Transcript
Ukraine’s Reform Agenda: Shaping the Future
Oleksiy Honcharuk
Prime Minister, Ukraine
Chair: Robert Brinkley
Chairman, Steering Committee, Ukraine Forum, Chatham House
21 November 2019
The views expressed in this document are the sole responsibility of the speaker(s) and participants, and do not necessarily reflect the view of Chatham House, its staff, associates or Council. Chatham House is independent and owes no allegiance to any government or to any political body. It does not take institutional positions on policy issues. This document is issued on the understanding that if any extract is used, the author(s)/speaker(s) and Chatham House should be credited, preferably with the date of the publication or details of the event. Where this document refers to or reports statements made by speakers at an event, every effort has been made to provide a fair representation of their views and opinions. The published text of speeches and presentations may differ from delivery.© The Royal Institute of International Affairs, 2019.
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2 Ukraine’s Reform Agenda: Shaping the Future
Robert Brinkley
Well, a very warm welcome, everybody, to Chatham House this evening, especially to the Prime Minister of Ukraine, Oleksiy Honcharuk, who’s here for the first time, I think. If I can just introduce myself. I’m Robert Brinkley. I Chair the Ukraine Forum here at Chatham House, which we setup in the middle of 2015 to discuss and pay attention to Ukraine, on its own merits, not as seen through the eyes of other states. And we’re going to have another all-day conference on Ukraine, with a slightly Dickensian title of Ukraine, Great Expectations here in London, here in Chatham House on Thursday the 5th of December. This meeting is on the record and is being livestreamed, and you can, if you wish, comment by Twitter, using the #CHEvents and @CHUkraineForum. But please make sure now that your mobile phones are turned to silent.
Today is the sixth anniversary of the start of the Revolution of Dignity or the Euromaidan, which was a real watershed event. The modern history of Ukraine divides into before or after that revolution, and just this year, in 2019 in Ukraine, the people of Ukraine elected a new President, Volodymyr Zelensky, who had no previous political experience, and in a free and fair election, he won 73% of the votes. 73%, so, Ukraine’s neighbours, please take note. The people of Ukraine then elected a new Parliament, giving the President’s Party, Servant of the People, an absolute majority of seats, and this is the first time that that has happened, since Ukraine’s independence in 1991.
So there’s been a change of generation in power in Ukraine, although this may tell you more about me than it does about the new generation in Ukraine. The average age of members of Parliament is now 41 years, that’s seven years younger than in the previous Parliament. The average age of the Cabinet of Ministers is 39, so it is fitting that the new Prime Minister, Oleksiy Honcharuk, is at 35-years-old, the youngest Prime Minister in independent Ukraine. He is a Lawyer, who spent more than ten years in legal practice. He won a reputation as a strong fighter for the rights of the business community. From 2015, he headed the Better Regulation Delivery Office, a non-governmental organisation, and in that capacity, he stimulated a veritable bonfire of the regulations, some 1,000 regulations were cancelled. He was also an external Advisor to First Deputy Prime Minister, Stepan Kubiv, who was responsible for Economic Development and Trade. The Prime Minister is going to speak to you for about 15 minutes and then take questions, and this meeting will finish at 8 o’clock. Prime Minister [applause].
Oleksiy Honcharuk
Ladies and gentlemen, the Ambassador Brinkley, thank you very much for such honour to speak to you. I was informed that in this auditorium, there are a lot of friends of Ukraine, is it true? [Applause] It’s a very good idea to speak with the friends in London. If you’ll be so kind to allow me to use some notes because it was my – it will be my first big speech in English, so I will use it sometimes. First of all, for us, it’s a very special day because six years ago, I was Euromaidan with a lot of people, with my friends and we fight for European values. And six years ago, Ukraine’s European path was chosen by a million of people on this Euromaidan and for us, it was the Revolution of Dignity. And now, as you see, I’m honoured to lead the new Government and you can be sure that we will continue this direction, Ukraine will move into the Europe, into the United Standards, based on our values, of course. But this choice didn’t come without a price, and you know about it, and Russia occupied Donbass and annexed Crimea, and we still have war in our East lines. Russia is imposing aggression in all spheres, and President Zelensky is doing his best to bring some peace into these lives. And my first message is that, from my point of view, it’s this conflict, this situation is not an issue only for Ukraine, it’s an issue, it’s a challenge, big challenge for all the world, and it’s very important for all world order.
3 Ukraine’s Reform Agenda: Shaping the Future
Of course, we in Ukraine, have a lot of different things to be done and I call it our homework and I will try to describe some ideas, what we are going to do next, in the coming years, in our government. First of all, of course, we should create some level playing field. It’s very important for attracting investments and Ukraine needs more investments, it’s true. We will start – we have already started from our Tax and Customs Services. Right now in Ukraine, the Head of the State Tax Service and State Customs Service are young, high professional and very good people, without any vested interests behind. And I believe I am sure that they will create some level playing field, in the sense of some tax regulations and customs regulations. Tax reform is important to ensure clear rules for business, it’s absolutely understandable, that’s why I’m speaking about it mainly, as about priority.
The second very important priority for us is digitalisation. It’s absolutely understandable that in the modern world in the 21st Century, the government, the state just wouldn’t be efficient without innovations, without ITs. In Ukraine, we have a great IT spheres, a lot of very highly talented people in this sphere, and we are going to, and we already attracted them into our government, into our team. We have very strong and very qualified team – IT team, IT – a lot of actually, IT teams inside our government. We need to bring some, to create some efficient and good solutions. We need a good data, and frankly speaking, we still have not enough data to do it. So, right now we are working on collecting some data and connecting and gathering all our registers, databases and so on and so forth, to make our state more efficient. We have – we still have, in Ukraine, a lot of post-Soviet barriers, limits, and absolutely doubtless we should cancel them. I speak, first of all, about land moratorium. I know that the Land Reform is a very complicated topic in our society, but we are very – we are standing on the position that we should provide this reform, first of all, and nearest – in coming months. It’s a very important signal, not only because the Land Reform, from my point of view, is a signal to all over the world that in Ukraine, the real – the complicated reforms could be provided. It could happened.
We have a lot of different limits in some, and other spheres. For example, we have a lot of limits, if we’re speaking about the movement of capital. We have a lot of limits in our labour regulations, because they was created – they were created in the middle of last century in the Soviet Union and of course, it’s absolutely unacceptable to keep all these rules in 21st Century. We should simplify them and we are ready to simplify them. One more important topic for Ukraine of course, is the corruption and we are ready to fight against corruption and we already do it. We will start from decreasing the level of influence and participation of our state, of our government and economy, and we are ready for the big privatisation. We already prepared more than one – 500 different assets to be sold, to be moved into some efficient owners next year. We have very good professional, a young talented Manager in our State Property Fund, this is the state body, main state body in Ukraine are responsible for big privatisation, that’s why I haven’t any doubts that the big privatisation is possible now in Ukraine.
Another issue is the monopolies. Of course, monopolies are – it’s very bad for fair competition. Energy sphere and infrastructure sphere has a lot of monopolies right now in Ukraine and the need of reform in the energy sector is maybe one of the most reform we are going to provide, next in coming months. Last week, actually the President signed a law, maybe you heard about it, the law about unbundling of Naftogaz. Ut’s a very complicated decision, was the very complicated decision. But right now, we almost have the independent operator for our gas transport system, and for us, it’s very good step. It’s very good achievement, and a very big achievement because it was not very easy to adopt this law and this – all these sub laws. Of course, let us be clear that all these reforms and initiatives will not succeed, unless they are supported by the new strong institutions who understand it. And one such institution is the Judiciary, Judicial Reform has not yet successful – enough successful in Ukraine, but last half of year or last months, I believe we have a great progress here.
4 Ukraine’s Reform Agenda: Shaping the Future
First of all, for example, the High Anticorruption Court has launched and it already works, and I haven’t any doubts that the Judges in these court are highly professional and well trusted persons in our society, and they will do their best to bring our judiciary into another level. Of course, there are a lot of different and other activities already done next – last couple of months. But there are a lot of very important institutions should be supported in Ukraine, such as Anti-Monopoly Committee and such as National Bank of Ukraine. From the start, we told that National Bank is independent and of course, we should support it, this independence, because it creates a very important base for macroeconomic stability. And actually, right now, of course we should improve their capacity, we should support them, we should protect them, but right now, I can already tell that National Bank and Anti-Monopoly Committee are capable enough to make their job well.
Finally, today my government is working on the transformation, which, by the – by its scale and complexity, is unprecedented, and I think we have very good macroeconomic situation in Ukraine. As I already told today, at last two quarters our economic growth, more than 4% and we expect that all these reforms, we are going to provide next year, will speed up this growth next year. And from my point of view, it’s a great time for all investors to come to Ukraine, to reach a lot of money, because our government is going to decrease the level of risks and issue for them.
Our government is the youngest government in the history of our country. Our Parliament and our President, the youngest in the history of our country, what it means? For us, it means not that our country leads by some just another people, we changed the generation in our country, which leading this country. And we’re absolutely open for a new – for challenges of this world, and for us, of course, it’s very important to have support of this modern world. We understand that the main resources is, in this 21st centuries world, is the trust, that’s why, for us it’s very important to have a trust from you, and you can be sure that we will use this trust to make great changes of our country and to make more people happy in this world. Thank you very much for your attention and I am ready to answer your question [applause].
Robert Brinkley
Well, Prime Minister, if I may, I’ll start off the questioning and then we’ll open it up for the audience. You talked there about creating a level playing field. You said that your government supports the independence of the National Bank of Ukraine, and you talked about gaining the trust of the outside world, which is so important. How can your government demonstrate, to the outside world, that you’re working for Ukraine as a whole and not in the interest of one or other big business figure? And I think, judging by what the IMF and other international donors have been saying, and I don’t see a great rush of investors so far, they still need to be convinced, how are you going to convince them?
Oleksiy Honcharuk
Thank you for such a complicated question. If you allow me, I will switch on my native tongue and I’ll ask to help with the translation, because I want to be as honest, as clear as possible. It’s still complicated. [Mother tongue].
Translator
With all our deeds and with all the actions we have taken so far, we are trying to show that we remain to be the most independent government ever in Ukraine.
5 Ukraine’s Reform Agenda: Shaping the Future
Oleksiy Honcharuk
Not trying to show, but we already show. [Mother tongue].
Translator
It’s easily visible if you just take a look at whose part of the government.
Oleksiy Honcharuk
[Mother tongue].
Translator
For instance, our Economic Minister received his education overseas and he is a Professor of one of the US universities.
Oleksiy Honcharuk
[Mother tongue].
Translator
And actually, our Minister of Justice actually had been working for the World Bank for a lot of time and received education in London.
Oleksiy Honcharuk
[Mother tongue].
Translator
And I can be talking about every Minister in our government with the same passion.
Oleksiy Honcharuk
[Mother tongue].
Translator
These are the people with absolutely different values, and are eager and ready to work to change the country for the better.
Oleksiy Honcharuk
[Mother tongue].
Translator
People of the same professional level are now leading the key Ukrainian Government agencies.
6 Ukraine’s Reform Agenda: Shaping the Future
Oleksiy Honcharuk
[Mother tongue].
Translator
And they’re normally hired through transparent competition.
Oleksiy Honcharuk
[Mother tongue].
Translator
And this already is producing results.
Oleksiy Honcharuk
[Mother tongue].
Translator
For instance, last week, our Parliament already approved our country’s next year’s budget.
Oleksiy Honcharuk
[Mother tongue].
Translator
And that’s probably a record that they’ve made, in terms of passing the budget for next year that early.
Oleksiy Honcharuk
[Mother tongue].
Translator
Well, normally, it had been happening for nights long and they have been approving this budget probably a night before the New Year, and last week, it just takes several days let’s say, to have the budget completely approved.
Oleksiy Honcharuk
[Mother tongue].
Translator
And what it means actually, is that when you take a look at that budget, you may not see any vested interest encrypted into this budget.
7 Ukraine’s Reform Agenda: Shaping the Future
Oleksiy Honcharuk
[Mother tongue]..
Translator
And that makes different influential groups feel very bad.
Oleksiy Honcharuk
[Mother tongue].
Translator
That’s why many of them are now continuously speaking publicly a lot.
Oleksiy Honcharuk
[Mother tongue].
Translator
We can see many of their interviews that are now broadcasted by many different outstanding TV stations and other media.
Oleksiy Honcharuk
[Mother tongue].
Translator
But this is – this only demonstrates that those people still try to keep up, pretend they are still influential, which is no longer the case.
Oleksiy Honcharuk
[Mother tongue].
Translator
So the business – so that’s why we’re trying to show that we’re absolutely independent, we want to work and we do work absolutely in a different manner, which we will obviously continue to do.
Oleksiy Honcharuk
[Mother tongue].
Translator
Of course, this government is pretty much reliant on the President, which was already mentioned.
8 Ukraine’s Reform Agenda: Shaping the Future
Oleksiy Honcharuk
[Mother tongue].
Translator
And the President, in his turn, is primarily led by his voters and as you’ve heard already, there were 73% of voters who supported the President.
Oleksiy Honcharuk
[Mother tongue].
Translator
So, in anything our government has been and will be doing, you will hardly see any kind of attempt to appease any vested or influential groups out there.
Oleksiy Honcharuk
[Mother tongue].
Translator
So, anything we’re doing is primarily focused on establishing a proper rule of law, also, fair competition, access to justice and transparent and open borders.
Robert Brinkley
You referred just now to the Parliament passing the budget in record time. I think the Parliament, with this big majority of the ruling party has been breaking other records as well, for not just the speed, but the quantity of legislation that’s been going through. But that, in turn, I think, has raised some questions within Ukraine, has there been enough time for consultation with interested parties? Are mistakes being made? Are you putting more value on speed and quantity and not enough value on the quality of legislation? How would you answer that?
Oleksiy Honcharuk
[Mother tongue].
Translator
There must be balance everywhere and always.
Oleksiy Honcharuk
[Mother tongue].
9 Ukraine’s Reform Agenda: Shaping the Future
Translator
You know, there is a saying in Ukrainian, which says, if the law hasn’t been produced by yourself, it always seems to be bad for you.
Oleksiy Honcharuk
[Mother tongue].
Translator
Of course, anything can be criticised as much as possible and we’ve got to judge, in terms of the quality of those regulations and laws passed, after they’re enforced and we’re going to see the effect of them.
Oleksiy Honcharuk
[Mother tongue].
Translator
So I must say we shouldn’t waste a single minute and continue the change process and change things in the country, as much as that can be done so far.
Oleksiy Honcharuk
[Mother tongue].
Translator
But you rightly mentioned that the biggest value we need to create right now is really, trust.
Oleksiy Honcharuk
[Mother tongue].
Translator
And to build this credibility and trust, one has to make sure you actually don’t fear things and you need to actually move ahead and be transparent enough.
Oleksiy Honcharuk
[Mother tongue].
Translator
Of course it takes time to build and then maintain this dialogue, and that’s exactly what we’re trying to do.
10 Ukraine’s Reform Agenda: Shaping the Future
Oleksiy Honcharuk
[Mother tongue].
Translator
Of course, when you are making a lot of changes at a time, you can’t avoid mistakes.
Oleksiy Honcharuk
[Mother tongue].
Translator
But we are ready to accept that we made a mistake and acknowledge them and we’re working closely together to have them corrected.
Oleksiy Honcharuk
[Mother tongue].
Translator
And I think this is another thing that can help build more trust.
Robert Brinkley
Let’s ask the audience for questions. There are microphones coming round, so when I pick you for a question, please can you keep your hand up, so the person with the microphone can see you. One here, please. And when you get the microphone, can you please give your name, and if you wish, your affiliation, and please keep your questions nice and short, so that we can get lots of people in.
Mathieu Boulègue
Thank you very much, Prime Minister. I’m Mathieu Boulègue, I’m a Research Fellow at the Russian and Eurasia Programme, and I’ve been working specifically on civil society resilience in Ukraine with my colleague, Orysia Lutsevych from the Ukraine Forum. How do you see the place of civil society in the Agenda Reform, as civil society has always been a driver for change and reform in Ukraine? And if I can ask a very short provocative question, you’ve been speaking about a new generation of young educated Ukrainians in Politics, with new values. Does that include the current Minister of Interior, Arsen Avakov? Thank you.
Oleksiy Honcharuk
[Mother tongue].
Translator
I’m convinced that this role played by the civil society in Ukraine is immense and extraordinary.
11 Ukraine’s Reform Agenda: Shaping the Future
Oleksiy Honcharuk
[Mother tongue].
Translator
I started my speech tonight by actually recalling those events back six years ago, when myself and friends of mine were actual participants of that Revolution of Dignity.
Oleksiy Honcharuk
[Mother tongue].
Translator
And the civil society’s role in those events cannot be overestimated. I think their role was very decisive at that point.
Oleksiy Honcharuk
[Mother tongue].
Translator
We have action we are taking at the moment. We’re trying to co-ordinate them properly with civil society organisations.
Oleksiy Honcharuk
[Mother tongue].
Translator
And that’s not very difficult indeed, ‘cause we are likeminded people together and we have the same values we want to follow.
Oleksiy Honcharuk
[Mother tongue].
Translator
And I think there are still many people in our government who still think that they are part of civil society, and that’s what they think about themselves.
Oleksiy Honcharuk
[Mother tongue].
12 Ukraine’s Reform Agenda: Shaping the Future
Translator
In answering the second question of yours, regarding our Minister of Interior...
Oleksiy Honcharuk
[Mother tongue].
Translator
...actually, we have two Government Ministers, who actually were in the previous government as well, and I’m talking here about the Interior Minister and the Finance Minister.
Oleksiy Honcharuk
[Mother tongue].
Translator
So we actually decided to keep those professional people, on the one hand at the Ministry that oversees the law enforcement institutions like the National Guards and the Police, as well as another Minister, who actually laid a good foundation for the Ukraine’s financial system to actually to keep them in this not a very easy time for Ukraine.
Oleksiy Honcharuk
[Mother tongue].
Translator
And actually, we are looking closely at what every ministry is doing, and we are judging only by their accomplishments and dates.
Robert Brinkley
Okay, next question. The lady over there, please.
Latika Bourke
Thank you, Prime Minister. My name is Latika Bourke. I’m a Journalist with the City Morning Herald in Australia. Could you please explain to the victims of MH17, why your government agreed to send Volodymyr Tsemakh back to Russia in the recent prisoner swap, out of the reach of Investigators, ahead of the trial next year?
Oleksiy Honcharuk
[Mother tongue].
13 Ukraine’s Reform Agenda: Shaping the Future
Translator
I think this tragedy happened and that’s the fault of the Russian Federation.
Oleksiy Honcharuk
[Mother tongue].
Translator
And definitely all the guilty ones must be punished.
Oleksiy Honcharuk
[Mother tongue].
Translator
I just want everybody to understand here, all those developments of the past and all those tragedies is a big bad thing that happened to Ukraine.
Oleksiy Honcharuk
[Mother tongue].
Translator
And this whole story is about a large neighbouring country that is investing billions and billions into building more military capacity and presence into their arms and weapons to actually fight against the civilised world.
Oleksiy Honcharuk
[Mother tongue].
Translator
It is the story for ourselves, about the International and Global Order was breached.
Oleksiy Honcharuk
[Mother tongue].
Translator
And actually, this order must be restored through sanctions and also, co-ordinated action of all the important actors around the globe.
14 Ukraine’s Reform Agenda: Shaping the Future
Oleksiy Honcharuk
[Mother tongue].
Translator
And therefore, actually, when we talk about any single event or something happening, we need to understand the broader context.
Oleksiy Honcharuk
[Mother tongue].
Translator
And, you know, in understanding this general context, we need to learn how to call a spade a spade.
Robert Brinkley
Thank you. The gentleman there at the back of the front section.
Les Sedgewick
Hi. Les Sedgwick, Freelance Chatham House Member. I’m just wondering what you’re doing to ensure a – that there is no repeat of the kind of 1990s, of oligarchies taking massive amounts of land, with the new Land Reforms, they seem to have been passed quite quickly. And I’d just be interested in your reasoning for how quickly they were passed and the insurances against big business taking that land and that amazing economic resource, from smaller to mid-level farmers?
Oleksiy Honcharuk
[Mother tongue].
Translator
It’s a really relevant question for Ukraine at the moment.
Oleksiy Honcharuk
[Mother tongue].
Translator
And I think this entire Land Reform in creating the land market is a big step towards the Ukraine’s reform process.
Oleksiy Honcharuk
[Mother tongue].
15 Ukraine’s Reform Agenda: Shaping the Future
Translator
In fact, when we try to talk about the existing land market in Ukraine today, it’s still there, it’s already functioning, although it is grey sometimes.
Oleksiy Honcharuk
[Mother tongue].
Translator
And the bad thing about it is, without this reform, the state kind of limits those small and medium land owners of their opportunities out there in the market.
Oleksiy Honcharuk
[Mother tongue].
Translator
And for us, this reform is not an attempt to actually somehow redistribute these land resources and give it – take it from some people and give it away to some other people. This is more about restoring justice and actually stop keeping away from legitimate access to these resources.
Oleksiy Honcharuk
[Mother tongue].
Translator
Of course, the model is still under discussion.
Oleksiy Honcharuk
[Mother tongue].
Translator
Of course, businesses still have to think about adapting their business models to this newly imagined land market.
Oleksiy Honcharuk
[Mother tongue].
Translator
And of course, a certain time will still pass until the Parliament already make the ultimate decision about the Land Reform and the land resources at all.
16 Ukraine’s Reform Agenda: Shaping the Future
Oleksiy Honcharuk
[Mother tongue].
Translator
But our government will do – be doing everything possible not to give any preferences to large businesses to actually be taking all those land resources, on the contrary, we’re trying hard to actually agree this level playing field for medium and small businesses.
Elena Istratescu
Lady here, please.
Robert Brinkley
Thank you, Prime Minister, for your speech.
Robert Brinkley
Could you introduce yourself?
Elena Istratescu
Yes, I’m Elena Istratescu, Morgan Stanley, Head of Senior Team and Ukraine Economist. I have two questions, if I may. One is – okay, just one. We have the IMF mission in town again, and it left in September. We were, to be honest, a bit disappointed, what preven – so, one question is, can it leave without the deal for the second time, ‘cause for the second time, it would be much more negative signal to the markets? Thanks.
Oleksiy Honcharuk
[Mother tongue].
Translator
The IMF mission is currently being [inaudible – 42:19] at the moment, and they are now working closely with our government colleagues there.
Oleksiy Honcharuk
[Mother tongue].
Translator
You clearly understand that I cannot command here for the mission itself, and I cannot tell you in advance, what’s going to be the outcome, ultimately.
17 Ukraine’s Reform Agenda: Shaping the Future
Oleksiy Honcharuk
[Mother tongue].
Translator
But here are the two important things that I would like to mention here.
Oleksiy Honcharuk
[Mother tongue].
Translator
First of all, our co-operation with IMF is not that much about money, but it’s a lot about trust.
Oleksiy Honcharuk
[Mother tongue].
Translator
And I have no doubt whatsoever that every next day that we continue working with the mission, our credibility and trust grow.
Oleksiy Honcharuk
[Mother tongue].
Translator
And, you know, if you track back the entire Ukraine’s independent history and a history of all the governments, it was never a case when, for instance, the IMF mission would come after the new government came to office, and over a month’s time, they left with total success.
Oleksiy Honcharuk
[Mother tongue].
Translator
And over, some of the – some of those negotiations sometimes took six months and even longer.
Oleksiy Honcharuk
[Mother tongue].
Translator
I think it’s been ten weeks since our government started talks with the IMF so far.
18 Ukraine’s Reform Agenda: Shaping the Future
Oleksiy Honcharuk
[Mother tongue].
Translator
So I cannot see any tragedy here yet.
Oleksiy Honcharuk
[Mother tongue].
Translator
But I’m sure these tough level arrangements and actually, agreements will be reached there very soon.
Robert Brinkley
Yeah, here, please.
Tim Ash
Mr Prime Minister, Tim Ash from Bluebay. Firstly, congratulations, because I think your programme is innovative, very ambitious, and things like Land Reform that for 30 years, in a country like Ukraine with the best soil in Europe, you know, this can be transformational. And, you know, privatisation, you mentioned digitalisation and also, for being very ambitious. I mean, your 40% over five year growth target is absolutely achievable, you know, if you follow through with the Land Reform, and also, if you deliver on what you said previously, in terms of rule of law. But my question, I guess, and I’m sure you know what question I’m going to ask, right, so the question is on PrivatBank, which I think is the number one issue for investors, it’s the number one issue for the IMF. What’s the strategy now if the Ukrainian courts rule for denationalisation?
The second question I guess is, you know, there has been talk about compromises and deals being done with oligarchs around the banking crisis of 2015 to 2017, you know, what kind of deals could be done? And then, a very specific question, I mean, in relation to the PrivatBank case, there is a London – obviously a London legal case and it’s been really specific about what happened. I mean, it’s really interesting for everyone in the room to actually read the documentation. But if that case rules that there was actual fraud, a 5.5 billion fraud, is it at all possible that a deal could be done with that particular oligarch?
Robert Brinkley
Thank you.
Oleksiy Honcharuk
[Mother tongue].
19 Ukraine’s Reform Agenda: Shaping the Future
Translator
I thank you for this question.
Oleksiy Honcharuk
[Mother tongue].
Translator
Timothy, you shouldn’t have asked it, I could have guessed it.
Oleksiy Honcharuk
[Mother tongue].
Translator
I am very sure that, and I am sure about this, and the President is as well, as well as our government, that the PrivatBank case is really outstanding for the rest of the world as well, not only for Ukraine.
Oleksiy Honcharuk
[Mother tongue].
Translator
That’s why we stand firmly on such an opinion that neither the bank itself, nor the money should be returned to the former investors.
Oleksiy Honcharuk
[Mother tongue].
Translator
And this is our clear position.
Oleksiy Honcharuk
[Mother tongue].
Translator
And we are going to be doing everything possible, for that kind of a thing in our position, to be well established and protected.
Oleksiy Honcharuk
[Mother tongue].
20 Ukraine’s Reform Agenda: Shaping the Future
Translator
If you’re asking about the courts...
Oleksiy Honcharuk
[Mother tongue].
Translator
...and, you know, I’ve had experience of working with courts a lot.
Oleksiy Honcharuk
[Mother tongue].
Translator
And of course strategies, notwithstanding different rulings that a court can make, can be different.
Oleksiy Honcharuk
[Mother tongue].
Translator
But you’ve got to be sure that we have a strategy, if not, strategies to actually give a proper response to whatever situation that might happen.
Oleksiy Honcharuk
[Mother tongue].
Translator
And now actually, our government, as well as the President, I’m sure, will be doing everything possible for this case to be a real signal from Ukraine that Ukraine has really changed.
Robert Brinkley
Thank you. There’s a lady, second row from the back.
Eugena Klochkoviko
Thank you. Prime Minister, you mentioned Ukraine is...
Robert Brinkley
Could you introduce yourself, please?
21 Ukraine’s Reform Agenda: Shaping the Future
Eugena Klochkinoviko
Sorry, you mentioned Ukraine’s still in...
Robert Brinkley
Who are you?
Eugena Klochkinoviko
Oh sorry. Eugena Klochkinoviko. You mentioned Ukraine still involved with Russia, but however, Ukraine resumed supplies of commercial electricity from Russia, does it mean Ukraine ready for just to go softer sanctions against Russia or how a Deputy Prime Minister mentioned there’s some cancellations, some sanctions in January in next year. What do you think?
Robert Brinkley
Ukraine is still at war with Russia, but it is taking electricity from Russia, does it mean you’re going soft on the sanctions?
Oleksiy Honcharuk
[Mother tongue].
Translator
Ukraine has a real, really straightforward energy strategy.
Oleksiy Honcharuk
[Mother tongue].
Translator
So our principle major, if not say, main system operator in Ukraine has signed the memorandum with most of the European system operators, that the Ukrainian grid will be absolutely and completely integrated with the European one by 2023.
Oleksiy Honcharuk
[Mother tongue].
Translator
And what this actually means for Ukraine’s entire grid to be integrated with that of the European Union, we obviously need to be disconnected from the grid with the Russian Federation, while with which it will have been historically connected, as you may probably know.
22 Ukraine’s Reform Agenda: Shaping the Future
Oleksiy Honcharuk
[Mother tongue].
Translator
And then, over time, it has to stay in function on its own by itself.
Oleksiy Honcharuk
[Mother tongue].
Translator
And only then after when the infrastructure is properly built then it can be integrated with the EU power grid.
Oleksiy Honcharuk
[Mother tongue].
Translator
And these are the plans we have and we will be doing everything possible to deliver on the plan.
Oleksiy Honcharuk
[Mother tongue].
Translator
But like I said, historically, the Ukrainian-Russian power grids are always connected.
Oleksiy Honcharuk
[Mother tongue].
Translator
And, you know, during all those times we normally have those ups and downs in the power supplies.
Oleksiy Honcharuk
[Mother tongue].
Translator
So, those, actually, energy supplies and power supplies, they’re not just happening yesterday.
23 Ukraine’s Reform Agenda: Shaping the Future
Oleksiy Honcharuk
[Mother tongue].
Translator
And if you take the real share of those, so to say, supplies in the entire Ukraine’s grid capacities, that’s really minute.
Oleksiy Honcharuk
[Mother tongue].
Translator
So to give you a quick answer to that question, actually, Ukraine will be doing everything possible and as swift – as swiftly as possible to get disconnected from the Russian Federation’s power grid, and be connected as soon as possible to that of EU.
Robert Brinkley
The lady at the back, please.
Julia Macfarlane
Hi, Julia Macfarlane, ABC News. Prime Minister, welcome to London and thank you for your comments. I wanted to ask, President Zelensky reacted to some comments that Kolomoisky made recently about Ukraine needing to turn back to Russia. The President said that it was his wish that elected officials determine Ukrainian policy and not oligarchs and businessmen. I wanted to ask how is that going so far? And one example, I mean, Vitali Klitschko – Zelensky wanted Klitschko out of office, but he’s managed to use his influence to hang in his job, so I just wanted to ask how that challenge is going? Can this new generation of leadership really shake off the Old Guard?
Oleksiy Honcharuk
[Mother tongue].
Translator
Like I already said, actually there is no influence on the President, nor there is any on government from oligarchs.
Oleksiy Honcharuk
[Mother tongue].
Translator
However, there are so many groups of influence in Ukraine and very influential individuals who actually use every attempt to speak up publicly and make their declarations, that’s all natural.
24 Ukraine’s Reform Agenda: Shaping the Future
Oleksiy Honcharuk
[Mother tongue].
Translator
I don’t think I’m in a position to share my comments about opinions of those people.
Oleksiy Honcharuk
[Mother tongue].
Translator
And I’m sure that this President we have today is a very honest, diligent and professional person, and this is exactly a very good opportunity for our country these days to create opportunities.
Oleksiy Honcharuk
[Mother tongue].
Translator
And I have no doubt whatsoever that in any situation, the President will always put the interest of the state much higher than any other interests out there.
Robert Brinkley
A question in the front here, please, gentleman here.
Robert Gardner
Prime Minister, thank you. I’m Robert Gardner, Chatham House. Prime Minister, thank you very much for your talk and good luck to you. Burisma, I wonder if you could comment on, is there an investigation going on, if so, what about? And can you also comment about your relationship with the American administration?
Oleksiy Honcharuk
[Mother tongue].
Translator
Maybe I don’t know something.
Oleksiy Honcharuk
[Mother tongue].
25 Ukraine’s Reform Agenda: Shaping the Future
Translator
But thanks very much for your wishes.
Oleksiy Honcharuk
[Mother tongue].
Translator
Maybe I didn’t get your question right.
Robert Brinkley
Is there an investigation into Burisma and what is the relationship...
Oleksiy Honcharuk
Ah, our relationship.
Robert Brinkley
...your government with the US administration?
Oleksiy Honcharuk
I didn’t catch the name of the company. [Mother tongue].
Translator
I don’t have every detail about this investigation.
Oleksiy Honcharuk
[Mother tongue].
Translator
That’s why I won’t share any comments right now about that ‘cause my words could be used for manipulative purposes.
Oleksiy Honcharuk
[Mother tongue].
Translator
On the other hand, I am still very convinced that President Zelensky will never be involved in any kind of stories, manipulative stories or gains. And whatever the investigation produces and leads to, I’m sure it – President Zelensky will be out of this process.
26 Ukraine’s Reform Agenda: Shaping the Future
Robert Brinkley
We’re coming to the end of our time, so I’m sorry, there’s not going to be time to take all of your questions, but I’ll take two more and then ask the Prime Minister to answer them together. Gentleman there. Is the microphone coming?
John Gawthrop
Thank you very much for your speech and welcome to London. I’d just like – my name is John Gawthrop and I work for Argus Media. I’d like to ask you about gas supplies. Do you think that there’s any chance of an agreement being reached between Russia and Ukraine over transit of Russian gas through Ukraine to Europe, by the end of this year? And as a sort of supplement to that, I know that Russia has linked the question of gas transit to supply of supposedly cheap gas to Ukraine, is Ukraine interested in buying Russian gas in the future, given that you’ve actually got...?
Robert Brinkley
Can I just take another question, then we’ll cover that?
John Gawthrop
Alright.
Robert Brinkley
Here please, in the second row.
Thomas Eymond-Latritaz
Thomas Eymond-Latritaz, Mercury. Mr Prime Minister, Oleksiy, I think you – your Premiership enjoys tremendous support internationally, as well as your governments. The main concern is about the influence of the vested interest, not so much on your governments, but on the judiciary and of the non- reform of the judiciary as being the biggest failure of the previous administration. And there has been a tax that has been proposed recently that didn’t meet a lot of positive welcome internationally. So my question is, how will you be addressing this issue that could undermine a lot of things, not just for your government, but also, FDI, the IMF, as we’re seeing it as well?
Oleksiy Honcharuk
[Mother tongue].
Translator
Northern gas transit to begin with.
Oleksiy Honcharuk
[Mother tongue].
27 Ukraine’s Reform Agenda: Shaping the Future
Translator
Yes, the talks are still on.
Oleksiy Honcharuk
[Mother tongue].
Translator
And there are two major parts here that had to be mentioned.
Oleksiy Honcharuk
[Mother tongue].
Translator
Well, Ukraine is willing and will intend to actually have integrated all the rules and procedures, in accordance with those European Standards.
Oleksiy Honcharuk
[Mother tongue].
Translator
So we’ve done much more, in the last three months, than anything that had been done years before that.
Oleksiy Honcharuk
[Mother tongue].
Translator
And so, because we’re establishing an independent gas transit operator, that’s why this company will be independent and fully in charge of the Ukraine’s gas transit system. And I’m sure, by the end of this year, Ukraine will be ready to start signing the contracts for the supplies of natural gas, in full accordance with European Standards.
Oleksiy Honcharuk
[Mother tongue].
Translator
The second part of the question is whether the agreement can be reached.
28 Ukraine’s Reform Agenda: Shaping the Future
Oleksiy Honcharuk
[Mother tongue].
Translator
And here again, it’s very difficult and I just can’t make any forecasts because the success of signing such an agreement depends very much on the two parties, the two sides.
Oleksiy Honcharuk
[Mother tongue].
Translator
And what’s important to understand here, however...
Oleksiy Honcharuk
[Mother tongue].
Translator
...I’m sure this agreement does not have to be looked at as purely the agreement between Ukraine and Russia.
Oleksiy Honcharuk
[Mother tongue].
Translator
It should be looked at as the contract that actually ensures European energy security.
Oleksiy Honcharuk
[Mother tongue].
Translator
Because such projects as the Nord Stream 2, which to my mind, is very much political and not that much economic...
Oleksiy Honcharuk
[Mother tongue].
29 Ukraine’s Reform Agenda: Shaping the Future
Translator
...it actually shows that the Russian Federation has been doing and will continue to create so many different tools to have enough leverage, and not only Ukraine, but also in the European markets.
Oleksiy Honcharuk
[Mother tongue].
Translator
This is why diversification of energy supplies to Europe is an issue of the European energy security.
Oleksiy Honcharuk
[Mother tongue].
Translator
That’s why it’s not only Ukraine that is interested in such a contract, but those are the EU member states that are stakeholders to it.
Oleksiy Honcharuk
[Mother tongue].
Translator
And it’s not an accident that this entire architecture of those negotiations involve many European actors.
Oleksiy Honcharuk
[Mother tongue].
Translator
And I’m sure, with a joint effort, we might ultimately reach the result that everybody will be happy about.
Oleksiy Honcharuk
[Mother tongue].
Translator
With regards to the vested interests question...
Oleksiy Honcharuk
[Mother tongue].
30 Ukraine’s Reform Agenda: Shaping the Future
Translator
...you know, the system of justice is composed of several very important integral parts.
Oleksiy Honcharuk
[Mother tongue].
Translator
And some of those important parts of the system are already under the governmental control.
Oleksiy Honcharuk
[Mother tongue].
Translator
For instance, the system of enforcing court rulings...
Oleksiy Honcharuk
[Mother tongue].
Translator
...or property rights registration...
Oleksiy Honcharuk
[Mother tongue].
Translator
...or actually, the system of execution of standards...
Oleksiy Honcharuk
[Mother tongue].
Translator
...all those parts are pretty much looked over by our Ministry of Justice.
Oleksiy Honcharuk
[Mother tongue].
31 Ukraine’s Reform Agenda: Shaping the Future
Translator
And like I said, we have a really, really team of champions there at the Ministry of Justice.
Oleksiy Honcharuk
[Mother tongue].
Translator
That’s why, like I said, the progress the Ministry has achieved in the last couple of months is really incredible and that’s really noticeable.
Oleksiy Honcharuk
[Mother tongue].
Translator
So we already put things into order and we already can share some of the achievements there.
Oleksiy Honcharuk
[Mother tongue].
Translator
Like I said, we’re about to complete our anticorruption infrastructure already.
Oleksiy Honcharuk
[Mother tongue].
Translator
And two months ago, we kickstarted the work of the High Anticorruption Court.
Oleksiy Honcharuk
[Mother tongue].
Translator
Actually, over the last two months, the Parliament voted for actually lifting immunity for the People’s Deputies, for the members of the Ukrainian Parliament.
Oleksiy Honcharuk
[Mother tongue].
32 Ukraine’s Reform Agenda: Shaping the Future
Translator
And we actually brought back a liability for illicit gains by High Officials.
Oleksiy Honcharuk
[Mother tongue].
Translator
We have actually reloaded the National Agency on the Prevention of Corruption as well.
Oleksiy Honcharuk
[Mother tongue].
Translator
And we, in government, have selected the highly reputable Board that will be actually working on selecting the Chairperson for this organisation.
Oleksiy Honcharuk
[Mother tongue].
Translator
Actually, an important law was passed to actually help reform the Judiciary.
Oleksiy Honcharuk
[Mother tongue].
Translator
We have a young and a very professional Prosecutor General that is working very hard on this Anticorruption Reform as well.
Oleksiy Honcharuk
[Mother tongue].
Translator
All those decisive steps that have taken place, over the last couple of months, have made me convinced that we’re doing the right thing and we’re on the right track.
Oleksiy Honcharuk
[Mother tongue].
33 Ukraine’s Reform Agenda: Shaping the Future
Translator
But of course, this takes time.
Oleksiy Honcharuk
[Mother tongue].
Translator
So we still sometimes have to be talking to every individual investor and actually handle those individual cases of those investors.
Oleksiy Honcharuk
[Mother tongue].
Translator
So our strategy is about building strong and capable institutions, therefore.
Oleksiy Honcharuk
[Mother tongue].
Translator
But our tactic, however, is to – not to leave any chance for those corrupt people anywhere in Ukraine.
Robert Brinkley
Prime Minister, thank you very much indeed. Thank you for your generosity with your time, in answering questions. I’m sorry we couldn’t get round to everybody’s questions. Thank you, all of you, for coming. Could I ask you please just to stay in your seats for a couple of moments while the Prime Minister leaves the room? [Applause].