Winners
David Rubenstein,
The Carlyle Group CEO
“The greatest single place to invest in the world is the United States because of the rule of law, transparency, quality of managers, quality of managers, quality of financing, etc. Nothing is comparable to it…(Ukraine) has an image issue in the West. Most people in the United States don’t really know much about Ukraine. They see it as a country that might be in the middle of a war… They don’t really realize the opportunities here….It’s going to take five or 10 years…I do think Ukraine has some great opportunities.”
Editor’s Note: Rubenstein, one of the world’s most successful investors, is also one of the most philanthropic – pledging to give away most of his wealth while he’s still alive.
Stephen Sackur
BBC Hard Talk host
“I am going to put Ukraine in crisis. I will tell you why. I asked people to raise their hands if they had any faith in the current government’s commitments to cleaning up government and delivering on the anti-corruption and reform agenda. You know how many people raised their hands? Two! Two! This country and I would be tempted to use an F-word, but I’m not going to. This country feels to me, right now, in pretty deep trouble. You’ve got some good stories to tell. We saw the videos and you’re turning your economy around to a certain extent. But your politics is still deeply dysfunctional. Everybody here has talked about commitment to anti-corruption, the commitment to clean up this country. The bottom line is, your country’s president is of the oligarch generation and until you address the basic facts that were presented to you by Mikheil Saakashvili, who is free to talk because he’s an outsider, I think you’ve got a big problem. I will tell you one guy who knows you’ve got big problems – that’s Vladimir Putin. Factor everything else everybody has said about Putin and his desire to stamp his authority across this region and I would say, you’ve still got a crisis on your hands.”
Editor’s Note: Sackur earned his fee from oligarch Victor Pinchuk with these closing remarks alone. He cut through the fog of illusions many in Ukraine have about the problems that continue holding back the country.
Marieluise Beck,
member of German Bundestag
“I want to say that people from the outside who really try to support Ukraine on its way to reforms, we have the difficulty of rumors and not getting transparency. You mentioned there has been a change with Naftogaz and then you go out in the hall and you hear the rumor that this has been transferred to the Ministry of Economy directly. It seems that this is good for Mr. (Dmytro) Firtash. We know the name (Igor) Kolomoisky…Is there a game around Donbas, Mr. (Rinat) Akhmetov, and which role is he playing? This makes it difficult for us to take a strong stand to support the country if there is such a big hidden agenda and hidden power. When you might see a prime minister who might be wanting to be honest but he can’t because his space to move is so limited.”
Editor’s Note: Beck asked very insightful questions and, with this remark, gave ample warning to Ukraine about why its leaders might have fewer friends and lesser support in the future.
Fareed Zakaria
Host of CNN’s GPS program
“The large countries tend to do this, you always look at your past, and you point to the fact that compared with five years ago, so many regulations have been taken away. Compared to 10 years ago, so much progress has been made. But maybe part of the key is that capital isn’t looking at your past, it’s looking at you in comparison to other countries. Capital doesn’t care how good of a job you did over the last 10 years. It doesn’t care that Ukraine is better than it was five years ago. What capital is asking is: I can put my money in Ukraine or Russia or Turkey or India. By that logic, there is a very simple metric, which is the World Bank’s Ease of Doing Business Index. Ukraine is 83rd on that ranking. If you look, you’re worse than Azerbaijan, you’re worse than Turkey, you’re worse than Russia – Russia is 53. In general, that should be the metric, which is how do you compare with other countries? Because ultimately you’re in competition not with your past, but with other countries’ futures.”
Editor’s Note: Zakaria also earned his fee from Pinchuk with these and other remarks. An international perspective pays off – capitalists will put their money where they get the greatest return and whether they feel their money is safe. That is not Ukraine, by all objective measures.
Mikheil Saakashvili,
Odesa Oblast governor
“When you talk about Ukrainian elite, I think more or less all of them are children of (ex-Ukrainian) President (Leonid) Kuchma. Ukraine is at war with Russia, but the Ukrainian elite very much shares the values of the Russian elite and has very little in common with the European or American. They live the same lifestyle. They live on rent from commodities. How Ukrainian government is run — it’s like a joint-stock society: Big oligarchs have their stocks. They appoint their CEO who is the prime minister or president, depends on who has more power at the moment, they have council of directors, who are ministers, they have supervisory council, which can be MPs or shadowy figures. That’s how the country is run. They might be even abroad, wanted by law enforcement, but they still might be running this sector or that sector of the economy. The way how it works is Mr. (Finance Minister Oleksandr) Danyliuk, who is a very reform-minded guy, he has the head of tax police, who is also sitting in this hall. Danyliuk can formally fire him at any moment. But the head of tax police was put there by some shadow figure in parliament who nobody has seen, who is one of the wealthiest guys in the country. If Mr. Danyliuk fires his subordinate Mr. Nasirov, then Mr. Nasirov can fire the entire government with no problem. As a result they are all sitting in one hall and continuing the stalemate…How do you break through this? You bring in a new generation.”
Editor’s Note: Saakashvili has diagnosed the problem correctly as well as the cure – new elections bringing in a new elite that is not beholden to the oligarchs. No wonder Saakashvili, given to emotional outbursts, is facing a smear campaign.
Mustafa Nayyem,
member of Verkhovna Rada, Bloc of President Petro Poroshenko
“To make this glass not empty, it is not about parliament…We should start from not sitting with oligarchs in the president’s cabinet, with you Mr. Lutsenko and interior minister, prosecutor general and secretary of National Council of Security and Defense…When we are talking about holes in this glass, one of them is energy. What did we do with the energy monopoly of Mr. (Rinat) Akhmetov for two years? Do we have some rules for them? Let’s put legislation about an independent regulator. Who stopped that? The Bloc of President Petro Poroshenko, People’s Front…In the back office, you are sitting with those guys, dealing…We are not satisfied with the efficiency and transparency of this government and the president also…this government doesn’t have the will to fight corruption…they (elites) have media, money and they have all these law enforcement agencies and they are fighting us. What do we have? Transparency, freedom of speech and accountability…I don’t know who will win, but I know who will lose. The country will lose…”
Editor’s Note: Nayyem correctly called out Lutsenko as being part of the problem – and part of the elite – rather than part of the solution.
Losers
Olga Bielkova,
member of Verkhovna Rada, Bloc of President Petro Poroshenko
“Do you know any country in the world which would create development by putting people in jail, by prosecuting people for corruption? Because I don’t. Do more advice on economic development rather than putting people in prison.”
Editor’s Note: Bielkova made perhaps the most ridiculous and unfounded comment of the conference. There is a direct correlation between rule of law and prosperity. Allowing impunity for corruption got Ukraine to the place it is now: The poorest big country in Europe. Good rules and laws are useless without enforcement.
Yuriy Lutsenko,
prosecutor general
“I became prosecutor general at the time the office was the embodiment of evil. Getting to the trial the untouchable members of the parliament and the oligarchs is the most important problem in Ukraine because it holds back the competition. They are preserving the economy, they are conserving the policy. I don’t think the most important in my job is to calculate the number of arrested and imprisoned individuals. Ukraine needs water. Our budget is empty. The salary of an ordinary teacher is $150 a month. The budget has been robbed by the previous government and it is not being replenished because of the corruption and oligarch monopolies now…this budget has a hole in it, it leaks…My task is, once we find these leaking holes, to have them plugged.”
Editor’s Note: It’s time to put a hook in Lutsenko’s leaky glass routine. This person clearly doesn’t understand the job of a prosecutor, he’s clearly unqualified, and he’s clearly a political hack of President Petro Poroshenko. Oligarchs, murderers, and financial fraudsters are laughing all the way to their offshore bank accounts.
Pierre Lelouche,
member of French Assemblee Nationale
“If you want to fix the Middle East, you’ve got to fix it with the help of Russia. I have a problem with America right now. I do not need a new Cold War in Europe. How do we get out of this box in Ukraine? Do we wait for the Ukrainian political class to come up with the necessary legislation to get Minsk implemented? The only way you’re going to keep Russians at bay is to succeed with the economic and political reforms.You have to take yourself by the hand and fix it. What Russia did is unforgettable and unforgivable (in Crimea). The reality is that in Washington, Paris, London and elsewhere, nobody is going to do the 1853 war in Ukraine again.”
Editor’s Note: It’s hard to imagine a politician other than Donald Trump getting so many things dead wrong. Russia is stirring up problems in the Middle East, not fixing them. The Russians have not lived up to any of their Minsk peace agreements, not Ukraine. The only point he got right is that Ukraine needs to get its own house in order by reducing corruption and creating rule of law.
Roman Nasirov,
head of Ukraine’s State Fiscal Service
“We’ve been dealing over the past year and a half not just with corruption, but with organized crime. Crime which has existed for many years, which was with the previous regime…where we have a problem today is so-called petty cash corruption. An officer who earns $100 a month is at high risk of being bribed, and at a high risk that he will accept a small bribe to feed his family.”
Editor’s Note: The disingenuousness of Nasirov’s comments is outmatched only by the extent to which they distract from the kind of corruption that is destroying Ukraine and keeps the vast majority of its population in grinding poverty: grand corruption sanctioned by top officials who treat Nasirov’s fiscal police as their personal muscle as opposed to state revenue collectors.
Kevin Spacey, actor
“A few years ago, Victor (Pinchuk) got Cirque de Soleil to perform at his birthday party. What you might not know is that afterwards, Cirque de Soleil invited Victor to join their troupe. Because he received no formal acrobatic training, but he’s still able to balance a billion-dollar empire, dozens of philanthropic and diplomatic projects, all the while juggling a wife and four kids. Now Victor, if you could just learn how to do all that on a unicycle, I’m sure they would love you to play in Vegas…I don’t make these moral equations about what I’m doing.”
Editor’s Note: Kevin Spacey, whose character Frank Underwood from House of Cards is known for murdering an enterprising journalist who threatened to get in the way of his political ambitions, happily spoke at Pinchuk’s invitation, a man who happens to have lived out that fantasy. Ukrainska Pravda co-founder Georgiy Gongadze was murdered 16 years to the day before Spacey’s speech in a murder plot in which Pinchuk’ father-in-law, former President Leonid Kuchma, remains the prime suspect. Spacey’s speech, besides complimenting Pinchuk at the start and leaving time for an equally complimentary Q&A session after, was a canned boilerplate story that he’s repeated many times before. With an estimated net worth of $80 million and worldwide fame, it’s surprising that Kevin Spacey needs to charge by the hour. But the actor’s speech on Sept. 15 revealed his willingness to prostitute himself in real life, too, without “moral equations.”
Volodymyr Groysman,
prime minister of Ukraine
“Criticism is our national sports. One hasn’t even started his job yet, but they are criticising him already. The government has enough reform-oriented people that can make a change – that’s exactly what we are doing. The decisions that the government is taking today are absolutely transparent. All the state bodies that have to fight corruption are doing it today. They are professional and independent enough.”
Editor’s Note: Groysman didn’t lack eloquence and boldness in his speech. What he lacked were facts to back his statements. He spoke in very general words, failing to name any concrete achievements or even plans of his Cabinet. The timing was against him: On the day before the speech, it became known that the Economy Ministry took over Uktransgaz, one of the key enterprises of the state-owned Naftogaz. After harsh criticism, the ministry rolled back its decision. But when Groysman was asked about it during a Q&A session after his speech, he answered vaguely, saying that he will do what is best for Ukraine – a banality which seems to be his favorite type of statement.
Leonid Kuchma,
president of Ukraine in 1994-2005
“I want to talk about goats. Do you still remember what a goat is? A Belgian entrepreneur has a goat farm in Lvivska Oblast. He’s asking, ‘How can I survive with my goats when the banks give loans with an interest rate of 23 percent?’ Let’s think about the development of our businesses. There is none. We forgot about it. Even under ‘good’ (ex-President) Viktor Yushchenko, who loved the West so much, there wasn’t a single joint Ukrainian-Western business project. Under ‘bad’ me, GDP grew by an average 8.4 (percent) every year, for the last five years of my rule.”
Editor’s Note: Embarrassment was in the air as Kuchma delivered his out-of-place, illogical remarks during a panel on foreign investments and a new economy. His major point was: Ukraine should stop caring about foreign capital and do its own thing, whatever that is. His other point was: Kuchma was Ukraine’s greatest ruler. Both were met with polite nods and scant applause.
