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Committee on International Relations
U.S. House of Representatives
Washington, D.C. 20515-0128

Hearing of the House International Relations Committee,
on "Ukraine's Election: Next Steps"
Testimony by Ambassador John Tefft, Deputy Assistant Secretary
for European and Eurasian Affairs
Tuesday, December 7, 2004

Mr. Chairman, Members of the Committee, I am pleased to be here today to discuss with you current developments in Ukraine and U.S. policy.

As requested, I shall provide our assessment of the problems in the election that led to the current crisis, the U.S. position on the negotiations and other efforts aimed at resolving the crisis, the lessons learned in the earlier votes that could be useful in helping avoid a repeat of the fraud and abuse, the role of U.S. policy in helping to resolve the crisis, the impact of the current situation on other countries in the region, and an assessment of U.S. policy options for the period after the situation is resolved.

Development of the Current Situation

More than a dozen years ago, Ukrainians chose freedom and independence and set their country on a path toward democracy and prosperity. This path has not been easy, but the Ukrainian people have remained committed to the principles of independence and self-determination. We now see the depth of that commitment on the streets of Kiev and all over Ukraine.

The current crisis came to a head when the Ukrainian people rejected the massive fraud and abuse that characterized the November 21 second round of the presidential election. The numerous problems that characterized the voting in the election's second round, however, were the culmination of months of irregularities, intimidation, and abuse by the pro-presidential side. In fact, the entire presidential campaign for almost the last year was plagued by difficulties. In his testimony before your Subcommittee on Europe last May, my predecessor, Deputy Assistant Secretary Steven Pifer, described in detail the many problems in the electoral campaign, including harassment of opposition politicians and those who supported them; obstruction and preclusion of opposition campaign events; abuse of state resources to support the government's candidate, Prime Minister Viktor Yanukovych; a near-monopoly of media attention for Yanukovych; violence and intimidation directed against independent media outlets; and eleventh-hour attempts to change the Ukrainian Constitution to extend the current authorities' hold on power. Despite strong messages from the United States, including from President Bush, and the international community against such actions, the Ukrainian authorities made little effort to rectify these imbalances. These problems in the campaign persisted up to the moment voting began.

The first round of balloting on October 31, too, was plagued by numerous problems and irregularities. The report of the observer mission of the OSCE's Office of Democratic Institutions and Human Rights (ODIHR) found that the first round failed to meet a considerable number of international standards for democratic elections and, thus, represented a "step backwards" from the 2002 Rada election, the last major election in Ukraine. Despite the many problems in the first round, however, there was no serious doubt that opposition leader Viktor Yushchenko and Prime Minister Yanukovych received more votes than any of the other candidates (39.87 percent and 39.32 percent, respectively, as determined by the Central Election Commission) and were thus entitled to run in the second round on November 21. (Ukrainian law provides that if no candidate receives a majority of the votes cast in the presidential election, the two candidates who received the largest number of votes should stand for a winner-take-all second round of voting held several weeks after the first round.) In their reports, the OSCE and other election observers detailed a number of ways in which Ukraine's electoral machinery needed to be fixed or adjusted in order to make the second round of voting free and fair to both candidates.

Despite the hopes of the Ukrainian people and the international community that the Ukrainian authorities would heed those recommendations, the second round of voting featured even greater and more widespread fraud and abuse. Senator Lugar, in Ukraine as President Bush's representative, who testified before you today, noted "a concerted and forceful program of election day fraud and abuse.with either the leadership or cooperation of the governmental authorities." The OSCE/ODIHR's report said that the election did not meet "a considerable number" of international standards, and that, as in the first round, state executive authorities and the Central Election Commission displayed a lack of will to conduct a genuinely democratic election process. ODIHR assessed the second round "less favorably" than the tainted October 31 first round vote. A U.S.-funded foreign NGO observer mission also described "a coordinated, systematic pattern of major violations leading to an outcome that does not reflect the will of the Ukrainian people."

The following are examples of the most egregious, widely observed and reported examples of election-day fraud on November 21:

  • Illegal Use of Absentee Ballots: According to the respected NGO "Committee of Voters of Ukraine" (CVU), massive electoral fraud was committed through the illegal use of absentee voter certificates. For example, people were caught in Dnipropetrovsk and Sumy oblasts with their pockets stuffed with blank absentee ballots that they were using to vote at multiple polling stations.
     
  • Opposition Observers Ejected: Observers from Our Ukraine and other opposition groups were expelled from most polling stations in eastern Ukraine on Election Day. For example, in Territorial Election Commission (TEC) district number 42 in Donetsk oblast, Our Ukraine observers were kicked out of all but a few polling stations.
     
  • North Korean-Style Turnout in the East: Turnout in the pro-Yanukovych eastern oblasts was unnaturally high. In several electoral districts, turnout for the run-off round increased by 30 to 40 percent over the first round. In Luhansk oblast, the reported turnout rate hit nearly 96 percent -- a number that, to quote the OSCE, even Stalinist North Korea would envy. A similar turnout rate was reported in Donetsk oblast, where 98 percent of the votes went to hometown candidate Prime Minister Yanukovych.
     
  • Mobile Ballot Box Fraud: In the second round of the election, the number of voters who supposedly cast ballots at home using mobile ballot boxes was double that of the first round. Much of this voting occurred without observers being present and was massively fraudulent. In Mykolayiv oblast, for example, nearly 35 percent of the oblast's voters purportedly cast their ballots "at home."
     
  • Computer Data Allegedly Altered To Favor Yanukovych: There were credible reports showing that that Yanukovych supporters gained illegal access to the Central Election Commission's computer system and illegally altered vote tabulation data being transmitted by TECs to the CEC.
     
  • Reports of Opposition Fraud: Yanykovych's supporters allege that Yushchenko's supporters stuffed ballot boxes in western Ukraine. But the reports and evidence of pro-Yanukovych fraud greatly outweighed those indicated for Yushchenko.
  • This massive ballot-box stuffing, fake turnout figures, and other forms of fraud and abuse allowed the authorities to create a victory for their candidate that almost certainly would not have been possible in a free and fair election. The final figures announced by the Central Election Commission (CEC) gave Prime Minister Yanukovych with 49.46 percent of the vote over opposition candidate Yushchenko with 46.61 percent. It is impossible to know what the real numbers were, but a large-scale (20,000 respondents), nation-wide anonymous exit poll conducted by a consortium of three highly respected research organizations (partially funded by the United States Government) projected Yushchenko the winner with 53 percent versus 44 percent for Yanukovych. Other exit polls and parallel vote counts indicated a Yushchenko victory, although by lesser amounts.

    Post-Election Crisis

    On November 22, the Central Elections Commission (CEC) announced preliminary results showing Yanukovych in the lead. Yushchenko supporters began pouring into the streets wearing orange ribbons and scarves, the campaign color of the opposition. In Kiev, their numbers have been as high as 200,000, despite daily temperatures below freezing. Pro-Yushchenko rallies also have occurred in several provincial capitals and other cities across Ukraine, including in eastern Ukraine. Yanukovych supporters have also demonstrated in support of their candidate, but with nowhere near the numbers or consistency of the Yushchenko supporters. The protests have generally been orderly and non-violent, though demonstrators have blocked access to government buildings and thus have impeded the legal functioning of the government and its institutions.

    A number of city councils declared Yushchenko the rightful president. In the east and south, several governors have declared that they would seek autonomy or even secession from Ukraine if Yushchenko were to be declared the winner; these calls were criticized by most Ukrainian leaders, including Kuchma, but not Yanukovych. Many government functionaries from various institutions have declared their allegiance to the opposition. The latter include several diplomats at the Ukrainian Embassy in Washington, who issued a statement decrying fraud in the election, supporting Yushchenko as the winner, and calling on other members of the Ukrainian diplomatic corps to join their protest. Three hundred other diplomats reportedly have signed their letter.

    The Ukrainian military has thus far remained on the sidelines of the crisis. Defense Minister Kuzmuk - a Kuchma loyalist who was appointed shortly before the first-round election in what many observers interpreted as an effort by President Kuchma to strengthen his hold over the military in case of post-election trouble - has said the military would remain politically neutral. Nevertheless, there have been reports of troop movements at times, and credible indications that government officials were, at one point, preparing to crack down on the protestors. Ukrainian police units and troops of the Ministry of Internal Affairs (MVS) guard government buildings and have also thus far refrained from the use of force. There are many reports of police officers and MVS troops fraternizing with demonstrators, but we believe that if a crackdown on the protests were to be ordered, it would be these units who would be asked to carry out the orders.

    In the days after the election, the political situation began to impact Ukraine's economy. The uncertainty caused by separatist calls emanating from the November 28 meeting in Severodonetsk, Luhansk oblast exacerbated fears, especially in eastern Ukraine. PM Yanukovych and Deputy PM Azarov likewise complained that demonstrators' disruption of the government's operations was chilling economic activity. On November 30, the National Bank of Ukraine (the Central Bank) imposed a series of currency controls restricting purchases of dollars, limiting cash withdrawals, blocking early payment of fixed-term deposits, and freezing bank assets levels (thereby effectively prohibiting new bank lending). On December 3, the Rada passed a resolution ordering prices of industrial and domestic goods to be frozen at the November 30 levels, and calling on the government to take other measures it deemed necessary to avert a financial crisis. However, this resolution apparently has no legal force. We have received some reports, especially from eastern Ukraine, of customers being unable to access their bank accounts, and complaining of cash shortages. Experts believe Ukraine has sufficient foreign reserves to meet demand, and that Ukraine's robust economy - which has grown by more than 12.5% this year - will be able to withstand the current pressure, but we continue to monitor the situation closely.

    Resolving the Current Crisis

    As the political crisis has grown, so too have the efforts to resolve it. The Ukrainian leadership and government at first appeared stunned and surprised by the strong reaction of Ukrainians to the reports of fraud, and evidently believed that the demonstrations would melt away and protestors return home as temperatures dropped and the finality of the results sank in. A precedent for such a scenario was set in 2001, when large-scale protests following revelations of the probable involvement of President Kuchma in the disappearance and murder of an investigative journalist eventually died out as protestors realized the government would not yield to their moral outrage. This time, however, the protestors have been able to maintain discipline and their numbers have not declined. Their resolve appeared to strengthen after the CEC announced final election results, followed by the Supreme Court's announcement on November 24 that the final results could not be promulgated (and thus become official) until the Court heard the opposition's case for election fraud.

    With no apparent resolution of the crisis in sight, Polish President Kwasniewski, joined by Lithuanian President Adamkus, EU High Representative for Foreign and Security Policy Javier Solana, and OSCE Secretary General Jan Kubis, offered international mediation assistance. A roundtable framework for negotiations was set up to include Yushchenko, Yanukovych, Kuchma, Rada speaker Lytvyn, and the European mediators. Russian Duma speaker Gryzlov at times has participated in the roundtable sessions as well. The first roundtable session produced pledges from both sides to refrain from violence and set up a Working Group of representatives of both sides. The second session on December 1 produced a preliminary agreement that included an opposition promise not to block government buildings, and renewed pledges from both sides to refrain from violence, reform electoral legislation, and preserve the country's territorial integrity. There was also a controversial pledge to adopt constitutional reforms, which had been rejected by the Rada last summer but are still supported by President Kuchma. The constitutional change would shift significant power from the presidency to the Rada and prime minister. The roundtable agreement did not address the central question of resolving the fraudulent second round of voting, delaying any discussion of that issue until after the announcement of the Supreme Court's decision on the opposition's complaints.

    On December 1, the Rada passed a resolution expressing no confidence in the Yanukovych government and calling on the President to name a new government of national unity. There were certain technical questions about the legality of the resolution and it was unclear when or if President Kuchma would have to dismiss the government. On December 3, after hearing testimony from both sides, the Supreme Court confirmed that there had been significant fraud in the second round vote, declared the vote invalid, and ordered a new vote by December 26. The Rada continues to debate revisions to the election law to prevent the identified problems and weaknesses from recurring in the repeat of second-round voting. We have urged all parties to move ahead quickly to adopt the necessary measures to ensure a new vote is free and fair, and results in an outcome that reflects the will of the Ukrainian people.

    Lessons Learned

    From the many obvious problems in the first and second rounds of the Ukrainian vote, a number of specific lessons emerged that would be helpful in reducing or avoiding fraud in another election:

  • First, the absolute necessity of maintaining or increasing the number of domestic and international election observers, particularly those working under the auspices of the OSCE/ODIHR. It is a sad, but true fact that it is extremely difficult to detect and deter fraud and abuse by a candidate and his supporters who have at their disposal all the resources of the state, including local authorities. The Ukrainian case, as well as the case of Georgia earlier, demonstrate that it is only through the Herculean efforts of tens of thousands of individual domestic and international election observers (both from OSCE/ODIHR and from NGOs) and others committed to a free and fair process that fraud and abuse come to light.
     
  • Next, the need to strengthen access, legal opportunities and protections for domestic observers. There were many instances in which Ukrainians acting as observers were simply locked out of polling stations and not permitted to do their jobs. Moreover, Ukrainian legislation on elections does not provide for the registration of domestic election observers and those observers who did work during the election were forced to register as journalists.
     
  • Likewise, the critical importance of developing legislative and oversight mechanisms to eliminate the possibility for fraud during absentee and mobile voting.
     
  • Also of importance is the need to strengthen legal controls over, and verification of, voter registration lists to ensure that opposition supporters are not excluded while names of deceased and other bogus voters are not added.
     
  • Strengthen and revise legislation regarding election commissions. In many cases, opposition supporters were excluded from serving on election commissions, despite legislation providing for balanced commission memberships. The functioning of commissions at the local, regional, and national levels was also in many instances non-transparent. Thirdly, election commissions should be protected from outside pressure by officials. Fourthly, protect election commission computer systems from parallel or alternate servers, which reportedly were used to alter election figures transmitted from the field.
     
  • Increase, and strengthen legal enforcement of, penalties against those who intimidate party activists and voters. In some cases, intimidation was perpetrated by local officials; in other cases by gangs of skinhead thugs.
     
  • Increase, and strengthen legal enforcement of, penalties against officials at various levels who engage in fraud. While election fraud is illegal in Ukraine, enforcement is sporadic at best and often itself politically motivated.
     
  • Ensure equal media access for all candidates and ensure independent media outlets are protected against government harassment. The current crisis has led many journalists to declare their freedom from government control and censorship and attempts by the authorities to dictate coverage appear to have weakened. Such positive trends should be extended and institutionalized.
     
  • Strengthen public commitment of national leaders and regional and local officials to free and fair election processes. Before the election, Ukrainian officials repeatedly and openly admitted that the election would not be entirely "clean." Such admissions - while perhaps a realistic appraisal from a political scientist - became an incitement and license for abuse when stated by national political leaders. Ukraine's leaders must lead by word and by example.
     
  • Ensure the international community is focused on the re-vote, especially given that it will take place the day after Christmas. The international community's scrutiny undoubtedly helped deter some fraud in previous votes.
  • Role of U.S. Policy

    The primary focus of U.S.-Ukraine relations over the past year has been the conduct of the presidential campaign and election. Over a period of many months, the U.S. and our European partners repeatedly advised Ukrainian authorities, publicly and privately, that we were watching the election closely and considered it a test of Ukraine's commitment to democracy.

    Our interest is in seeing Ukraine develop as a stable, independent, democratic, prosperous country with an economy based on free-market principles, one that respects and promotes human rights and abides by the rule of law, and draws closer to European and Euro-Atlantic institutions. We made clear that the conduct of the campaign and election-day voting would determine the democratic credentials and credibility of Ukraine's political leadership as well as the country's strategic course for the next decade. We specifically stressed that the conduct of elections would have significant implications for our relations; the manner in which the next president was elected would directly impact our ability to work with that president.

    We did not - and do not - favor a specific candidate. The United States has pledged repeatedly that it would work with whoever won a free and fair election. We have focused on ensuring that Ukrainians had an opportunity to choose their next leader freely, without coercion or manipulation.

    The United State government has worked consistently throughout 2004 to promote a free, fair campaign and election in Ukraine:

    We have made clear, consistent public statements about the positive and negative implications for Ukraine depending on the conduct of the election;
     
    We kept up a steady-stream of high-level visitors (both official and unofficial) to underscore our message privately;
     
    We have used all of our high-level meetings with Ukrainians to underscore our expectations and concerns about the election, including President Bush at the NATO-Ukraine Commission Summit in Istanbul, as well as bilateral meetings of Secretary Powell and Dr. Rice;
     
    We have tried to "raise the bar" for fraud by focusing our assistance in ways that would help to expose large-scale fraud (such as parallel vote counts and independent exit polls);
     
    We funded one of the largest international election observer efforts ever undertaken;
     
    We demonstrated the personal consequences of electoral misconduct by denying visas for individuals engaged in fraud and anti-democratic behavior;
     
    We welcomed Rada Speaker Lytvyn to Washington five days before the run-off to underscore our support for a legislative body committed to ensuring an outcome that reflected the will of the people;
     
    We have welcomed Congressional activity on Ukraine (resolutions, floor statements, visits); and
     
    President Bush asked Senator Lugar to deliver a message directly to President Kuchma on the eve of the vote.

    The United States provided funding to support independent media, provide non-partisan political party training, voter awareness and education, training for election officials and observers, and more. All of this assistance was provided on a non-partisan basis. For instance, political party training funded by the U.S. government is open to all parties on an equal basis. Our election-related assistance to Ukraine totaled approximately $13.8 million. The U.S. also funded thousands of international observers. This included the U.S. contribution funding the approximately 600-person OSCE observer mission; additional funding for another 100 observers under special agreement with the countries of Central Europe; and funding for an additional 1,000 foreign NGO representatives organized by Freedom House and the European Network of Election Monitoring Organizations (ENEMO). In addition, some 10,000 domestic observers were organized by the Ukrainian NGO Committee of Voters of Ukraine, which receives partial support from the U.S. Government via NDI. This support represents one of the largest international observation efforts ever.

    In preparation for the mandated re-run of the election on December 26, we today submitted a Congressional Notification of $3 million, as a contingency, to provide funding for election-related activities. The CN provides for up to $500,000 for OSCE election observers (including a possible central European mission of 100 people under ODIHR auspices) and up to $2.5 million to support NGO monitoring and other election-related efforts.

    Beginning in February, a wide, bipartisan range of senior U.S. officials and prominent private citizens visited Ukraine carrying a strong message about the importance of a democratic election to Ukraine's Euro-Atlantic integration. These included Defense Secretary Rumsfeld, Deputy Secretary of State Armitage, USAID Administrator Natsios, former President Bush, former Secretaries Albright and Kissinger, Dr. Brzezinski, Richard Holbrooke, Thomas Pickering, General (r.) Wesley Clark, Rep. Bereuter, Senator McCain, and of course Senator Lugar. The President asked Senator Lugar to return in November as his representative to deliver a letter to President Kuchma urging a free and fair election and to remain in Ukraine during the sensitive period immediately following the voting. He has already reported to you on that experience. We are grateful for Senator Lugar's efforts, and have been extremely pleased at how closely the Administration and the Hill have cooperated in the run-up to the election in Ukraine.

    As we look back now, we can cite some positive elements of the election campaign. There was very little election-related violence, and the military stayed entirely on the sidelines. Despite substantial obstacles, the opposition remained viable, active, and able to compete. President Kuchma did not seek a third term and, as far as we can tell, is prepared to leave office once a successor is legitimately elected. That said, we were extremely disappointed with the violations of democratic processes reported throughout the campaign that I described at the beginning of my testimony.

    Russia also openly supported Prime Minister Yanukovych. There were credible reports of Russian financial backing for his candidacy. President Putin visited Ukraine twice this fall, just prior to each round of voting, and underscored his support for the Prime Minister. We have discussed repeatedly with Russian officials our concern over the conduct of the Ukrainian campaign and elections and the role of Russian citizens in that process. We have consistently encouraged the Russian government to join other OSCE member states in organizing common monitoring and mediation activities to promote a free and fair election that reflects the will of the Ukrainian people. We have urged the Russian government to refrain from any activities that could limit Ukrainians' ability to choose freely.

    U.S. efforts intensified as the campaign drew to a close. The State Department issued a hard-hitting statement in October that got considerable attention in Ukraine, the Deputy Secretary published an op-ed in the Financial Times on the eve of the first round, and the Department issued another statement after the first round vote. The White House issued strong statements of its own just before the November 21 election, and both the White House and the Department have spoken out repeatedly since the November 21 vote to make it known that we did not recognize the legitimacy of the results of the run-off because of the widespread and credible reports of fraud, and that we expected the will of the Ukrainian people to be upheld. The White House issued another statement following the run-off underscoring the "extensive and credible indications of fraud," "calling on the Government of Ukraine to respect the will of the Ukrainian people," and noting that "the United States stands with the Ukrainian people in this difficult time."

    In addition, the Deputy Secretary spoke to PM Yanukovych and to opposition leader Yushchenko last week. The Secretary has been in regular contact with President Kuchma, Russian Foreign Minister Lavrov, Polish President Kwasniewski, EU High Representative Solana, and many others since November 21. The President has made known his strong support and deep appreciation for the mediation efforts of European leaders, which bore fruit in a preliminary agreement last Wednesday. We and our NATO and EU allies are united in support of democracy in Ukraine. We have reiterated our unwavering support for Ukraine's territorial integrity and our rejection of separatist initiatives. We have called on all parties to avoid violence, confrontation, and unhelpful rhetoric, and to work constructively towards a peaceful and just resolution to the impasse that reflects the will of the Ukrainian people. As the President said, our common goal is to see the will of the people prevail in elections that are free of outside interference. It is essential that the voice of the Ukrainian people be respected.

    Impact on the Region

    The crisis in Ukraine remains far from final resolution, so it is difficult to predict its long-term impact on other countries in the region. If, in the end, a democratic process prevails and there is a result that reflects the will of the Ukrainian people, it could have a potentially major impact for the development of democracy in the region. It will signal millions of people that democratic freedom is on the ascendance. This will help bolster pro-democracy NGOs, even as authoritarian governments in Belarus, parts of Central Asia, and elsewhere in Eurasia advance crackdowns on pro-democracy civil society groups. We will intensify our efforts to establish balanced cooperation with governments in these regions, recognizing that long-term stability and security arise when people enjoy freedom to participate in the civic life of their countries and fundamental human rights.

    Democracy in the countries of the former Soviet Union has lately had its ups and downs. In Georgia, a "rose revolution" in 2003 unseated the government of President Shevardnadze following a fraudulent parliamentary election, and was followed in January 2004 by a presidential election that by and large did adhere to international standards. At the same time, however, there have been disturbing indications of a retreat from democracy in Russia, including flawed elections, greater control of the press, and selective prosecution of powerful business leaders thought to pose a threat. Moreover, Moscow has of late become more active in what it regards as its "near-abroad." As I said, the Russians have taken a particularly active role in the Ukrainian election, openly throwing their support behind Prime Minister Yanukovych.

    The outcome of the presidential election process in Ukraine will have an impact well beyond Ukraine's borders. It is in the interests of everyone to see Ukraine develop into a democratic, market-oriented nation with good relations with all its neighbors and with other members of the European and Euro-Atlantic communities.

    Long-Term U.S. Policy

    U.S. strategic interests in Ukraine have remained steady for more than a dozen years and will continue to do so regardless of the outcome of the presidential election. As I said earlier, the U.S. wants to see Ukraine develop as a secure, independent, democratic, and economically prosperous country that increasingly draws closer to European and Euro-Atlantic institutions.

    U.S. policies toward Ukraine for the period following the presidential election must be properly calibrated to provide an appropriately positive or negative immediate response to the conduct of the election while furthering our long-term strategic interests in Ukraine and the region. We want to encourage Ukraine to maintain its peacekeeping contingents abroad, including in Iraq, Kosovo, and other peacekeeping operations. But we will not allow those deployments to become reasons to excuse or ignore democratic shortcomings in Ukraine.

    Our bilateral relationship will obviously be affected by the final outcome of the crisis over the presidential election. Isolation of Ukraine is not an option, but, at the same time, if the repeat election once again fails to meet democratic standards, there will be consequences for our relationship, for Ukraine's hopes for Euro-Atlantic integration, and for individuals responsible for perpetrating fraud, including our consideration of further use of Presidential Proclamation 7750 to deny visas to individuals engaged in corrupt and anti-democratic activities. We have made clear our willingness to respond to an undemocratic electoral process given that failure to do so would undercut our credibility with others in the region who also support a Europe whole and free.

    As I stressed earlier, we are prepared to work closely with any candidate who wins in a free and fair contest that meets international democratic standards. If that condition is met, we also are prepared to deepen our relationship and to move quickly on a number of issues of importance to Ukraine. These would include intensifying consultations and engagement at the highest political levels, possible upgrading of Ukraine's relationship with NATO; increased U.S. support for a closer relationship between Ukraine and the European Union; increased cooperation in the areas of energy, health, education, science, and technology; closer military-to-military links; and increased cooperation to accelerate Ukraine's bid for accession to WTO, provided its government enacts WTO-consistent laws and regulations and addresses our concerns on agriculture and protection of intellectual property. A democratic outcome would also likely spur greater trade and foreign investment. We are prepared to work with OPIC, Ex-Im Bank and the Trade and Development Agency in order to bolster our economic relationship. Substantial progress on intellectual property rights would also allow us to recommend removing existing economic sanctions and restoring Ukraine's benefits under the Generalized System of Preferences (GSP) program. Ukraine has complied with the provisions of the Jackson-Vanik Amendment to the Trade Act of 1974. In principle, we support Congressional action to "graduate" Ukraine from Jackson-Vanik and to grant normal trade relations with Ukraine, and we would urge more rapid action on this matter. In other words, a Ukrainian government reflecting the will of the Ukrainian people could expect a broad and growing, and mutually beneficial, relationship with the United States.

    Conclusion

    Mr. Chairman, in conclusion, let me say again that the U.S. wants to see Ukraine develop as a secure, independent, democratic, and economically prosperous country that increasingly draws closer to European and Euro-Atlantic institutions. A democratic election whose outcome reflects the will of the Ukrainian people would be an important step in this direction. This Administration is committed to helping Ukraine achieve this goal and looks forward to working closely with whoever wins in a free and fair election process.

    Thank you very much for allowing me to appear before your Committee today. I would be happy to answer any questions you may have.



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