Ukraine-Russia relations: Why Kiev made a dramatic U-turn back toward Moscow
President Viktor Yanukovich was elected in February on pledges to restore Ukraine-Russia relations. But he has acted more swiftly than anyone imagined, reversing the pro-West moves of the Orange Revolution.
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Analysts say there is little chance that Yanukovich will be willing to revisit the ambitious program of economic reunification, called the Common Economic Space plan, which included a customs union and movement to a common currency, that Putin advocated before the 2004 Orange Revolution brought Yushchenko to power.Skip to next paragraph
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Ties to boost nuclear, aviation industries
Some Ukraine analysts say Putin's idea of merging the nuclear power industries of the two countries is very welcome in Kiev, because it would bring much-needed Russian assistance to complete the long-stalled Khmelnitsky atomic power station, and a 25-year contract to provide fuel for Ukraine's four existing nuclear plants at sharply discounted prices. Russia might benefit, too, because its own grand nuclear expansion plans have stalled for lack of international customers.
Another Putin proposal, to join the two states' aviation industries, is aimed at Ukraine's struggling Antonov, maker of giant Soviet-era cargo planes, which could be revived by an influx of Russian capital and expertise, say experts.
But there are signs that Yanukovich is already balking at Putin's latest suggestion to merge Ukraine's state gas company Naftohaz with the Kremlin-run natural gas behemoth Gazprom.
Critics say the scheme actually amounts to a takeover of the Ukrainian firm, which is barely a tenth the size of Gazprom, along with its lucrative pipeline network -- through which 80 percent of Russian gas exports to Europe flow.
"[Putin's suggestion] was quite unexpected, and it doesn't follow that we will accept it," the official Russian ITAR-Tass agency quoted Yanukovich as saying Thursday. "We are interested in building up gas transit, but our key policy is that of protecting Ukraine's interests."
Support for Yanukovich tied to economy
If the thaw with Moscow brings tangible economic benefits to Ukraine's crisis-hit population – something Yushchenko signally failed to do –Yanukovich may continue to get his way, both with the Rada and Ukraine's electorate, analysts say.
"During the time of the Orange leadership the Ukrainian people did not see benefits from the expansion of democracy and pluralism; unfortunately it was not a time of rising living standards," says Masha Lipman, an expert with the Carnegie Center in Moscow.
"So, if Yanukovich can deliver this, then political issues such as Ukraine's increasing dependence upon Russia may be easier for him to handle," she says. "But it's a mistake to think that Ukraine, or any other former Soviet country, is going to opt to become a satellite of Moscow. That's not in the cards."
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