Ukraine's President Kravchuk Cements Relations With US

THIS week's US Department of Commerce conference on American-Ukrainian investment and trade opportunities reflects the speed with which bilateral relations are progressing.

Ukrainian President Leonid Kravchuk - former communist, now a nationalist - frequently refers to Ukraine as a European country and himself as an internationalist. The leader of the second-largest former Soviet republic is particularly proud of his nation's developing ties with the United States.

During a recent visit to Washington, he boosted Ukraine's status with the US on two fronts: military and economic.

He assured President Bush of the removal of all nuclear weapons from Ukraine and pledged to sign the non-proliferation treaty and to carry out Ukraine's portion of the Strategic Arms Reduction Treaty (START) which was negotiated with the now-defunct Soviet Union.

Satisfied with Ukraine's cooperation on the nuclear issues, the Bush administration committed $10 million toward the Ukraine Science and Technology Center established for local weapons scientists and engineers to redirect their efforts to civilian pursuits.

President Bush signed an Overseas Private Investment Corporation agreement providing US government investment insurance, project financing, and other incentives to US investors in Ukraine. He also announced $110 million in food credits for Ukraine and promised most-favored-nation status for that nation.

Mr. Kravchuk's optimism about relations with the West is in obvious contrast to his pessimism concerning Ukraine's future in the Commonwealth of Independent States. Back home after the high-profile visit to Washington, Kravchuk spurned an invitation to a May 15 CIS summit in Uzbekistan, further undermining cooperative efforts among the successor states of the ex-Soviet Union. The dissolution of the old Communist empire unleashed a bitter historical rivalry between Ukraine and Russia. Exacerbating tensio ns is Russian President Boris Yeltsin's refusal to cede to Kravchuk's request to use the CIS summits to divide Soviet property, embassies and other assets once commonly shared by all republics.

The six-month-old Ukrainian government is wary of Russian domination in the post Soviet scenario and anxious to make its mark as a strong sovereign state.

Says Serhiy Kulyk, First Secretary at the Ukrainian Embassy in Washington: "We are the new nation in the international arena."

SINCE the early stages of the Soviet Union's disintegration, Kravchuk has been eager to win US recognition as an important partner. Months before Ukraine held its first presidential election and a referendum on independence, last December, Kravchuk told US Ambassador (to the then-Soviet Union, now Russia) Robert Strauss he would gladly find housing for a US embassy, not the consulate space requested by Washington. But first, he said, the US would have to find a site for Ukraine's embassy in Washington. He came to Washington to inaugurate his new, three-man embassy, which opened May 5.

A confident Kravchuk addressed more than a hundred American business leaders recently at the US Chamber of Commerce. Soliciting US corporate interest, the Ukrainian leader explained that his economic advisers are absorbed in creating stable conditions for investment, including a Ukrainian national currency and a legal framework that protects the intellectual property, repatriation of profits, and other rights of foreign investors.

Ukraine's top priority is to convert the massive old military machine into civilian production lines, he said.

"The plants that need conversion have good workers. I can assure you that if you'd like to help in that area, we will create every condition for you," he told the US business leaders. "Come, you will see some new entrepreneurship, and maybe some bureaucracy, but let's fight the bureaucracy together."

Mr. Kulyk, now busy with the Commerce Department conference, is trying to cut through his country's red tape, build US-Ukrainian commercial ties, and "attract US capital to Ukraine." He cites "good incentives, such as tax holidays," as lures for American investors. On this and other levels, he says, "we favor bilateral, not CIS, relations with the US."

Deputy White House spokesman Roman Popadiuk has been appointed the new US ambassador to Ukraine.