Ev­ery­thing is mostly rosy, says Canada’s am­bas­sador to Ukraine

Kyiv Post - - Business - BY BRIAN BON­NER BON­[email protected]

Ahead of the tra­di­tional July 1 Canada Day in­ter­view with the Kyiv Post, Canada's Am­bas­sador to Ukraine Ro­man Waschuk — the son of Ukrainian par­ents — was pretty up­beat about progress on the re­form front in Kyiv.

The in­ter­view took place only two days be­fore the June 27 Ukraine Re­form Con­fer­ence in Copen­hagen, Den­mark, and with Ukraine's politi­cians still com­ing up short in three must-have re­forms re­quired by the In­ter­na­tional Mone­tary Fund: a truly in­de­pen­dent anti-cor­rup­tion court, hikes in house­hold gas prices to mar­ket lev­els and a re­align­ment of the state's $40 bil­lion bud­get to bring the deficit down to 2.5 per­cent of gross do­mes­tic prod­uct rather than 4 per­cent. Anti-cor­rup­tion court? "I think we are al­most all the way there…We have the frame­work law. We have the im­ple­men­ta­tion law. The sec­ond read­ing should give us a fix on the ap­peals pro­ce­dure."

Rais­ing natural gas prices and re­duc­ing the deficit, which would re­quire sev­eral bil­lions of dol­lars in in­creased rev­enue, spend­ing cuts or a com­bi­na­tion of both?

Th­ese "are big house­keep­ing is­sues that the gov­ern­ment needs to ad­dress and will be ad­dressed in months to come."

So let's just for­get that no­body has been con­victed of cor­rup­tion, hardly any of the $60 bil­lion stolen from the bank­ing sec­tor and ex-Pres­i­dent Vik­tor Yanukovych's rule has been re­cov­ered, there's still no rule of law, no agri­cul­tural land mar­ket, no pri­va­ti­za­tion, no cus­toms re­form, no elec­toral re­form and no uptick in for­eign di­rect in­vest­ment?

No, Waschuk said. Those is­sues are still im­por­tant. But he doesn't think that Ukraine's politi­cians, ahead of pres­i­den­tial and par­lia­men­tary elec­tions in 2019, can do more.

"I would say: rec­og­nize what is the car­ry­ing ca­pac­ity of the po­lit­i­cal sys­tem at this point with the play­ers you’ve got," Waschuk said from the Cana­dian Em­bassy in Kyiv. "And rec­og­nize also that in a pre-elec­tion pe­riod, not ev­ery­one is will­ing to go" against pub­lic opinion.

Take the re­sis­tance to cre­at­ing an agri­cul­tural land mar­ket. Ukraine is the only na­tion in Europe be­sides Be­larus that does not al­low free trad­ing — buy­ing and sell­ing — of agri­cul­tural land.

"Ukraine has ac­tu­ally, un­der the guise of pro­tect­ing poor lit­tle old vil­lagers, cre­ated mas­sive lease-based farm­ing op­er­a­tions al­most un­par­al­leled any­where in the world. It is achiev­ing the op­po­site aim of pro­tect­ing the lit­tle guy. In fact, land re­form would un­lock op­por­tu­ni­ties for lit­tle guys and gals."

Ukraine went into the June 27 Copen­hagen con­fer­ence with ac­com­plish­ments, the am­bas­sador said, in­clud­ing: • adop­tion of a na­tional se­cu­rity law that is "broadly ac­cept­able to NATO part­ners," Waschuk said, al­though crit­ics say it does not bring trans­parency to de­fense spend­ing, which takes up 5 per­cent of GDP; • adop­tion of a law lib­er­al­iz­ing for

eign cur­rency trans­ac­tions; • health care re­form that takes ef­fect on July 1 and seeks to em­pha­size pa­tient ser­vice, rather than Soviet for­mu­las for per-bed sub­si­dies; • ed­u­ca­tion re­form that moves away from Soviet-style rote learn­ing with the adop­tion of a Cana­di­anstyle cur­ricu­lum in the early grades that puts "a big em­pha­sis on group work, joint prob­lem solv­ing and lay­ing foun­da­tions for life­long learn­ing rather than rote re­pro­duc­tion of po­ems and for­mu­las from very tra­di­tional Soviet and post-Soviet ed­u­ca­tion;" • a pri­va­ti­za­tion law that should, at last, al­low Ukraine to start con­duct­ing a ma­jor sell­off of 3,500 state-owned en­ter­prises that, col­lec­tively, are ma­jor sources of cor­rupt prof­its and sig­nif­i­cant losses for tax­pa­pers; and. • a trans­par­ent, on­line value-added tax re­fund sys­tem that elim­i­nates the ar­bi­trari­ness and cor­rup­tion of the pre­vi­ous meth­ods of col­lec­tion. "There's quite a bit of leg­isla­tive progress that has been made. It's a mat­ter of us­ing the re­main­ing months for im­ple­men­ta­tion. It is im­ple­men­ta­tion that will be im­port- ant to na­tional part­ners and in­ter­na­tional in­vestors," Waschuk said.

Ad­di­tion­ally, but not unique to Ukraine's politi­cians, law­mak­ers have a propen­sity to de­lay un­til the last minute.

"Ukraine has habit of pulling all nighters and try­ing to fin­ish all its home­work at the last minute; like me in uni­ver­sity. My mother kept telling me not to do that. I per­sisted in the habit," Waschuk said. "The same thing seems to be hap­pen­ing in Ukraine."

Top-level Cana­dian of­fi­cials, in­clud­ing For­eign Min­is­ter Chrys­tia Free­land, will not only be par­tic­i­pat­ing in the June 27 Copen­hagen con­fer­ence, but Canada looks set to host next year's Ukraine Re­form Con­fer­ence. Be­sides Copen­hagen, the in­au­gu­ral event took place in London last year. The gath­er­ing of Ukraine's Western friends as­sesses suc­cesses and fail­ures in meet­ing the na­tion's goal of be­com­ing a mod­ern Euro­pean democ­racy able to qual­ify for the Euro­pean Union some­day.

Waschuk, the son of Ukrainian par­ents who set­tled in Canada af­ter World War II, al­most con­firmed that Canada will be the host in 2019. "I would read the com­mu­nique very care­fully and you will find the answers," he said.

Cana­dian Am­bas­sador to Ukraine Ro­man Waschuk (C) drops the ball to start a street hockey game on Khreshchatyk Street on June 25, 2017 as Kyiv Mayor Vi­tali Kl­itschko looks on. (Kostyan­tyn Ch­er­nichkin)

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