Posted by: U.S. Ambassador Geoffrey Pyatt
It was great to have Secretary of Commerce Penny Pritzker in Ukraine this week, where she announced that that United States intends to provide another $1 billion dollar loan guarantee to Ukraine in 2015.
Since her previous visit 13 months ago, Ukraine’s government and people have stood firm in the face of enormous challenges, and have made notable progress: foreign reserves have grown from $5 billion to $12 billion, industrial production has stabilized, agricultural exports are increasing, your currency has stabilized, and experts predict a return to overall economic growth in 2016. These are the returns on the hard but important reform progress that the Rada has made in conjunction with the Prime Minister and the President.
There’s still a long road ahead for Ukraine to reach its full economic potential, and to get there, Ukraine has to stay the course and continue to make meaningful progress on reform. That’s not only the key to maintaining the support of the international community in the near-term, it’s also absolutely critical to creating a climate where U.S. and other global companies like the ones that traveled with Secretary Pritzker — businesses like Cargill, Citibank, Dupont, Honeywell, NCH Capital, and Westinghouse – have the confidence to invest.
Earlier this week, I explained to Voice of America in an interview that these companies are risk averse. “Money is a coward,” one of the CEOs traveling with Secretary Pritzker told the Prime Minister. They will want to see that reforms stick and the IMF conditions are complied with. They want to make sure that the environment is one where they’re taking a business risk, not other unknown risk. Only then will you see them bringing their resources, their technology, and their capital to the Ukrainian market.
Getting there requires that Ukraine tackle corruption, make its infrastructure more efficient and attractive for investors, reduce excessive regulations, raise the professionalism of its judiciary, better protect intellectual property, and improve its tax administration.
Of these, the number one impediment to faster investment by American companies in Ukraine is the problem of corruption. That’s why we’ve placed such an emphasis on the Prosecutor General’s Office. That’s why we’re so focused on the rapid implementation of the new framework for the anti-corruption prosecutors, the National Anti-Corruption Bureau – the NABU. All of these are institutional measures to root out the pervasive corruption that has done so much to hold Ukraine back since its independence. It’s about creating an expectation that if you are a government official involved in stealing resources from the Ukrainian people, you will be held accountable. And it’s about changing the entire system, not just one individual or another.
Imagine if – instead of lining corrupt officials’ pockets – the resources being stolen from the Ukrainian people as a result of corruption were freed up and reinvested in Ukraine’s economy. Imagine what those resources could do to fuel the development and broad-based prosperity the Ukrainian people want and deserve.
We know that these changes are hard. Not only for the Ukrainian government, but also the Ukrainian people. That’s why the proceeds of the loan guarantee Secretary Pritzker announced will be focused on helping the Ukrainian government protect those most vulnerable to the impact of the necessary economic adjustments for them to achieve the kind of reform that’s necessary.
As one of the American CEOs told the President and Prime Minister earlier this week, “Don’t blink. Keep it up.” Pressing ahead and accelerating the process of reform will benefit the people of Ukraine. And it’s an effort that the United States will continue to put all of its energy into supporting.