D.C. panel provides overview of Ukraine's first five years (09/01/96)

D.C. panel provides overview of Ukraine's first five years

by R.L. Chomiak
Special to The Ukrainian Weekly

WASHINGTON - At age 5, Ukraine is doing surprisingly well, say three experts who have followed these developments closely, and by its seventh birthday, one of them predicted, Ukraine should enjoy economic recovery.

This candid, "warts-and-all" view of Ukraine was offered at the Center for Strategic and International Studies (CSIS) in Washington on August 21 by a panel organized jointly by CSIS and The Washington Group (TWG).

Economist Oleh Hawrylyshyn, now an International Monetary Fund official who had represented Ukraine at the IMF and before that was Ukraine's deputy minister of finance, admitted that two years ago he was critical of Ukraine. "Today," he said, "it's impossible to be critical. Ukraine looks like it's catching up." Its inflation, he noted, has been stopped, but productivity is not there yet. Now, if Ukraine continues to keep the inflation down, waits for change to occur without forcing it, and fights the forces that seek to block this change, then by its seventh birthday Mr. Hawrylyshyn said he would expect Ukraine to have an economic recovery.

Roman Popadiuk, the first American ambassador to Ukraine and now international affairs adviser to the commandant of the U.S. Industrial College of the Armed Forces, recalled that a fellow ambassador in Kyiv had argued Ukraine wouldn't last five years.

At that time, he said, Ukraine had two main problems: security and identity. By now, Mr. Popadiuk continued, the identity problem has been solved, and the first credit for that should go to President Leonid Kravchuk and then Foreign Minister Anatoliy Zlenko, who "made a big effort to extend Ukraine's reach," to open up Ukrainian Embassies in many countries.

The security problem is still there, the former ambassador said, and he included in it Ukraine's energy deficiency, friction between those who want to continue Soviet-era subsidies and those who want privatization and ties to the West, but foremost the fact that Ukraine can't count on help in its security system from friendly countries large and small, because none of them would want to irritate Russia. That factor is always present in any of Ukraine's foreign policy initiatives, Mr. Popadiuk contended.

Adrian Karatnycky, president of Freedom House, who has kept a finger on Ukraine's pulse and frequently reported the results since long before independence, expressed "substantial optimism" about Ukraine's future.

He noted that despite many problems over the past five years, Ukraine now "is stabilizing in a democratic direction, and to a large extent this has to do with the kind of leadership that has been exhibited by the two people who have been custodians of that state over its first five years - President Kravchuk and President Kuchma."

While justifying the optimism about Ukraine's future, with democracy and civil society continuing to evolve there, Mr. Karatnycky also warned that it was important not to "turn away from many shortcomings that are natural to a transition from a 70-year legacy of totalitarianism."

In a discussion after their presentation, which was moderated by Richard Murphy, who is both a senior associate at CSIS and member of the board of directors of TWG, Mr. Hawrylyshyn suggested Ukraine should not give up easily when its exports are blocked with charges of dumping (as was the case last year when the U.S. said women's coats made in Ukraine were selling at dumping prices). In a similar situation, he said, Taiwan would hire some smart lawyers to find loopholes in anti-dumping regulations.

Mr. Karatnycky discounted a suggestion from the floor that there are strong forces in Ukraine pulling it towards Russia. He said he didn't see that as a major factor. Mr. Popadiuk agreed with this and recalled that when he traveled through Ukraine at the height of the problems in the Crimea, there wasn't much serious talk of going back to some form of union. But Russia, he said, hopes Ukraine will fall on its own, without any need for an aggressive takeover.

If Ukraine gets its economic house in order, he said, it will survive.