Kharkiv Agreements With Russia is the Key for Ukraine's Continuous Economic Growth

By Volodymyr Oliinyk Peoples Deputy Of The Vekrhovna Rada Of Ukraine, PRNE
Tuesday, April 26, 2011

KYIV, Ukraine, April 27, 2011 - Today marks the first anniversary since Ukraine-Russia
strategic so-called Kharkiv agreements became effective. One year ago, the
Presidents Viktor Yanukovych and Dmitry Medvedev agreed onthe new terms of
gas supplies from Russia to Ukraine, with the latter being the main transit
corridorfor Russian natural gas to the European Union.

The key provisions of the "Kharkiv agreements" entered into force on
April 27, 2010 were the prolongation of the stay of Russia' Black Sea fleet
in Ukrainian Crimea until 2042. In return, Ukraine was provided a 100 USD per
thousand cubic meters discount, if the gas price is higher than 333 USD or
30% discount if the price goes lower the mentioned amount. The price of the
natural gas is calculated according to a special formula essentially
depending on the world's crude oil price.

The previous agreement, signed by the Prime Minister
YuliaTymoshenko in 2009, provided for the base price of 450 USD per thousand
cubic meters. The ruling party representatives claim that YuliaTymoshenko had
abused her powers by signing the gas agreements in 2009 without government's
approval. Instead, The new agreement have become the way out of recession for
Ukraine, says anofficial statement of the Ukrainian ruling Party of Regions.

"Due to Kharkiv agreements President Yanukovych was able to
stop the devastating scenario. The 100 USD per thousand cubic meters
discount, in fact, saved major economic sectors from being destroyed,
stabilized and increased export activity and saved thousands of jobs. As a
result, the state budget received target revenues", - said VolodymyrOliynyk,
key representative of the ruling Ukrainian Party of Regions at a press

"The one who agreed to a base price of $ 450per thousand
cubic meters should answer for the billions in losses incurred by the
national economy. This was a true criminal intent that bore huge economic and
political damage to the country", sums up the Party of Region's statement.

Ukraine's economy is based on heavy industry, which consumes around 20
billion cubic meters of gas annually. Economic expertscalled450 USD a
"killing" price for Ukraine's chemical industry and critical for the steel
industry, Ukraine's two main underpinnings of the economic growth.

For more information, contact Volodymyr Oliinyk +380442553551, oliinyk.volodymyr at, People's Deputy of the VekrhovnaRada of Ukraine, Party of Regions

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