VZCZCXRO5065
PP RUEHLN RUEHVK RUEHYG
DE RUEHKV #1038 1491535
ZNR UUUUU ZZH
P 281535Z MAY 08
FM AMEMBASSY KYIV
TO RUEHC/SECSTATE WASHDC PRIORITY 5686
INFO RUEHRC/USDA WASHDC
RUCPDOC/USDOC WASHDC
RUEATRS/DEPT OF TREASURY WASHDC
RUCNCIS/CIS COLLECTIVE

UNCLAS KYIV 001038 
 
SIPDIS 
SENSITIVE 
 
TREASURY FOR ALIKONIS 
DEPT PLS PASS USTR FOR CKLEIN/PBURKHEAD/EPORTER 
USDOC FOR 4231/ITA/OEENIS/NISD/CLUCYK 
USDA/FAS/OCRA FOR JFLEMINGS/DADAMS 
USDA/FAS/OGA FOR ROMEARA/JLAGOS 
USDA/FAS/PECAD FOR MLINDEMAN 
 
E.O. 12958: N/A 
TAGS: ETRD EAGR TBIO UP
SUBJECT: ENCOURAGING UKRAINE TO HELP ALLEVIATE THE GLOBAL 
FOOD CRISIS 
 
REFS: A) KYIV 980 
      B) STATE 52628 
      C) STATE 53353 
      D) STATE 53346 
      E) KYIV 198 
      F) 2007 STATE 160639 
 
Treat as Sensitive but Unclassified.  Not for Internet. 
 
¶1. (SBU) Summary: Post has delivered points contained in 
refs B-D regarding the President's Global Food Security 
Initiative and agricultural trade issues.  On May 21, the 
GOU moved to cancel restrictions on grain exports.  We 
continue to work with Ukraine on introducing a regulatory 
framework to allow for the use of products of 
biotechnology; here, the GOU has made progress but is being 
slowed by the Ministry of Environment, which remains 
ideologically opposed to biotech.  End Summary. 
 
¶2. (U) Post has delivered ref B points regarding the 
President's Global Food Security Initiative to several GOU 
interlocutors, focusing on the issues of export 
restrictions and biotechnology (refs C-D), which have been 
long-standing topics of our bilateral trade discussions. 
Special Representative for Commercial and Business Affairs 
Frank Mermoud raised the topic with Serhiy Korsunsky, 
Director of the MFA's Economic Cooperation Department, on 
May 20 and with Valentyna Zavalevska, Deputy Minister of 
Agriculture, on May 21.  EconOff also approached the local 
World Bank office to discuss a possible joint demarche. 
Martin Raiser, World Bank Economic Adviser, told us on May 
23 that he did not believe a joint message was necessary, 
as the World Bank had just a few days before issued a 
public statement urging Ukraine to abolish restrictions on 
food exports. 
 
Progress on Export Restrictions 
------------------------------- 
 
¶3. (U) Both Korsunsky and Zavalevska opined that the GOU 
would soon move to cancel restrictions on grain exports due 
to the good harvest.  On May 21, the Cabinet of Ministers 
did in fact vote to eliminate the restrictions, effective 
immediately (ref A).  The Cabinet did vote to retain a 
quota of 300,000 tons for sunflower oil exports up to 
September 1, but President Yushchenko issued a decree May 
28 overturning the quotas.  Therefore, the status of these 
restrictions remains in doubt. 
 
Slower Progress on Biotech 
-------------------------- 
 
¶4. (SBU) As part of our bilateral WTO Market Access 
Agreement of March 2006, Ukraine promised to "establish a 
policy based on modern risk assessment principles and 
guidelines" in regulating products derived from modern 
agricultural biotechnology.  Law 1102-V, "On the State 
System of Biosafety in Creating, Testing, Transporting and 
Using Genetically-Modified Organisms," adopted by the Rada 
(parliament) in May 2007, established the broad legal 
framework for a biotech regulatory system. 
 
¶5. (SBU) GOU agencies still need to issue implementing 
regulations in order for the system to become operable, 
however.  We have repeatedly urged the GOU to issue these 
regulations as soon as possible and have noted the 
importance of this commitment made by Ukraine in our 
bilateral agreement.  We have also provided technical 
assistance to the GOU to assist in drafting the necessary 
implementing regulations.  Drafts of most of the nine 
required regulations have progressed well, but some staff 
at the Ministry of Environment continue to oppose 
biotechnology on an ideological basis and appear to be 
blocking the process.  Post intends to continue dialogue 
with the GOU on establishing a fair regulatory environment 
and is planning public outreach efforts to broaden support 
for biotechnology (refs E-F). 
 
TAYLOR