According to the Israeli daily Ha'aretz, Ukraine agreed to drop its objections after the Interior Ministry offered to alter the status of Ukrainian guest workers who until now had been in Israel illegally.

The friction over the youth program was fueled in part by frustration among Ukrainian officials that relations with Israel are not deeper, particularly with regard to economic development and investment, Ha'aretz added.

During the past decade, Ukraine has been the source of 50 percent to 60 percent of all immigration to Israel from the former Soviet Union. Ukraine has an estimated 500,000 Jews. More than 250,000 Ukrainians have immigrated to Israel since 1989.

Ukrainian officials have repeatedly expressed discontent with the Na'aleh youth program, which recruits 15- and 16-year-olds to finish high school in Israel. Most participants move to Israel and adopt Israeli citizenship.

More than 8,000 youths from the former Soviet Union were enrolled in the program in the spring of this year.

In August, U.S. Jewish leaders raised the issue of Ukraine's tensions with Israel during a meeting with President Clinton, who promised to press Ukrainian authorities to allow 250 high school students to take part in the Na'aleh program.

The youth program is not the only source of tensions between Israel and Ukraine. Earlier this year, Ukraine expelled two Jewish Agency emissaries after claiming they had visited a security installation to try to persuade Jewish scientists to emigrate.

Ukraine has also accused the Jewish Agency, a quasi-governmental body responsible for immigration and absorption, and the liaison office in Israel's Prime Minister's Office of going beyond the bounds of agreements regarding their work in the Ukrainian Jewish community.

In 1994, Kiev demanded that the Jewish Agency stop its operations in Ukraine — a dispute that was settled when then-Israeli Foreign Minister Shimon Peres intervened during a visit to Ukraine.