[26.08.03]

On August 18 the redeployment of the Ukrainian peacekeepers ended. In the end of August they began patrolling operations together with the U.S. troops.

Oleh Khanenko was approved one of three Ukrainian representatives in Iraq's provisional coalition government. He will be in charge of collecting aid proposals for Iraq coming from the donor countries so as to coordinate them in conformity with real needs of the country.

It is planned that this government will include two more representatives from Ukraine.

On August 27 President Kuchma signed a decree on rendering humanitarian aid to Iraq.

Constitutional reform

On August 24 Ukraine celebrated its national holiday - the Independence Day. Twelve years ago on August 24 Ukrainian parliament adopted a decision for secession of Ukraine from the USSR and its independence.

In a large speech to mark the holiday (August 23) President Kuchma said, in particular, that he is ready to support a new agreed draft of amendments to the Constitution. Two days earlier there an information passed that the consultations between presidential chief of staff Viktor Medvedchuk and leaders of major left-wing parties - Petro Simonenko (Communist party) and Oleksandr Moroz (Socialist party) resulted in an agreement on a new draft constitutional reform, which would replace the two drafts put forward earlier.

A draft worked out earlier by the lawmakers will underlie this new draft. The president has already informed that he would recall his draft bill introduced in July.

The matter in question is the transfer to the existing system of the presidential-parliamentary republic to the system of the parliamentary-presidential republic. New presidential elections will be held in 2004 (so, their term won’t be changed). The president's powers, starting from 2004, will be substantially limited. The right to form the government will go to parliament. The issue of parliamentary elections on the basis of the proportional system, just as the question of the election of the president by parliament, as far as is known at the present stage, are still dubious. The agreement of the draft most likely is being finalizes at present.

Leaders of the parliamentary majority factions have already said that they are ready to bolster the new draft bill. If it, as expected, is backed up by the left-wing factions, then this draft will collect two thirds of votes (301 out of 450) necessary to bring about changes in the Constitution.

Spokesmen of the "Viktor Yushchenko bloc" and the "Yuliya Tymoshenko bloc" expressed their disagreement with the draft. Their main argument is the statement that the authorities, according to their views, enjoy very little support in the society and therefore have no right to carry out the reform.

The other important points in the presidential speech made on August 23 were:

• stringent criticism of corruption in the society and, first of all, in law-enforcement structures;

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• necessity to strengthen the role of the Council of National Security and Defense.

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Achievement of centrist agreement

A report came on August 21 that six centrist parties signed an agreement providing for the promotion of the political reform and nomination of a common candidate for the presidential elections. This agreement is open for other political forces.

Commentary. This is a first decisive step in nominating a common candidate at the presidential elections from the centrist forces. The 6 parties mentioned above are encompassed by the parliamentary majority, but do not form its whole majority. Thus "a majority is formed inside the majority".

On August 22 prime minister Viktor Yanukovich visited Moscow. An official reason: participation in a great reception in the Ukrainian embassy to mark the Independence Day. In addition, he had an informal meeting with Russian prime minister Mikhail Kasiyanov.

On August 27 President Kuchma fired minister of internal affairs Yuri Smirnov and appointed Mykola Bilokon as the new minister. As expected this is not the last dismissal. In his speech on the occasion of the holiday President Kuchma sharply criticized corruption in Ukraine's law-enforcement agencies.

Minister of foreign affairs of Afghanistan Abdullah Abdullah visited Ukraine on August 27. At the meetings with President Kuchma and minister of foreign affairs Anatoly Zlenko they mainly discussed issues of the participation of Ukrainian companies in restoration of Afghanistan.

The all-Ukrainian association For Ukraine! For Yushchenko! was set up on August 21. Lawmaker Yuri Yekhanurov became its president. Viktor Yushchenko himself became an honorary chairman of the association.

The 8th World Congress of Ukrainians was held in Kiev on August 18-21. Such previous congresses were held in the USA and Canada. Askold Lozinsky was again elected its president.

Direct foreign investments

The level of direct foreign investments to Ukraine during the first half of this year increased by 10.5% or by $573.6 million and as of July 1, 2003 reached $6,037.5 million which makes up $126 per one citizen of Ukraine.

In the first half year of 2003 foreign investors made $581.8 million of direct investments including investments from the CIS countries: $29.8 million (5.1% of the overall level) and $552 million (or 94.9%) from other countries of the world.

Nonresidents withdrew $123.2 million of capital.

Cash investments ($351.8 million) accounted for 60.5% of the invested level, whereas movable and real property ($192.3 million) accounted for 33.1% of it.

The investments came from 114 countries of the world and in this case the largest investments were made by the nonresidents from the U.S. - $997.6 million (or 16.5% of the total volume), from Cyprus - $631.1 million (10.5%), the United Kingdom: $564.7 million. (9.4%); Virgin Islands: $481.4 million (8%); the Netherlands: $410.7 million. (6.8%); Germany: $359.7 million (6%; Russia: $342.9 million (5.7%); Switzerland: $300.1 million (5%) and Austria $243.3 million (4%).

These 9 countries account for 71.9% of the total level of direct investments to Ukraine's economy.

Since the beginning of the year the levels of direct investments from the U.S. increased by 11.3%.

Food industry is the most enticing for the U.S. investors and accounts for 14.8% of the total level of investments from the U.S., metallurgy and metal working (14%) just as wholesale trade and intermediate trade - 12.1%.

In this case the levels of U.S. investments in metallurgy and metal working since the beginning of the year have increased 2.8 times up to $139.9 million; in food industry and agriproduct processing - by 2% up to $147.5 million, while in wholesale trade they have decreased by 3.2% that is $120.8 million.

The U.S. investments over six months this year have substantially increased as well: in transportation and communication by 7.2% up to $50.4 million; chemical and petrochemical industries: 4.1% up to $27.9 million; agriculture, hunting and related services by 3.1% up to $28.6 million.

The levels of investments from the U.S. in the hotel business since the beginning of the year have reduced by 1.1% and amounted to $85.8 million, while there were no investments in construction, generation and distribution of power, natural gas and water and as of July 1, 2003 totaled $59.9 million and $46.8 million.

Ukraine ranks sixth in the world in the sales of arms

In deliveries of products of military purpose Ukraine holds the sixth place in the world.

General director of the state company UkrSpetsExport Valeriy Shmarov informed the public about it at the international MAX-2003 aerospace show (Russia).

In the overall world export levels of military-purpose products Ukraine ranks sixth after the U.S., Russia, France, Great Britain and Germany.

It is planned that in 2003 Ukrainian export of military products will increase by 20 percent.

V. Shmarov noted that "the tendency for growth remains and mainly owing to knowledge-intensive products".