Yanukovych and the cabinet ministers
involved struck a deal with Moscow to keep down the price of
Russian natural gas. The deal purportedly involved a
Ukrainian commitment to slow progress toward WTO membership
or to consider the possibility of maintaining the Russian
Black Sea Fleet's presence in Crimea past the 2017 deadline,
which PM Yanukovych mentioned publicly in early November
after meeting Russian PM Fradkov in Kyiv. Others, including
Regions MP Leonid Kozhara have linked the price of gas to
Ukraine's interest in a NATO Membership Action Plan (MAP),
and Yanukovych's September 14 speech at NATO declining to
pursue MAP at this time. When Yanukovych was asked point
blank in a November 11 Inter television interview, Yanukovych
categorically denied that any deal linking Ukraine's NATO
aspirations and energy supplies had been struck.


7. (C) In fact, Yanukovych is unlikely to sell out Ukraine
and its national interests. Ukrainian politicians and
political analysts generally agree that, while Yanukovych
wants better relations with the Kremlin, he is not prepared
to hand over control of his government -- and his country --
to Russia. In addition, there are business interests within
the Party of Regions that are encouraging Yanukovych and his
political backers to keep their distance from Russia because
they see Ukraine's economic future with the West (and perhaps
even more importantly because they do not want Russian
business competition in Ukraine). In their view, Yanukovych
should satisfy Russia's interests only when doing so clearly
provides the Party of Regions and Ukraine with a political or
economic advantage. One example of an area in which the PM
has not responded might be the Common Economic Space, about
which Yanukovych and his government have continued the line
of the orange government and at most given polite lip
service, including during Yanukoyvch's November 30 visit to
Russia, in response to entreaties to increase Ukraine's
involvement beyond a free trade area.


8. (C) Yanukovych told EUR A/S Fried November 16 that he and
President Yushchenko did not materially differ on the goals
of European and Euro-Atlantic integration, but just on the
timing and tactics to reach the goals (ref C). Yanukovych
also claimed to Ambassador November 19 that the Kremlin had
difficulty arriving at a more nuanced approach to Ukraine,
taking into account Yanukovych's greater popularity in
Russia, to substitute for the overt pressure directed against
his "orange" predecessors. Former President Kuchma told the
Ambassador that Yanukovych's assertion was probably right.

The Diplomatic Front
--------------


9. (C) Meanwhile, Russia is taking steps to warm up the
bilateral relationship. Russian FM Sergei Lavrov's November
7-8 visit to Kyiv was productive and non-contentious, at
least on the surface. MFA First Territorial Department
(responsible for relations with Russia) Counselor Oleksandr
Kushnir told us the primary purpose of Lavrov's visit had
been to hold the first meeting of the sub-commission on
international cooperation, chaired by the respective foreign
ministers, which was a subordinate element of the
"Yushchenko-Putin Interstate Commission." The meeting was
intended to pave the way for Putin's visit to Kyiv as head of
the Russian side in the first session of the plenary
interstate commission (note: this commission had not met
since its inception in 2005). The sub-commission on
stationing of the Russian Black Sea Fleet had met three times
and the sub-commission for economic cooperation, chaired by
Ministers of the Economy, had met October 24 in Moscow. Only
the remaining two sub-commissions, for humanitarian
cooperation and for security, needed to meet prior to Putin's
visit to Kyiv.

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10. (C) Kushnir said the sub-commission meeting had taken
place over two-and-a-half hours in a constructive and
friendly atmosphere, since Foreign Ministers Tarasyuk and
Lavrov had met briefly November 7 and decided to exclude any
contentious issues. The two sides agreed on a plan of
action, or as Kushnir noted, a kind of "roadmap," for
2007-2008 that carried forward activity on 20 priority areas
addressed in the 2005-2006 plan of action. The foreign
ministers heard updates from the chairs of the
sub-commission's six working committees -- for land border
issues, delimitation of sea boundaries in the Azov Sea and
Kerch Strait, cooperation in international organizations,
regional conflicts, new challenges and threats, and consular
cooperation.


11. (C) As evidence of the constructive engagement in the
sub-commission, Kushnir said the Ukrainian side had been
pleased the Russians agreed to form a joint committee on land
demarcation issues, a step that the Ukrainians had long urged
and which the Russians had resisted. On maritime boundaries,
however, the Ukrainians and Russians were still deadlocked.
The Russians proposed the Sea of Azov be considered an
internal body of water subject to joint use, except for a
narrow coastal strip, while Ukrainians continued to insist
that the Sea of Azov be divided according to the old Soviet
administrative boundary.

The President-Prime Minister Tug-of-War
--------------


12. (C) When we asked, Kushnir said Lavrov, a seasoned
diplomat, had been completely professional in all of his
meetings in Kyiv, and there had been no evidence that he had
attempted to "divide and conquer" by turning the Prime
Minister's office against the Foreign Ministry. First Deputy
Foreign Minister Volodymyr Ohryzko had sat in on Lavrov's
meeting with PM Yanukovych. Kushnir said the fact of the
visit belied the claim of some that the Kremlin was again
targeting Tarasyuk for removal (note: Tarasyuk was dismissed
as FM in 2000 by Kuchma after Kuchma met Putin in Yalta, and
was again dismissed by the Rada -- although a presidential
challenge is pending, December 1 after Yanukovych returned
from his own meeting with Putin). Nonetheless, Ukrainian
suspicion over Russian motivations prompted some to see
darker motives behind the visit. Political analyst Viktor
Nebozhenko claimed to daily newspaper Gazeta po-Kievski that
Lavrov had visited Kyiv to lobby for Tarasyuk's removal and
his replacement by someone who would demonstrate "the Party
of Regions' wish to move closer to Russia."


13. (C) Unclear is whether, in forcing Tarasyuk out of
government, Yanukovych is pandering to Russian desires as
well as meeting his own political agenda. Regardless of
Russian views, Yanukovych displayed a clear hostility to
Tarasyuk in what could be political theater. Yanukovych
attacked Tarasyuk in a November 13 Inter interview in
personal terms, saying that, "if you are a man, if you have
principles," then he would leave the cabinet, since
Tarasyuk's own Rukh party was in opposition to the
government's platform. Surprisingly, Tarasyuk was supportive
of Yanukovych during his November 15 meeting with EUR A/S
Fried and suggested Yanukovych had moderated his attacks on
"orange" ministers after meeting with President Yushchenko
(ref B). Tensions continued to rise and finally December 1,
the Party of Regions-led ruling coalition voted Tarasyuk out
of office -- at the PM's request. However, a lack of
constitutional clarity and a constitutional court challenge
to the dismissal could restore Tarasyuk in office (and may
end up keeping him as Acting FM until the legal issues are
resolved).

Flashpoints: Black Sea Fleet, Holodomor, and More
-------------- --------------


14. (C) Whatever government is in power or whoever is foreign
minister, and no matter how friendly the public chatter
between the two governments is, there will continue to be
points of tension in Ukraine-Russia relations despite, or
sometimes perhaps because of, the close historical and
cultural ties between the two countries. One set of issues
involves the intractable and still unresolved problems that
resulted from the break-up of the Soviet Union and
disentangling ex-Soviet structures. These are the issues --
such as the future of the Russian Black Sea fleet,
demarcation of the maritime boundary, apportioning of
Soviet-era debts -- that Tarasyuk and Lavrov probably decided
to remove from the table during the November 8 sub-commission
meeting.


15. (C) Other problems, often economic and trade-related,

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result from conflicting and competing national interests.
Russia demands prices at Western European levels for natural
gas and suspends importation of Ukrainian dairy and meat
products; Ukraine responds by threatening to raise rents for
the Russian Black Sea Fleet or suggesting greater
compensation for operation of early warning radars.
(Ukrainians also suspect Russia uses these economic levers to
achieve political ends.) The GOU also has been very nervous
about suggestions, including from Fradkov during his visit,
that Russia and Ukraine coordinate their WTO accession.
After the U.S. completed its WTO bilateral with Russia, the
MFA, probably reflecting concerns high in the GOU, asking us
to confirm the USG did not support such "synchronization"
(ref A). Worries that Russia might accede before Ukraine
seem to be one factor driving the GOU's recent energetic push
to pass remaining WTO legislation.


16. (C) Another set of issues results from Ukrainian
resistance to what Ukrainians see as unwarranted Russian
interference in Ukrainian domestic affairs and infringements
on Ukrainian sovereignty, particularly in Crimea (see
septel). Senior Ukrainian officials told us that they were
convinced that the Kremlin quietly supported the anti-NATO
demonstrators that disrupted joint U.S.-Ukrainian military
training related to the Sea Breeze exercise in June 2006.
Ukrainians react by banning the entry of certain Russian
citizens, provoking Russian protests, and obtaining legal
judgments on the status of lighthouses used and operated by
the Russian Black Sea Fleet.


17. (C) Finally, an increasing source of friction is the
different world view between Russia and Ukraine, an
indication of growing Ukrainian independence and
self-confidence. Ukraine declares the 1932-33 Holodomor
famine was a form of Soviet genocide; Russia responds that
Ukraine is being hostile to Russia when it campaigns to have
the international community define the Holodomor as genocide.
Ukraine and Russia also find themselves increasingly on
opposite sides in how to address the frozen conflict in
Transnistria, in regional organizations such as the OSCE, as
well as at the UN as Ukraine continues to align itself with
the European Union on most major issues, regardless of how
Russia is voting.


18. (C) In spite of Ukraine's continued independent foreign
policy stand, we have seen some evidence that the MFA,
uncertain of the Cabinet of Ministers and ruling coalition's
response, is more cautious and not as forward-leaning on
positions that might irritate the Russians. The MFA endorsed
a GUAM (Georgia, Ukraine, Azerbaijan, and Moldova regional
organization) statement, for example, critical of the South
Ossetia referendum and "election," but did not post its own
statement on its website. In another example, Ukraine broke
with its normal practice of adhering to EU policy positions
by voting against the Australian amendment at the UN to the
Cuba embargo resolution, although EU countries voted in
favor. (Note: The Ukrainian parliament passed a resolution
a few days earlier condemning embargoes on Cuba. Ukraine
remains grateful for ongoing Cuban medical assistance for
victims of Chornobyl - see ref K.)


19. (C) Prime Minister Yanukovych and his cabinet might be
more conciliatory toward Russia than the previous two
"orange" governments, but the underlying differences between
Ukraine and Russia will continue to result in minor, and
perhaps sometimes major, conflicts of interest between the
two neighbors. The recurring tensions might threaten to
overwhelm any good intentions and reservoirs of good will
that exist on either side, before the two neighbors patch
things up yet again.


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