Alexander Gorobets: USA announced trade war against Ukraine

The USA held a research as for piracy of disks, digital video disks and US-made CD-Rom 1.5 years ago. Ukraine was announced a country with the most developed piracy over the whole of Europe. The International Federation of Poligram Industry (IFPI) informs, every year Ukraine supplies dozens of millions of high-quality piratical copies to the European and South-American markets. The USA is extremely concerned about the situation now. First, the USA demanded for toughening of the governmental control over the sphere. But later, when Ukraine took no measures concerning the problem, Washington threatened with imposing of economic sanctions against Kiev. Closer to this autumn the threats got more perceptible. Originally the USA imposed a ban on annual import of Ukrainian metal and footwear to the sum of $75 million. Ukraine’s government had to develop and consider a law to give law enforcement authorities the right to destroy all illegal factories for production of disks, digital compact disks and CD-Roms discovered in Ukraine. But some deputies of the Supreme Rada doubted necessity of such a resolute measure. This made the USA more resolute, and the threats got more pressing. That is why head of Ukraine’s Cabinet of Ministers Anatoly Kinakh went to Washington in October to ask the US authorities to postpone implementation of the sanctions. Mr.Kinakh said, the government would try to settle the problem with passing of the law in the Supreme Rada.

USA Ambassador to Ukraine Carlos Pascual took an active part in enactment of the law for a stricter struggle with the disk piracy. Most Rada’s deputies reacted rather acutely to such intrusion into Ukraine’s internal affairs. The Ambassador was declared persona non-grata in Ukraine for the interference with the home affairs, Communist Pyotr Simonenko was the initiator of such declaration.

Ultimate terms for passing of the law have been fixed by the USA two times already. Ukraine’s largest producer of compact disks Rostok-Records was the most active opponent of the law. Last week Igor Masol, Rostok-Records president, accused the Western music industry of attempts to do away with rivals; the company’s personnel even organized protest actions near the US Embassy in Kiev.

The last, third ultimate term expired on Thursday, December 20. On that very day Ukraine’s Supreme Rada declined the law “On state regulation of production, export and import of laser disks”. This becomes a ground for more active debates that are to resume after a parliamentary recess in January. The law’s author, Sergey Chukmasov, says that the sanctions may cause anti-American attitude and make adoption of the law impossible.

Washington, in its turn, imposed strong commercial measures against Ukraine. President of Ukraine Leonid Kuchma thinks that imposition of the sanctions by the USA is fair, he also considers Rada deputies responsible for the situation. The president is anxious about possible loss of the American markets.

The US’s sanctions against Ukraine are to come into effect on January 23, 2002. Experts have already estimated losses after the sanctions’ implementation: at least $400 million per year.

US Trade Representative Robert Zellik says in a press-release published in Washington that the USA is determined to protect the rights and hopes that Ukraine will toughen struggle with violation of the rights for intellectual property. This is the only basis for abolishment of the sanctions. Robert Zellik says: “The USA, as well as the World Trade Organization, treats the problem of intellectual property seriously. Ukraine should develop and implement legislation necessary for solution of the problem. This is also to make for Ukraine’s adjustment to WTO regulations.”

The US Federal Register published a list of Ukrainian goods subject to higher duties; it is available on the site of the US Commercial Representative (

Deputy Boris Bespaly voted against adoption of the law. He thinks, it is impossible to pass a law that provides for control over the economic sphere to be rendered by teams special. In his opinion, there will be few businessmen to operate in the sphere that is officially controlled by teams special.

The law also provides for unscheduled checks to discover violation of the author rights. The deputy thinks, the law makes raids in this sphere of economy legal.

Another deputy Vladimir Bondarenko thinks, in this case the law does not concern the sphere of intellectual property, because we may speak about intellectual property when some product or a software is on a disk. But Ukraine is said not to produce disks, but to buy them from other producers. Production of laser disks, the high-tech sphere, characterizes the level of a country’s technical development. If a country can not produce laser disks, it is considered to be a low development country. That is why the law can not be referred to the sphere of intellectual property.

Now 11 billion of illegal disks are produced in South-Eastern Asia. Only highly developed countries could set-up the production in the area to avoid taxation. Thus, it is difficult to define now, whether the production belongs to the USA, Great Britain or Israel. But everyone is perfectly aware of the production.

We also know about Bulgaria’s experience that passed a similar law. Disks are not produced there and not to be produced in the future.

There are two more variants of the law; it is not clear why that one, developed under the pressure of the USA Embassy, is being supported now. Perhaps, the problem of intellectual property is planned to be involved in pipe or textile trade. But the situation on the market reveals, that Ukraine reduced ferrous metallurgy sales by 83% this year. It means, development of US-Ukrainian relations reveals, that the market is closed for Ukraine. Thus, implementation of the law will hardly open the market for Ukraine.

It is to be mentioned also, any economic sanctions aim not only at protection of economic interests of producers or consumers, but some political interests as well. America’s attitude can be also explained by the coming elections in Ukraine. It is an open secret, one of the political blocks is supported by US influential powers that aim at support of Ex-Prime Minister Viktor Yuschenko. The attitude is to become a counterbalance to pro-Russian influence on the elections in Ukraine. Several Ukrainian experts consider, the intrigue has been planned long ago. And the USA has used only one of the economic pressures on Ukraine.

Alexander Gorobets PRAVDA.Ru Kiev Ukraine

Translated by Maria Gousseva

In the photo: US Ambassador to Ukraine Calros Pascual

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