July 25, 2002

The Honorable Paul O'Neill
Secretary of the Treasury
1500 Pennsylvania Avenue
Washington, DC 20220

Dear Secretary O'Neill:

Congratulations on your recent trip to Ukraine and other former Soviet states. I applaud your interest in the newly independent states (NIS). To this end, I urge you to implement a pilot program of Mr. Bush's Millennium Challenge Account in Ukraine for fiscal year 2003.

As you know, President Bush's Millennium Challenge Account (MCA) is a bold foreign assistance initiative, unprecedented in scope since the Marshall Plan. The MCA is exactly the sort of measure needed to promote democratic and economic development in the NIS, and to maintain consistent long-lasting economic growth. This is especially true in Ukraine, which, based on its significant assets and natural resources, and its economic progress since independence, would be an ideal country for a pilot MCA program.

Ukraine should be an MCA target for a number of reasons. As you have seen firsthand, Ukraine's potential for wealth creation is underdeveloped, but it will respond very positively to significant western interest and investment. Additionally, renewed American interest in the commercial potential in Ukraine would be a valuable weapon in fighting corruption and encouraging the Ukrainian government to create an environment conducive to economic growth by attracting foreign and private sector investment. This investment, in turn, will maintain growth, improve the standard of living and mobilize the wealth-generating potential locked within Ukraine's agricultural and commercial sectors.

Ukraine's agricultural sector, having once supplied one quarter of the entire Soviet Union's demand, is now floundering and is in desperate need of western financial and technical investment. Western investment could also rejuvenate Ukraine's struggling energy sector, which currently operates below 50 percent efficiency. In addition to these basic sectors, Ukraine promises growth and significant advances in other areas, especially in science and technology-related fields, healthcare, transportation and even tourism.

With regard to science and technology, Eastern Ukraine was once the hub of Soviet high-tech development, including missile guidance and delivery, telecommunications, and aerospace technologies. Today, many scientists are working as coal miners, while other missile specialist are looking for work in the Middle East! This is undoubtedly a result of Ukraine's best engineers and scientists remaining idle. Despite its potential, experts suggest less than one quarter of Ukraine's technology demand has been tapped.

Mr. Secretary, because of this tremendous, broadly based potential, and because people everywhere can indeed do great things when they have the tools and incentives for success, I hereby urge you to support Ukraine as the premier candidate for MCA implementation.

Very truly yours,

Bob Schaffer
Member of Congress
Co-Chairman Congressional Ukrainian Caucus

WASHINGTON, D.C. (July 25, 2002) - U.S. Congressman Bob Schaffer (R-CO), Co-Chairman of the House of Representatives Ukrainian Caucus, today urged U.S. Treasury Secretary Paul O'Neill to implement in Ukraine a pilot program of the president's Millennium Challenge Account, which Schaffer called "a bold foreign assistance initiative, unprecedented in scope since the Marshall Plan." In a letter today to Secretary O'Neill, Schaffer called Ukraine a "premier candidate" for the president's MCA program.

Announced by President Bush in March, Millennium Challenge Accounts (MCA) will extend U.S. aid and economic opportunity to countries demonstrating economic and political progress. Under the president's proposal, the MCA program will increase U.S. development assistance over three years, leading to a $5 billion annual increase above current levels by 2006.

"Ukraine's potential for wealth creation is underdeveloped, but it will respond very positively to significant western interest and investment," Schaffer wrote. "Ukraine's agricultural sector, having once supplied one quarter of the entire Soviet Union's demand, is now floundering and is in desperate need of western financial and technical investment."

"Because of [Ukraine's] tremendous, broadly based potential... I hereby urge you to support Ukraine as the premier candidate for MCA implementation," Schaffer said in his letter to O'Neill.

Congressman Schaffer was first elected to Congress in November of 1996. He is a member of the Committees on Agriculture, Resources, and Education and Workforce. He is Vice Chairman of the Education Subcommittee on Education Reform, Co-Chairman of the Ukrainian Caucus, President of the Republican Junior Class, and the Speaker's appointee to the House Republican Policy Committee. His official Internet website address is www.house.gov/schaffer, E-Mail: rep.schaffer@mail.house gov.