Ukraine: Current Issues and U.S. Policy
LIBRARY OF CONGRESS WASHINGTON DC CONGRESSIONAL RESEARCH SERVICE
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In January 2005, Viktor Yushchenko became Ukraines new President after massive demonstrations helped to overturn the former regimes electoral fraud in what has been dubbed the Orange Revolution, after Yushchenkos campaign color. Some hoped Ukraine might finally embark on a path of comprehensive reforms and Euro-Atlantic integration after 15 years of half-measures and false starts. However, infighting within his governing coalition hampered economic reforms and led to disillusionment among Orange Revolution supporters. The global economic crisis has hit Ukraine very hard. Ukraines real GDP is expected to drop by 17 in 2009. In November 2008, the International Monetary Fund approved a 16.4 billion standby loan for Ukraine to bolster its finances. The loan was conditioned on a commitment from Ukraine to allow its currency to depreciate in a controlled way, to recapitalize the banking sector, and to pursue more rigorous fiscal and monetary policies. After taking office as President, Yushchenko said that Ukraine would seek integration into the global economy and Euro-Atlantic institutions. Ukraine joined the World Trade Organization WTO in May 2008. In the longer term, Yushchenko seeks Ukrainian membership in the European Union and NATO. Relations with Russia have been tense over such issues as Ukraines NATO aspirations and energy supplies. U.S. officials have remained upbeat about Ukraines successes in some areas, such as securing WTO membership, holding free and fair elections, and improving media freedoms, while acknowledging difficulties in others, such as fighting corruption, establishing the rule of law, and constitutional reforms. The Obama Administration has expressed the desire to reset relations with Russia, but has warned that it will not accept any countrys assertion of a sphere of influence. It has also reaffirmed its support for NATOs open door to NATO aspirants such as Ukraine.
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