Ukraine in visa deal with HK amid warming trade ties with China

PUBLISHED : Sunday, 05 September, 2010, 12:00am
UPDATED : Sunday, 05 September, 2010, 12:00am

Hong Kong struck a visa-free travel agreement with Ukraine yesterday as its president hailed the city's role in his Eastern European nation's emerging 'strategic relationship' with China.

President Viktor Yanukovych said he wanted Hong Kong investors to play a key role in a new era of 'political pragmatism and economic modernisation' after long years of 'political confusion'.

'Elevating our relationship [with China] to a new strategic level is a priority for us,' Yanukovych told a Trade Development Council lunch after meeting Chief Executive Donald Tsang Yam-kuen.

'China is a special force of attraction for Ukraine ... it is a tolerant force, it's not going to pull Ukraine to the right or left nor make it an area of its influence.

'Today we have a new class in our country, a class of entrepreneurs willing to work in market conditions and with respect to fair competition. The work of this class is not based on ideology but on fair competition.'

Hong Kong's relations with the emerging markets of Eastern Europe have had a hectic few days. Yanukovych's delegation included senior government, parliamentary and industrial figures, and marked his first state visit to China.

Tsang met Russian President Dmitry Medvedev in Moscow on Tuesday after Cathay Pacific's inaugural passenger flight between the Russian capital and Hong Kong. He will meet a delegation from the Slovakia led by President Ivan Gasparovic at Government House tomorrow.

Hong Kong officials said that while Eastern Europe remained an important emerging region for the city, the flurry of activity did not represent a sudden new push but rather efforts to steadily build links.

Trade with Eastern Europe was largely insulated from the worst effects of the global financial crisis.

Council executive director Fred Lam Tin-fuk said Hong Kong-Ukraine trade was up 33 per cent to US$78 million in the first two quarters of this year - a figure he described as 'just the beginning'.

'I say this because I know that Ukrainian trade with the ... mainland is also growing fast. Building economic ties with the ... mainland is a priority for Ukraine.'

Ukraine exports minerals and agricultural products and is also a source of hardware and technology for China's growing military - a legacy stemming from its previous inclusion in the former Soviet Union.

The People's Liberation Army is expected to lean more heavily on Ukraine in coming years as a source of technology it can no longer acquire from an increasingly wary Moscow.

Once derided by opponents as being too close to Moscow, Yanukovych has broadened Ukraine's international relationships while seeking to promote its entrepreneurs.

A former Soviet-era transport chief, Yanukovych recovered from an overturned 2004 election to win a five-year term in March.