Cold comfort for independent Ukraine

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UKRAINE marked the third anniversary of independence yesterday with the economy in turmoil and the state deeply divided along political, regional and linguistic lines. President Leonid Kuchma, elected last month on a platform of speeding up reforms and drawing closer to Russia, expressed hope that life would improve for his people but added: 'The road we are travelling on is uneven. There will be much turbulence.'

Ukrainian television tried to boost people's spirits by screening film of the heady days of August 1991, when the parliament in Kiev declared independence from Moscow shortly after the failure of the conservative Communist coup against Mikhail Gorbachev. But little could disguise the fact that Ukraine's leaders face an immense task in reviving the economy and healing the divisions between the country's Ukrainian- and Russian-speaking citizens.

Compared with Boris Yeltsin's Russia, where prices have been liberalised and privatisation is well advanced, Ukraine has introduced practically no economic reforms. Inflation and a precipitous fall in economic output have reduced Ukrainian living standards to levels well below those in Russia. Mr Kuchma recently estimated that 90 per cent of Ukraine's 52 million people lived in poverty.

Mr Kuchma portrays himself as more committed to change than his predecessor, Leonid Kravchuk, and earlier this week decreed a reduction in state control of Ukraine's currency markets. But economists regarded the measure as insufficiently bold and said it was unlikely to satisfy the International Monetary Fund, which is helping to devise a reform programme in order to free a dollars 700m ( pounds 460m) loan.

Even if Mr Kuchma wanted to push ahead quickly with reforms, he would face resistance from the powerful Communist and Socialist bloc in parliament. But his close relationship with Ukraine's heavy industrial lobby, and his background as a former director of a gigantic missile factory in Dnipropetrovsk, suggest that he may prove a more cautious reformer than some of his election rhetoric indicated.

Though he began speaking Ukrainian exclusively after he took office, Mr Kuchma believes his country's future lies in closer integration with Russia. It will not be easy to balance the demands of ethnic Ukrainian nationalists in western regions with the pro- Russian sympathies of people in eastern Ukraine and the Crimean peninsula.

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