Roman Romanov, the head of the national defense industry concern Ukroboronprom, denies accusations of mismanagement and refuses to step down, despite the fact that Ukrainian Prime Minister Volodymyr Groysman advised him to do so.
Romanov told online newspaper Liga.net that he would continue to execute his duties.
During the cabinet meeting on Dec. 27, Groysman said he would initiate Romanov’s dismissal because Ukroboronprom’s Mykolaiv Shipyard had failed to pay its employees for months. Groysman said he asked Romanov to pay off the debts by Dec. 25, but it hadn’t happened. Mykolaiv Shipyard owes its workers $2 million, or Hr 58 million, in salaries.
In the statement on Ukroboronprom website, Romanov said that the reason behind the gap in payroll is a state debt for unfinished missile cruiser, called “Ukraine.” The debt of $2.2 million (Hr 61 million) appeared after the state failed to provide reimbursement for the maintenance of the cruiser, so Ukroboronprom covered all the expenses since February 2015. The concern expected to get the expenses back and cover all the salaries, but it didn’t happen.
Romanov published the letter from the Ministry of Defense, saying that the army hasn’t seen the need to rebuild the cruiser neither in 2014 nor in 2017.
Another document features a request from Ukroboronprom to the Cabinet of Ministers, where Mykolaiv Shipyard, run by Ukroboronprom since 2011, links financial difficulties to lack of shipbuilding orders. Since 2006, the company hasn’t built any new ships.
Although Ukroboronprom has 134 military-industrial companies under its umbrella, Romanov said he has no right to redistribute the funds from other companies based on the regulations.
“If (we) withdraw funds from other defense industry enterprises, namely (aircraft manufacturer) Antonov, Kharkiv Machine Building Design Bureau, (manufacturer of heavy equipment) Malyshev factory, (air-to-air missile manufacturer) Artem factory, and others, Ukraine will be left without airplanes, tanks, and other weapons,” he said.
Instead of criticism, Romanov expected to hear gratitude for Ukroboronprom achievements – for almost 15,000 units of weapons and equipment, designed since the war in eastern Donbas started, new workplaces, saved money, and more.
Under Romanov’s management since 2014, the concern had become profitable for the first time in a long time. In 2016, its net income amounted to more than $1 billion, and export volume grew up to 25 percent.
At the same time though he is being criticized by the experts of the industry for a slow pace of changes.
Viktor Plakhuta, former head of the department of defense and security at Economy Ministry, said in his op-ed to the Kyiv Post that Romanov dismissal and appointing of the next CEO should be first among many other steps to reform the concern.
Meanwhile, Ukraine’s National Anti-Corruption Bureau suspects one of Ukroboronprom’s companies of money laundering from a $39 million contract to supply parts for Antonov AN-32 aircraft to the Iraqi defense ministry.
