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Energy sector reform saw only modest progress, with the Cabinet approving a plan to deal with some energy sector debt.

The summer months saw good results from last year's agricultural reforms, as Ukraine recorded its highest harvest since independence.

The Ukrainian Government has scrambled to cut spending and to increase borrowing to fill the budget gap.

Despite some downgrades from rating agencies, Ukraine successfully raised 0 million through a Eurobond offering in the fall of 2002.

Of the roughly 6 million in FY 2002 FREEDOM Support Act funds, USAID programs accounted for approximately million and U. State Department Public Diplomacy programs accounted for about million. New programs to expand Internet access for Ukrainians were put in place.

Assistance was increasingly directed to the regional and local levels of government and to the private and civic sector.

Outreach to the next generation remained strong as 99 Muskie/FSA Graduate fellows, 109 FSA Undergraduate fellows, and over 400 Future Leaders Exchange Program (FLEX) secondary school students studied in the U. Even at the current high levels, competition for exchange program slots remained intense, and applicant quality remained high, thanks to effective publicity and recruiting campaigns and the continued growth of English-language competence in Ukraine. Department of State - English-Language Training: Building English language capacity facilitates Ukraine's integration into Western structures.

Public Diplomacy programs are administered by the U. Embassy's Public Affairs Section in collaboration with the Bureau of Educational and Cultural Affairs (ECA), and implemented in Ukraine by several U. partner organizations, including the American Councils for International Education (ACIE/ACCELS), the International Research and Exchanges Board (IREX), and Project Harmony. In FY 2002, four English Language Fellows were placed at institutions of higher learning in three Ukrainian cities.

Upon returning to Ukraine, one program alumnus established a municipal development agency to encourage economic and business development in the community.Political developments in Ukraine in 2002 were a study in contrasts.In March 2002, Ukraine held parliamentary elections, which the Organization for Security and Cooperation in Europe (OSCE) declared to be flawed, but an improvement over the previous elections.Agricultural exports picked up as result, and lower food prices were a major contributor to keeping inflation down.On the fiscal side, lower growth and minimal privatization caused revenues to fall below expectations.

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Private sector assistance focused on assisting agricultural producers and small business, by providing access to credit, working to reduce regulations, and strengthening property rights. Government-funded exchange programs have brought approximately 18,000 Ukrainian citizens to the United States for long-term study or short-term professional training, including over 2,100 in FY 2002 alone. Department of State - Public Diplomacy Exchanges: In FY 2002, more than 1,550 Ukrainian citizens traveled to the U. to participate in academic and professional exchanges.

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