LVIV – Few people know that the hryvnia, Ukraine’s currency, was first printed in Canada. Still fewer people know that Daniel Bilak negotiated the deal in 1991 for Canada-based Faskens law firm when his ancestral homeland regained independence.
As of November 1, he’ll have to broker bigger deals in the next 12 months as the Ukrainian prime minister’s chief investment adviser and director of the newly created Ukraine Investment Promotion Office (IPO).
“It’s an overwhelming job,” the now former managing partner of international law firm CMS Cameron McKenna in Kyiv told The Ukrainian Weekly over a digital voice call from Lviv. “We could fundamentally re-brand Ukraine…So that when people abroad hear about Ukraine, they don’t think corruption, but ‘wow, high-technology, agribusiness,’ they think agricultural technology, they think of a modern country that is open for business.”
Mr. Bilak’s goal is to raise at least $1 billion during the 12-month secundment from the London-based law firm. Drawing on the intimate knowledge of his clients’ needs, the native Torontonian said he could “unlock $100-200 million just by giving them a feeling of predictability and certainty.”
Not losing sight of the existing foreign investors in Ukraine, some of whom are “quite unhappy” because of the “flexible application of the rule of law in the country,” he wants to foremost make them “apostles… to preach the virtues of Ukraine to investors.”
It doesn’t matter whether it’s greenfield investments – new projects – or so-called brownfield infusions to existing assets ripe for development.
Prime Minister Volodymyr Groysman has given him three principal mandates to achieve this. Mr. Bilak is to create an investment information hub to become the government’s main portal for where businesses are looking to park their money.
“Everybody has to weigh their risk-reward ratio. There are trillions of dollars flowing around the world looking for yield, but not a lot of places to place it. So we need to build some momentum, we have got to make investors feel as comfortable as we can,” the attorney said.
Within his purview, Mr. Bilak, 56, wants to foster a healthy sense of competition among Ukraine’s regions to draw investment.
“One thing I want to do is identify cities of excellence. Places that welcome investors and make them feel happy, warm and fuzzy… Places that will use the tools that are available today, such as industrial parks,” he said.
Besides measuring the “body temperature” of each the nation’s 25 regions, Mr. Bilak will start a “concierge service” to match investors with the projects they want to develop. This includes handling the current problems that investors face, like administrative issues and so-called raider attacks that utilize the country’s crooked court system to steal legitimate business operations.
Despite installing fundamental reforms since the Euro-Maidan revolution, Ukraine still ranks lower than its geographical peers in the World Bank’s most recent “Ease of Doing Business” ranking, falling behind authoritarian Russia.
In terms of foreign direct investment, Ukraine only attracted $3 billion through September of this year with 70 percent flowing into the financial sector from the International Monetary Fund, loan guarantees from the U.S. and largesse from the European Union. It’s 38 percent more over the last 12 months, and surpasses the $300 million that Ukraine saw enter in 2015.
Another big obstacle that Mr. Bilak faces is to further reduce burdensome regulations – the red tape that businesses still complain about. His office will join legislative working groups in Parliament and push for cutting at the regulatory agencies. He added that, “because of the composition” of the Verkhovna Rada, it might be difficult to pass needed legislation. In that case, he said, “anything we could do to get a Cabinet [of Ministers] decree or decision is something we’ll be looking at very carefully” in order to simplify the conduct of business.
Changing perceptions is a top priority as well.
“There’s a lot of investment that you could unlock,” the career lawyer said. “If in a year’s time we do enough to start to change the perception of the country, we’ll succeed. I look at this as a workout of a massively undervalued, poorly performing company that we have months to put on its feet. It’s an ambitious project.”
Before joining the CMS law firm, Mr. Bilak served for 10 years as a senior government expert at the United Nations Development Program starting in 1995. Having earned a law degree from McGill University in Montreal, he has also advised the Ukrainian government for 10 years. Issues for which he has provided guidance to the president, the prime minister and the justice minister include rule of law, anti-corruption and regulatory issues. He also advised the governments of Bulgaria and Lithuania on rule of law issues as part of their EU accession process.
Wearing more than one hat, Mr. Bilak also sits on the governing council, or Senate, of the Ukrainian Catholic University in Lviv and heads the Canada-Ukraine Foundation.
The father of five children attributes his successful track record to staying honest in a deeply incorrigible country.
“My father always said the most important thing in your life is your integrity,” he said. “You could work 30 years building your reputation, but you could lose it in 30 seconds. I made a decision very early on in my career in Ukraine that I would be totally transparent in everything I do. I’ve done a lot of stupid things in my life, but that was a smart decision… I always put the cause first. We’re always working with the objective to help the country.”
Yet he was tempted more than once.
“I was offered all sorts of encouragements,” he added. “It’s funny, if you ever take a bribe, they’ll always know… When you’re offered a rent or reward for performing a function, the first thing that goes through your head, is oh, my God… that’s a lot of money, no one will ever know. The most important thing in life is to maintain your integrity and dignity. It’s fascinating what goes through your head in that moment, but then you get a sense of revulsion… you don’t even want to be in the same room with this person because you feel like you’ve been sullied in some way… you’re always on the hook.”
Success on the job is also buttressed by Ukraine’s young generation whom Mr. Bilak called “really savvy.”
Noting that Prime Minister Groysman is only 39, he said the young people who’ve gone into government are English-speaking, “putting together great presentations, are coming with fresh ideas, have university degrees from abroad – that really gives me hope… This is the new Ukraine.”