As Ukraine and the United States prepare for their summer Independence Day celebrations – July 4 for America, Aug. 24 for Ukraine – both nations have fresh reasons for optimism about the strength of the relationship.
Ever since Donald J. Trump’s inauguration on Jan. 20, many Americans have sought to reassure Ukrainians that — contrary to what people read about the U.S. president’s close ties to Russia — American policy will remain steadfast in support of Ukraine.
Trump surrogates – ex-House Speaker Newt Gingrich and ex-New York City Mayor Rudolph Giuliani — have even made trips to Kyiv recently to underscore the point.
But nothing drove the message home like the personal meeting that took place in the Oval Office on June 20 between Trump and President Petro Poroshenko.
The Ukrainian leader also met with five Cabinet members — Vice President Mike Pence, Secretary of State Rex Tillerson, Secretary of Defense James Mattis, Secretary of Energy Rick Perry and Secretary of Commerce Wilbur Ross — among other top administration officials and leaders of Congress.
Attending many of the meetings was U. S. Ambassador to Ukraine Marie L. Yovanovitch.
Trump meeting
In an interview with the Kyiv Post ahead of America’s Independence Day celebrations, Yovanovitch discussed the achievements of the two days of Washington D. C., meetings and dispelled a few misconceptions.
Firstly, while described in some news media accounts as a mere Oval Office “drop-in” lasting a few minutes, Yovanovitch said that the session with Trump and Poroshenko — which also involved Ukrainian Foreign Minister Pavlo Klimkin, Ukrainian Ambassador to America Valeriy Chaly and U. S. National Security Adviser H. R. McMaster — lasted at least 30 minutes.
Secondly, contrary to reports that Perry, Tillerson and Mattis will be visiting Kyiv this year, Yovanovitch noted that no official trips have yet been announced despite invitations extended from the Ukrainian side.
Thirdly, while Poroshenko suggested that the U.S. may start supplying Ukraine with lethal weapons to defend itself against Russia’s war, Yovanovitch said no decision has been made. “The administration is still reviewing its position,” she said. “That kind of decision needs to be reviewed carefully and will take some time.”
Nonetheless, Yovanovitch hailed the dialogue as a tremendous success.
“The biggest accomplishment was that the leader of the United States and the leader of Ukraine were able to meet and have a really good conversation about what is happening in Ukraine. So they were able to establish a relationship, which is always important,” Yovanovitch said. “It was a very substantive conversation. President Poroshenko had a real opportunity to talk about what was happening in Ukraine, especially the situation in the east. It was clear to me that President Trump was very interested in that and asked a lot of questions.”
As Trump approaches the six-month mark of his presidency, “it’s very clear where we are with our policy with regard to Ukraine,” she said. “There’s robust support for Ukraine.”
No end to war
It does not appear, however, that the United States or its Western allies have any fresh ideas for persuading Russia to call off its war against Ukraine, now in its fourth year with more than 10,000 people killed, or to return the illegally seized Crimean peninsula.
Everyone is sticking with the 2015 Minsk peace agreements, which Russia has ignored, and the four-nation Normandy format in which Germany, France, Ukraine and Russia meet periodically for thus far fruitless peace talks.
Despite movement for tougher sanctions against Russia, most notably coming from the U. S. Senate, consensus for turning the economic screws harder against the Kremlin is lacking.
America and the United Kingdom still come under criticism for not doing more to support Ukraine’s sovereignty as part of the 1994 Budapest Memorandum, under which Ukraine surrendered its Soviet-era nuclear weapons in exchange for security assurances.
But, as the West struggles to find the right formula to get Russian President Vladimir Putin to end the war, Yovanovitch said that America has no reason to apologize.
“We have provided over $650 million in security assistance since the start of the war,” Yovanovitch said.
“The single most important thing we can do is provide that training,” Yovanovitch said. “You can see the change in tactics on the front lines. This is a more capable force, first of all because of the bravery of the Ukrainian soldiers, but also because of those countries, including the U.S., that have provided significant assistance.”
As for the Budapest Memorandum, while it’s an “extremely sensitive topic” in Ukraine, “we believe that the U.S. has lived up to what is agreed to in the Budapest Memorandum. There’s only one country that hasn’t — that’s Russia,” Yovanovitch said. “Over the last three years, there has been arguably no country that has been more supportive of Ukraine than the United States, whether assistance on critical reform pieces or security assistance.”
‘Moving forward’
Besides $650 million in security assistance since 2014, the United States has provided a comparable amount in economic aid and $3 billion in loan guarantees.
But the United States has had to get tough, on occasion, such as when America pressed Poroshenko to fire Prosecutor General Viktor Shokin, who had been obstructing justice and blocking anti-corruption investigations.
Poroshenko finally relented in May 2016, but only after ex-U.S. Vice President Joseph Biden reportedly intervened personally and the American government made the issue a public condition of further financial assistance. Ex-U.S. Ambassador to Ukraine Geoffrey R. Pyatt detailed the government’s stance publicly before his departure to Greece a year ago.
However, as Shokin’s replacement, Poroshenko chose political ally Yuriy Lutsenko, a non-lawyer with no prosecutorial experience. Lutsenko has not transformed the prosecutorial service with 18,000 employees, nor has he successfully prosecuted any big anti-corruption cases. He has, instead, kept Shokin loyalists as top lieutenants.
Nearly a year into Yovanovitch’s tenure as U.S. ambassador, there’s been no public “Shokin moment” as Pyatt had under ex-U.S. President Barack Obama’s administration.
But that doesn’t mean the Trump administration will go soft on reforms, she said.
“I think that one of the important things that President Poroshenko heard (in Washington, D.C.) is that it’s important to keep on moving forward in reform, whether in the judicial sector, fighting against corruption or other areas,” Yovanovitch said. “Ukraine needs to keep on going to be where it needs to be economically and from a security point of view.”
Economically, Ukraine is only now starting to recover from losing half of its annual economic output — dropping from $180 billion in 2013 to only $90 billion in 2015. But growth remains at a tepid 2–3 percent per year, a source of hardship and growing impatience for Ukrainians.
“It has to be 6 to 8 percent growth,” Yovanovitch said. “For that, there has to be privatization. There has to be FDI (foreign direct investment) in Ukraine. I have heard this from the leadership of Ukraine. They understand that is what it’s going to take to get the quantum leap forward for the economy. It’s important that a level playing field is created so that Ukrainian companies can compete as well as foreign companies in growing the economy so there are more jobs.”
U.S. Ambassador to Ukraine Marie L. Yovanovitch speaks with the Kyiv Post on June 26 in the U.S. Embassy in Kyiv. Yovanovitch is America’s ninth ambassador to Ukraine, the first woman to hold the post and celebrates her first anniversary on the job in August. (Oleg Petrasiuk)
‘As quickly as possible’
American business representatives tell Yovanovitch that they see a lot of investment opportunities in Ukraine, which is at the geographic center of Europe and which has a highly educated workforce. The hot sectors include agriculture, energy and information technology.
But obstacles remain.
“Ensuring that judicial reform really take hold is a critical piece,” Yovanovitch said, citing the ongoing selection of justices for a new Supreme Court that will hopefully be seated in July. “It’s important that not only the most ethical and qualified judges are selected but that people perceive it as a positive, transparent process.
The ambassador said that legal protections for intellectual property rights have been strengthened in recent years, but that more progress must be made.
She also flagged “some of the raider attacks we’ve seen” on businesses as an ongoing problem that “frightens not just Ukraine companies but that frightens foreign companies as well.”
Related to the selection of a new Supreme Court, Yovanovitch also described creation of a new anti-corruption court as “critically important.”
She said that Poroshenko, ex-Prime Minister Arseniy Yatsenyuk and others “worked hard to create these new anti-corruption institutions,” including the National Anti-Corruption Bureau of Ukraine and the Special Anti-Prosecutor’s Office.
“These are new institutions. You have investigatory institutions, prosecutorial institutions, but (cases are) still going to the same court system,” she said. “My understanding is that 60 percent of cases put forward (by the National Anti-Corruption Bureau of Ukraine and Special Anti-Prosecutor’s Office) have been stymied at the court level. It is important that an anti-corruption court be established as quickly as possible.”
‘Always re-evaluating’
Making her job easier, the ambassador said, is that “U.S. interests and values coincide with what the Ukrainian people want for Ukraine. They are looking to the West and finally and forever becoming a part of the West.”
Along with those aspirations, they “want a government that is accountable, that is transparent and they want to see results.”
The challenge for U.S. policymakers is to provide effective assistance to advance these goals.
That’s why U.S. officials regularly ask “should we be continuing in this area or another area and should we reprogram our money? We have that conversation. We look at things carefully. We take our responsibility both to the U.S. taxpayer and Ukrainian citizens very seriously.”
Thus far, Yovanovitch said, the U.S. government has worked collaboratively with the Ukrainian government and Poroshenko, who is widely criticized by Ukrainians for going too slow or obstructing reforms.
She believes, however, Poroshenko is acting in the national interest and attributes his unpopularity to his three-year incumbency.
“I think that now in every country, the longer you are into a presidential term or a prime ministerial term, the lower the numbers go,” she said. “It’s kind of the laws of politics. People want change and they want change fast. There’s the reality of how long things take. I think we need to work with our partners from the Ukrainian government as well as civil society to move our joint agenda forward.”
Besides judicial reform, she also cited pension and agricultural land reform as priority areas.
Ukraine spends 12 percent of its GDP on pensions. Despite the money spent, average monthly pensions are only $70. Ukraine, moreover, gives special benefits to many of its 12 million pensioners and allows men to retire at 60 and women at 58, earlier than in most Western nations.
Additionally, an agricultural land market has to be created, Yovanovitch said.
“There’s no advanced economy in the world that doesn’t allow individual companies to buy and sell land,” she said. “Details do matter, of course, and it’s good there’s a robust debate. But there’s no question this is something Ukraine has to do for Ukraine’s sake to grow the economy.”
Political risk insurance
With no end to Russia’s war in sight, some in the business community want Western governments to contribute financially to an investment risk insurance pool for Ukraine, along the lines of the U. S. Overseas Private Investment Corporation and the World Bank’s Multilateral Investment Guarantee Agency.
The thinking, as articulated by American lawyer Bate C. Toms, who is the president of the British Ukrainian Chamber of Commerce, is that billions of dollars of potential investment is sitting on the sidelines because of Russia’s war. The ability for private business to be insured affordably against the possibility of total loss of investment would open the floodgates to new money for Ukraine, Toms believes.
If it’s a great idea, it is one that is “not on my radar,” Yovanovitch said. Likewise, she said, a lot of the private American investments and trade with Ukraine are made on a business-to-business basis with little or no involvement from the U.S. government.
Visa-free travel
Ukrainians got a huge psychological lift on June 11, when 90-day visa-free travel to most European Union nations began. Ukrainians have set their sights on similar agreements with Canada and the United States.
“Right now, today, probably Ukraine isn’t quite ready for that. Let’s see how it works with the E.U.,” she said. “Anything is possible. I think the U.S. visa regime is about facilitating travel to the United States. That’s what we want to see. We want to see Ukrainians come to the United States do business, study there, work there and then return to Ukraine at the end of the visa period.”
The U. S. and Canada, while rejecting a quarter or more of visa applicants, do grant 10-year travel visas for those whose applications are accepted.
Fourth of July
For now, however, Americans in Ukraine are looking forward to celebrating their nation’s 241st birthday.
Festivities include events put on by America House and the American Chamber of Commerce of Ukraine. One of the traditional gatherings is a backyard barbecue hosted by the U.S. ambassador to Ukraine at the official residence, which sits at the base of the Podil neighborhood and has spectacular views of St. Andrew’s Church above.
Yovanovitch is America’s 9th ambassador to Ukraine and the first woman to hold the post. She took over in August and also served as the deputy chief of mission in the U. S. Embassy in Kyiv in 2001–2004. She joined the American foreign service in 1986 and has been posted to numerous nations, including serving as ambassador to Armenia (2008–2011) and Kyrgyzstan (2005–2008).
She hails from a small town in Connecticut, where she recalls Fourth of July celebrations fondly as revolving around parades, kids, bands and hot dogs. “We had a carnival and Ferris wheel. It was a town of 2,000 people that doubles in the summer because of all the summer residents.”
“It’s a great holiday,” she said. “It gives us an opportunity to think about the United States and what that means in the U.S., but also what that means around the world. It’s an opportunity for introspection as well.”
America at a glance
Total area: 9,826,675 square kilometers
Population: 321.4 million
Government type: Constitutional federal republic
Head of state: Donald Trump
GDP: $18.56 trillion (2016)
GDP per capita: $57,300 (2016)
Main industries: Petroleum, financial services, telecommunications, electronics, consumer goods, motor vehicles, steel, aerospace, chemicals, food processing, lumber, mining
Ukrainian-American relations
Trade: $1.65 billion (2016)
Export from Ukraine to U.S.: $578 million
Exports from Ukraine to the U.S.: Iron, steel, chemicals, foodstuffs, locomotives, heavy machinery
Import from U.S. to Ukraine: $1.07 billion
Exports from the U.S. to Ukraine: Mineral fuels and oils, nuclear reactors, boilers, machinery, automobiles, seafood, plastics, pharmaceuticals
American investment in Ukraine (cumulative through 2016): $712.6 million
Main investors: Cargill, DuPont Pioneer, Monsanto, Coca-Cola, McDonald’s, Bunge, Citigroup
Sources: U.S. Department of Commerce, Ukrainian Ministry of Foreign Affairs, U.S. Census Bureau
