President of Ukraine

Greetings of President on the occasion of the 25th anniversary of the American Chamber of Commerce in Ukraine

1 June 2017 - 19:55

Greetings of President  on the occasion of the 25th anniversary of the American Chamber of Commerce in Ukraine

Ladies and gentlemen! Dear Friends, Excellencies!

I am very happy to be here with you and congratulate the American Chamber of Commerce in Ukraine on its 25th Anniversary!

Right after the declaration of Independence, investors saw great opportunities that Ukraine could offer, and actively started their engagement here. This was the time of establishment of the American Chamber of Commerce in Ukraine, which has become a reliable partner in shaping Ukraine’s economy and laying down the foundation in building its reputation as a democratic, open, economically attractive European state.

I think we have a very close contact with the American Chamber of Commerce for many years. And I think this is extremely important for building up businesses in Ukraine.

For me personally, Ukraine's security and economic growth are the highest priorities, together with the focus of a strong brand of Ukraine on international arena and creation of favorable investment climate within. All existing investors are the best ambassadors for sharing the image of Ukraine, proving by their own example that Ukraine is a country of great business opportunities, people and growth.

European integration is the core of our transformation strategy. The path is thorny, but we are on the right track. The adoption of visa-free travel for Ukrainian citizens to the countries of the European Union, which everyone will be able to use in a few days, ratification of the Association Agreement by the Dutch Senate, strong political support on Ukraine’s territorial integrity and sovereignty are key steps that demonstrate we have the undeniable support from all European Union political and organizational structures recognizing the depth of our reforms.

US-Ukraine roadmap for Business Climate Improvements encapsulates short and midterm regulatory and legislative reforms, and serves as a blueprint for engagement between Ukrainian Government and American Administration. U.S. businesses consistently cite four broad areas as crucial to making Ukraine an attractive destination for investments. First and foremost, businesses need a stable and predictable macroeconomic and regulatory environment. In this regard, Ukraine continue to meet IMF and international financial institution benchmarks. We forecast GDP growth to almost 2% this year vs 9.8% decline in 2015. This year inflation is projected to be at the level of little bit more 10% vs 43.3% in 2015. State deficit in 2016 was below 3% of GDP vs more than 10% in 2014, including huge Naftogaz deficit. Finally, National Bank reserves grew from 5B USD in 2015 to more than 18B USD today. This is macroeconomic stability, ladies and gentlemen, and it was achieved despite all security challenges my country faces.

Second, businesses need to see steady and significant progress in prosecuting and preventing corruption and strengthening the rule of law. After years of broken promises and false starts, Ukraine is finally making progress against corruption. Much work remains, but reforms initiated in the past few years hold out the prospect of a fairer and more honest economy in which public contracts are awarded on merit instead of backroom deals and those who line their pockets at public expense are held to account. Independent anti-corruption institutions, eDeclarations, Prozzorro, energy reforms, banking sectors reforms – all these are our important weapons on anti-corruption front. There is still a long way before Ukraine’s system will be in the top ranks on international anti-corruption measures. But, for the first time, a Ukrainian government is driving the anti-corruption effort forward instead of resisting it. In 2016, the Сonstitutional amendments regarding judiciary cleared the way for the full-fledged judicial reform that will make the judiciary more independent and publicly accountable, and renew the judicial corps. Unprecedented formation of the entirely new Supreme Court, based on an open competition for all of the positions within the Court became a cornerstone of the total reboot of the judiciary, and will become active this autumn.

Third, businesses across all sectors stress the need for continued strides in microeconomic reforms including customs, tax administration and deregulation. VAT system and Tax Administration has always been №1 issue for foreign investors. We launched public electronic system for the management of VAT return and received a lot of positive feedbacks from international and local businesses, who finally got their VAT return within 30 days of filing declarations, and without interference of tax authorities. Two times reduction of social tax for enterprises as well as overall reduction on quantity of taxes from 22 to 11. 

Growing «Doing Business» rating from 152 in 2013, to the 80 in 2016. In addition, we still waiting 10 step up in 2017. This is exactly what we are looking for.

You can start business in Ukraine within 2 days and absolutely online. We are not stopping, we just ramping up.

Finally, Ukraine should develop and implement a transparent corporate governance and privatization plan for state owned enterprises that uses international best practices and provides a level playing field and genuine opportunities for international investors. New governance model and management at Naftogaz has already made it profitable. Yesterday, Financial Times wrote “a Stockholm arbitration tribunal have granted a major victory to Ukraine – and a big blow to Russia’s Gazprom”. My congratulations! This is our joint victory. “Naftogaz reform efforts cut corruption and wasteful nationwide gas consumption while diverting supplies away from costly Russian imports”. Similar situation we see across other state-owned enterprises. New CEOs, who, by the way, are coming originally from your business community, are demonstrating new approach in making state companies profitable. 2 years ago we raised 11B hryvnias to the state budget through open and transparent 3G tender, and I am sure, you already enjoy this technology benefits. Now it is time for 4G! This week I will sign very important law on electricity market, which represents EU standards, ensures competition and secures transparency. Today, I have signed additional two laws on corporate governance, one of which is securing rights of minority shareholders in the enterprise, while other enables broad usage of corporate agreements for the security and protection of investor’s rights, which is very common among the Western companies and was prohibited in Ukraine before.

We do have very complex security situation with Russia aggression towards Ukraine, but does it stops international and local investors? Definitely – not. In 2014-2016 the following investment projects have been completed in Ukraine: Allseeds plant – 200M USD, Bunge terminal -180M USD, Arcelor-Mittal – 150M USD, COFCO Agri – 75M USD, BIOFARMA plant – 40M USD, Fujikura – 87M USD, etc. This is during the war, and it is a very effective demonstration about the changes have happened in my country.

Just during last two years 56 new plants have been opened in Ukraine. And more to come: Cargill terminal – 130M USD, Louis Dreyfus - 50M USD, Holteck – 300M USD…    

During last three years, we have done more than perceived, but less then we aspire for. So, what is ahead of us? Pension reform, Land reform, Healthcare reform and, certainly, Privatization. All of them are important and challenging. Ukraine’s revival can be possible only through reforms and investments, and, I am confident in our success, only by uniting efforts of the President, the Government, the Parliament, business community and civil society. Thus, I want to say thank you to the American Chamber of Commerce, which serves as quite critical link in this process. Putting every single effort to promote Ukraine internationally as an attractive investment destination, you are opening it for international investors, and helping us to make it even better.

Over the years, we have built a strategic partnership between Ukraine and the United States.

This is a partnership for democracy.

Ukraine has always felt a reliable shoulder of the U.S. in building up strong institutions, vibrant civil society and prosperous market economy.

With that support, Ukraine gradually becomes a more robust stronghold of democracy in the region.

This is a partnership for global stability.

Having abandoned the third largest nuclear arsenal in the world, Ukraine has played a historical role in strengthening non-proliferation regime globally.

Just days ago we celebrated the International Day of Peacekeepers.

It is my honor to state that Ukraine has always been by the international efforts in bringing back peace and order to turbulent regions.

Indeed, we have made a greater contribution to the global stability than ultimately got in return.

And this is a partnership for peace. 

The former is of extreme importance at times when Ukraine’s become a key battleground between US-led liberal order and Russian revanchism.

That said, let me remind you of what the U.S. vice-president Hubert H. Humphrey once said.

“Peace is not passive, it is active.

Peace is not appeasement, it is strength.

Peace does not happen, it requests work”.

I shall thank our U.S. friends for your genuine support of Ukraine throughout all this years.

But most importantly I would like to thank the U.S. for your support these days.

Being of a solid bipartisan foundation, this is extremely important not just to Ukraine.

Fighting Russian aggression is not an easy endeavor. It has never been.

But if standing firm on the ground of unity and solidarity, if keeping strong the united front of transatlantic sanctions against Russia, if genuinely working for peace through strength, we will ultimately manage to stand the current storm and defend the world order we jointly promote and defend.

We do not strive for changes, we work for them. We understand the vital need to make Ukraine a great country, every day proving this with our hard work, dedication and support.

Let me congratulate the American Chamber of Commerce in Ukraine and the entire business community. I wish all of you lots of energy in implementing the important mission.

God bless America!

Слава Україні!

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