Steven PIFER: IT WILL BE UNFORTUNATE IF UKRAINE TURNS AWAY FROM THE ROAD OF REFORMS AND DEMOCRATIZATION

“It will be recalled, on the eve of the eighth anniversary of our independence, that the U.S. political establishment was not too enthusiastic about the emergence of several new countries at that time. To what extent, from the U.S. viewpoint, has the assessment of the factor of Ukrainian independence changed since then?”

“The American view of Ukraine's geo-political significance has evolved a lot in the last seven years, and we see Ukraine now as a major European country. But what we would like to do is see Ukraine as a normal European country, that is, a democratic market economy fully integrated into the political and economic life of Europe. This stems from the argument that a stable, independent, and prosperous Ukraine is going to be a factor that will help make Europe in the 21st century a more stable and secure place. The importance of that kind of Ukraine is illustrated when you look at some of the neighboring regions, such as the Balkans or the Caucasus, a successful Ukraine can have a very positive influence on those areas”.

“What do you think are the most apparent obstacles to Ukraine's successful movement toward becoming a normal European state?”

“I think the main issues are economic ones. Ukraine has made a certain amount of progress on economic reform. It hasn't yet reached the point where you have what you would expect to follow from economic reform, which is economic growth, job creation, and increased tax payments. That kind of economic development is going to be important not only for improving living standards in Ukraine, but also for Ukraine to have the resources to be a positive player in Europe. Those economic changes will be necessary, for example, as Ukraine develops its relationship with the European Union. Obviously, a reformed market economy is going to be a critical criterion by which the European Union will evaluate Ukraine's progress.”

“Recently, Zbigniew Brzezinski called for supporting independent Ukraine under any circumstances. Does this mean the United States may support an independent, but undemocratic, Ukraine, a Ukraine that carries out no market reforms?”

“The U.S. supports Ukraine, and what we are going to see is Ukraine develop a market economy and also a democratic, a fully democratic political system. And while Ukraine still has a way to go, it has also made a lot of progress in eight years. I think probably we in the West sometimes may have underestimated just how difficult it is to effect fairly major changes coming from the system that Ukraine began with in 1991. But our view of Ukraine is that of continuing down the path of democratization and building the market economy. That's going to be Ukraine that offers the best future for the people of Ukraine. It's also Ukraine that we think is going to be the best partner of the United States. So we are going to support continued movement along those paths, and it will be unfortunate for Ukraine to turn away from that direction.”

“Do you think it would be more important for Ukraine not only to receive IMF and World Bank soft loans but also be involved in international economic mechanisms, be admitted to the World Trade Organization (WTO), and enlist Washington's support on a project for creating a “Ukrainian” route of Caspian oil export to Europe?”

“Right now I do not think it is an ’either or situation'. You want to have support from the IMF and the World Bank, you want to be moving along the path of integration with the international economic institutions, you want to accelerate the case of your accession to the World Trade Organization. You want to create conditions where international investors want to come and invest large sums of money in Ukraine. I think the IMF and the World Bank programs are important for Ukraine in the near term. But Ukraine cannot and Ukraine should not want to have to count on those programs for the medium and long term. For example, joining the World Trade Organization is going to be hard because it exposes Ukraine to international competition which can be difficult, but that's what is going to make Ukrainian companies more efficient and more effective, like their competitors on the world market. It means creating conditions here that draw in international investment. There is now about $2.8 billion of international investment in Ukraine. Of that amount $500 million is American investment. We are the largest investor, but that's a very small sum. There is $6 billion of American investment in Poland, and we need to have Ukraine catch up to Poland on that score. On the specific question of the pipeline, there actually has been considerable American support for the pipeline in the form of a Trade Development Agency grant of $750,000 to look at the economic viability of the pipeline. That study is due to be finished this summer. One of the things it will look at are the demand factors for Caspian oil in Central Europe. I think what this study can do is help interest companies by showing here that there will be demand for Caspian oil in countries like Poland, Hungary, and the Czech republic. That will be one of the things that will help begin to create interest on the part of the private sector, because again what I think Ukraine wants is investment to help finish the Odesa-Brody pipeline and also build an extension of it into Poland. Private investors will decide to parriciapte in that project when they see that it's commercially viable and that they can make a decent profit on it.”

“Some members of the left-wing in Ukraine affirm that, since President Kuchma's administration is very weak and the economic situation in this country is not only improving but even worsening with every passing year, the support granted to President Kuchma (and now also a presidential candidate in the next election) by the West is aimed at keeping Ukraine weak. Could you comment on this?”

“It is wrong to say that the Untied States and the West want to see a weak Ukraine. First of all, a weak Ukraine is not going to help build a more stable and secure Europe. It is going to be a problem of instability. We think Ukraine can actually be part of the answer. We do not want to see it part of the problem. On the economic and commercial interests of the United States a weak Ukraine doesn't help our economic relations. If you look at countries with which we have the best economic relations, they are countries with strong and very well-developed economies. It is our expectation that as the Ukrainian economy becomes stronger, becomes more stable, and begins to consolidate institutions of the market, it is going to increase market opportunities, it is going to increase investment opportunities. A weak Ukraine would mean limited opportunities for an increase in economic interaction. So I think there is an interest on the part of the United States both for geo- strategic reasons and for economic reasons to want to see Ukraine build a stronger economy and become more prosperous.”

“We would not like Western support to Ukraine to be personified. It would be of paramount importance for us if the United States did not give our anti-Western-minded politicians a chance to say that Washington backs up an anti- Ukrainian regime.”

“Well you are asking me to fight a battle of perceptions, which is sometimes very difficult to do. I've head others say that the United States has more influence over the IMF process than is really the case, and that because the United States allowed pauses to happen in the EFF disbursements, we are somehow not supporting President Kuchma. These perceptions are awfully hard to take on. What the United States is trying to do in Ukraine is support those objectives that we think are in Ukraine's interests and our interests. We've tried to do that in a way that we felt was consistent with our own principle of not intruding into what is a domestic political decision for Ukraine.”

“You have repeatedly pointed out that Ukraine has problems with freedom of the press. Does Washington pay attention to this? Is this the subject of official negotiations?”

“When you look at questions like freedom of the press, criticism of the government is one of the major factors. There is in the Ukrainian press a wide range of opinion, including a lot of criticism of the government (including from time to time in The Day ). At the same time, there have been some questions that we've had regarding the treatment of individual papers, and we have raised questions about that. What we're hoping to see is that the opportunities for a free press expand and Ukraine keeps moving in that direction as it moves down the democratic path.”

“Unlike many others, we sound an alarm about press freedom infringement, not only when it directly deals with The Day . On the one hand, we are pleased to be an indicator of the remnants of democracy in this country, for we are an opposition newspaper. On the other hand, we are disappointed that the number of publications that could express an independent opinion is steadily declining. We gave numerous examples of regional publications, in particular, about the recent suspension of broadcasting by four Crimean TV companies, perhaps in connection with Mr. Kuchma's vacation there. We are extremely worried that tax agencies are being used, with top leadership consent, the way the Soviet secret police once was. We raise this point so acutely because we have seen all too well the origin of problems in neighboring Belarus, where all opposition leaders are in exile. We hope Ukraine will overcome this ailment, but we would like to know your point of view. Another question: to what extent do you think it is possible, precisely by external methods and in normal conditions, to hold authorities inclined to stifle elementary democratic freedoms?”

“There is a huge difference between what we see with regard to the press in Belarus and what we see in Ukraine. I think there is an understanding here that a vibrant democracy needs to have a full and really functional press, and that's going to be part of the criteria by which Ukraine is accepted in Europe. The situation in Ukraine eight years after it became an independent country has changed considerably. I mean, you have a press here that was unheard-of when I was assigned to the embassy in Moscow ten years ago. We just want to see that trend continue.”

“When the USSR existed, the United States displayed very serious concern over the protection of human rights. At that time, the Soviet people had a very vague idea of human rights. Now we have a better idea of this. But human rights violations in this country are perhaps even more glaring than in Soviet times. However, we no longer hear such critical voices from the West, particularly from the US. Does it not seem to you that this policy is somewhat unwise?”

“Actually, we do pay a lot of attention to the human rights situation here in Ukraine. You can see in the report the Department of State puts out annually with regard to every country in the world, including Ukraine — we can certainly make a copy of that available to you the assessment that the U.S. Government has of the human right situation here in Ukraine. This is a very detailed report that comes out every year and looks at both the progress but also some of the problems.”

“I do not know if it is obvious for the United States that now the Ukrainian government in fact breaks not only civil rights and freedoms, as was the case in the Soviet Union, but also tries to violate basic human rights, including the most sacred one, the right to live. There functions in Ukraine a sinister mechanism of the annihilation of unsuitable businesses. Any entrepreneur can tell you privately how greatly he depends on the local authorities and fiscal bodies. Instead of protecting the entrepreneur, the state literally destroys him and all other people working with him. Do you think it is worth shifting the focus from a formalist view of human rights protection to more specific instances?”

“My one-sentence assessment is that I would find it hard to compare the kind of problems from the human rights angle that you had in the Soviet Union with some of that arise today in Ukraine. You have lots of opposition parties here, you have a press here that represents a wide variety of viewpoints and has been critical of the government, there is freedom of emigration that was typically a very important issue for the United States. I am not trying to say that there are no problems, there are issues here; it is not yet a perfect democracy. I mean, in the United States I do not think we have a perfect democracy, there are problems. But I'd have to say that I think the situation in Ukraine is far better for the people in terms of the traditional human rights concerns than it was in the Soviet Union.”

“Both your speeches and U.S. press publications (in particular, The Washington Post ) repeatedly stressed that what is important for the U.S. is not who will become president of Ukraine, but that Ukraine develop a democratic process. Does this mean the United States is now preoccupied with the development of democracy in Ukraine, especially in the run-up to the presidential elections? To what extent seriously and adequately is the U.S. going to participate in the international monitoring of the preparation for and the course of the elections in Ukraine?”

“My government is a proponent of democracy. Basically the logic of that position is you accept whoever the people of Ukraine choose to be their president. We do place a very strong weight on the democratic process. Looking at the election process, the United States is going to watch with great interest what happens not only on October 31, but also in the run-up to the elections. We've seen now four national elections in Ukraine. Each has had problems, but I think the bottom line judgment of international observers was that in the end the results reflected the way people voted at the ballot box. That was certainly my experience when I observed the parliamentary elections in March 1998. We saw lots of problems, things that would have been really problematic in the United States, such as people voting outside the voting booths, sometimes husbands and wives consulting right there. These are things that technically shouldn't happen, but they are not big problems. The make- up of the Rada that emerged, I think in our judgment reflected the way people voted in March. So there is this tradition of four elections, and we want to see that tradition continue. And we will watch with great interest as the election takes place, but also the run- up to the election.

“If your want to ask what is the U.S. view on the election, I'll answer that now. First and foremost, this is an election for Ukrainians to decide. And what the U.S. government is going to say is that we will support the principles — principles of strong relations between the United States and Ukraine, the principles of continued democratization in this country, the principle of Ukraine developing a full and prosperous free market economy. And we will support those forces in Ukraine that share those principles, and want to work towards those objectives. But beyond that it would not be appropriate for us to talk about particular names. That's a choice for Ukrainians to make based on their vision of which way Ukraine should go in the future.”

“The experience of Ukrainian national elections may be a little marred if we look at the problems of local government. Please tell us: do the Kyiv mayoral elections and what followed it also confirm your optimism that everything is OK in Ukraine regarding elections, vote counting, the law and the court as such?”

“With regard to the actual counting process, it was our conclusion in the March election of 1998, and I think that there are similar rules in place now, that in fact the counting process will be transparent. As we understand the rules, there will be procedures in place to allow a wide variety of observers at each individual polling station to observe and monitor not only the balloting, but also the election count. And the system, we think, is sufficiently transparent that if some, for example, non-governmental organization wishes to, it could actually conduct its own parallel count. And I think that kind of transparency creates confidence that the count is going to be legitimate, or if there is a problem, it will be caught.

“With regard to the court case concerning the result of the Mayoral election, we are still trying to sort that out (interview took place July 28 — Ed.

).”

“The visit by Vice President Al Gore and the session of the Kuchma-Gore commission were planned for September. Will there be any changes, will this bilateral commission hold its session?”

“There was actually a planned session of the US-Ukrainian binational commission for the Summer, but both sides felt it would be more convenient to postpone it.”

“For how long?”

“One of the things Ambassadors should not do is make announcements that more properly belong to the President of Ukraine and the Vice- president of the United States.”

“Were it not for U.S. assistance, the Ukrainian peacekeeping mission in the Balkans might as well have remained a non-starter. Is the U.S. going to support Ukraine's probable participation in the reconstruction of the Balkans, particularly Yugoslavia, for example, via the Pact of Stability for South-Eastern Europe?”

“First, I think Ukraine can be a very positive force in Kosovo and the Balkans. So we have been very supportive in the United States of Ukraine's participation in KFOR, and we have spoken for some time politically about the importance of Ukraine taking part in that force. We recognize that the economic situation of the Ukrainian military is difficult. Although it is our general rule that in peacekeeping operations like Kosovo countries should pay their own way we have in this case made an exception for Ukraine. We have informed the Ukrainian military that we would be prepared to supply a certain amount of in-kind goods and services to assist the Ukrainian contingent in Kosovo. As to the effort for reconstruction assistance to Kosovo, and economic development of Balkans more generally, is still being formulated. But I would hope that Ukraine would have a fall opportunity to participate in that. Part of it I think is for Ukraine to make sure there is a clear understanding of what contributions it can make, what kinds of companies, what kinds of reconstruction efforts it could do best. And I think it would be important and useful for Ukraine to advertise exactly what it can do.”

“Do you ever entertain the thought that East European countries — Ukraine, Moldova, the Transcaucasian states, etc. — need, not less than the Balkans, a plan for their development, as important as to be compared to the Marshall Plan? Although we, thank God, have not had bloodshed similar to that in the Balkans.”

“Certainly, there are needs for economic assistance in Ukraine, Moldova, the Caucasus. What you have is just a fact of political life — the situation in Yugoslavia over the last five months has focused people's attention on that part of the world. Traditionally, it has been a very unstable part, and the question is whether you can in fact integrate them into Europe in a way that makes them not a source of attention and instability in the future. I think building that kind of more stable Balkans is good for Ukraine, and I think Ukraine can also help in that process of creating a more stable situation in the Balkans. That's one of the reasons why my government has come out in favor of Ukraine being a full participant in the Stability Pact process for South-East Europe.”

“Lately, Ukraine has been increasing the export of weapons, even to such sensitive regions as countries in Africa. What is the U.S. stand on this matter? How can the United States appraise probable Ukrainian military and technical cooperation with Syria and Libya, which recently had UN sanctions lifted?”

“This is a complex issue, in part because the United States itself is a major arms exporter. And I do not think I can tell you with a straight face that all American arms exports are stabilizing and good, and all other arms exports by other countries are a problem. In terms of the arms export policy of Ukraine what we look at of course is control, very tight control, of weapons and technology as related to the weapons of mass destruction. There is a very small number of countries that we in the United States consider state-sponsors of terrorism, and we do ask that Ukraine not export weapons to those countries. One of American laws deals with countries that the United States government has found to be state-sponsors of terrorism. In those laws the Congress has provided for certain sanctions against countries that engage in certain types of military cooperation. So sometimes military cooperation with certain countries would be a problem because of American law, but I think we've had a very good dialogue with Ukraine over the last two years on this, and I think Ukraine understands now the issues raised by American law. We also ask, which I think is sort of international common sense, to look at situations and see if an arms sale contributes to a conflict? In other words, to take into account political consequences of arms sales to a particular country or a particular region. But my sense is that Ukraine in fact does try to weigh those factors when it's looking at its arms export.”

“A few days ago, the authority of Belarus president Aleksandr Lukashenko expired. The U.S. State Department has only made a statement on this subject. Many Ukrainians think the United States might have taken a firmer and clearer stand. Developments similar to those in Belarus are also possible, though not too probable, in Ukraine. How would the U.S. react in this case?”

“I think there were serious questions in the United States regarding the way the Belarusian Constitution was changed to prolong the term of Mr. Lukashenka's presidency. There are also concerns about many other Mr. Lukashenka's practices which are seen as undemocratic. As a result, US- Belarusian relations, which five years ago were actually very warm, have cooled significantly. American engagement with Belarus now is actually very narrow as a result of policy choices that Mr. Lukashenka has made. Happily, I do not face that kind of situation in Ukraine. I don't expect to.”