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This Week

DEFENDING UKRAINE’S ISLAND EMPIRE

Ukraine’s claim to a small, sparsely inhabited island beyond the Danube estuary may hold the key to greater energy independence and a wealth of natural resources. The ruthless pursuit of this rocky outcrop illustrates the increasing strategic importance of Black Sea energy resources for countries throughout the region More

RADISSON STRIKES DEAL TO BUILD COMPLEX IN CRIMEA

Crimea’s enormous international tourism potential has long been smothered by political uncertainties and competing local interests, but a deal struck last week to bring a top international hotel chain to the peninsula may mark the beginning of a new era for the Crimean tourist trade More

UKRAINE’S HEATING SYSTEM IN NEED OF URGENT REFORM

Last month’s tragic blast which destroyed part of a Dnipropetrovsk apartment building was a timely reminder of the urgent need to reform Ukraine’s archaic domestic heating system, but the task ahead is likely to be Herculean More

UKRAINE RANKS LOW IN GLOBAL COMPETITIVENESS INDEX

A new world competitiveness index released October 31 by the World Economic Forum shows that Ukraine and other former Soviet countries still lag behind most of the developed world in competitiveness More
 

News

DEFENDING UKRAINE’S ISLAND EMPIRE

Ukraine’s claim to a small, sparsely inhabited island beyond the Danube estuary may hold the key to greater energy independence and a wealth of natural resources. The ruthless pursuit of this rocky outcrop illustrates the increasing strategic importance of Black Sea energy resources for countries throughout the region

Viktor Yushchenko may not be widely regarded as a man of iron will or steely determination, but last week his resolute stand was the talk of Bucharest. In stark contrast to the President’s regular calls for compromise on the domestic front, the Ukrainian head of state spent his state visit to Romania vigorously defending Ukraine’s official position as the owners of Serpents Island on the Black Sea, and effectively laying claim to what are thought to be considerable gas and oil fields in the nearby continental shelf.


Hail the conqueror


In the wake of Yushchenko’s two-day visit, the Bucharest newspapers were full of his strong man performance, with the daily Ziua (The Day) offering the front page headline “Yushchenko 3, Basescu 0” in reference to Ukraine’s perceived dominance of the bilateral talks which covered a number of territorial issues.

Rarely has Yushchenko managed to adopt such a combative pose when representing Ukraine internationally and it is not hard to imagine why he was so vocal this time round. After all, following years of dithering and procrastination, the Ukrainian government has recently agreed to begin the hard work of extracting the energy wealth of its Black Sea territories. The official acquisition of Serpent’s Island and the surrounding territorial waters would greatly expand Ukraine’s scope as a regional energy source country at a time when the country has few higher priorities.

The fact that the normally confrontation-shy Yushchenko was prepared to take up such an apparently hard line position in Bucharest is testament to the importance of the Serpent’s Island energy reserves for Ukraine as well as a demonstration of the regional muscle the country flexes.

Upsetting new EU member state Romania may not be particularly desirable in terms of Ukraine’s relations with Brussels, but it is a price most Ukrainians would consider well worth paying if it means securing a bigger slice of the energy market. Nor are EU officials likely to involve themselves in the details of a conflict that dates back to post-war years when the Western powers stood by and allowed whole swathes of eastern Europe to change hands.


Island home or rocky outcrop?


The battle for Serpent’s Island has long since been referred to the international law courts for arbitration. It once belonged to Romania but was taken from Bucharest by Stalin in 1945 as one of many spoils of the Second World War, finding itself at part of the USSR.

Romania’s claim today is that the island is actually just a rock which therefore brings no accompanying claims to sovereignty over surrounding seabed reserves.

Ukraine’s government has taken a number of steps to refute this argument, establishing a scientific research base on the island as well as a small village, both of which have been placed under the jurisdiction of Odessa Region.

It remains to be seen whether these blunt tactics will win international recognition for Ukraine’s claim to the fabled Serpent’s Island, but at the very least they do serve to emphasise a commitment to exploiting Black Sea energy resources that represents a refreshing change to what have been years of inactivity and kowtowing to Russian monopolist interests.

Peter Dickinson
Business Ukraine
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