Kuchma advance team paves way for DC visit (05/18/97)

Kuchma advance team paves way for DC visit

by Yaro Bihun
Special to The Ukrainian Weekly

WASHINGTON - President Leonid Kuchma of Ukraine arrived here May 14 for the first plenary meeting of the Binational Commission established last year to cement the strategic relationship between the United States and Ukraine.

But even before his plane left Kyiv, most of the members of his large, high-level official delegation were already hard at work in the U.S. capital, ensuring that the visit, which encompasses meetings with officials of the U.S. government and international financial institutions, members of Congress and within the four working committees of the Binational Commission, which is co-chaired by President Kuchma and Vice-President Al Gore, is successful.

The delegation included virtually all of the heads of the major ministries and government agencies, especially those dealing with economics, among them Roman Shpek, who heads Ukraine's Agency for Reconstruction and Development.

Before beginning the preparatory talks of the four committees - dealing with foreign relations, security, sustainable economic development, and trade and investment - Mr. Shpek and his colleagues spent the early part of the week in talks with representatives of the International Monetary Fund and the World Bank, discussing Ukraine's commitment to economic and structural reforms and the need to pass the budget. They also held talks with the National Security Council and the Treasury Department.

Mr. Shpek also went to Capitol Hill for a meeting with Rep. Sonny Callahan (R-Ala.) whose House Appropriations subcommittee held a hearing dealing with the worsening investment climate and corruption in Ukraine, featuring some American businesspersons who had lost their investments in that atmosphere.

That issue was also a major subject of discussion in the committee on sustainable economic development in Ukraine, which Mr. Shpek headed along with Ambassador Richard Morningstar, advisor to the president and secretary of state on aid to the newly independent states of the former Soviet Union.

In an interview in the midst of the preparatory talks, Mr. Shpek said his committee, which like the other four was preparing a joint document for the plenary session, focused not only on the problem areas of investment in Ukraine but also on the efforts undertaken by the Kuchma administration in trying to improve that climate, through the president's consultative board that includes representatives of leading foreign firms and the board of independent expert ombudsmen that looks into investors' complaints.

They specifically talked about some of the "problem investments" of American businesspeople, such as those dealing with Gala Radio and the Grand Hotel in Lviv, he said. But they also looked at some of the investment disputes that were successfully resolved, he added.

Following his meeting in Congress, Mr. Shpek said he came away feeling that American lawmakers would support President Kuchma's fight against corruption and his efforts to create a favorable investment climate for both Ukrainian and foreign private capital.

But Rep. Callahan also pointed out another problem area that has caught the attention of Congress: Ukraine's dumping practices in trading with North America, which, he said, must stop.

Mr. Shpek said he was optimistic that all these problem areas would be resolved in a "civilized and normal" manner.

"I think that as a result of this open and objective discussion of our actions - not plans, but actions taken by our government - and of our current technological and financial needs, we will be able to rebuild the trust that we shared with the U.S. government and Congress, and this will enable us to speed up the reform process in Ukraine," Mr. Shpek said.

Another, albeit sideline participant in the Washington talks was Ronald Winton, a consultant to several major U.S. companies and at the same time advisor to President Kuchma.

He said he saw "reasonable progress" being made in the economic committees, but added that the American side, including the Congress, was "a little behind the curve" on what has and has not been resolved with respect to investment complaints and on some of the improvements in the investment climate in Ukraine.

"I don't think that there's full account being given by the U.S. side to the rather considerable amount of progress that's been made by the president, by the prime minister and other entities within the Ukrainian government over the last 60 days," he said.

"I think that in the last couple of days, most of that has been worked out, (but) there are still a few outstanding issues," he added.

Mr. Winton stressed that "the American side needs to come to grips with the fact that every American company that tries to do business there is not a hundred percent right, and in a couple of the more high-profile cases, there's some right and some wrong on both sides. And you can't expect those things to be decided quickly or easily, and you can't expect the Ukrainians to just totally capitulate just because they're here and need an awful lot of relief."

As for the Congress' role in the argument over corruption and investment problems in Ukraine, Mr. Winton said: "The one thing that I hope doesn't occur - and there are some signs in some sectors that it may occur - that this becomes a political battle not between Ukraine and the United States, but between the U.S. Democrats and the Republicans."

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