On April 21, Ukrainians elected comedian and political newcomer Volodymyr Zelenskiy their new president. The following day, the business community was quick to provide a list of seven expectations it has for the new president.
“Businesses seek to see clear proposals, concrete steps and candidates for key positions – those, who will be able to support effectively the transformation processes in the country, and those who will implement important changes instead of window dressing,” said Anna Derevyanko, executive director of the European Business Association (EBA), the largest business association in Ukraine with over 1,000 members, according to an April 22 press release.
The following are the seven steps that businesses expect Zelenskiy to take, according to EBA.
One: Put professionals in key positions
Businesses want to see professionals with an impeccable reputation in such positions as the prosecutor general, the head of the Security Service of Ukraine (SBU), the minister of foreign affairs and the minister of defense. These people also must not have any ties to oligarchs or large businesses.
This will require a lot of effort and strong personal will from the new president, the statement reads.
“(Zelenskiy) needs to surround himself with very intelligent people, to remove any sources of political influence and to eliminate himself from pressure groups which he already has,” said Sergiy Yevtushenko, managing partner of UDP Renewables, a Ukrainian renewable energy investment and development company.
Depending on who will be appointed, businesses hope that Russia’s war in eastern Ukraine will come to an end.
“If (the appointments) have an effect on the resolution of the conflict in eastern Donbas, then it will be important. If the situation starts to fall apart, businesses immediately will feel (the consequences),” said Stepan Tanasiychuk, founder of IT company Stfalcon.
“People will start withdrawing money from banks, flying to other countries. In 2014, I had a lot of losses because of the war,” he told the Kyiv Post.
Two: Plan for reforming law enforcement agencies
Businesses expect a plan to be presented on how law enforcement agencies will be reformed in order to reduce the pressure on businesses.
Three: Relaunch troubled anti-corruption agencies
The next step is to relaunch the National Agency on Corruption Prevention and the Specialized Anti-Corruption Prosecutor’s Office. Also, the new president should support activities of the National Anti-Corruption Bureau of Ukraine (NABU) and the All-Ukrainian Association of Credit Unions.
Four: Macroeconomic stability
Businesses expect to ensure macroeconomic stability, including further cooperation with the International Monetary Fund (IMF). The president must also ensure the guarantee of the independence of the National Bank of Ukraine and support a low budget deficit policy.
Businesses also are concerned about Zelenskiy’s connections to oligarch Ihor Kolomoisky who is fighting for PrivatBank, Ukraine’s largest bank. Kolomoisky used to own the bank which was nationalized in 2016 due to a $5.5 billion hole in its ledger, allegedly moved out by Kolomoisky and his business partner Gennadiy Bogolyubov, via fraudulent schemes.
During the past week, three courts have controversially ruled in favor of Kolomoisky including the court ruling that says the bank’s nationalization was illegal.
If these court rulings are enforced, businesses expect Ukraine’s collaboration with the IMF to end, destroying the investment climate and the local currency, said Yevtushenko.
“Everyone has already started to prepare for instability, maybe they are already withdrawing money. This is not a massive outflow, but it already exists,” said Tanasiychuk.
Five: Continuation of structural reforms
Businesses also expect the protection and continuation of structural reforms undertaken during the past years, including public procurement reform, automatic reimbursements of the value added tax, deregulation, the State Fiscal Service reform, medical reform and decentralization.
“We want macroeconomic stability in the country, we don’t want a short-sighted economic policy to unbalance our financial system and provoke inflation,” said Yevtushenko.
Six: Legislative changes
The business community also expects Zelenskiy to initiate legislative changes, starting with liberalizing the land market by lifting the land moratorium, transparent privatization of large state-owned enterprises with the option of applying Western standards.
Seven: The independence of market regulators
Last, it is important to ensure the independence of market regulators such as the Anti-Monopoly Committee and the National Regulatory Commission, which regulates the energy and utilities sectors.
“Now a lot of questions have been raised that need to be solved by the new president. I don’t know how he will deal with them, but it surely won’t be easy,” said Konstantin Gavrilyuk, the general manager of Elopak, a producer of packaging for liquid produce.
