His visit, postponed six times in recent years, looks like becoming a watershed in Moscow's relationship with Kiev, as it is widely seen as being the first time Russia has implicitly acknowledged that Ukraine is an independent nation, with its own borders.
The treaty is intended to establish the framework for amicable bilateral relations, ending a long period of squabbling over the fall-out of the collapse of the Soviet Union which prompted Ukraine to look Westward for friends and security in the hope of reducing Moscow's influence.
Mr Yeltsin's two-day visit follows the settlement of one of the issues that have corroded relations between the two nations - the fate of the former Soviet Black Sea Fleet, and the city of Sevastopol in Crimea, which was ceded to Ukraine by Khrushchev in 1954, but which many Russians have continued to regard as their own.
Earlier this week, both sides reached an agreement under which they will divide up the now rusting Black Sea Fleet and Russia will keep its ships at Sevastopol under a leasing agreement for the next 20 years.
But the friendship treaty, to be signed tomorrow, has wider significance: it suggests that Russia is no longer wedded to the concept that Ukraine - a country the size of France, with a population of 51 million - is inherently part of a Slavic territory over which Moscow exclusively holds sway. "This is the first time when we can see Russia treating the Ukraine as a foreign policy issue, rather than a domestic one," said Martin Bilynskyj, director of the US-Ukraine Foundation in Kiev.
"For several years, Russia used the stick when dealing with the Ukraine," he said. "It was intransigent over the Black Sea Fleet, refused to negotiate over border issues, and wouldn't discuss the question of Ukrainian money left in Moscow's banks after the end of the Soviet Union. But now Moscow is using a carrot."
The Ukrainian President, Leonid Kuchma, has helped force Russia's hand by leaning provocatively Westwards.
Further pressure was brought to bear on Moscow by Kiev by weaving closer economic ties with the West - particularly the US, its largest foreign investor - and by seeking friends among neighbouring former Warsaw Pact countries. It has manoeuvred to reduce its dependency on Russia, which accounts for almost half of its trade and supplies almost all of its energy.
If all goes well, this weekend's events will add further weight to the argument that Boris Yeltsin has adjusted his foreign policy, and is more interested in domestic reforms than international confrontation.
Security charter with Nato agreed
Nato Foreign Ministers yesterday agreed a security charter with Ukraine to mirror the historic founding "Act" signed with Russia on Tuesday, before getting down to talks to finalise which East European states will be invited to join Nato at the Madrid summit on 8-9 July, when the charter will also be signed .
The foreign ministers of the 16-nation Western alliance, including Britain's Robin Cook, met in a baroque monastery in the forests outside Sintra, 15 miles west of Lisbon, in Portugal. The charter with Ukraine allows it to consult with Nato on security threats, establish a permanent mission at Nato headquarters - like Russia - and hold regular talks. But unlike the Nato-Russia "Act", it does not establish a permanent Council.
Christopher BellamyReuse content