Leonid KUCHMA: “Today I am practically an independent person”

April 13, before Ukraine was visited by US Secretary of State Madeline Albright and Russian President Vladimir Putin, Ukrainian President Leonid Kuchma met with a BBC reporter. The interview’s Ukrainian version is found on http://www.uatoday.net, rating as a sensation.

BBC: How comfortable do you feel, Mr. Kuchma, as President of Ukraine, balancing between West and East? How does this position benefit Ukraine? How comfortable does this stand feel?

L.K.: It is uncomfortable on the one hand, as everyone makes promises, and no one keeps them. This is the main problem. Ukraine has determined its foreign political priority: the European choice. This is why, when meeting with Mrs. Albright and Mr. Putin, all discussions will be focused on the main problem: [Ukraine’s] cooperation with the IMF. If we wait to read the statements of the second round of NBU audit findings, we could all wind up starving to death in Ukraine.

BBC: How would you act as head of the IMF: would you give Ukraine money now, without waiting for the results of reform, or wait for Ukraine to comply with all the [IMF] requirements? Or maybe you would consider Ukraine’s geopolitical importance and decide to help?

L.K.: I would certainly consider a lot of factors, including Ukraine’s geopolitical and strategic location. Most importantly, Ukraine cannot be compared, say, to any Western European countries, not even the Baltic states. For the simple reason that the Ukrainian mentality, just like the Russian one, is totally different than that found in Poland or any of the Baltic countries. We were building communism for over 70 years. We do not have any generations that have experienced a different regime. One must has to keep this factor in mind.

As I have said, people used to live like inmates in a giant zoo; they were handed everything, including wages and salaries keeping them alive. And the end of that work they would be give a small apartment and old-age pension, so they could have their bread and something to go with it. Overcoming this mentality is far more difficult than any other of our problems. Our people just do not understand what has happened; only recently they did not have to pay anything for housing and now they have to pay 100% of their homes’ prime cost. And the kind of wages and salaries our people receive is not enough for half of the floor space. Of course, our opponents are using the situation. We do not have the kind of homogenous society we would like to have today.

BBC: Considering Russia’s new President, quite a few Western analysts predict that Russia will take a more pragmatic foreign political stand with regard to all the post-Soviet states and that this stand will be more aggressive. Is Ukraine prepared to cope with this new Russian stand?

L.K.: I would do the same if I were Putin. I would make my policy more severe, more pragmatic. And this would benefit Ukraine and its citizenry. You have to pay for what you buy. Today, Russia is practically crediting Ukraine. We need gas, but we do not pay for gas supplies. For the first quarter of the year, our arrears on gas supplies [from Russia] amount to some $500 million. I would understand the situation if all those gas supplies were entered into the national budget expense items. They were not, slipping through our fingers like sand, finding their way to commercial structures and from then on to offshore zones. Therefore, as President of Ukraine, I am interested in enforcing severe oversight procedures and a rigid approach to our relationships with Russia. Commodity-money-commodity. We are, however, used to a different procedure and now we are shouting that Russia will take a different stand [toward Ukraine]. But is the Russian economic situation any better? Doesn’t Russia have enough of its own domestic problems?

BBC: They say that Ukraine will drift away from Russia westward as Russia continues to press harder on Ukraine.

L.K.: The harder the pressure is, the farther we will drift away. Ukrainian-Russian trade turnover is decreasing with each passing year. Lack of economic interest will cause a lack of political interest. And so I say, first and foremost, that the Russians have to think. I am convinced that Europe is interested in normal businesslike relationships between Ukraine and Russia, for this is in the interests above all of European stability.

BBC: Over the past several years, Ukrainian-Russian relationships have been basically determined by personal neighborly contacts between Leonid Kuchma and Boris Yeltsin. That period of “loose-tie” democracy is said to have reached its end. How do you propose to build relationships with Russia and Vladimir Putin from now on?

L.K.: Let them say whatever they like; we will do our jobs. We will maintain our contacts, loose-tie or otherwise. Personally, I am convinced that our contacts with Vladimir Putin will be perfectly normal, friendly, and responsible. So we and Yeltsin were friends. Has anyone given us presents for that? I can only feel grateful that, as presidents, the two of us could solve several major strategic issues. I mean the Ukrainian-Russian Treaty, the recognition of Ukraine, and, secondly, we solved the Black Sea Navy issue. Until 1997, the Russian fleet was in the Ukrainian territory without paying a cent. This benefited Ukraine, to an extent. Relationships between political leaders depend largely on how much each country needs the other.

BBC: The manner in which the new Russian President is going to build his relationships with the so-called oligarchs is considered his main test [of strength] and indicator of the domestic political situation. He seems determined to curb their influence. About the situation in Ukraine, how do you feel about certain people in Ukraine wielding so much influence in the political, economic, and media domains?

L.K.: I really don’t know where such a negative attitude toward the word oligarch comes from. Let’s take a look: in Great Britain, the US, or any other country they have oligarchs. The US had its trial of Bill Gates who is personally worth $58 billion. And no one is making this into a tragedy.

For me, the main thing is for the oligarchs and their capital to work for the Ukrainian economy. Certain political forces here describe [Hryhory] Surkis as an oligarch. Even so, this “oligarch” has brought Kyiv Dynamo and its training facilities into conformity with international standards, turning it into a world-class soccer club by investing his own money.

Now consider Pavlo Lazarenko and characters like him that are still in Ukraine. They are still here, yet their fortunes are far away, in some offshore zones. They have not invested a single kopiyka in the Ukrainian economy.

I think that Vladimir Putin will proceed from the same reasoning. He will make them all work for Russia. The government will always support such initiative. Now if you work against it, I will take appropriate measures. Thus today all the activities of the oligarchs are transparent.

We know, say, what enterprises they own, so we will keep an eye on what kind of investment they make to develop production and where; what kind of revenues they make and from where, and so on. In fact, we have built a barrier in the way of all those offshore zones, banning their participation in the privatization process. Otherwise, it would mean all those new Ukrainians or Russians getting control over such processes all the way from those offshore zones. The most important thing is that their money returns there.

BBC: Do you feel satisfied with the new government’s performance?

L.K.: I shall never be satisfied with any Cabinet performance, so long as I remain President. I will always have reasons not to be. In the situation that has developed, the President of Ukraine cannot be satisfied. I will offer my assessment at an extended Cabinet meeting. Still, I am convinced the oligarchs are not what stands in the Cabinet’s way; the Cabinet is making certain problems for itself. Let them set things straight at the Cabinet first and then we’ll talk.

I am not satisfied by the fact that a total of 34 bills must be passed to resume the International Monetary Fund’s EFF tranches. Where are they? The Cabinet has had three months in which the majority would pass any bill in Parliament. Nothing happened. I am certain that the IMF will closely watch the Cabinet’s every step in meeting its obligations. And if all the Cabinet can come up with is promises, no pompous declarations or new titles will help.

The EFF tranches are extremely important for Ukraine now, because we will never survive with the NBU currency reserve we have to the next audit. This is why we must act quickly without waiting for anyone’s help; we must establish a more fruitful cooperation with Parliament. Fruitful cooperation with Parliament is the guarantee of today’s Cabinet’s success. The Deputies will not automatically vote for the Cabinet’s proposals by secret ballot.

BBC: You won the presidential campaign recently. How do you visualize Ukraine toward the end of your presidency? What kind of Ukraine would you like to leave behind?

L.K.: I would like to see in this country the overwhelming majority of people agreed that we have not struggled through these years in vain. That no one would be wishing to return to the Union — be it the Soviet, Slavic, or any other mythical union. I can guarantee that for Ukraine, but I would like this guarantee to be supported by the rest of the people. To have this support, we must have success in the economy. We can have such progress only when foreign capital comes, including that from Great Britain. When their businessmen feel confident they can invest and that such investment will have results.

BBC: Do you think about your successor?

L.K.: I think to myself, but I would not recommend others do so. I don’t advise them to do so, because they could make a false start. They would do much better to show people what they can do and not just talk. Actually, I don’t think it necessary to raise the topic at the moment.

BBC: You said you would be a new President before the elections. Now that almost half a year has elapsed, how much do you think you have changed?

L.K.: I have changed. Today I am practically an independent person. This is the main thing. I am independent in making my own decisions. You understand, during my first term, especially toward the end, I had always to think of the electorate. And not only. Thus I think that my decisions relating to the agrarian, administrative, and cadre reforms testify to this. I am working to intensify the struggle against organized crime; I am very serious about this – in Ukraine this is felt and very seriously.