Kyiv spruces up for convention of EBRD's board of governors (04/26/98)

Kyiv spruces up for convention of EBRD's board of governors

by Roman Woronowycz
Kyiv Press Bureau

KYIV - Kyiv is sprucing up. Everywhere there are in freshly painted buildings and newly re-paved streets. Workers are rapidly finishing work on reconstruction projects that have languished for years. Hotel rooms have been remodeled. And two historic churches, long destroyed, have been rebuilt.

The flurry of activity is in anticipation of next month's annual convention for the European Bank of Reconstruction and Development board of governors. Scheduled for May 9-12, it is Kyiv's first world-class convention, and the city is making every effort to pull it off in a world-class way.

Ukraine is looking at the annual convention, which will include the board of governors meeting, a business forum and an exposition of Ukrainian business potential, as well as the usual entertainment and cultural events associated with such an endeavor, as a showcase of its investment potential. "It will give us a chance to show investors our possibilities and potential for future investment," said Yurii Poluneyev, Ukraine's London-based representative on the EBRD board of directors.

The event will cost Ukraine about $1.5 million, a relatively paltry sum for a major convention. Ukraine has kept costs low by searching out sponsors in Ukraine's banking industry and by auctioning off certain elements associated with the conference, such as the transportation of guests, which Mercedes Benz picked up.

The costs do not include extensive road maintenance and building renovations, which were needed anyway, according to the head EBRD Organizing Committee of the Ukraine's Cabinet of Ministers, Oleh Taranov.

"Reconstruction of hotels and roads came from the city budget," said Mr. Taranov. "This was done as a normal need. The only difference was that we had the schedules moved up to fill the needs of the convention."

Ukraine hopes that the more than 7,000 guests expected - among them 3,000 European visitors and 200 to 300 Western journalists - will view the convention not simply as a chance to party and share stories of financial conquests, but as a chance to take a serious look at investment possibilities in Ukraine.

"We do not want this to be a tourist excursion, but a meeting of potential business partners," said Mr. Taranov.

To bring together potential Ukrainian and European business partners, the organizing committee is sponsoring an exhibition of Ukrainian business in connection with the EBRD Business Forum.

There, Ukrainian businesses will display their wares and production capabilities to European investors and bankers. And, in an interesting marketing strategy, potential European investors who see something they like will be able to get a first-hand look at the Ukrainian operation immediately, no matter in which region of Ukraine it is located.

"We will have charter flights available so that interested delegates will be able to fly out to the regions," said Mr. Taranov.

All guests to the EBRD Business Forum will have access to the exhibition. The forum, designed to promote investment and business opportunities among the 58 member countries of the EBRD, comprises information services, bank seminars and country presentation, which will include country profile reports.

The EBRD is an international organization founded in 1991 that finances projects for countries in economic transition to democracy and open market systems. Its work is specifically aimed at 26 countries of the former Warsaw Pact and the Soviet Union. Its shareholders consist of all the countries of the European Union, the United States and Japan. The EBRD performs three functions: it provides credits, invests in capital stocks and gives credit guarantees.

Currently the bank has approved 23 projects for Ukraine with a total value of some $600 million.

With all that it could bring to Ukraine, the convention - which Mr. Taranov predicted could mean investment interest by 10 percent of the guests - has not been without its problems.

"I don't want to say that in six months we made heaven in Kyiv," said Mr. Taranov.

The biggest headache has been the absolute lack of five-star hotels in Kyiv. There are no Western-style hotels in Kyiv even today, almost seven years after independence, thanks in large part to the stifling government red tape and fees that have become a business hallmark of this country and have inhibited overall investment. In addition, there is simply a dearth of hotel rooms to accommodate the 7,000 expected guests. The lack of space has forced Mr. Taranov's organizing committee to look to alternate housing.

They have turned to the Dnipro River as their salvation. Two large excursion boats with 700 rooms will be moored at docks near the center of the city and will house the support staff of convention delegates.

Besides the general facelift Kyiv is enjoying as a result of convention preparation, another benefit the city will receive is the reconstruction of two historic, religious landmarks. The Church of the Assumption of the Virgin Mary of Pyrohoscha and the Monastery of St. Michael of the Golden Domes, two historic landmarks destroyed by Stalin in the 1930s, are being restored. The former is generally complete with only the interior left to finish, while the bell tower of St. Michael has been finished and exterior work on the main church is nearing completion

So, how are Kyivans reacting to a major international event occurring in their midst and the new face that Kyiv is taking on for the event? Not without some cynicism.

As 35-year-old Oleskander Smoliy, employed at Ukraine's Ministry of Justice, said, "It's a good thing, it will give Ukraine more exposure in the West and maybe even some business investment might come of it. But do you really think that the renovation of Kyiv will continue after the bankers leave?"