Janusz Bugajski on how effectively the EU The exodus of foreign banks The history of the Ukrainian will respond to the Kremlin's growing and dim prospects for domestic ones Insurgent Army pressure on its Western neighbours

№ 20 (62) november 2013 Klitschko knocked out?

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|contents BRIEFING SOCIETY Dangerous Games: Postponed Days of Firtash in London: Association Agreement signing Dmytro Firtash’s widely- may be an effective tool to put advertised Days of Ukraine pressure on Yanukovych, but will in the UK lured very few make Ukraine more vulnerable people who actually to Russia discovered something new 4 about Ukraine FOCUS 20 Klitschko Knocked Out? The scandalous tax amendment The Wonder of Life: The and more attempts to fuel amazing story of an 18-year internal warfare in the old girl who is a step away opposition from death, helping others and 6 making the world a better place Andreas Gross: The failures of 22 democracy need precise and HISTORY critical, not diplomatic comments Regular Beginnings for an Irregular Army: Caught 9 between warring superpowers NEIGHBOURS and without a state of their own, Ukrainians formed the Janusz Bugajski on the Ukrainian Insurgent Army with EU-Russia showdown and an eye to the creation of an Europe’s response to the independent nation Kremlin’s moves against its nearest European neighbours 24 10 CULTURE & ARTS The Master ofM usical Compromise: Contemporary Ukrainian Leonidas Donskis: Ukraine will remain a precious friend to a composer Myroslav Skoryk talks about the death of avant-garde democratic Russia in the future. Not now, alas and the mystery of music 13 28 Georgia’s Unknown Night at the museum, jazz groove and new British films: The President: The era of Ukrainian Week offers a selection of events to attend this month European politics is over as current Premier Ivanishvili concentrates all power in his 30 hands. Will this be the end of NAVIGATOR other accomplishments of the A Monastery by theD evil’s Rock Saakashvili decade? amidst the remnants of a medieval fortification, pagan shrines and the 14 annual folk festival ECONOMICS Who Said Bankers Can Relax? After the painful liquidity crunch 32 last year, the Ukrainian banking system seems stable again. This is a misleading impression Starship Troupers: If starships are ever built, it will be in the 16 distant future. But that does Oleksandr Suhoniako: President of the Association of Ukrainian not deter an intrepid band of Banks on why foreign banks are leaving Ukraine, local ones are in scientists who are thinking danger and the NBU is turning a blind eye to all this about how to do it 18 34

E-mail [email protected] Tel. (044) 351-13-87 www.ukrainianweek.com The Ukrainian Week № 20 (62) November 2013 Editors address 37 Mashynobudivna str., Kyiv, 03067, Ukraine Founder ECEM Media GmbH Print Novy Druk LLC, 1 Mahnitohorska str., Kyiv, 03056, Ukraine Publisher ECEM Media GmbH Ordering number 13-8214 Sent to print on 31 October 2013 Address Austria, Am Gestade,1, 1010 Vienna Print run 15 000. Free distribution State registration certificate КВ № 19823-9623ПР 19.03.2013 Chief Editor Alla Lazareva Our partner Editors Anna Korbut, Natalia Romaneс, Shaun Williams № 20 (62) november 2013|the ukrainian week|3 briefing| trends &talk Entrepreneurs in Dnipropetrovsk Ukraine suspends gas IMF mission arrives to work in Ukraine. Its conclusions launch a fundraising campaign imports from Poland may influence further negotiations regarding coopera- to rename Karl Marx Street after because of higher price tion with the IMF. At this point, Ukraine is unlikely to get Oleksandr Pol, Ukrainian activist, and reports of difficul- new IMF loans as the government refuses to fulfill the entrepreneur and philanthropist of ties in reverse transit requirement to raise gas tariffs for households in view of the 19th century from Romania the upcoming election Dangerous Games Postponed Association Agreement signing may become an effective tool to put pressure on Yanukovych, but will make Ukraine more vulnerable to Russia and increases the likelihood of an Armenian scenario

Author: Oleksandr Kramar subsequent continuation of her im- prisonment on her return to t the time of the preparation Ukraine (should she indeed re- of this issue, the Polish Min- turn). Moreover, the resolution of ister of Foreign Affairs, Ra- the issue, even in this format, was Adoslaw Sikorski, stated that postponed after the disruption of if Tymoshenko is not released, the the parliamentary session on Octo- signing of the Association Agree- ber 24, as a result of the scandalous ment will have to be postponed un- amendments to the Tax Code (see til next year. “This is possible”, he page 6), which were seen as a threat stressed, citing Moldova and Geor- to the participation in the election gia, who are preparing to initial the of the second most popular opposi- Agreement in Vilnius and sign it tion candidate for the presidency November 5, in other words, less next year. Thus, the EU is looking behind Tymoshenko – Vitaliy than two weeks prior to the meeting for an asymmetric response to Ya- Klitschko. Clearly, the government of the Council of Europe on Novem- nukovych’s attempts to play on the took this step, hoping for certain ber 18. According to The Ukrainian geopolitical confrontation between agreements with Putin in Minsk Week’s sources, the procedure for Brussels and Moscow and avoid the and later in Sochi. passing the law and its signing by execution of previously undertaken Currently, government repre- Yanukovych could be finalised on obligations. sentatives have publicly and in uni- the eve of the summit, if not later. Previously, Yanukovych actu- son opposed the possibility of a par- The President may thus be hoping ally withdrew from earlier agree- don for Yulia Tymoshenko, since to cover his back – he will only sign ments with the Cox-Kwasniewski there are “no grounds for this”. So the document that has been ap- mission and instead of the suppos- there are two possible further sce- proved by parliament after the As- edly “agreed” decision on the re- narios: either, remaining convicted, sociation Agreement has been lease of Tymoshenko, even if by she will go abroad for treatment, or signed by EU representatives. Oth- means of a partial pardon, he pre- will stay in Ukraine. Moreover, the erwise, Yulia Tymoshenko will not fers to limit it to her release to go second voting on the draft law for leave the territory of Ukraine. abroad for medical treatment as is medical treatment of prisoners At the same time, the develop- her right as a prisoner, with the abroad will not take place before ments on the Russian side signal The month in history 1 November 1918 2 November 1938 4 November 1950 The November Riot known The FirstV ienna Arbi- Members of the Council of also as the Battle of Lemberg tration transfers south- Europe sign the Convention begins: Ukrainians take over ern parts of Zakarpattia for the Protection ofH uman Lviv and proclaim the West and Slovakia densely Rights and Fundamental Ukrainian People’s Republic populated by Hungar- Freedoms in Rome ians to Hungary 4|the ukrainian week|№ 20 (62) november 2013 |briefing

All Internet users can now get access to informa- The European Parliament recommends the Coun- Kyrgyzstan andA rmenia tion about the founders of Ukrainian companies cil of the EU to sign the Association Agreement launch the process of joining and their stakes in statutory capitals.The Single with Ukraine only if it meets all conditions. The the CustomsU nion with State Register of Legal Entities and Individual EP also gives consent to temporarily enact almost Russia, Kazakhstan and Entrepreneurs offers access to virtually all data on 80% of the AA provisions immediately after sign- Belarus entrepreneurs on its website ing, the EP Resolution of October 23 states

payment for gas already purchased more than USD 0.5bn in Septem- in October, threatening of Ukraine ber alone. At the same time, it with advance payment for fuel, the should be remembered that the li- stirring up of a media war and so quidity level of NBU reserves re- on, is evidence that the Kremlin’s main unknown. The lion’s share of only intent is to intensify pressure. its assets is in securities, which still In all likelihood, official Mos- have to be sold. cow is convinced that the Associa- Clearly, in such a situation, the tion Agreement will not be signed renewal of financing by the IMF and in November and that the situation other international institutions will in Ukraine will become so critical, be the only possibility of avoiding that Kyiv will be forced to capitu- capitulation to Moscow. Even Pre- late. Ukraine’s financial problems mier Mykola Azarov, who had long are increasing. In October 30 – No- declared that “we shall survive with- vember 15, the government and the out IMF loans”, is now talking about NBU has to pay out USD 1.6bn of his readiness to come to a “sensible external debt, Russia has already compromise” with this organiza- raised the issue of the repayment of tion. The fact that this statement the debt for the gas imported in was sounded after the Ukrainian August, in the amount of almost Premier explained that the delay in USD 0.9bn. This does not cancel the payment of social benefits from out the need to finance the import the budget was caused by the “ne- of gas in October – November by cessity to pay external debts” is tell- early December. In light of the start ing. At the same time, the IMF is of the cold season, these payments not demonstrating any optimism. It will constitute more than USD 1bn will be clearly futile to expect re- per month. newed financing if the Association Thus, by December - immedi- Agreement is not signed. ately after the Vilnius Summit - the Under the above-mentioned Ukrainian government will have to conditions, the threat of not reject- find at least USD 4.5bn for external ing, merely postponing the signing payments. This is on condition that of the Association Agreement – that as yet, Yanukovych has failed Gazprom does not demand the and the renewal of cooperation to get the desired credit-price bo- above-mentioned advance pay- with the IMF respectively - for nuses from Putin without the obli- ments. If it does, this amount will three-four months is probably an gation to become a member of the increase further by more than USD attempt to find an asymmetric in- Customs Union. He can only get 1bn. Will it be possible to find the strument of pressure on Yanu- them in exchange for rejecting the funds to pay these expenses, in kovych in response to his attempts Association Agreement with the view of the problems Ukraine has to play on the geopolitical ambi- EU. It appears that no agreements with access to international credit tions of Brussels and Moscow. Vik- were reached either in Minsk, or in markets? The question is rhetori- tor Yanukovych will then have to Sochi, where they had a tete-a-tete cal. Payment of the relevant dream up how to hold out until meeting lasting several hours on amount using the NBU’s gold and spring. But the EU is also taking a October 27. And Russia’s subse- currency reserves will mean that risk: by increasing pressure, the quent actions, such as the suspen- the latter will be reduced from USD Kremlin can take advantage of the sion of the import of Ukrainian 21.6bn as of September 30 to less above-mentioned time lag, to al- carriages, restriction on the import than USD 16-17bn. This does not ready force Yanukovych into the of meat products, the issue of an even include significant interven- Armenian scenario in winter. Nei- overdue invoice for gas imported in tions on the interbank market, ther Ukraine, nor the EU would

August on the eve of an even bigger which, by the way, constituted benefit from this. ph l PHOTO:

5 November 1953 6 November 1943 7 November 1708 Paton Bridge opens The 1st Ukrainian Front com- Hetman Ivan Mazepa switches in Kyiv. It is the manded by General Nikolai to the Swedish side in the Great world's first all- Vatutin pushes back Hitler’s Northern War and starts a maneu- welded bridge and army and takes over Kyiv ver to join the army of Charles XII the longest bridge in Kyiv № 20 (62) november|the ukrainian week|5 focus|Opposition Authors: Oleksandr Mykhelson, Andriy Skumin

n detective stories, a multi- Klitschko way intrigue is when every ac- tion inevitably evolves into an Ientire chain of other ones. In life, a multi-way intrigue opens the door to new options. On Oc- tober 24, the Verkhovna Rada Knocked Out? (VR) used one: it passed draft law No. 2054a “On Amendments to the Tax Code of Ukraine Re- garding the Registration of Tax- The scandalous tax amendment and efforts to payers”. Despite the innocent ti- aggravate mutual distrust in the opposition tle, one provision of the draft law in Article 170.11.1 has stirred a scandal – “…an individual that has a permanent residence per- mit in a foreign country shall be considered a non-resident of Ukraine”. Formally, this is only “for tax purposes”. The opposition, how- ever, realizes that the amend- ment may be used to prevent UDAR’s leader, Vitaliy Klitschko, from running in the 2015 presi- dential election. The Ukrainian Constitution requires candidates for the presidency to reside in Ukraine “for ten years prior to the election year”. The Klitschko brothers have residence permits in Germany where their promotion business is based. It is no secret that this could actually be a serious obsta- cle to Vitaliy Klitschko’s presi- dential aspirations. The media buzzed about this for a while. Klitschko himself said at the be- ginning of 2013 that he has lived in Ukraine for six years after 13 years in Germany. However, his internal Ukrainian passport does not indicate a change of pro- pyska - residence registration - since 1992. After the amendment was passed, he made an impor- tant statement: “I’m going to run for the presidency!” Surprising haste The first red flag in the scandal was the haste with which the government pushed through amended draft law 2054a. On October 8, 337 MPs approved the basic government-sponsored document. On October 23, it was returned for review to the VR Tax and Customs Policy Com- mittee (Tax and Customs Com- mittee) before the second read- ing next day –it now had numer- ous amendments. 6|the ukrainian week|№ 20 (62) november 2013 Comments live Batkivshchyna and UDAR MPs comment on whether the Brychenko amendment fueled squabbles in the opposition Serhiy Sobolev, Batkivshchyna This was yet another attempt to fuel conflicts within the opposition but it had the opposite effect. In my opinion, the teams worked well. Moreover, it was obvious imme- diately that the Party of Regions had planned the whole scheme and was interested in it. Plus, it took place alongside a number of other actions. Against Tymosh- enko. In fact, a declaration was made during those days that there would be no pardon or amnesty for her. That there would be no law other than the one to allow her treatment abroad. Klitschko basically said that he was prepared to continue all negotiations to agree on one opposition candidate. It was emotional at first, but then… a statement followed that this would not harm the single candidate, and this is true. So, the opposition has no controversies on this. Our opinions remain valid. If the law changes to have a one-round presidential election, the sin- gle candidate will run. If it doesn’t, all candidates are ready to support the one who will win the first round. I think our stance remains unchanged.

Oksana Prodan, UDAR Vitaliy Klitschko’s statement should put an end to the government’s insinuations and provocations. It will do no harm to the opposition’s agreement. Moreover, we already hear Yatseniuk and Tyahnybok state that they understand and support Vitaliy Klitschko. I have already filed an appeal to Prosecutor General to investigate fal- sifications during the vote on the draft law to amend the Tax Code. I think it is impossible to miss the blatant falsifications that took place there. I would like to re- mind you that the President has not yet signed the draft law. He can stop these provocations and falsifications by sending the draft law to repeated voting in parliament.

Lawyers barely had time to A provocation? analyze it before it was handed The scandalous amendment was out to MPs on October 23. As a sponsored by Batkivshchyna’s result, most legislators had no Ihor Brychenko. Obviously, this idea that they were now voting alerted UDAR MPs, fueling sus- for something different from the picion of a secret plot to kick Vi- draft law they had passed in the taliy Klitschko out of the election first reading two weeks earlier. race, given that he is currently Then, VR Speaker Volody- the major obstacle on Arseniy myr Rybak put the whole bill up Yatseniuk’s path to the second for vote instead of each amend- round. In response to this, Yat- ment, including the notorious seniuk claimed in parliament tax amendment, individually. that the fact of Brychenko’s sub- The opposition went into an up- mission of the amendment was roar but that did not help. Rybak falsified. Brychenko himself said signed it on the same day and that he did not sponsor any immediately sent it to Yanu- amendments to the draft law. He kovych. So it’s more than likely even confused the document that it will be signed and en- number, referring to it as 2045, acted. not 2054a. UDAR’s MP Oksana Prodan According to The Ukrai- who is member of the Tax and nian Week’s source, however, Customs Committee now insists Ihor Brychenko did sponsor the that the tax amendment was amendment. He tried to recall it never discussed at the commit- on the morning of October 24 tee meeting. In her appeal to but failed. Vitaliy Khomutynnyk Prosecutor General on this she confirmed this in parliament, wrote that “the comparison table saying that Brychenko had sub- with changes in the draft law mitted 31 amendments, then presented to parliament for the “expressed the desire to recall October 24 vote was not the one some of them”. After the close of that was considered at the com- the day’s session, Yatseniuk con- mittee meeting.” firmed this, too. He told report- focus|Opposition dence, conscription, voting and various property issues)”. It is clear, however, that the argument about Klitschko paying taxes abroad will be used more and more often in political mud- slinging as the election nears. The Party of Regions’ Hanna Herman and Vadym Kolesn- ichenko announced in parlia- ment that Klitschko feeds those who “killed our people” and “plundered our land” by paying taxes in Germany. This was clearly an overreaction. Ms. Her- man is known for her love of German cars, so she and people like her support the German economy no less than people like Klitschko do. Last but not least is how many opposition politicians interpret the notorious amendment: the government needed it to disrupt the passing of draft laws to re- lease Yulia Tymoshenko, among other things. This would mean The ECHR’s decision ers that he and Brychenko had on the Major Court found that “the require- the disruption of the Association spoken to Rybak at 9 a.m. that Melnychenko case ment of residence in Ukraine Agreement. An UDAR MP told dated October 19, day and that Rybak had prom- 2004, is an was not absolute and that the The Ukrainian Week that ised not to put the amendment argument Klitschko domestic authorities, in allow- “One Party of Regions’ MP ap- could use against the proached me personally and told up for the vote. tax amendment ing or refusing registration of a It is surprising how easily particular candidate, were me: ‘don’t give up, block parlia- Speaker Rybak tricked the oppo- obliged to take into account his ment!’ They wanted us to disrupt sition, despite being known for or her specific situation. The the session, then accuse the op- breaking laws and his own prom- Court considers that neither the position of preventing Tymosh- ises on many occasions. It is sur- relevant legislation nor practice enko’s release”. prising that they believed him to contained a direct eligibility re- This could indeed have been the extent that they did not ex- quirement of “habitual” or “con- the purpose of the scheme. After pect the draft law to be put up for tinuous” residence in the terri- all, the opposition did not block the vote in its entirety and were tory of Ukraine. Furthermore, parliament but is still blamed for not prepared. no distinction was made in the the delay in the Tymoshenko is- This was yet another blow to law between “official” and “ha- sue. When this article was writ- the image of Batkivshchyna and bitual” residence on the terri- ten, Speaker Rybak asked foreign Yatseniuk, and Party of Regions’ tory of Ukraine.” ambassadors to “communicate to MPs swiftly zeroed in on the The ECHR also observed that their governments” that it is the “split in the opposition” in their “the only proof of legal registra- opposition that is hampering the speeches. tion of residence in Ukraine at release of Tymoshenko. How- ever, both the three opposition The scale of the threat factions, and the Party of Re- If the government decides that The image of Batkivshchyna gions – a total of 367 MPs – all the Tax Code amendments are and Yatseniuk has suffered voted to postpone the consider- not enough, it could also amend ation of draft laws on Tymoshen- the Law “On the Freedom of yet another blow ko’s release until the beginning Movement and Free Choice of of November. The most obvious Place to Live”, preventing Vitaliy that time was in an ordinary citi- reason for the Party of Regions’ Klitschko from registering as a zen's internal passport, which reluctance to consider this issue candidate. But Klitschko has did not always correspond to the on October 25 is the following: at tools to counter this, too. person's habitual place of resi- that time, President Yanukovych A serious argument in dence. The Court further noted had not yet managed to talk to Klitschko’s favour is the Euro- that the propyska was an inte- Russian President Putin about pean Court’s decision on Major gral and fundamental aspect of what Russia would be ready to Melnychenko dated October 19, the Ukrainian administrative do in return for Ukraine’s refusal 2004. Back then, Melnychenko system and was widely used for a to sign the Association Agree- was not allowed to register as a number of official purposes ment with the EU. The tax parliamentary candidate based (such as the registration of the amendment could have been a on the residence factor. The citizen's current place of resi- convenient means to buy time. 8|the ukrainian week|№ 20 (62) november 2013 Opinion|neighbours Facing the Crisis of Democracy

emocracy is a mosaic of hundreds of small and However, the majority of PACE delegates ignored big constituents, and it is moving constantly. the obligation to look at the whole process, in which Many parts, such as rights and institutions, even a director of a CoE political school was arrested Dare not stable. Not all of them move in the and prevented from being a candidate. Instead, they good direction. But all of them combined define the concentrated on what they saw with their own eyes quality of democracy in a specific moment. on the election day and came to a statement which Today, a lot of these elements see a regress in many was not well understood: „ Overall around election countries. The quality of public debate declines and big day we have observed a free, fair and transparent media prefer scandals over electoral process. (...) From substance. National democra- what we have seen, electoral cies are subject to markets and procedures on the eve and too weak to civilise them. Par- on election day have been ties no longer represent the carried out in a professional majority of society. That is why and peaceful way. (...) On Author: many talk of the crisis of de- election day we did not wit- Andreas Gross mocracy. Some write that we ness any evidence of intimi- have reached a “post-demo- dation against voters, in or cratic” time; that democracy is close to polling stations. (...) no longer real, no more than a However, improvements are smokescreen. That is painful. still desirable with regards But we have to face it in order to the electoral framework, to know what we have to do to notably concerning the re- restore it. spect of fundamental free- Elections are a big constitutive part in the democratic doms during the months before the election.“ mosaic. In too many of the 57 member-states of the Or- The biggest surprise for me came from OSCE Acting ganisation for Security and Cooperation in Europe Chairman and Ukraine’s Foreign Minister, Leonid Ko- (OSCE), as well as in 47 member-states of the Council of zhara. „In these statements the international observers Europe (CoE), democracy is weak because the quality of conclude that a number of aspects of the conduct of the the election process is bad. As a result, political power Presidential Election in Azerbaijan showed progress to- lacks legitimacy, is often misused and does not respect wards meeting the OSCE and Council of Europe com- human rights or the general interest of people. mitments and other international standards for demo- This October, many Euro- cratic elections, while also peans witnessed such The crisis of democracy is outlining the areas which failed presidential election need to be further im- in Azerbaijan, and were as- painful. But we have to face proved. (...) In this regard, tonished that not all ob- it in order to know what I congratulate the people servers stated what has to and the leadership of be said when the quality of we have to do to restore it Azerbaijan on this democracy is served, not achievement that repre- the interest of those who sents an important step get power illegitimately. I observed the preparation forward in democratic development of their coun- for this election in the PACE Monitoring Commit- try,” his statement said. About the tee and the day before the election in Gedebey, a very Many of “the people” of Azerbaijan showed immediately author: rural municipality on the feet of the South Caucasus, what they thought about such a statement at a protest Andreas that took place the next weekend after the election in Gross is a 440 km away from Baku. OSCE delegates – experts who Swiss political observed the campaign for several months, as well as Baku (see photo). The statement may have pleased the scientist, an short-term observers – all came to a clear conclusion: winner, the oligarchs and the energy-supply needs of expert on “The presidential election in Azerbaijan was under- many, but it had nothing to do with political truth or the the quality of mined by limitations on the freedoms of expression, quality of democracy. The Ukrainian Minister also com- democracy. assembly and association that did not guarantee a mitted the faux pas to refer himself to “international ob- He lectures level playing field for candidates. Continued allega- servers” who where invited and paid by the regime and at different tions of candidate and voter intimidation and a re- do not live up to the Copenhagen Criteria – the refer- European strictive media environment marred the campaign. ence for evaluation of elections for the international universities, Significant problems were observed throughout all community. serves as Swiss MP and leader stages of election day processes and underscored the Such conceptual and diplomatic mistakes do not help of the Social serious shortcomings that need to be addressed in or- restore democracy in Europe. Those who want to do this Democrats der for Azerbaijan to fully meet its OSCE commit- have to face the facts and name the shortcomings in the ments for genuine and democratic elections.“ clearly. Only then we may learn which stones in our mo- Parliamentary With this statement, OSCE delegates showed that the saic have to be repaired and how this has to be done. Assembly of quality of an election cannot be judged by just one day Then we can stop the regression and improve the demo- the Council of when citizens actually vote. cratic process, knowing that this effort will never end. Europe № 20 (62) november 2013|the ukrainian week|9 Neighbours|EU-Russia EU-RUSSIA SHOWDOWN As the Vilnius Summit nears, the question of how effectively the EU will respond to the Kremlin's growing pressure on its European neighbours is open Author: lacking a foreign policy or secu- Janusz Bugajski rity dimension. By the mid to late 1990s, the EU was increasingly elations between the Euro- perceived as a useful counterpart pean Union and Russia are to NATO and U.S. influence when at their lowest point since it assumed a growing number of Rthe Union began to expand “soft security” functions amid in- eastwards following the collapse tensive debates about the ratio- of the Soviet bloc. While EU lead- nale for NATO’s future. ers now realize that Russia does During the Putin presidency, not abide by international con- the EU has been perceived as en- ventions and regulations, Mos- croaching on Russia’s national in- cow views the Union as a signifi- terests. By the mid-2000s, the cant threat to its regional ambi- EU included most of the Central- tions. In response to Russia’s East European (CEE) countries, aggressive moves against its near- which challenged the accommo- est European neighbors, EU dating Union approach toward states will need a common voice Moscow’s democratic regression and an effective “Eurasian” policy and regional reimperialization. in close coordination with Wash- The EU’s democratization agenda ington. was viewed in the Kremlin as un- dermining the policy of maintain- The Europe-Eurasia ing pliable post-Soviet govern- come a growing source of attrac- Chasm ments along its borders. Addi- tion to various regions inside the There is a fundamental difference tionally, EU standards for Russian Federation, including between the EU and Russia. The government accountability, busi- those forcibly annexed from EU project is designed to increase ness transparency, market com- neighboring European states, multinational governance in an petition, and environmental pro- such as Kaliningrad and Karelia. increasingly interconnected con- tection increasingly undercut tinent. In stark contrast, Putinist Russia’s economic penetration, If Russia moves from Russia is intent on rebuilding a which was primarily based on threat to action against strong state that is not bound by opaque business practices. In international norms and subordi- sum, the EU’s gravitational force Kyiv or Chisinau it is nates weaker neighbors. While was seen as pulling several post- essential for Europe and Russia’s leadership operates in Soviet neighburs permanently terms of spheres of influence and out of Moscow’s orbit. the U.S. to maintain a zero-sum calculations, EU policy- The EU now occupies a piv- unified position makers believe in mutual inter- otal position in Russia’s strategic ests, shared sovereignty, and equations. A unified EU foreign The Battle of Vilnius “win-win” solutions. policy synchronized with Wash- The EU's Vilnius Summit on No- In Russia’s western strategic ington that undercuts Russia’s as- vember 28-29 promises to be a horizon, perceptions of the EU pirations is viewed in Moscow as major showdown between Brus- have undergone three main a source of threat that needs to be sels and Moscow. In the past few stages. In the early 1990s, the EU neutralized. In effect, the EU may months, the battle lines have was viewed as a relatively harm- be a more direct challenge to been drawn between the Euro- less organization, limited to Moscow’s ambitions than NATO. pean and Eurasian projects and Western Europe, focused on eco- Not only is it disrupting the Eur- they revolve around the identity nomic cooperation and trade, and asia project, but it also could be- and membership of several post- 10|the ukrainian week|№ 20 (62) november 2013 EU-Russia|Neighbours the latter arrangement, the for- mer Soviet republics would need to revoke their commitments to EU accession. Moscow envisages several stages in Eurasian con- struction, beginning with a Cus- toms Union and moving toward an economic and political amal- gamation modeled on the EU but with one significant difference. Whereas the EU is based on shared sovereignty, the EuU will be founded on surrendered sover- eignty to a dominant central power. Russia is offering mem- bership in the Customs Union to its former dominions, which cur- rently includes Russia, Belarus, and Kazakhstan, claiming that this will bring tangible benefits. In reality, this is a protectionist project and the first step on a downward ladder toward subor- dination. An expanding EU is a direct threat to Putin's Eurasia project as it precludes future state merg- ers with Russia. EU entry is also viewed in Moscow as enhancing each country's qualifications for NATO accession and closer links with the U.S. To thwart such Eu- ropean aspirations, Russian offi- cials have heated up their rheto- ric. In early September, Putin ca- joled the Armenian government to revoke its EU ambitions and join the Customs Union. Arme- nian President Serzh Sargsyan

: Reu t e r s P hoto came home from Moscow visibly humbled and announced that Ye- On October 23, the Soviet states. Under the Lithua- European Parliament The long-term economic benefits revan would join the Russia bloc, nian presidency, the EU has rein- passed a resolution of these arrangements will be far in effect renouncing any EU aspi- forced its commitment to signing accusing Russia of more substantial than any closer rations. pressure on its neigh- Association Agreements and Free bours: “…the free economic links with Russia. Putin stressed Armenia’s eco- Trade accords with a number of choices of the East- Ukraine, Moldova, and Geor- nomic and energy dependence on ern Partnership East European capitals. To qual- countries should not gia have been singled out as Moscow and reportedly threat- ify, each country must meet some make them bear con- meeting the criteria for EU asso- ened Yerevan with withdrawing sequences such as ciation and free trade. This is de- support for Armenia’s occupation basic political and economic cri- trade measures, visa teria. Although the signatories policy, the restricted spite the fact that Moldova and of Nagorno-Karabakh and other have no immediate prospect for mobility of workers, Georgia are divided states and the Azerbaijani territories. Moldova interference in frozen EU membership, the agreements conflicts, and others. Ukrainian government has still is also menaced by Moscow with are viewed as the first rung in an It also urged the Eu- not released from jail the former economic collapse, with sanctions ropean Commission upward ladder toward accession. and the European Ex- Prime Minister Yulia Timosh- already imposed on Moldovan By establishing a free-trade ternal Action Service enko. The support of new EU wine, the country's major export area with the EU, each country to “deal with the de- members has been crucial in en- item. The Kremlin also manipu- plorable develop- will improve its access to Eu- ments beyond a ticing the emerging democracies lates Transnistrian separatism to rope’s markets while gaining in- purely trade dimen- to join the European project and bring Chisinau into line. sion, thereby acting creased foreign direct invest- and defending the thus reducing their political tur- The most serious recent ment. In return, the EU expects Union’s partners”. bulence, economic instability, threat has been issued against the modernization of regulatory and dependence on Russia. Ukraine, the pivotal piece in the systems and business practices in But instead of seeing the EU Eurasian jigsaw puzzle. At an in- line with its standards. The asso- initiative as a means of stabilizing ternational forum in Yalta on ciation agreement would also re- its neighborhood, Moscow views September 21, Kremlin adviser quire conformity with EU politi- the Vilnius summit as a direct Sergei Glazyev brazenly warned cal norms, including a reformed threat to its ambitions for creat- of Russian sanctions if Ukraine justice system and free elections. ing a Eurasian Union (EuU). In signs the EU accords. Moscow № 20 (62) november 2013|the ukrainian week|11 Neighbours|EU-Russia would evidently impose an eco- to charge the country excessive man rights record could obstruct nomic blockade and raise energy prices and manipulates energy the ratification of the Russia-EU prices to hasten Ukraine’s eco- supplies as a form of political visa-free travel agreement in Eu- nomic collapse. The Kremlin pressure. Russia’s officials have ropean parliaments. Moreover, could also terminate the bilateral criticized EU moves to boost en- the imprisonment of Greenpeace treaty on strategic partnership ergy market competition and un- activists on charges of piracy for and no longer recognize Ukraine’s dercut Europe’s reliance on Rus- protesting against Moscow’s Arc- borders. It could also support sian supplies. The Commission tic oil drilling has outraged all EU separatist movements in Eastern announced in September that it is capitals and confirmed that Rus- and Southern Ukraine and be finalizing its judgment on Gaz- sia is becoming a rogue state. prepared to intervene on their be- prom’s gas trading practices. EU half. In effect, the Kremlin has regulators are preparing to Europe’s Test Ahead raised the specter of partition and charge Gazprom with abusing its EU parliamentarians, especially challenged Ukraine’s existence as dominant position - this could those from CEE, have urged the a unified state. lead to a fine of up to USD 15bn. European Commission to adopt a The response of Brussels to Furthermore, if gas prices are firmer stance against Moscow’s Russian threats has been stronger freed, Gazprom could lose a fur- multiple abuses of its neighbors than expected. Stefan Füle, the Eu- ther USD 14bn in revenues. and its disregard of international ropean Commissioner for Enlarge- Moscow’s reaction has been norms. A bureaucratic response ment and Neighbourhood Policy, predictable, by imposing trade and punitive actions against Gaz- asserted that Customs Union sanctions on Lithuania and threat- prom or against Moscow at the membership is not legally or tech- ening other states with embar- WTO are not enough to affect nically compatible with the EU goes. In early October, Russia’s Kremlin policy. The EU has the Free Trade accords. He also issued Customs Service banned the im- opportunity to act in solidarity a strong statement in the European port of Lithuanian dairy products with Lithuania and all member Parliament criticizing the pressure states that are threatened by exerted by Russia on the EU’s East- The EU may be a more Moscow by demonstrating that ern Partnership countries. The U.S. aggression ultimately harms Rus- administration has also become in- direct challenge sia itself. volved in the dispute, asserting to Moscow’s ambitions As the Vilnius summit ap- that Russia's threats against proaches the most effective re- Ukraine and Moldova contradicted than NATO sponse would be to ceremoni- its commitments to various inter- ously sign association and free national agreements, including the and an embargo on meat, fish, and trade agreements with Ukraine, principles of the Organization for other products was threatened. Moldova, and Georgia. The sum- Security and Cooperation in Eu- EU Trade Commissioner Karel De mit should also announce that all rope (OSCE). Gucht asserted that Moscow failed post-Soviet states except Russia Both the Ukrainian and Mol- to provide clarification regarding are invited to obtain the same ar- dovan governments have refused its customs controls and its moves rangements. Even those countries to succumb to Moscow’s black- could precipitate a challenge that have mistakenly entered mail. If Russia moves from threat against Russia in the World Trade Moscow’s Customs Union, where to action against Kyiv or Chisinau Organization (WTO). they will incur significant eco- it is essential for Europe and the Paradoxically, Moscow’s nomic and political costs, can re- U.S. to maintain a unified posi- sanctions against Vilnius created turn to Europe once they revoke tion. Either the creation of a Mos- serious problems in Kaliningrad, their signatures. cow-dominated Eurasian Union which is more dependent on Lith- Brussels must also unequivo- or conflicts generated by resis- uanian produce, and even cally confirm that each aspirant tance to establishing such an alli- sparked public protests in this will be considered for full EU ance will undermine security Russian exclave against Kremlin membership and will be given an along the EU's current borders. tactics. Vilnius has also threat- accession path similar to those af- But as the Vilnius showdown ap- ened to block Russia's road and forded to all the West Balkan proaches, it remains unclear how About the rail access to Kaliningrad if Mos- countries, once they meet the ini- effective a response the allies are author: cow continues to pressure its tial criteria for accession. Simulta- willing to undertake in defending Janusz Bugajski neighbors, thus further isolating neously, a common position with the sovereignty and integrity of is a foreign the region. Such moves could Washington should be issued dur- neighboring states if the Kremlin policy analyst, raise support for Kaliningrad’s ing or after the Vilnius summit. escalates its pressures. author, lecturer, independence from Moscow that This must underscore that bully- columnist, would boost the region’s chances ing and pressure by Moscow will Spreading Conflicts and television for closer links with the EU. be countered by resolute action to In addition to conflicts over the host based Among other sources of construct a democratic, secure, EU’s eastern neighborhood, Rus- in the United mounting EU-Russia tensions are and prosperous trans-Atlantic States. He sian authorities have accused has published human rights violations and the community that includes all Euro- Lithuania of harming its energy 18 books arrest of Greenpeace environ- pean states. The Kremlin needs to interests. Vilnius has lodged com- on Europe, mentalists. According to Ambas- understand that bullying and plaints to the European Commis- Russia, and sador Vygaudas Usackas, Head of blackmail is counter-productive sion that Gazprom uses its domi- trans-Atlantic the Delegation of the EU to Rus- and will ultimately defeat its own nation of the natural gas market relations sia, Moscow’s deteriorating hu- ambitions. 12|the ukrainian week|№ 20 (62) november 2013 |opinion Bidding Farewell to Russia ussia generously helps the EU. If we needed proof Lithuania, it appears that the third Eastern Partner- that swiftly deteriorating human rights record in ship Summit to be held on November 28-29 in Vilnius Russia coupled with intimidation and blackmail is not a headache, but rather something tantamount to Rcampaigns it launches from time to time against an existential threat to Russia. How else can we under- its neighbours are not a fantasy of the Baltic States and stand the malicious actions of Russia vis-à-vis Lithua- Poland portrayed by Russian propagandists as the lead- nia, its truck drivers on the border, or dairy products? ers of international Russophobes, we got it at last. It is a massive attack against what is still regarded as The Magnitski case, the Bolotnaya case, the Khodor- their zone of interest. kovsky saga (October marked the 10th year that Mikhail I will never forget how once my friend Edward Lucas re- Khodorkovsky spent behind bars), and the Pussy Riot acted to a remark made by a high-ranking European story, were all followed over the past weeks by the ghosts Commission official in an informal meeting of political Author: of Soviet propaganda and oppressive practices. These in- experts, opinion and policy makers. Leonidas cluded an overt denial of the universal validity of human To the point made by a colleague concerning some Donskis rights and civil liberties, and political abuse of psychiatry neighboring countries as objects of special Russian in- – it suffices to recall Mikhail Kosenko who will undergo terest, Lucas reacted by asking as to what kind of inter- compulsory psychiatric est Germany has in, say, treatment outside Moscow Ukraine will remain Denmark. That was the only due to his participa- end of the debate, as it tion in the Bolotnaya a friend to a democratic was becoming increas- Square events. Russia in the future. ingly clear that no neigh- In addition, recent ethnic bouring country, no mat- riots in Moscow signal the Now, Ukraine and Russia ter whether big or small, is awakening of official xeno- are bound to bid farewell a property of a large coun- phobia as a state policy. try which claims an exclu- Instead of protecting in- to one another sive right to form a re- nocent migrants and gional political landscape workers against the mob, Sergey Sobyanin, Mos- in accordance with its wishes and urges. cow’s new mayor, ordered to arrest hundreds of By blackmailing neighbouring countries, Russia is migrants. Coupled with fascist rhetoric of the political not doing itself a good service. Ukraine is big and strong clown Vladimir Zhirinovsky, it leaves a bitter and un- enough to ignore Russian pressure. The paradox is that pleasant taste of the rise of fascism or at least of irre- Russia needs Ukraine much more than Ukraine needs sponsible playing with the fire. Russia. Russia is still inclined to see Ukraine as its Sig- This is not the end of the story, though. The piracy nificant Other, and therefore the Kremlin cannot con- charges dropped and then replaced with hooliganism ceive a Russian empire without Ukraine. All paths to any charges against Greenpeace activists clearly mark Rus- form of the restoration of the Russian empire lead sia’s positioning itself beyond international law. If present through Ukraine. Full stop here. Russia under Vladimir Putin has decided to “adjust” the This relationship is based on incomparably more than entire system of international relations to its foreign poli- pragmatic interest. It is more complex than a sheer love- cies and domestic political needs, we have to call a spade a hate relationship so characteristic of Eastern and Central spade. We are at the new cold war – undeclared, ignored, Europe vis-à-vis Russia, as Ukraine is a significant part of written off as a Russophobic fantasy or else dismissed, Russia’s historically formed identity. If the Baltic States which nevertheless is there, no matter what they say. are little more than a historical sentiment and a jingoist Therefore, Edward Lucas wrote smart prose and talked reaction to what once was the North-Western region of sense in his perceptive book The New Cold War. We the empire, Ukraine is at the heart of Russian identity. simply chose not to name what was, and continues to And yet Ukraine and Russia are bound to bid farewell be, obvious. We are at cold war with the Kremlin which to one another. Ukraine will remain a precious friend regards all those who joined the EU and NATO as trai- to a democratic Russia in the future. Not now, alas. Ev- tors and enemies. We have to be blind and deaf not to ery move towards a dignified way to live and choose identify the political will to resurrect the Soviet Union in one’s priorities freely is met by Russia with paranoid a new and slightly modified hypostasis (as an Eastern suspicion, anger, and frustration. Instead of thinking European version of successful authoritarian modern- about its decreasing population and changing demo- ization after the Chinese pattern, or, better still, after the graphic situation which makes it quite possible for Chilean experiment – no wonder that Pinochet was Russians to end up as a minority in Siberia with an praised up to the skies in Russia even by its “liberals”). overwhelming Chinese majority, or about how to win On a closer look at the massive blackmail and intimi- respect and friendship in Europe, Russia is till fighting dation campaign targeted by Russia at Ukraine and with the ghosts of its past. № 20 (62) november 2013|the ukrainian week|13 neighbours|Georgia Georgia’s Unknown President The media are buzzing about how and why the “era of Saakashvili” came to an end. Some say that his page in history has been turned forever. Others are confident that the 45-year old is too young to bow out of politics

Author: wo months ago, I had a However, Ivanishvili put many Vakhtang chance to ask Mikheil Saa- officials from Saakashvili’s team be- Kipiani a kashvili what he would do hind bars. One was Vano Merabish- special report Tonce he leaves the presi- vili, Secretary General in Saakashvi- for The dent’s palace. He said that he li’s party and the architect of the Ukrainian would remain in politics since he successful police reforms. When he Week from has many proactive supporters was accused of several absurd epi- Tbilisi and unused potential. He even sodes, his lawyers fended off the said that he wouldn’t mind return- prosecutors’ attacks and the case ing to the government, however he began to fall apart. But he soon would continue to make radical faced new charges. reforms there, not just sit pa- Thus, the attempt to introduce a tiently in his office. practice in which several antagonis- tic forces would co-exist in Georgian Choosing a weak politics failed. Saakashvili’s voters president criticized him for giving up, allow- This year’s presidential campaign ing bandits and Russian agents into was very different from previous the government. Ivanishvili’s elec- ones. First, constitutional reforms torate were equally outraged: in made Georgia a parliamentary re- their eyes, Saakashvili was a tyrant, public and gave the legislature con- a criminal and there was no way trol over appointing the premier. that the new government could co- The president no longer affects ap- ordinate its policies with him. pointments in government, nor can The top parties got to the final border police. After the 2008 Rus- he dissolve the legislature. Sec- phase of the election with opposite sia-Georgia war, Burjanadze was ondly, Georgians viewed the Octo- motivations. Ivanishvili’s support- the first Georgian politician to visit ber 27 election as the final chord in ers struggled to eliminate legislative Vladimir Putin and subsequently the transfer of all power from Saa- dualism and give all power to Pre- met with him several more times. kashvili and his party to the Geor- mier Ivanishvili. Saakashvili’s elec- She is considered the primary facili- gian Dream coalition. torate struggled to prove that they tator of Russian politics in Georgia Right after last year’s parlia- exist despite repressions, and re- – sort of a local Viktor Medvedchuk, mentary election won by Georgian main the main opposition party in but with more charisma and will- Dream, the party of Russian-French the country. Both fulfilled their ingness to take political risks. billionaire Bidzina Ivanishvili, the tasks on October 27. She spent many years on the president still maintained a good sidelines and stayed away from lo- deal of de jure and de facto power. The end of the race cal and parliamentary elections. Saakashvili was entitled by the Con- Nino Burjanadze, ex-speaker of the Now is her time. Part of the Geor- stitution to appointing his ministers Georgian parliament and former gian electorate is growing increas- of defence, internal and foreign af- member of the opposition team of ingly weary of their once-beloved fairs. This would mean a way into the 2003 Revolution of Roses, is the Georgian Dream idols, but will the government. So he allowed his best-known candidate in Ukraine. never vote for a candidate from Saa- opponents to appoint their people She was not satisfied with anything kashvili’s party. “Soviets” would be to these offices. In return, he ex- less than a leading role in Georgian the best name for them. pected respect for the rights of the politics. Moreover, Saakashvili did Their choice is purely emo- opposition minority and himself, not take into account the economic tional, based on post-Soviet and the President and leader of the interests of her husband, ex-deputy post-Russian nostalgia. They na- United National Movement. prosecutor general and head of the ively believe that Russia still loves 14|the ukrainian week|№ 20 (62) november 2013 Georgia|neighbours A poster then the Minister of Conflict Regu- create any jobs despite his assets. of the pro- lation in charge of the reintegration Over 94% of his countrymen voted government of occupied territories, and finally for a continuation of the “hand- coalition candidate as Interior Minister. He was the outs” –yet another record set in Giorgi one to bear the negative aspects of this election. Margvelashvili the United National Movement’s and the eight years in government. The winners are not eternally sad Giorgi Margvelashvili is Ivan- judged. The defeated may Charlie Chaplin ishvili’s candidate. This gave the well be little-known former professor of Giorgi Margvelashvili, who will be- philosophy-turned Education Min- come the fourth president of Geor- ister a pass to the president’s office. gia in mid-November, gained 62% Unlike his predecessors, he has of the overall vote. Davit Bakradze nothing much to show the voters. came in second with 21.7%, while He has no highs or lows—a grey Nino Burjanadze ended up with mouse that has accidentally found just 10.16%. himself in an atypical role. But that Bidzina Ivanishvili has concen- was Ivanishvili’s decision – and trated enormous executive and leg- that is enough. islative power in his hands. He will There is a much stronger can- now have no one else on which to didate on Ivanishvili’s team. Irakli blame his political problems and Alasania is a charismatic 40-year mistakes. The newly-elected Mar- old European and NATO oriented gvelashvili was happy about the Defence Minister who speaks Eng- election outcome but knew his lish. He is one of the few principled place and waited for the Premier to people in the Georgian Dream and finish his speech at the briefing. the leader of the Our Georgia – This is not a place for independent Free Democrats party. He is an in- political games or ambitions. An dependent politician with good era of public politics is followed by contacts in Washington and Brus- an epoch of Byzantinism. More- sels, and very different from his over, the oligarch Ivanishvili has boss who remains a dark horse for promised to resign from the pre- mier’s office only to control the Constitutional reforms government from outside. This suggests that his spin-doctors are made Georgia a tasked with weakening Georgia as parliamentary republic much as possible. Efforts to this end are sadly easy to see. and gave the legislature Bakradze, following Saakashvi- control over appointing li’s suit a year ago, did not wait for the official results of the election. the premier He greeted his opponent on the vic- tory and offered to work for Georgia and awaits them, that it is willing to the world after a year as premier. together with him, yet this civilized allow Georgian agricultural prod- That is why Alasania received no gesture remained unnoticed. ucts into its markets, and that Pu- blessing from Ivanishvili while A few hours later, President tin is ready to help Georgia restore Margvelashvili did. Mikheil Saakashvili spoke his piece: its territorial integrity. For them, “I am deeply convinced that Georgia the conflicts with Russia were all Georgians vote is moving toward Europe and the the fault of “stupid Mikheil”. with their feet voters support this course… All Thanks to lavish funding at- This year, 46.6% of Georgians those who do not like the outcome tained right before the election, showed up at polling stations. This of the election should not give up; Burjanadze managed to come in was the lowest turnout ever. Half any retreat is always temporary. third. Her portraits were every- of the voters voted “against all” Georgia has a good future”. where – in the subway, on the yel- with their feet rather than ballots. These are nice words, but is the low city buses, on billboards and in As a result, the winner is the presi- victorious party willing to halt the shop windows. dent of the minority. acts of repression that threaten to Davit Bakradze is a somewhat The electorate was predictably reach Saakashvili? Some alarm reluctant candidate from the most proactive in Sachkhere, home bells are already sounding. The United National Movement. After region of Premier Ivanishvili. For investigation into the death of Vano Merabishvili ended up in jail, many years, he was a real father for Zurab Zhvania, former parliament Saakashvili was left without a char- his region in deeds, not just words. speaker and a top activist in the ismatic and electable candidate. He paid for all utilities, covered Revolution of Roses, has been re- Then, ex-speaker Bakradze won college tuition for local children, sumed. The media is buzzing with the primaries. He had an impres- gave TV antennas and fertilizer to potential attempts to blame this on sive career, first as chairman of the local families and provided them Saakashvili, but we will soon see European Integration Committee, with clothes. However, he did not where this story is headed. № 20 (62) november 2013|the ukrainian week|15 economics|Banks Who Says Bankers Can Relax? Having survived a harsh liquidity crunch last year, the Ukrainian banking system now seems fairly stable. This impression is misleading

Author: with their Ukrainian subsidiaries sions over a period of two and a Lyubomyr Shavalyuk in the post-crisis recovery – at half years, since they could do this point, they are not making nothing to collect the bad loans. ast year, Ukrainian banks the expected profit. It dropped found themselves caught up from 13% in 2007 to 1.3% in the Ukrainians are buying back in a liquidity crunch, pro- first nine months of 2013. Now, Western subsidiaries with Lvoked by the National Bank they are waiting in line to leave of Ukraine (NBU). Interbank the market. The European debt clean balance sheets, overnight rates exceeded 50% crisis, coupled with the specifics optimized cost efficiency while the average interest rate on of the Ukrainian business envi- hryvnia-denominated deposits ronment, seems to further en- and high liquidity buffers was 25%. Interest rates are now courage them to do just that. lower. However, the underlying As a result, the assets of This encouraged them to sell problems remain unresolved, go- banks with Western capital (I-III their loan portfolios to Ukrai- ing from serious to chronic. groups based on the NBU classi- nian banks at knockdown prices. fication) in Ukraine have shrunk These turned into profitable as- European banks flee by a third over the past two and a sets in the hands of Ukrainian Despite the overall illusion of sta- half years, dropping from UAH bility, the situation with individ- 272bn to UAH 187bn. European Shifts on the banking market ual banks and their groups seems banks have taken technological We ern banks are leaving Ukraine. Before the crisis they much more worrisome. The innovativeness, the quality of had bought overpriced banks from the local owners. Now, banking market is undergoing re- services, liquidity, fairness and Ukrainian bankers are buying them back for peanuts distribution: while some banks transparency with them. struggle to make ends meet, oth- The dynamics in accumulat- Bank assets* by the origin of capital, UAH bn ers are put up for sale, and some ing provisions for bad assets (see 1200 buy up their competitors on a Opposite standards) is a perfect massive scale (see Shifts on illustration of the loss of trans- 1000 135 the banking market). parency. Right after the 2008- 134 Over the past three to four 2009 crisis, most subsidiaries of 129 187 years, around ten European European banks accumulated 800 111 204 banks have left Ukraine. The pro- transparent provisions for bad 235 cess continues. Bankers claim debts and other toxic assets. By 217 600 272 that a few more Western parent the end of 2010, they had almost 204 banks are looking for buyers for UAH 55bn or 20% of total bank- 176 their Ukrainian subsidiaries. Re- ing assets. They declared the pro- 400 159 cent examples include UniCred- visions – and suffered relevant it’s UkrSotsBank and Raiffeisen losses. 470 529 Bank’s Aval. The loss was triggered by the 200 403 According to one banker, local business practice. The oli- 317 when Europeans entered the garchs who owned the banks be- Ukrainian market before the fore selling them to Europeans 0 2010 2011 2012 1П 2013 2008-2009 crisis, they had no used them to lend to their other clear strategy for the local mar- businesses. These loans re- Ukrainian Ukrainian We ern Russian private public banks banks** ket. Their goal was the fat profit mained on the banks’ balance banks banks they could earn on the margin be- sheets as they were sold to Euro- peans before the crisis. The latter *The analysis covers banks from groups I, II and III based on the NBU tween cheap money borrowed in classification. As of mid-2013, the groups included 59 banks with the Europe and expensive loans is- gave oligarchs an excuse to not total assets at 89% of all assets in Ukraine’s banking sy em. sued in Ukraine. In the process, repay the loans. **Russian banks include BTA Bank with Kazakh capital Western bank executives did not As a result, European own- Sources: NBU, The Ukrainian Week think about what they would do ers wrote off half of their provi- 16|the ukrainian week|№ 20 (62) november 2013 Banks|economics bankers and collection agencies Opposite andards ers insolvent and turn their loans who still remembered their loan into bad debts. collection practices from the After the crisis, banks with We ern and Russian capital set The government is not re- up adequate reserves for troubled assets transparently. 1990s. When, after the govern- They have mo ly been writing them off lately so the sponding adequately to these ment changed in 2010, a cam- reserves depleted. By contra , Ukrainian banks did not challenges. In the first case, it fil- paign to oust Western subsid- report troubled assets transparently and never accumulated ters out problem banks from the iaries from the Ukrainian mar- sufficient reserves to cover them. Now, a lengthy economic market by helping to leak infor- ket began, with the occasional crisis may reveal that their balance sheets are much worse mation about their problems to use of administrative leverage, than what they appear to be at fir sight other bankers. As a result, sound the exodus of Europeans be- Reserves for assets*, UAH bn banks cap credit limits for the came just a matter of time and troubled bank and the system re- 180 price. tains liquidity. However, the 160 toxic bank finds itself up in the Ukrainian wildlife air: it is bankrupt de facto but Now, Ukrainians are buying back 140 16 neither the regulator nor the De- Western subsidiaries with clean 14 posit Insurance Fund seems to balance sheets, optimized cost ef- 120 17 38 notice that, and the bank contin- ficiency and high liquidity buffers 13 30 ues to operate de jure, albeit in- of an average of 0.2-0.6 of the 100 capable of returning deposits. 37 bank’s capital. Such acquisitions, 36 18 Moreover, it continues to accept ,coupled with NBU assistance to 80 37 deposits from unaware clients at bankers it is close to, have 60 18 17 interest rates that are far above boosted the share of Ukrainian average. banks on the market, their assets In the second case, the cen- 40 74 growing by 2/3 from the end of 53 62 tral bank keeps a lid on the news 2010 through mid-2013, and 20 51 to prevent panic. Instead, it un- 36% for state-owned banks (see folds propaganda about safe 0 Shifts on the banking mar- 2010 2011 2012 1П 2013 banks and encourages people to ket). deposit their money while the Ukrainian Ukrainian We ern Russian However, banks still have ex- private public banks banks** banks offer good interest rates. If tremely low provisions for bad banks banks a panic does indeed start, the assets. A lengthy recession will NBU can impose a ban on deposit *The analysis covers banks from groups I, II and III based on the NBU only aggravate their troubles. classification. As of mid-2013, the groups included 59 banks withdrawal. Their liquid assets are also very accounting for 89% of the total assets in Ukraine’s banking sy em. The third challenge is a time low, with the ratio of cash and **Russian banks include BTA Bank with Kazakh capital bomb, but the government con- cash equivalent to total assets at Sources: NBU, The Ukrainian Week tinues to turn a blind eye to it. 11% in private banks and 8% in While economic recession is state-owned ones. The total li- slow, it allows banks to hide bad quidity of private banks is essen- One is the critical mass of assets and avoid accumulating tially ensured by two major problem banks borrowing on the provisions for them. Meanwhile, banks – PrivatBank and Delta. interbank market and failing to more and more junk accumu- The former has increased its liq- repay the loans. They thus infect lates on their balance sheets. uid assets to UAH 32.2bn over other banks, causing a domino This is not surprising as the cri- the past 18 months, including effect. Another is panic among sis has pushed most enterprises UAH 7bn on correspondent ac- depositors who will rush to with- into losses, making them inca- counts in the central banks of draw their money as soon as they pable of repaying their loans. Latvia, Russia and Georgia hear any alarm bells. Some are Plus, the government keeps where it is actively expanding its ringing already: some banks, al- milking them through ever-in- network and UAH 15bn in other creasing tax pressure to patch non-resident banks. Delta Bank when Europeans entered holes in the budget, and has increased its liquidity to the Ukrainian market squeezes hryvnias out of the real UAH 10.3bn, half of which is and financial sectors to keep the placed abroad. It is using part of before the crisis, they had exchange rate unchanged. Banks its liquidity to buy smaller banks no strategy. Their goal was roll over loans to some compa- and increase its presence on the nies in the hope of at least get- Ukrainian market. the fat margin between ting interest from them. What cheap money borrowed in will happen when they can no The whiff of a new crisis longer afford to pay even that? With the ongoing recession and Europe and expensive loans The longer the recession, fu- the depressed macroeconomic issued in Ukraine eled by an ineffective govern- situation, the risks inherent to ment policy continues, the fewer private Ukrainian banks are be- banks will remain afloat. The ginning to crystallize. If at least beit mostly small, are having a current troubles of some small one of the following factors hard time returning deposits to banks may be red flags for comes to pass, it could under- their clients. The third factor is deeper problems. A systemic mine the current misleading sta- the downward spiral of the econ- bank crisis could just be a matter bility. omy that will make some borrow- of time. № 20 (62) november 2013|the ukrainian week|17 economics|Banks Oleksandr Suhoniako: “We’ve passed the critical point and have reached the super-high instability zone”

Interviewer: or does this signal a systemic cating the sound part of the Lyubomyr crisis? banking system. A sound bank Shavalyuk – As far as I know, the sick could give a loan to a sick one, banks that are failing to service which will never be repaid. As a he signs of a banking crisis their obligations before deposi- result, a financial institution that have mounted in Ukraine. tors are Daniel and ZakhidIn- is doing fine now will also be- More and more banks are comBank. They are not returning come a problem bank. That will Tnot returning deposits to deposits, in spite of a court deci- trigger a chain reaction. their clients. Paradoxically, the sion. Experts talk about 10 to 20 In the pursuit of mythical ex- National Bank of Ukraine (NBU) problem banks. Unfortunately, change rate stability, we have is not reacting to this. Most the NBU has no transparent in- virtually lost the function of the bankers that The Ukrainian national money market that Week tried to talk to only agree could adequately respond to the to speak off the record. They ad- Instead of funding needs of the real sector. mit that they fear government the economy, sanctions against their banks. UW: The banking sector has Oleksandr Suhoniako, President banks are forced to grant normal liquidity now and inter- of the Association of Ukrainian loans to cover public bank rates are fairly low. Does Banks (AUB), has agreed to this mean that the industry has speak openly, despite the fact spending no problems? that many large banks have left Liquidity alone does not indi- the AUB after his harsh criticism formation or clear position on cate the lack of problems. The of the policy of then NBU Chair- this. What we are seeing is just key point here is how this liquid- man Serhiy Arbuzov in spring the tip of the iceberg. ity works. When free cash comes 2012. Problem banks have to be re- into the real sector from banks at moved from the market, while low interest rates, the economy UW: The Ukrainian Week has the NBU is waiting. The Deposit is fine indeed. Unfortunately, information that at least ten Insurance Fund is taking a back this is not the case here. banks have difficulties with re- seat as well. They have been in- turning deposits to their clients. ert since the crisis broke in UW: Why is the NBU not react- Is this just an individual prob- 2008. This is dangerous because ing to this? lem of financial institutions that the problems are not being – This is an old disease: the always exists in any economy, cured, just made worse, intoxi- Central Bank reacts to conse- 18|the ukrainian week|№ 20 (62) november 2013 Banks|economics quences, not causes. Many other terests of Ukrainian society institutions, not just the NBU, Economic anemia rather than on new strategic have such flaws. The current Banks have been lending to the government to cover goals for foreign banks. governance practice offers very budget deficit and losses of ate-owned enterprises, not few examples of successful pre- the real seor UW: Who could buy the subsid- ventive responses to crises. One Government and ate-owned enterprise debt iaries of foreign banks in was in 1998 when the authorities to banks and NBU from 2008 to 2012, times Ukraine if they continue to and market players came up with 15 leave the country? an effective solution. Unlike 15 – Economically, the acquisi- Russia, Ukraine managed to tion of any banking assets in avoid a nationwide default and Ukraine is a foolish strategy at the collapse of the banking sys- this point. There is no certainty 12 tem back then. In 2008, how- that you will have any profit ever, the NBU did not react to five years after such purchase. our warnings (the AUB had Angela Merkel said that the cri- warned it of the looming crisis in 9 sis in Europe will last 10 years. April 2008) and basically slept It will last much longer in through the beginning of the Ukraine. global crisis. People say that the 6 What will happen to the latest global crisis started with a 5.2 banks that stay here? Their only mortgage default in the city of option is to cut costs, particu- Stockton, California. Ukraine larly interest costs, dramatically. 3 has to stay alert to nip its own 1.9 Over the past two years, how- Stockton in the bud. 1.09 ever, the interest expense growth rate has exceeded that of interest 0 UW: The media has reported Total Outanding debt Outanding Outanding income growth as a result of high that some Western financial outanding of ate-owned government government deposit interest rates. This is a groups are planning to sell debt in the enterprises to debt to banks debt to the NBU problem of the government and their Ukrainian subsidiaries. For economy banks commercial banks, not just the instance, UniCredit is suppos- Source: AUB regulator. Unless we deal with it edly selling UkrSotsBank, and now, there will be very serious Raiffeisen Bank – its subsidiary consequences.

: PH L P hoto Aval. Why do they not see any 2005-2008 when the national prospects here? Is it about the capital market provided foreign UW: How close is the banking Ukrainian economy, the bank- financial entities with access that system to the critical point ing sector, their own problems was not well thought out and un- when no-one will be able to in Europe or is it that they can’t controlled. We did not set them Economically, the control the situation? come to terms with the current any requirements or priorities. purchase of any – In my opinion, we are al- government? banking assets in Our market was virtually left at Ukraine is a foolish ready operating close to this crit- – Ukraine seems to be seek- the mercy of foreigners. And they strategy at this point ical point. What are the signals? ing European integration but were certainly not going to sup- The budget is empty. Social ben- real European businesses are port our aircraft and space engi- efits (pensions, wages for public leaving it. This means that the neering or space technologies sector employees and unemploy- government’s declarations do with loans. ment benefits) are delayed. The not correspond with the reality All we gained was mortgages Premier blames local authorities of its economic policy. In 2010, in foreign currencies, consumer for budget deficits and claims an economic development pro- and car loans. This is why these that banks support the eating up gramme was developed. It pro- banks have now lost their stra- of money through lending. How- vided for Ukraine to join G20 by tegic prospects in Ukraine. New ever, the government owes banks priorities have not been devel- During the previous 2020. Many of its provisions are crisis, the UAH:USD 5.2 times more than it did in effective. But it also required re- oped, while old ones have been exchange rate 2008 in outstanding government forms, investment and increased exhausted. The financial cycle is dropped by 60%. A bonds, and 15 times more to the comparison of the export. The only real accom- over. Banks can no longer earn depletion of reserves NBU, while lending to the entire plishments so far, include a sta- on the gap in interest rates be- back then and now economy has only increased by shows that the ble exchange rate and a low in- tween deposits in Europe and exchange rate may 9% since then. Instead of fund- flation rate. But these are just loans in Ukraine. The current fall 30% this time. So ing the economy, banks are tools to accomplishing strategic terms for lending to the real sec- it could potentially forced to grant loans to cover be at a level of goals, such as greater prosperity, tor are clearly not adequate for public spending. Some claim that improved quality of life and a foreign banks. Fortunately or UAH interest rates on loans should fall more developed economy. In unfortunately, foreign investors to 14% by the New Year, but how Ukraine, the tools have become can no longer turn a blind eye to 10.5: is this possible, given that cur- an end in themselves. As a result, the risks we are used to. We USD 1 rent deposit interest rates are as economic growth has ground to a have to start working now to re- high as they are? This is why I halt. store the share of foreign banks believe we are just a step away The main reason for the exo- in the Ukrainian banking sys- from the critical point; we are in dus of foreign banks from the tem, but this work should be the zone of super-high instabil- Ukrainian market stems from based on the well-articulated in- ity. № 20 (62) november 2013|the ukrainian week|19 Society|Oligarchs Days of Firtash in London There were very few people in attendance at oligarch Dmytro Firtash’s “Days of Ukraine” in the UK who actually discovered Ukraine Author: Bohdan Tsioupine, London

PROMOTION RACE: Oligarchs Dmytro Firtash and Viktor Pinchuk compete in improving their image in the West

riter Oksana Zabu- who actually “discovered” they were all in paid advertise- zhko left the London Ukraine. ment sections. Library after her lec- Meanwhile, the Ukrainian Little exaggerations tend to Wture at Days of media coverage of Days of mount. Thus, the Ukrainian me- Ukraine in the UK obviously irri- Ukraine arranged by the Firtash dia reports about “a street in tated. “This is not the way it Foundation and funded by Cambridge named in honour of should be done”, she explained, Group DF gave a whole different Taras Shevchenko” left one de- forgetting to switch from English impression. Some editors pro- tail out: the street was renamed to Ukrainian. “The main thing is claimed that “interest in Ukraine for one year to celebrate the po- to have a target audience for has grown significantly in the et’s 200th anniversary. Plus, the your message (about Ukraine U.K.” following the events. In street is a small albeit central al- and Ukrainian culture). They one report from London on a na- ley squeezed between law, his- would then spread it further… tionwide Ukrainian TV channel, tory and linguistics department and that would be a discovery for the journalist held up a British premises. “The renaming for just someone. And if you plan an newspaper and proclaimed that one year does not make it less event like this and do not have at “all British newspapers” were symbolic”, says Dr. Rory Finnin, least ten people who must be on writing about Days of Ukraine. Director of the Cambridge Ukrai- the list in an audience this The U.K.’s press market is nian Studies programme. A small… I was happy to see Kyiv one of the biggest in Europe but I graduate of Columbia University, journalists, but … this is not for did not see one real report on the he was the only Ukrainian- Kyiv journalists! If Mr. Firtash event in any national newspaper. speaking voice in the coverage of decided to spend money on me, I In fact, The Evening Standard the event by Inter, a Russian- want to see it spent effectively”. featured an article with beautiful language TV channel owned by Unlike Ms. Zabuzhko, at- photographs advertising Days of Group DF through the Inter Me- tendees seemed happy with the Ukraine and an interview with dia Group company. lecture and brief concert by the Dmytro Firtash’s wife Lada. Sev- Rory Finnin said that there Telnyuk Sisters. But the writer eral media had articles about the would be no programme of confirmed one fact: there were exhibitions and concert that Ukrainian studies in Cambridge very few people in attendance were part of the programme, but without Dmytro Firtash’s multi- 20|the ukrainian week|№ 20 (62) november 2013 FAMILIAR FACES: The Firtash Foundation tried hard to attract as many visitors as possible. Ultimately, it brought many guests along from Ukraine

million-pound contributions. He concert were mostly young em- also said that the system of fund- ployees at London banks and ing through Cambridge Trust other companies, students, ille- guarantees continuous funding gal migrant-workers and the without the influence of the do- third generation of Ukrainian di- nor on how the funds are imple- aspora born in Manchester. They mented at the University of Cam- wanted to listen to Vopli Vido- bridge. “Otherwise, I would be pliasova, the band’s leader Oleh working at a different place”, Dr. Skrypka, and the leader of Plach Finnin said. Yeremiyi, Taras Chubai. They Dmytro Firtash has begun to had a great time and the fact that speak more openly of the pur- the event failed to lure even a pose of events he sponsors in the handful British visitors who U.K. “Our task is to communi- could actually discover Ukraine cate and show both our compa- is to be blamed on the organiz- nies’ and the country’s potential; ers. show that we can enter the stock The festival concert and fair exchange and that we have some- were the only events open to the thing to offer”, he said as he public. The reception at the Brit- opened a trading session at the ish parliament and the gala din- London Stock Exchange. ner at the Natural History Mu- The most heated debate in seum were more glamorous and London is about how much privileged. But that glamour Group DF’s business interests seemed to have impressed only have in common and in conflict the Ukrainian reporters who with the interests of Ukraine and wrote how “fancy” the premises the public. “Firtash spent his were and wondered why neither own money so he could do what- David Cameron nor “even former ever he wanted and invite who- Prime Minister Tony Blair” at- ever he wanted”, some say. He tended the events. “has no right to represent the Representatives of the whole country and pretend that Firtash Foundation initially his desire to promote his busi- claimed that they wanted to host ness interests was not central”, 100,000 guests at Days of others claim. Ukraine. Ukrainian newspapers Lada Firtash, President of reported the total number of vis- the Firtash Foundation charity itors at 110,000. The Day news- fund, received boos from the paper placed attendance at crowd when she greeted the au- 120,000 although those who ac- dience of the final Days of tually attended the events Ukraine concert in Russian thought these numbers were ex- rather than Ukrainian. Many aggerated. We had no chance to others paid no mind to the un- get specific information from the known woman on stage. The organizers as they refused to Ukrainians who attended the grant us an interview. Society|People The Wonder of Life The amazing story of a girl who is a step away from death, helping others and making the world a brighter place

Author: amara Shevchuk has time where she met many generations of Valeria for everything. She smiles immigrants from Ukraine. “Some Burlakova and holds up a poster saying had left Ukraine before the Famine T“I love the Ukrainian lan- (1932-33 – Ed.), others did so after guage. Don’t break my heart!” at the Second World War,” she says. protests against the notorious lan- “UPA (the Ukrainian Insurgent guage law passed last summer. Army – Ed.) fighters lived there! Another picture features her sit- This is where it all began.” ting on the broken stairs of Half way across the world Hostynnyi Dvir (see Unwel- away from her homeland, Tamara come Guests at the Inn at felt the need to learn Ukrainian. ukrainianweek.com), crying “My parents told me that I don’t after a clash with special police need it, that we won’t return to child can leave the country with- units that disrupted activists pro- Ukraine,” she notes. “Fortunately, out parental consent,” Tamara ex- tecting the architectural site from I was a serious swimmer. I got my plains. At that time, she had being taken over by a private master’s degree in sports in Ar- Ukrainian citizenship, since she owner and transformed into a gentina and was preparing for the was born in Ukraine, and tempo- shopping mall. She goes on raids Junior Olympics so trained six rary Argentinian citizenship which with Road Control, a group of vol- days a week. I told my parents that she was granted in view of her ath- unteer activists helping drivers to I trained seven days a week and letic accomplishments. protect their rights, and supports went to a Ukrainian Greek-Catho- Once in Ukraine, Tamara ini- the young men accused of ruining lic Church every Sunday. It’s a tially lived with her grandmother the Lenin monument in Poltava huge church, bringing together in Ivano-Frankivsk, then moved to Oblast. She is a young artist, Ukrainians from all over Argen- Kyiv where she lived with her aunt studying at the Academy of Arts tina. That’s where I began to learn, until her parents returned to Kyiv and selling her paintings at charity speak and read in Ukrainian.” from Buenos Aires. exhibitions. She paints murals on At 13, Tamara Shevchuk had a the walls in children’s hospitals serious spinal injury. She had to A SPLASH OF COLOUR and fixes playgrounds at her own quit sports. “I felt like nobody IN HOSPITALS expense. Now 18, Ukrainian doc- needed me anymore. Sport had After secondary school Tamara tors claim she has three more been my life – I had nothing else. entered the Ukrainian Academy of years to live at most. Tamara has So I decided to change some- Arts. “I was taking my entrance already undergone several surger- thing.” That was when she made exams during the language pro- ies on her spine, but the pain will the decision to return to Ukraine. tests. I stayed at Ukrainian House only get worse with time, and her Tamara’s grandparents still (the location of the protest in Kyiv heart will eventually fail. lived in Ukraine. They stayed in – Ed.), all the time cooking food touch through correspondence. In and bringing it to protesters, and RETURN TO UKRAINE her next letter, she wrote that she staying there overnight… But I Tamara lived in an orphanage be- was coming to Ukraine. Then she somehow managed to pass the ex- fore a pair of Ukrainian emigrants bought a ticket and left a note for ams.” Tamara works to pay her tu- from Argentina adopted her. When her mother. “It was just two ition. She doesn’t complain. “I she was 12, her adoptive parents (“I phrases,” Tamara says laughing. work as a guard at a kindergarten. think of them as my real parents” “The first thing I wrote was that And I do freelance painting. Plus, I Tamara says) lost good jobs and Mr. Jose the son of two UPA mem- clean floors in supermarkets. had to move to a poor district of bers with whom my grandfather That’s how I make UAH 5,000- Buenos Aires. “Despite the poverty, had fought, really liked me and 6,000 a month. It’s more or less every family had a TV set and a treated me as his daughter. He enough to cover my tuition, rent gun! Everyone watches football in took me to an amusement park and food.” Argentina!” Tamara recalls. “They where we won two huge stuffed What she doesn’t mention is shoot into the air every time the toys. I wrote that I’m leaving one that she spends her money on a lot Argentinian team scores.” for my mum and taking the other more things. After her first year at Tamara can talk for hours about one with me. I also wrote that I’m the Academy of Arts, she had her childhood in Buenos Aires. But going to Ukraine. That was it.” some free time during the summer it was something else that was im- “This was Argentina! The pro- break. “I thought I should do portant for her there: this was cedure there is very simple: any something. But what? What could 22|the ukrainian week|№ 20 (62) november 2013 People|Society charge and whom we work for… people from the neighbourhood. People are sure that it is a promo- “Yulia, the mother of a 3-year old, tion for someone or something. who used to take her child to a Ukrainians are not used to genu- playground two blocks away, did ine volunteering.” the most. Then the locals collected some money to fix the swings. IGNITING OTHERS Three weeks later, the whole play- Before her work in hospitals, Ta- ground was fixed… So far, we have mara fixed playgrounds. “I often sorted out four playgrounds, and deal with kids from troubled fami- are working on two more”. lies,” she says. “Sometimes, they Tamara also paints graffiti – her sleep at my house when they have images are mostly of UPA fighters, problems with their parents. I find black and red flags and tridents. them on the street.” “I’m an artist, I decorate Kyiv,” she Tamara found 12-year old Ari- says when the police question her. anna, drunk and unconscious on a “Well, keep on decorating then,” is street in Troyeshchyna, an off- all the perplexed officers can say. beat outskirt of Kyiv, at 1 a.m. “I Tamara says she has time for didn’t call the ambulance because everything because she sleeps the doctors would report this to two-three hours a day. She does social services, which could cause not talk about her own health, but the girl problems. So I sobered her her friends do. “She works to buy up and talked to her. I tried to find insulin. She has diabetes caused out what made her break down,” by a medical mistake,” blogger I do? Not much – just paint,” Ta- ART THERAPY: Tamara explains. “It emerged that Dmytro Reznichenko wrote when mara shares. “I have spent a lot of “Ukrainians Arianna had nowhere to play. he found out about her diagnosis time in hospitals and I really hated are not used Without play, children easily end and the verdict of doctors. “She the walls there… So I decided to to genuine up in bad company.” hardly sleeps at all, and when she volunteering,” paint murals on hospital walls.” claims Tamara This incident reminded Ta- does, she sleeps in a semi-reclined She announced her first paint- Shevchuk mara of the three playgrounds position. Several years ago, she ing campaign in a children’s hos- around the building where she fell out of a window and injured pital online. “I thought two or lives. “The only things there were her back really badly. She has un- three friends would come. Instead, broken swings where junkies or dergone several difficult surgeries 15 people I don’t know came. I re- drunks hung out. Then, on the in- for vertebra implants in her alized that someone else needs ternet, I saw people making vari- spine.” He launched a fundraising this, not just me, which added to ous figures – lions, bears and the campaign for Tamara; if not for my confidence. We’ve already like – from old car tyres. A friend another surgery which costs an painted murals in 15 hospitals. of mine works at a service station. unrealistic EUR 200,000 but of- We’ve fixed the leaking roof at the He helped me bring old tyres to fers no guarantees, then at least to children’s section of the Ukrainian the playground and I could start give the 18-year old the chance to Specialized Radiation Clinic. We making something out of them.” live a normal life for what little climbed up on our own, fixed it Tamara started with figures time she has left. and fell off it. We plastered the from Masha and the Bear, a popu- UAH 26,000 was collected walls, too. In spring, we intend to lar cartoon. Towards evening, I within several days. Tamara did fix the windows,” she shares. saw a crowd with plastic bags at not accept the money and made Young patients gladly help vol- the playground – they had come her friends stop raising funds. She unteers to paint murals. The au- to have a drink. “There they stand, decided to donate this money to a thorities were going to shut down staring at me, the fool “sculpting” three-year old boy with cancer the hospital – the only one of its car tyres late at night,” she laughs. whom she met at Okhmatdyt, the kind in Ukraine - because it was in “Confused, they asked me: central children hospital in Kyiv. a very poor state. “Thanks to us, it - Does your kid play here? “His parents abandoned him as a is still operating,” Tamara says. “It - No, I don’t have kids. baby when they found out that he was considered to be a hazard. But - Why are you doing this then? was born with cancer. A nurse ad- it is actually in Pushcha Vodytsia - I care about other kids. opted the boy… Of course, she (an elite suburb north-west of - Wow! cannot afford the treatment. And Kyiv where medical centres for the This was all they could say be- I’m doing fine. I found a great man treatment of serious illnesses, in- fore moving on, puzzled. who uses herbs to suppress pain. I cluding tuberculosis and cancer, Next day, I was making a boat- couldn’t believe it was possible; I and cottages that used to be state- like sandbox on the same play- thought it was nonsense. But he owned townhouses but were later ground. My friends cut some trees, helped”. Tamara says. privatized, are surrounded by pine polished the boards and brought She does not want any more forests – Ed.). We all know very them to me. Suddenly, I saw the surgery. “I’ve had enough! Con- well what a tasty morsel this is for same guys from the previous ventional medicine has done ev- any construction company.” night. They brought a bunch of old erything possible,” she insists. “It Tamara says that doctors are tyres in their old Zhyguli. “We makes no sense to spend more always surprised to see volunteers. want to help you,” they said. Five money on this. It can be used for “They ask who pays us, who is in days later, Tamara was joined by better causes”. № 20 (62) november 2013|the ukrainian week|23 history|Resistance movement

Regular Beginnings for an Irregular Army Caught between warring superpowers and without a state of their own, Ukrainians formed the Ukrainian Insurgent Army with an eye to the creation of an independent nation

Аuthor: uring the second half of of Ukrainians is a paragon of in- there were reasonable fears that Ivan Patryliak 1942 and almost all of surgent warfare, was originally the organization would not be able 1943, one of the most conceived as a regular rather to control the guerrilla element af- Dunique military forma- than guerrilla army. ter stirring it up, which would lead Photos tions in Ukrainian history took to a bloody crackdown by the Ger- provided by shape — the Ukrainian Insurgent Between two frontlines man authorities. The Resistance the Centre for Army (UPA). It would become an By mid-1942, the leadership of the Movement would wane, and the the Study of extraordinary example of a self- OUN(B) underground in German- very idea of fighting for an inde- the Liberation sustained autonomous military occupied Ukraine were faced with pendent Ukraine would be dis- Movement, force. Through guerrilla warfare, serious challenges. On the one credited in the eyes of the masses. Lviv it sought to be an independent hand, the occupation regime had The documents and actions of the player and pursue its own goals become crueller, especially in the OUN(B) clearly reflect this ambig- on the enormous battlefield that territory of Reichskommissariat uous situation. had engulfed Europe. Surpris- Ukraine, which called for more ac- The presence of a spontaneous ingly, the UPA, which to millions tive resistance. On the other hand, guerrilla movement forced the 24|the ukrainian week|№ 20 (62) november 2013 Resistance movement|history The UPA established OUN(B) leadership in Volhynia The plan rested on the as- five officer training tionally by the RMH, causing and Polissia to opt for deploying a sumption that the superpowers centres that trained some serious confusion and large-scale resistance movement fighting on the Eastern Front some hampering further efforts to in August 1942. In a printed state- would finally become completely 700 form an underground army. To ment, regional leaders declared, exhausted economically, militar- men who took avoid this duplication of func- commanding posts “To an oppressed people, a guer- ily and psychologically, which in the army tions, the OUN(B) Leadership of rilla war is, as a rule, the first stage would lead to internal upheavals the Northwestern Ukrainian or part of a ‘grand war’, a popular and eventual breakup. At the Lands and the RMH held a joint insurrection until armed people moment when the Third Reich meeting on 9 April 1943 and de- are able to form a regular army”. and the USSR would disinte- cided to call all of the OUN(B)’s Stepan Bandera’s followers in Vol- grate, the front would run along military units the “Ukrainian In- hynia and Polissia sought to form the Mozyr¬–Voronezh–Rostov- surgent Army”. The UPA had to permanent guerrilla subunits on-Don line. The chaos and be divided into groups, with each which they began to aggregate into transfer of power in Moscow group having a clearly defined larger units in October 1942. Ger- were expected to last for two to territory in which military okru- man security forces reported on three months after which the Nearly has (districts) were formed as 29 October 1942, “On 16 October new rulers would begin to administrative-territorial struc- 1942, Ukrainian nationalists “gather lands”. This hiatus had 100 tures. They also served the pur- professional doctors formed a larger band for the first to be used in order to create a and poses of mobilization and sup- time near Sarny and are con- Ukrainian army that would go to ply. The group commander was, 150 stantly receiving reinforcements”. the front and prevent Russian in- medical students at the same time, the comman- This was also when the first large- tervention. Preliminary efforts to were recruited to the dant of the respective okruha in scale actions against the German organize an underground army UPA Sanitary Service the territory assigned to his through the URC administration and police were re- had to be made prior to the dis- network. Hundreds group. This did away with double corded. integration of the Eastern Front. of girls from the OUN leadership, and the OUN net- women’s section The OUN(B) leadership The idea was to reorganize guer- were trained as work was tasked with serving the viewed the situation quite differ- rilla units in Volhynia and Polis- nurses needs of the emergent army. ently: they interpreted the out- sia into the core of the future un- On 15 July 1943, Dmytro break of a guerrilla war purely as derground regular army, which Kliachkivsky set up and headed a response to Soviet and Polish would be transformed into full- the first Supreme Command of provocations aimed at stifling vi- fledged armed forces after an the UPA, which relied upon the tal Ukrainian forces with Ger- open insurgency. Resolute and OUN(B) Leadership of the man hands. In September 1942, strict mobilization efforts were Northwestern Ukrainian Lands. the organization’s leaders were expected to yield an A month later, the UPA Head- convinced that they had to build 800,000-strong army, including quarters was fully staffed. It in- up more power in order to de- 500,000 personnel in Volhynia cluded former UNR army offi- liver a decisive blow at this criti- and Galicia and 300,000 in other cers, such as Lt. Col. Leonid cal juncture in the war: “We Ukrainian lands. must save our strength, because we believe that at the final stage Deployment In 1943-44, the leadership of the war we will have an oppor- of a “forest army” of the OUN’s underground tunity to fight for and build our The first stationary guerrilla own Ukrainian state. Not guer- units were set up in Polissia in and the UPA’s commanders rilla warfare of hundreds or October 1942 through January did the impossible in laying thousands but a national libera- 1943 and were guided by Serhii tion revolution of millions of “Ostap” Kachynsky, a regional the foundations for a Ukrainians is the path for us”. OUN(B) leader responsible for future regular army The discrepancies between organization. His work relied on the two tactical approaches to the military sections of the orga- Stupnytsky (chief of staff), Col. the struggle threatened to be- nization’s regional branches Mykola Omeliusyk and Col. Ivan come an intractable conflict be- whose activities were coordi- Lytvynenko. tween the regional leaders in nated by Vasyl “Som” Ivakhiv, a From August 1943, the Volhynia and the central leader- leader for military activities in OUN(B) underground in Vol- ship. The urgency of the situa- Volhynia and Polissia. In early hynia and Polissia partially re- tion forced Mykola “Ruban” February 1943, the Regional Mil- vealed itself and switched to mil- Lebed, then chief of the OUN(B), itary Headquarters (RMH) was itary activities. The leaders an- to call a secret military confer- set up there. Starting in the nounced the formation of a ence in Lviv in October 1942 to spring, the RMH built the future “front”, which included all UPA work out a joint tactic for mili- UPA on foundations that very units, and a “zapillia”—rear-line tary growth and armed struggle. much resembled the structure of services provided by the OUN’s A compromise was reached a regular army. military-administrative struc- with the Volhynian regional Until the end of March 1943, tures. leadership, and the OUN(B) the nationalist military units In May 1943, Lebed, who was sought to develop an under- acted in separate squads, pla- opposed to guerrilla warfare, was ground regular army by reorga- toons and companies which were removed from the OUN(B) lead- nizing guerrilla units beginning organizationally coordinated by ership, and Roman Shukhevych, in early 1943. the OUN(B) network and opera- aka Taras Chuprynka, became № 20 (62) november 2013|the ukrainian week|25 history|Resistance movement the de facto head of the organiza- tion. As chief of the Leadership Bureau, he became increasingly involved in developing the UPA jointly with a group of military specialists. After carefully ana- lysing the situation, they launched another round of reor- ganization in autumn 1943. In November 1943, the new UPA Supreme Command was set up and headed by Shukhevych him- self. The Supreme Military Headquarters was also formed and headed by Dmytro “Pereby- inis” Hrytsai. It consisted of seven sections: I – operations, II – intelligence, III – rear services, IV – organization and HR, V – training, VI – political propa- ganda and VII – military inspec- tion. Subordinated to the UPA’s military chief were also the UPA’s communications service Doctors were On a regular basis sanitary kryivka (hiding place) in at a premium. and the Central Technical Com- A group Modelling itself after a regular the territory of each organiza- munications unit, which secured of guards army, the UPA command placed tional kushch (territorial unit contact with the UPA Supreme accompanying great emphasis on discipline. For composed of several villages) and Commander, group command- a doctor and example, in 1943-44 the UPA provide it with all the supplies ers, chiefs of staff and heads of a nurse from had special punitive units to needed to take care of the individual units. the UPA’s which flagrant transgressors wounded and the sick. Each dis- During the reorganization medical service. were sent. In September 1943, trict had to have one clandestine period, the Ukrainian National Peremyshl the UPA Military Field Gendar- hospital able to accommodate up Self-Defence (UNS), which was region, 1946 merie was formed, while police to 15 wounded people. Nearly 100 set up earlier in Galicia, was in- stations dealt with criminal cases professional doctors and 150 corporated in the UPA, contrib- in the zapillia. medical students were recruited uting 5,000-6,000 men. On 18 In 1944, the “forest army” to the UPA Sanitary Service December 1943, Shukhevych also formed intelligence and through the URC network. Hun- signed the order “On Forming counterintelligence services. Fol- dreds of girls from the OUN the Ukrainian Armed Forces” to women’s section were trained as unify and merge the UPA and the nurses. UNS into one insurgent army. Modelling itself after Without a state of its own on In late 1943 and early 1944, a regular army, which to rely, the UPA command the UPA’s field of action covered did its utmost to systematically three krais, or general military re- the UPA command placed supply the army with materiel and gions (in the system of territorial great emphasis on foodstuffs. Following the example division involving the OUN net- of regular military formations, it work and zapillia): UPA North discipline sought to train commissioned and (Volyn, western Polissia, Zhyto- non-commissioned officers, se- myr region and north-western lowing instructions from high cure proper pre-mobilization Kyiv region; commander Dmytro command, intelligence units training and establish a clear sys- Kliachkivsky), UPA West (Gali- were to be set up inside UPA tem for recruiting youth to the cia, the Carpathians, Bukovyna, headquarters and tasked with es- UPA. Most of these issues were Transcarpathia, Kholm region, tablishing a network of agents in addressed by organizational-mo- Hrubeshiv region, Tomashiv re- their areas, as well as organizing bilization and materiel sections in gion, Liubachiv region; com- and guiding reconnaissance and the zapillia or the OUN. They ac- mander Vasyl Sydor) and UPA raiding units. quired and stored weapons and South (what is now Khmelnytsk, In autumn 1943, the under- ammunition to be supplied to mil- Vinnytsia and part of Cherkasy ground of the Ukrainian Red itary units, set up production fa- and Kirovohrad oblasts; com- Cross (URC) and the UPA Sani- cilities to serve the needs of the mander Vasyl Kuk). The UPA Ti- tary Services were formed. The army (repairing weapons, sewing tiunnyk, an okruha group that URC structures operated in zapil- clothes, making footwear, pro- was part of the UPA North group lia, recruiting and training medi- cessing agricultural products, etc.) and active in the Zhytomyr re- cal personnel, collecting medica- and provided foodstuffs to mili- gion, was expected to become tions, medical supplies and in- tary units. They also kept a regis- UPA East, a new krai group struments and setting up ter of men capable of military ser- tasked with operations in Polissia underground medical institu- vice, sought necessary military in Chernihiv and Sumy regions. tions. The URC had to set up one and technical specialists for the 26|the ukrainian week|№ 20 (62) november 2013 Resistance movement|history In 1943-44, the leadership of the OUN’s underground and the UPA’s commanders did the im- possible in laying the founda- tions for a future regular army. However, when they made plans for military capacity growth in late 1942 and early 1943, they had no way of knowing that the front of the great war would cross the Dnieper a year later and completely “flood” the UPA’s mainstay regions by the end of 1944. The arrival of the front, followed by Stalin’s totalitarian regime with its “all-seeing and all-knowing” security services, frustrated existing plans. The established structure of the UPA had to be constantly changed for the purposes of se- crecy and simplicity of com- mand, while some attributes of a UPA, and reinforced and staffed UNR’s army, the Red Army and Before taking regular army (such as the mili- an oath of new insurgent units. members of the Legions of allegiance. tary field gendarmerie) had to be An important task of the mil- Ukrainian Nationalists (Nachti- Graduates abandoned. In 1944 through itary mobilization section was to gal and Roland). Some 60 people of the UPA’s 1946, the UPA South and UPA provide military training to the were trained there in August “Oleni” officer North groups were completely population in cooperation with through December 1943. training disbanded and their remaining other zapillia structures. (In In September 1943, the sec- centre in the staff transferred to the OUN’s 1942, 10,000 people received ond UPA training centre, “Lisovi Carpathians, armed underground. By the end military training in Rivne Oblast Chorty”, was set up and headed July 1944 of 1947, a similar process came alone.) In addition to being by Fedir “Pol” Polovy and Vasyl to an end in the territories of the taught practical and theoretical “Borovy” Brylevsky. It operated Buh, Lysonia and Sian military military science, future con- in Volhynia until January 1944. okruhas. In the “Karpaty Hover- scripts received training in lib- After training 150 men, its staff lia” okruha, incomplete insur- eral arts, politics and ideology. was moved, in February, to a gent companies operated until Young men also received a sound place near Dolyna in the Car- the end of 1949, after which they knowledge of Ukrainian litera- pathians where the third centre, were disbanded on orders from ture, Ukrainian and world his- “Oleni”, was established under tory, geography, geopolitics and the guidance of Stepan “Khmel” The UPA’s comprehensive the ideological foundations of Frasuliak and later Fedir “Pol” Ukrainian nationalism. Evi- Polovy. This centre trained 350 liberal arts and ideological dently, it was largely this com- men, including 230 commis- training compensated for prehensive liberal arts and ideo- sioned and 120 non-commis- logical training that compen- sioned officers. The latter com- its lack of material sated for the lack of material pleted training by mid-June resources and made resources and made insurgents 1944 and the former in July extremely efficient within the 1944. insurgents extremely complex circumstances of the Soviet security agencies that efficient within the struggle. fought with the UPA beginning in early 1944 noted that the in- complex circumstances of Cadres are the key surgents had a good system of the struggle A characteristic feature of the training commanders, involving UPA’s evolution on the model of a four-month training course for higher command and their staff a regular army was the addition commissioned officers and a were moved to the armed under- of military institutions to train two-month course for non-com- ground. Curiously, even after the commissioned and non-commis- missioned officers. Cheka men essential incorporation of the in- sioned officers. Five such centres did not want to believe that in- surgents into underground were set up, providing training surgent commanders could be structures, the Supreme Com- to a total of some 700 officers properly trained underground, mand and headquarters were who took commanding posts in and provided their bosses with kept intact, allowing for a rapid the UPA. The first centre, “Dru- false information claiming that restoration of the UPA’s struc- zhynnyky”, was established in in addition to attending under- ture and its transformation into Polissia and headed by Lev ground centres, UPA officers a regular armed force under fa- “Horyn” Krysko. Its teachers were trained by the British in vourable geopolitical circum- were former officers from the Canada! stances. № 20 (62) november 2013|the ukrainian week|27 Culture & Arts|Music The Master of Musical Compromise Composer Myroslav Skoryk talks about the decline of avant-garde and the mystery of music

Interviewer: yroslav Skoryk is the pa- something that relates to their Bohdan triarch of contemporary hearts, not decipher manmade Butkevych Ukrainian music. Critics technical, albeit very ingenious, Mcall A Melody, his best elements. known piece, which was used in the war-time drama Vysokyi Pere- I compose music based on val (Highland Pass), “Ukraine’s classic traditions but I never spiritual anthem”. He composed shun new techniques. Still, in- operas, ballets and symphonies tuition always matters most. for Ukrainian cartoons and films, Computers, no matter how including Sergei Parajanov’s smart, are not robots that will Shadows of Forgotten Ancestors. do everything for you. They He always managed to find a com- are technology, even if very promise between styles, genres convenient, but do not affect and sounds in his music. The re- the essence of the music sult was high-quality and timely process. I recently com- classical, spiritual and even popu- posed a track for a cartoon lar music. Skoryk has taught many without writing a single generations of musicians starting note. I just played the from 1959 until the present. In tune and computers did 2013, he celebrated his 75th birth- all the rest – harmonized day at the International Days of it, wrote parts for other Myroslav Skoryk’s Music. instruments and all that. It is an interesting THE MYSTERY experience of course, OF EXPRESSION but I think I would have Music should appeal right to done a much better and the soul. That’s what I seek in my more interesting job on music – first and foremost, I want my own. Still, time is to stir emotions in the audience. time – composers must 30-40 years ago, I and several follow it and develop their other Ukrainian composers – Leo- personal style in line with that nid Hrabovsky and Valentyn Syl- context. vestrov – thought that avant- garde music was the future. We I once researched ways to were wrong. Instead of getting express every sound with the more complicated, music became right colour. But it is extremely more primitive or returned to difficult to actually transform mu- classics - a déjà vu of simplifica- sic into visual material on a high tion. People who listen to serious level. I also worked on the chord music now, once more buy Tchai- theory, i.e. a system to make every kovsky, Verdi, Schubert and the note more expressive. But the like. Mass culture is everywhere. more I deal with music, the more I Avant-garde music that had a realize that much of it does not fit more complex harmony and a lot into any schemes or understand- of dissonance went into decline, ing. It’s not even about the fact turning into a ghetto for few fans. that music cannot get more com- In many respects, it was a dead- plicated. When I compose some- end branch of music evolution be- thing, I can’t tell for sure that peo- cause it was unnatural – compli- ple will like it. I can only hope that cation for the sake of complica- they do, investing all my experi-

tion. People want to hear ence and knowledge into it. enk o : S e r gey y rot photo 28|the ukrainian week|№ 20 (62) november 2013 Music|Culture & Arts Still, some pieces have this expres- framework within which a serious BIO siveness that touches the audi- composer had to work. Take Ar- Myroslav Skoryk is a contemporary Ukrainian composer. Born in 1938 in Lviv, he is the great-nephew of Solomiya Krushel- ence, and others don’t. You can’t nold Schoenberg (Austrian- nytska, one of the brightest Ukrainian sopranos of the 20th blame this on technique. Some- American composer of Jewish or- century. In 1947, the Skoryk family was repressed and deported times you listen to a song – it’s not igin who worked in Germany, to Siberia. Only after Stalin’s death in 1955, was the family al- well-done; it’s wrong, primitive, France and the U.S. – Ed.) and lowed to return to Lviv. In 1955-1960, Skoryk studied at the and yet the audience likes it. No- his dodecaphony – the twelve- Mykola Lysenko Conservatory in Lviv. From 1966 through the body knows why this happens be- tone technique he devised, late 1980s, he taught composition at the Kyiv Conservatory, cause it’s a mystery that no music whereby a note is not repeated then worked in the U.S. for a long time, and in Australia until system available today can grasp. until all the other 11 notes of the 1996. In the late 1990s, Skoryk returned to Ukraine. He be- chromatic scale (a chromatic came dean of the History of Ukrainian Music Department at scale has 12 notes) are sounded. the National Music Academy in 1999 and Artistic Director of I prefer to work on my the Kyiv Music Fest in 2002. In April 2011, Skoryk was ap- own music. When I make music He once said that his invention pointed Artistic Director of the Kyiv Opera House. His music is for a project, especially a film, the will help German music to con- played in the U.S., Canada, Australia, France, Germany, Poland, director decides everything. You quer the world in the next 50 the Czech Republic, Slovakia, Russia, Georgia, Armenia and the think that you’ve composed a mas- years. Half a century later that Baltic States. terpiece, but the client does not system has still not generated a agree. What matters here is find- single outstanding composer. ity product and persuaded that ing a compromise between a di- This is because such an approach that’s the way it should be. The rector’s vision – often so trivial is standardized and not serious. less intellectual investment, the that it kills any desire to continue Music should be similar to folk more cash. However, I think the to work – and your efforts. In fact, music in terms of being some- audience is gradually tiring of there is always a way to come to thing that people can relate to. this and turning to better music. terms with everybody. It’s a job af- When American journalists asked Take the Kyiv Music Fest (Myro- ter all. I had a great time working Henryk Górecki, a well-known slav Skoryk is the festival’s Artis- with Sergei Parajanov although he Polish composer, about the sys- tic Director – Ed.). More and was a weirdo and had this Oriental tem in which he worked after the more people come every year, the backslapping habit. Of course, he successful performance of his concerts are sold out, and still had comments about my music symphony in the U.S., he replied: more young people come. This but they were reasonable and ade- “I don’t give a damn about those proves that today’s primitiveness quate. One day, he asked me to systems.” is something unnatural and will compose a tune of death. I showed die out under normal influences. it to him. “No, this will be the tune Classical music is elite in of love,” he said. Okay, I thought, essence, so should not be im- The increasingly popular let it be love. posed on the audience. This is electronic music operates what the Soviet government was with sounds rather than mel- I have never been member doing. It is largely why Ukraini- odies. It’s more of a sonorous of any political party. I was in- ans first rushed to love things like mix of noises – sometimes even vited to join many times, espe- Besame Mucho, and later well-composed – than real music. cially the Communist Party of the switched to low-grade pop music. I don’t think it’s possible to com- Soviet Union. I always came up The idiotic persecution, whereby pose a serious piece of music with excuses to delay this - “I have someone who listened to the “im- based on sounds. But to each his to think about it”, “I’m not ready moral” Besame Mucho could have own. Live instruments are still yet” and the like. After Ukraine been put in jail, only aggravated the best option in symphonic mu- became independent, I decided to this. sic – the area I work in. Still, elec- stay out of politics. Of course, you tronic substitutes are so good can’t live in a society and be abso- Pop music has taken over now that they are even better for lutely free of it and its norms. I everything in recent decades. pop music because they require had to compromise sometimes, Of course, any music is necessary fewer resources. but only when it wasn’t about and all music must have its niche. something I regarded as really se- If you come to a strip bar, you The current situation in rious. What matters most to a mu- don’t need Brahms. After all, I music reminds me of the 18th sician is to compose music first used to play and compose quite a century in many internal and and foremost, he/she can’t dis- few entertainment pieces myself. external aspects. Composers perse him/herself into various ac- However, 90% of what is called and musicians both find it diffi- tivities. So I tried to stay out of any show business today is blatant cult to survive without rich do- political activity or dangerous is- kitsch, not to mention plagiarism. nors and sponsors. Music is also sues, although I fully supported There is too little professionalism experiencing a certain stagnation the patriotic concepts of the Six- in the industry now. And there is and lack of new bright names. I ties’ dissidents. a huge tilt towards primitive mu- can’t really name any great com- sic. People who want to think posers right now. Most of those PLAYING IT DOWN about the sense of life or some- whom we view as the best com- Music cannot be built on thing more complicated will have posers are not. But a new Bach standards. For a long time, it to opt for Brahms after all. In may well be ripening somewhere. was very important in the U.S. to many aspects, this is a downgrade Perhaps he has even composed have a solid music system with in the music industry, i.e. people some pieces but they are yet un- clear-cut borders, rules and a are intentionally fed a poor qual- known. № 20 (62) november 2013|the ukrainian week|29 Culture & Arts|events 2 November, 7 p.m. 3 November, 19:00 Through 6 November, 7 p.m.

Marcus Miller Ennio Morricone Document International Culture and Arts Ukraine Palace (103, vul. Velyka Bilshovyk shopping mall Centre (1, vul. Instytutska, Kyiv) Vasylkivska, Kyiv) (6, vul. V. Hetmana, Kyiv)

Well-known jazzman, multi-in- The maestro and composer will The second interna- strumentalist and composer Marcus give an amazing present to the Ukrai- tional theatre festival, Miller will present his new album, Re- nian audience on his 85th birthday. En- Document, kicked off naissance, in Kyiv this fall. His distinct nio Morricone has devoted 50 years of in Kyiv, Lviv, Odesa, style and resonating elastic bass his life to composing music for mas- Kherson and Kharkiv sound, much like the twang of a bow- at the end of Octo- string, makes Marcus Miller’s music ber. The goal of the unique and easily-recognized. The festival is to share expe- new album features the work of a big riences and encourage doc- team of jazz performers, including umentary theatre artists to communi- saxophonist Alex Han, pianists Fed- cate and exchange ideas. The Kyiv sec- erico Gonzalez Pena and Kris Bowers tion will offer a reality show with the and jazz singer Gretchen Parlato. The intriguing incomprehensible title audience will hear their wonderful лЕ29дЕ31нЕ30ц - 90 minutes of con- creation this coming Saturday night. sumer space. The title is a code of the names of the playwrights and direc- terpieces of world cinematography. tors who worked on it, including E29 Although his name is mostly associ- for playwright Tetiana Kytsenko and ated with soundtracks to modern cult director Tamara Trunova; E31 for play- movies, the pieces are more than just wright Dan Humennyi and director film music – they have a life of their Olena Roman, and E30 for playwright own. Ukrainian fans will hear tunes Oksana Savchenko and director Andriy from some of their favourite movies, Mai. Apparently, the artists have bor- including Malena, Once Upon a Time rowed their codes from symbols for in America, Django Unchained and artificial food components used on others. product labels in Ukraine.

8 November, 7 p.m. 15 – 17 November From 15 November Goran Bregovic Night in Lviv 2013: New British Film Festival International Culture and Arts November – 2013 Centre Ploshcha Rynok, Gallery-Café Kyiv Movie Theatre (1, vul. Instytutska, Kyiv) Shtuka, Museum of Religious (19, vul. Velyka Vasylkivska, History and other venues Kyiv) The fall concert season would not (8, vul. Kotliarska; 1, Museina be complete without a vibrant show Ploshcha, Lviv) As always, film lovers will have from the world-renowned Balkan the opportunity to see a series of the composer Goran Bregovic. Along with Ukrainian premieres and projects of his Wedding and Funeral Orchestra, British cinematography. This year’s Bregovic will present his new pro- festival is the thirteenth, featuring gramme. His music is always a unique eight new movies. Diana is a melo- combination of otherwise opposite drama that reveals the secrets of the music genres – Balkan folk music, last two years of Princess Diana’s life symphonies and rock. Make sure to and love. Hyde Park on Hudson is a book your tickets in advance – Ukraini- story about the re- ans love his fusion of Gypsy rhythms Night tours are becoming yet an- lationship between and traditional Bulgarian music. other of the many attractions of Lviv, the US President Frank- cultural heart of Ukraine. The Night in Lviv lin Roosevelt and promotion campaign now takes place his cousin. The twice a year – in July and November. This story of a young fall programme features around 100 couple’s toad trip is night-time attractions for everyone. You the plot of the will have the opportunity to attend plays black comedy, by the Voskresinnia (Resurrection) The- Sightseers. The atre, a wide range of city tours including Selfish Giant, di- one to the historic Lychakiv Cemetery, a rected by Clio Bar- fashion night, numerous concerts, gigs nard, is based on and workshops. This is a destination for Oscar Wilde’s fairy anyone seeking a blast of joy and fun. tale. 30|the ukrainian week|№ 20 (62) november 2013

Navigator|Western Ukraine A Monastery by the Devil’s Rock The walls of the True Cross Monastery in Pidkamin are like an open history book bearing traces of the Batu Khan invasion, two world wars and Soviet occupation

Article and n their own way, all neglected Pidkamin and the monastery of was the steep slope that bulldozers photos by architectural sites have some- the Dominican Order are first men- could not navigate. Today, the Olena thing miserable in common. tioned in records from the 15th monastery belongs to the Greek Maksymenko IThe Monastery of the Origin of century. A century later the town Catholic Church and the few the True Cross in Pidkamin, a vil- was attacked once again and the monks living there are restoring lage in Brody Region, Lviv Oblast, monastery was demolished. It was the shrine on their own. Unfortu- looks far from miserable. But all restored to its present form in the nately, the mighty defensive walls historical turmoil since medieval 17-18th centuries. The construction cannot protect it from corrosion times has left a trace on its walls, was interrupted twice because the and decay. The monks claim that as if in an open book. roof collapsed as a result of errors the copper gilded column crowned Now a village, Pidkamin used in the design, and the beginning of with the sculpture of the Mother of to be the Town under the Stone – the liberation war. God in the monastery’s courtyard this is what the name means in has begun to turn from green to Ukrainian. Legend has it that it Thrice-born gold since they settled there. Pho- once sheltered 12 monks fleeing The First and the Second World tographs taken over the years con- Kyiv in 1234 during the devastating Wars also left their devastating firm this: the golden streak is grad- invasion by Batu Khan. They built marks. The library burned down ually growing from top to bottom. a chapel and set up a cross but did along with the books, the cathedral The state does not allocate any not survive long. The Mongol inva- was shut down, and the monks funds for restoration while the sion reached their village, the were deported to Siberia in the walls continue to crumble, so shrine was destroyed and the 1940s. The monastery switched NGOs and private companies are monks were killed. According to from being a prison and torture helping the monks. NGOs organize other assumptions, the first fortifi- chamber, to a morgue for victims volunteer camps where young peo- cations at the spot where the mon- of the plague, to a warehouse for ple from different countries come astery now stands were built based fertilizers – their chemical fumes to help the monks restore the on a project by Danylo Halytskyi ruined ancient frescoes, to an asy- church. Private companies provide (Daniel of Galicia), Prince of lum which still occupies part of the technical assistance. The result is a Halychyna, who designed defences monastery. The only thing that weird combination of brand new on the inaccessible slopes of the prevented Soviet authorities from plastic windows in old time-worn land there. leveling the church to the ground walls. 32|the ukrainian week|№ 20 (62) november 2013 Western Ukraine|Navigator The priests and monks eagerly tre high rock may have been a started mining rock to expand the show people around and share shrine in the early Iron Age. Find- monastery, so the caves became their stories. The grand church ings from the 11-7th centuries B.C. much deeper. Apparently, the un- with its bell tower was once a confirm this. Geologists claim that derground caves served as cave prison. On the brink of death, peo- Devil’s Rock is a piece of coral reef churches or cells for the first ple burned anything they could to that appeared here millions of monks. Rebels found shelter here keep warm, including icons. But years ago when the terrain was in times of trouble and hid their they rescued a man-sized gothic under the sea. treasures in the caves. The caves crucifix – they threw it over the Some sources stated that the could well be connected to the fence to the locals. This is now in rock had been a pagan shrine: a monastery’s underground tunnels. its proper place next to the altar. special niche underneath had sup- The underground church officially posedly been used for sacrifices to Saved by music? called “the winter church” has hid- the gods. According to other as- Since 2007, Pidkamin has mostly den tunnels leading to the Devil’s sumptions, the rock had been in been associated with the annual in- Rock, since the monastery served the foundation of the ancient ternational ethnic rock festival of as a defence fortress in addition to wooden fortification mentioned the same name. Every year, more being a shrine. This is now a pil- above. It is believed that Oleksa and more young people come here grimage destination, the monks tell Dovbush – a Ukrainian Robin seeking music and drive, and Devil’s stories of the blind getting their Rock becomes the heart of the vi- sight back and of people recovering brant groove. The locals benefit from serious illnesses. They also The state does not allocate from this too: this year’s festival had share stories about ghosts rest- any funds for restoration nearly 40,000 guests and organiz- lessly haunting the monastery. The ers claim that this is not the limit. fortification offers a breathtaking while the walls continue The special thing about the view of the Pochayiv Monastery to crumble, Pidkamin festival is that it remains and the beautiful surrounding free and open to everyone, while area. so NGOs, volunteers and doing its best to catch up with com- After all these walls have gone private companies are mercial festivals. In addition to the through, they still have a powerful music programme, it offers a liter- atmosphere in the air. Being here helping the monks ary event and a movie night. feels light and serene. You just Thus, the new tradition has want to freeze for a moment, sit- Hood, used the rock as one of his added a further layer to living his- ting for hours on the bulwarks un- observation points. Today, the reef tory. Once the festival is over, life der the strong and kind walls. This rock challenges all lovers of ex- returns to its normal quiet provin- place remains more powerful than treme activities: climbing it is a real cial rhythm. The locals take care of any human evil. challenge. their cattle, hang laundry in their The rock is surrounded by backyards, ride horse-pulled carts; Rising from the deep seas stone crosses and tombstones from young people party in village clubs The Devil’s Rock is smaller in size the 17th century. Some sources say and pubs; masses are held in but as legendary and mysterious that these are Cossack graves. Oth- churches every day, even if no-one as the monastery. According to lo- ers claim this to be a cemetery – all attends. Because of its neglected cal lore, the devil once got mad at that remains of the Savior Church. appearance, the Pidkamin Monas- the Dominican monks, tore off a The tombstones stand over the tery is not mentioned in most piece of the Carpathian Mountains graves of pioneer monks who came guidebooks. But this may be for the and threw it at the monastery. The here from Kyiv. Caves are located better: its doors will still be open to piece did not reach it. According nearby in the brushwood. Initially, everyone, while the serenity will to archeologists, the huge 16-me- they were natural but the monks not be disturbed.

№ 20 (62) november 2013|the ukrainian week|33 Navigator|Interstellar travel Starship Troupers If starships are ever built, it will be in the far future. But that does not deter the intrepid band of scientists who are thinking about how to do it

pace, as Douglas Adams low-up to a larger shindig held ear- the possibilities offered by rockets pointed out in The Hitch- lier this year in San Diego. powered by a series of nuclear ex- hiker’s Guide to the Galaxy, Starship research is enjoying plosions. Then, in the 1970s, the Sis big. Really big. It is so big, something of a boom. “A few years BIS designed Daedalus, an un- in fact, that even science fiction ago, there was only one organisa- manned vessel that would use a fu- struggles to make sense of it. Most tion in the world working on inter- sion rocket to attain 12% of the sci-fi waves away the problem of stellar travel,” Jim Benford, a mi- speed of light, allowing it to reach the colossal distances between crowave physicist and former fusion Barnard’s Star, six light-years away, stars by appealing to magic, in the researcher, told the conference. in 50 years. That target, though not form of some kind of faster-than- “Now there are five.” The following the nearest star to the sun, was the light hyperdrive, hoping readers day many of the speakers at the nearest then suspected of having at will forgive the nonsense in favour event would visit the British Inter- least one planet. of enjoying a good story. planetary Society (BIS, the venera- But there are scientists, engi- ble organisation of which Dr Ben- How final a frontier? neers and science-fiction writers out ford spoke) to discuss design details After Daedalus, interest flagged. there who like a challenge. On Octo- for a starship named Icarus. Lately, though, several develop- ber 22nd a small but dedicated audi- Starship research has always ments have given the field a shot in ence gathered at the Royal Astro- been a small field, full of iconoclasts the arm. nomical Society (RAS) in London to and dreamers fitting the activity The internet has made it easier hear some of them discuss the latest around their “proper” jobs. Serious for like-minded dreamers to get in ideas about how interstellar travel work in the field dates back to 1968, touch. Astronomers have discov- might be made to work in the real when Freeman Dyson, an indepen- ered thousands of alien planets (in- world. The symposium was a fol- dent-minded physicist, investigated cluding, possibly, one around Alpha

34|the ukrainian week|№ 20 (62) november 2013 Interstellar travel|Navigator Centauri B, which at 4.4 light-years least to slow down. Only Project to explore space just outside the so- away is part of the star system that Longshot, run by NASA and the lar system, rather than flying all the actually is closest to the sun), and American navy, envisages actually way to another star, would require this exoplanet boom has caught the stopping on arrival and going into as much electrical power as a small public’s imagination, as well as giv- orbit around the star to be studied. country—beamed, presumably, ing starship researchers a list of des- But nuclear rockets have prob- from satellites orbiting Earth. A true tinations. The rise of the private lems of their own. For one thing, interstellar machine moving at a space industry, which aims to slash they tend to be big. Daedaluswould tenth of the speed of light would the cost of getting into orbit, brings weigh 54,000 tonnes, partly be- consume more juice than the en- hope that the sort of orbital infra- cause it would have to carry all its tirety of present-day civilisation. structure which would be needed to fuel with it. That fuel itself has mass, The huge distances involved mean build a starship might one day be and therefore requires yet more fuel that everything about starships is developed. And the involvement of to accelerate it, a problem which big. Cost estimates, to the extent DARPA, an arm of the American quickly spirals out of control. And they mean anything at all, come in defence department, which is spon- the fuel in question, an isotope of multiple trillions of dollars. soring a long-term project to de- helium called 3He, is not easy to get That illustrates another question velop the sorts of technology a star- hold of. The Daedalus team as- about starships, beyond whether ship might require, has brought sumed it could be mined from the they are possible. Fifty years of engi- money and attention. neering studies have yet to turn up The chief problem, as Adams A true interstellar machine an obvious technical reason why an noted, is distance. During the cold unmanned starship could not be war America spent several years moving at a tenth of built (crewed ships might be doable and much treasure (peaking in 1966 the speed of light too, although they throw up a host of at 4.4% of government spending) to extra problems). But they have not send two dozen astronauts to the would consume more juice answered the question of why any- Moon and back. But on astronomi- than the entirety one would want to go to all the trou- cal scales, a trip to the Moon is ble of building one. nothing. If Earth—which is of present-day civilisation Ian Crawford, an astronomer at 12,742km, or 7,918 miles, across— Birkbeck College, London, pointed were shrunk to the size of a sand atmosphere of Jupiter, by humans out that sending a robotic probe to grain and placed on the desk of The who had already spread through the another star would be much better, Economist’s science correspondent, solar system. scientifically, than studying it the Moon would be a smaller sand A different approach, pioneered through telescopes. He even pre- grain about 3cm away. The sun by the late Robert Forward, was sented a checklist of the instruments would be a larger ball nearly 12 me- championed by Dr Benford and his such a mission should carry, and of tres down the hall. And Alpha Cen- brother Gregory, who, like Forward the questions—in stellar physics, tauri B would be around 3,200km was, is both a physicist and a sci- planetary science and general as- distant, somewhere near Volgograd, ence-fiction author. The idea is to tronomy—it could be designed to an- in Russia. leave the troublesome fuel behind. swer. But for many of those attend- Chemical rockets simply cannot Their ships would be equipped with ing such conferences, “because we generate enough energy to cross sails. Instead of filling them with can” would be reason enough to try. such distances in any sort of useful wind, an orbiting transmitter would Several speakers at the RAS time. Voyager 1, a space probe fill them with energy in the form of agreed that a starship would not be launched in 1977 to study the outer lasers or microwave beams, giving feasible until such time as human solar system, has travelled farther them a ferocious push to a signifi- beings had spread through most of from Earth than any other object cant fraction of the speed of light Earth’s solar system, and possessed ever built. A combination of chemi- which would be followed (with luck) an economy able to command the cal rocketry and gravitational kicks by an uneventful cruise to wherever resources of more than one planet. from the solar system’s planets have they were going. Whether that day will arrive is an boosted its velocity to 17km a sec- Without fuel, the ships could be open question. Gregory Benford ond. At that speed, it would (were it small, and therefore easy to acceler- said that Thomas Jefferson, Ameri- pointing in the right direction) take ate. They might even be able to stop ca’s third president, guessed it more than 75,000 years to reach Al- at their destinations by employing might take a thousand years for the pha Centauri. the solar wind of the target star to American frontier to advance to the Nuclear power can bring those slow themselves down, using a sec- Pacific Ocean. Humans are bad at numbers down. Dr Dyson’s bomb- ond, so-called magnetic sail. The prediction, Dr Benford argued, and propelled vessel would take about basics of the technology already ex- often things thought on the edge of 130 years to make the trip, although ist: microwave sails have flown in possibility happen faster than any- with no ability to slow down at the laboratories. And the transmitter one would have believed. other end (which more than dou- could be reused, which would make Of course, the past is not neces- bles the energy needed) it would zip such ships cheaper than one-shot sarily any guide to the future, and through the alien solar system in a nuclear rockets. the magnitude of the problems in- matter of days. Daedalus, though © 2013 The volved in space exploration dwarf quicker, would also zoom right past Economist Because it’s there any earthly analogy. Gregory Ben- its target, collecting what data it Newspaper “Cheaper”, though, is a relative ford may be wrong. But he and his could along the way. Icarus, its spir- Limited. All term. Jim Benford reckons that fellow starship designers are, by ne- itual successor, would be able at rights reserved even a small, slow probe designed cessity, an optimistic bunch. № 20 (62) november 2013|the ukrainian week|35 B OOKST ORES KYIV 3, vul. Lysenka tel: (044) 235-88-54; 5,vul. Spaska tel: (044) 351-13-38, 33/2, Povitroflotskiy Prospekt tel: (044) 275-67-42 LVIV 7, Prospekt Svobody tel: (032) 235-73-68 VINNYTSIA 89, Soborna tel: (0432) 52-9341 TERNOPIL 7-9, vul. Valova tel: (0352) 25-4459 KHARKIV 3, vul. Sumska tel: (057) 731-5949 IVANO-FRANKIVSK 31, vul. Nezalezhnosti tel: (0342) 72-2502 VOLODYMYR-VOLYNSKIY 6, vul. Kovelska tel: (03342) 2-1957 www.book-ye.com.ua

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