Ukraine Reform Conference will test nation’s progress
Ukraine's business and political leaders are preparing for a big international conference in Copenhagen, Denmark, on June 27 with three big question marks:
Will parliament pass legislation creating a genuinely independent anti-corruption court?
Will it raise household gas prices to market levels?
Will it cut its budget deficit to 2.5 percent of gross domestic product?
These are the three remaining conditions that the International Monetary Fund requires in order to restart lending from a $17.5 billion program that ends in March. Ukraine's stalling and backsliding on these three key reforms froze lending last year at $8.4 billion in the four-year program.
Ruben Madsen, Denmark's ambassador in Ukraine, was optimistic on June 19 that Ukraine will deliver on these key areas before coming to Copenhagen.
Denmark is picking up the baton from the United Kingdom, which last year hosted the Ukraine Reform Conference.
The annual event, which may be hosted by Canada in 2019, is a way for Ukraine's Western friends to discuss Ukraine's progress and chart reform priorities to get the nation closer to the standards of eventual membership in the European Union, which is the goal of most Ukrainians.
Madsen said the conference will focus on two themes this year — good governance and economic develpoment. It appears that the Nord Stream 2 project, the expansion of a gas pipeline between Russia and Germany, will be discussed. Ukraine and some of its friends are adamantly opposed to the project because it would bypass Ukraine — depriving the nation of up to $2 billion annually in fees from transiting gas from Russia to Europe. Denmark plays a pivotal role as one of three nations where the pipeline passes through territorial waters, so it could conceivably stop the project entirely. (The other two nations — Russia and Germany — are proponents.)
Madsen said he expects that Nord Stream 2 will come up on the sidelines. He said he doesn't know when Denmark will decide whether to approve or reject Nord Stream 2. The nation hopes for a European Union solution to the controversial project.
Madsens said Denmark is expecting at least 10 foreign ministers to attend the Ukraine Reform Conference, including those from the Nordic and Baltic nations, as well as Poland. Invitations have been sent out to nations part of the G7, NATO and European Union. Additionally, European Commissioner Johannes Hahn is expected.
Danish Prime Minister Lars Løkke Rasmussen and Ukrainian Prime Minister Volodymyr Groysman will host the June 27 event.
The day before, June 26, will be devoted to strengthening business ties with meetings of representative of the Confederation of Danish Industry and Ukrainian businesses.
Besides Groysman, among those making the trip from Ukraine, according to preliminary plans, include: Stepan Kubiv, vice prime minister; Oksana Markarova, acting finance minister; Francis Malige of the European Bank for Reconstruction and Development; Hlib Vyshlinsky, executive director of the Centre for Economic Strategy; Anna Derevyanko, executive director of the European Business Associatoni; Ivanna Klympush-Tsintasdze, vice prime minister; Hanna Hopko, head of the Committee on Foreign Affairs of the Verkhovna Rada; and Lenna Koszarny, CEO of Horizon Capital and executive vice president of the Western NIS Enterprise Fund.
Ukraine could not have found a more supportive host — or a better role model.
The Scandinavian nation, with only 5.7 million people compared to Ukraine's 42 million people, has an economy three times the size of Ukraine's $100 billion a year output. The Kingdom of Denmark is one of the richest, happiest, least corrupt and most generous nations.
Madsen is striking a "modestly optimistic" tone about the conference if Ukraine can get the right anti-corruption court legislation passed before the June 27 meeting. Ukraine's Western friends "would have liked to have seen" such an anti-corruption court "a long time ago," he said.
"We should be careful not to fall into the gloomy ditch," Madsen said from the Danish Embassy in Kyiv. "Every road has a ditch on each side — too gloomy and too rosy… Ukraine is on the road to getting rid of the 'old Ukraine," he said, and deserves support in reaching its des- tinations, he said.
But impunity for those "steaing the future of the country" must stop, he said. "They should be prosecuted. Nobody has been convicted. Ukraine must get out of the situation with this impunity — that anybody could steal and nothing would happen."
Nonetheless, Madsen said, Ukraine has achieved "remarkable results, not dramatic, but remarkable results" in reform, citing as last year's adoption of transparent value-added tax returns that eliminate arbitrariness and reduce corruption.
Ukraine is "not at the point of no return," he said, and must reach that point "where the fruits are so clear and the costs are so obvious."
He cautions against pushing too hard.
"Western countries lose transition countries by asking too much," Madsen said. "We can't afford for Ukraine to slide away and into stability."
A sightseeing vessel is seen at Nyhavn Canal in Copenhagen, Denmark, on Oct. 9, 2015. (AFP)
Danish Ambassador to Ukraine Ruben Madsen speaks with the Kyiv Post on June 19, offering a preview of the June 27 Ukraine Reform Conference in Copenhagen, Denmark. (Volodymyr Petrov)