FOR THE RECORD: Lazarenko at National Press Club (08/04/96)

FOR THE RECORD: Lazarenko at National Press Club

Following are excerpts of the statement of Ukrainian Prime Minister Pavlo Lazarenko at the National Press Club in Washington on July 26.

Using this opportunity, I would like to express my sincere satisfaction with the results of my working visit to the United States, as well as with the advancing development of bilateral relations between our two nations, which are quickly attaining a friendly partnership character, and are one of our most important priorities. In the name of the president of Ukraine, I express my gratitude to the American president, administration and United States Congress for their political and economic support which today is granted to our country in an extremely complex time for us, a time of radical socio-economic transformations. ...In this complicated time of economic transformation and precipitous moves towards democratization, the importance of support given to our reforms by the United States and the West is difficult to overestimate.

We have already declared, and I would like to reaffirm it once more, that deeper trans-Atlantic cooperation and integration into European structures are our conscious choice. ...Among the gains on this course, it is necessary to note the acceptance of Ukraine to the Council of Europe; the greater level of cooperation with the European and Eastern European Unions, G-7 nations, and NATO; active inclusion in important subregional and regional forms of cooperation in Europe; and our acknowledgment as a nation with an economy in transformation by the European Union and Japan. ...

The purpose of my visit to the United States can be stated in the following way: to whatever degree possible, in a broader and more detailed manner, to familiarize the leadership of the United States, the International Monetary Fund and the World Bank with the situation in Ukraine since the adoption of the new Constitution, and to secure support from your great nation and these leading world institutions in the matter of further reforming the Ukrainian economy. ...

As I have already mentioned, with the adoption of the new Constitution the Ukrainian nation has begun a qualitative new age of its development.

Above all else, the national economy of Ukraine has obtained a specifically delineated set of laws, the measures of which were based on the equality of all forms of ownership, including private, with special emphasis on land. Ahead lies an immense amount of work on the adoption of over 50 legislative acts needed to effectuate provisions of the Constitution that deal with the economic sphere. ... our nation is persistently following the course of economic reform begun by Ukrainian President Leonid Kuchma in the fall of 1994. As a result of their coming to fruition and development, today certain macroeconomic stabilization can be observed.

Aside from this, the level of inflation in the past three months has not surpassed 1 percent per month (in May, 0.7 percent, June, 0 percent). The exchange rate of the national currency is increasing as well. The rates of production decline also have gotten smaller. The process of privatization is gaining pace. In Ukraine, at the given moment, 40,000 entities have been privatized, while at the same time 7,600 large and medium-sized companies were converted to joint-stock companies, and out of those, nearly 3,000 were fully privatized. In total this year, 30 percent of all firms were privatized. Mass small-privatization has been completed. The program of restructuring of the first group (43 large industrial firms) has been approved, and so far three unprofitable mine shafts have been closed down. In the near future, 20 more mines are scheduled to close.

All of this shows that the government is tightly sticking to its adopted path of reform. As a result, during the past few months in Ukraine there has not been a single deviation from a reform program agreed upon with the IMF. It is necessary to mention, without overlooking the certain positive developments in Ukrainian economic reform, that today the nation finds itself in an extremely difficult financial standing. Internal debt consists of more than 300 trillion karbovantsi. ...

In an attempt to overcome financial hardship, especially reducing the budget deficit, the government has introduced an outlined regime of budget spending. For social spending, 80 percent of budget funds have been allocated. The government payroll staff has been reduced by 20 percent. The sizes of salaries in the budget sphere have been restricted. Loopholes in legislation which allow the payment of taxes to be avoided are also being removed.

... immediate foreign financial aid to our country is indispensable.

In conjunction with this, we are counting on the fact that the United States now, like before, will view our problems with understanding and will give us financial support so needed right now for Ukraine to continue on the way to market reforms and the establishment of democratic institutions.

With the intention of continuing on the course of economic and social reforms, we expect to obtain credit from international financial organizations, first and foremost from the International Monetary Fund.

In closing, I would like to once again state that since the adoption of the Constitution on June 28, 1996, there will be no turning back from our course of integration into the community of democratic nations. Although at the present time we are in a complex and difficult period for our young nation, we hope that we can count on support from your country, from your great nation. I am convinced that this period of our relations will go down in gold letters in the history of Ukrainian nationhood and will forever remain in the grateful memory of the Ukrainian nation.

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