U.S. Assistance to Ukraine - Fiscal Year 2003

U.S. programs in Ukraine in FY03 emphasized democratic reform, especially in preparation for the presidential elections in October 2004. Economic and security assistance focused on fostering Ukraine’s integration into the structures of the Euro-Atlantic community, which are predicated on an adherence to the basic norms of a middle class weighted market economy, a civilian controlled military, and an active and vibrant civil society.

The $188.5 million budgeted by all U.S. Government agencies for assistance programs in Ukraine in Fiscal Year 2003 is allocated roughly as follows:

Democracy Programs	$54.7 million
Economic & Social Reform	$48.0 million
Security & Law Enforcement	$71.5 million
Humanitarian Assistance	$ 2.0 million
Cross Sectoral Initiatives	$12.3 million

Democracy programs in Ukraine focus on supporting local government reform, independent media, civil society, political party and parliamentary development, electoral reform, and the rule of law. Local government reform programs will focus on developing the capacity of associations to provide training to administrators and lobby for national legislation for local self-governance as well as on providing training to municipal professionals on strategic planning, management of services, and citizen participation in decision-making. Assistance for independent media will focus on 30 print and broadcast outlets, providing business, financial management, and marketing training. Civil society programs will work to strengthen the advocacy work of NGOs, support think tanks to encourage public dialogue on government policies, and develop community level anti-corruption coalitions. Political party and parliamentary development programs will focus on fostering responsiveness and accountability, increasing the participation of youth and women in public affairs, and improving governance. Rule of law programs will support advocacy centers and student legal clinics, improve legal education, and strengthen judicial associations.

Small grant-making programs administered by the Eurasia Foundation, National Endowment for Democracy, and U.S. Embassy in Kiev support the work of indigenous NGOs to foster civil society, private enterprise development, local government accountability, independent media, access to information, and other initiatives to promote democracy in Ukraine.

Training and exchange programs continue to be an assistance priority, reaching out to the next generation of Ukrainian leaders and giving them first-hand experience with the day-to-day functioning of a market-based, democratic system. Since 1993, the U.S. has funded the travel of over 19,000 Ukrainian citizens to the United States on academic and professional exchange programs in fields such as management, social service provision, and NGO development. FY 2003 funding will provide programs focusing on the education of young people such as the Future Leaders Exchange (FLEX) program, which will bring some 410 students from Ukraine to live with U.S. host families and attend U.S. high schools. Access to information is promoted through programs like the Internet Access and Training program that supports 37 public access facilities in 32 cities throughout Ukraine.

Market reform programs include accounting, commercial law, customs modernization, fiscal, banking, and land reform technical assistance, including a strong focus on land titling. To help small and medium enterprises (SMEs), the U.S. Government, through the U.S. Agency for International Development (USAID), provides training, assistance and consulting to promote private sector business development. The assistance program is also provides support to EBRD partner banks and microfinance institutions as well as training for small and medium-sized business entrepreneurs. The U.S. Government has provided technical assistance to the Ministry of Finance and the Tax Administration to help reform tax policy and administration; this assistance will phase out, since the Government of Ukraine adopted a new, simplified tax code.

USTDA will finance two projects in FY2003, the first associated with the expansion and modernization of the Gostomel airport, the second involving the development of a regional air traffic control system.

In FY 2003, the U.S. government has allocated approximately $66 million in security and law enforcement assistance to Ukraine. Nearly half of the funding is provided by the Departments of State and Energy, and executed largely by the latter to enhance nuclear reactor safety and protect against the misuse of nuclear material. One third of the funding, or $20 million, is available for the Department of Defense to continue strategic weapons destruction activities and related infrastructure dismantlement, and to initiate dismantlement of biological weapons and infrastructure and redirect the activities of former scientists. This latter effort, to redirect former weapons scientists to peaceful and commercially viable endeavors, is supported with over $8 million in additional funding through the Science Centers and other programs.

Two million dollars in Export Control and Related Border Security Assistance (EXBS) is being spent to help Ukraine establish an effective national export control and border security system.

International Military Education and Training (IMET) provides training to improve the interoperability of Ukrainian military personnel with their counterparts in U.S. and NATO security structures. Foreign Military Financing (FMF) funds support procurement of equipment and services to enhance Ukrainian forces ability to operate more effectively alongside U.S. and NATO partners in real world peacekeeping operations and exercise activities. In FY 2003, Ukraine became eligible to receive Excess Defense Articles (EDA) on a grant basis under Section 516 of the Foreign Assistance Act (FAA).

U.S. assistance funds continued to support cooperative efforts between U.S. government law enforcement agencies and Ukrainian Government and local government officials to combat crime. The USG assistance program focused on four areas of law enforcement reform: combating money laundering, improving the protection of intellectual property rights, improving border security, and combating trafficking in persons.

At the end of FY 2003, there were approximately 200 Peace Corps Volunteers in Ukraine, working with Ukrainians on development of small-and-medium sized enterprises, health care and teaching.

Current humanitarian assistance programs in Ukraine consist of the provision of commodities through the Department of State humanitarian transport program. Additionally, the Department of State executes a humanitarian program in Crimea to assist Formerly Displaced Persons (FDPs), mainly Crimean Tartars, and a medical humanitarian program in the Donetsk Region to assist the ethnic Greek population. These two specific programs, executed by International Relief and Development (IRD) and the World Council of Hellenes (SAE) respectively, are managed through Department of State grants and are designed to assist the most needy populations groups in these regions of Ukraine. The Crimean project provides needed humanitarian items such as medical supplies, food, clothing and shelter, as well as access to water in areas of Crimean populated by Crimean Tartars through the construction and/or renovation of wells. The medical project in the Donetsk region, in addition to providing medicines, medical equipment and medical supplies to the most needy population in the area, operates a modern medical clinic for the treatment of the vulnerable population.