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News from and about Ukraine & Ukrainians: Ukrainian Community Press Releases
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BRAMA, Jan. 16, 2000, 2:00pm EST
"Seize the Moment" – Invest in Ukraine Today!
by H. Krill (BRAMA), with special thanks to Dr. Vera Andrushkiw of US-Ukraine Foundation for providing content and observations.
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Business-to-Business Conference on Ukraine Welcome by L. Wolanskyj, publisher of Eastern Economist
Round table: Learning From Everybody's Mistakes.
The view after 9 years
Panel: A Matter of legality: Setting up business,
dispute settlement, exit strategies
Program: afternoon session Keynote Speaker: Ross Wilson, Principal Deputy Special Advisor for the NIS, Department of State Topic: Why should Americans invest now? Roundtable: Sleeping with the Enemy: The nature
of a business relationship, key cultural differences, dealing with bureaucrats
and corruption
Panel: The Golden Source: sources of financing,
buying stakes, handling profits
Open discussion: Three simple changes that would
make a big difference
Wrap-up by Lidia Wolanskyj, publisher of
Eastern Economist
Matlid Publications, Inc. is the publisher of Eastern Economist, a weekly magazine; EE Daily, a daily business newswire; Dining Out in Kyiv; and MoneyMaker, a local-language monthly about doing business in Ukraine. |
Should you invest in Ukraine? The answer is an overwhelming "yes!" according to experts who took part in the "Business-to-Business Conference on Ukraine" which took place on January 10, 2000 in Washington, DC at the International Trade Center on Pennsylvania Avenue. The conference was organized by Matlid Publications, publisher of Eastern Economist, EE Daily and other resources for information about Ukraine.
Speaking at the conference were a wide range of specialists on conducting business in Ukraine including economists, businesspersons, legal experts, tax advisors, bankers and others. It was a day-long affair of energizing discourses, according to Dr. Vera Andrushkiw of the US-Ukraine Foundation who attended the conference. The upbeat atmosphere and interesting presentations left most in the room with positive feelings about Ukraine’s future as a haven for investors. "The time is right", "seize the moment", "invest today" were the typical catch phrases exchanged among those present as they all considered what the most lucrative investment possibilities might be.
The most negative of the presentations were merely cautionary in nature. Lawyers, for example, tended to offer "reality checks" about the still present corruption, the lack of enforcement of the law, the burdensome taxation system. In contrast however, it was suggested that working within the guidelines of the law will keep corruption at bay, and that the new tax system was well within reason for profitablity.
The good news, according to John Hansen (World Bank), was that although the decline in GDP was greater even than that experienced by the U.S. during the Great Depression, Ukraine’s economy is in an upswing.
Other positive feedback included satisfaction with the new political landscape that resulted from the last presidential elections. Although incumbent President Kuchma managed to retain his hold on leadership, his constituency changed considerably. In contrast to Kuchma’s first term election which was carried by Eastern Ukraine, support for the second term was garnered mostly in the western half of the country. As many of us already know, the Dnipro River is not only a natural geographical dividing line between two parts of the same nation, but it also demarcates political and cultural differences that have never been resolved even by the forces of the Soviet Union. Now, Kuchma has greater support in Western Ukraine, a region with strong European traditions and values, and it is expected that this government’s policies will shift towards more Western (European) standards.
According to legal expert Markian Silecky, some of the early problems that Ukraine experienced stemmed from a poor understanding of the country, its culture, its heritage, and its potential by the West, the U.S. in particular. Not enough research was done by the various agencies involved in the transition economics on learning about the region. In other words, it was often assumed that what was known about Russia and Russians also applied to the rest of the FSU. Misconceptions on the part of Ukraine, according to Mr. Silecky, also played a big role in the slow transition to the market. There was little understanding about how a marker economy functions. Today, many of these issues have been mitigated with a clearer understanding on the part of the West of the different national interests of the NIS countries, and Ukraine appears to be developing greater business acumen as it learns the tough lessons of the market.
Corruption, said Nestor Scherbey, is measurably lower in Ukraine than in most other countries encountered in his work at Customs, Trade and Risk Management, Ltd. The legal system, according to Adam Mycyk of Altheimer & Grey, was still too changeable, although there has been a marked improvement in the stability of legal system recently. Richard Shriver (Lviv Consulting Group) pointed out that Ukrainians were still unused to planning long-term strategies, but that there is a new dynamic among the younger generations which sets them apart from their predecessors. Plan your investment with a good exit strategy, and you are pratically garanteed success. Sarah Carey (Squires, Sanders, & Dempsey) says that as long as you are "code-compliant" with the civil law, your business willl certainly survive.
Myron Stoll of "Ukrainian Wave", a mobile telephone company in Ukraine, said that the early years since independence were tough, but that his very successful business testifies to the potential for any early investments made in Ukraine. One important point made by many of those who had conducted business there: don’t be an "absentee" business owner. You must live in Ukraine and tend to your business personally in order to keep your investment safe.
Biographies of Speakers
(in order of appearance)
Lidia A. Wolanskyj has been publishing Eastern Economist since February 1994, Ukraine's first English-language business periodical. A professional writer and editor, she first worked on a technical assistance project with the National Bank of Ukraine in 1992-93, then became managing editor of a Kyiv-based news service before starting her own business. Ms. Wolanskyj worked as a freelance technical writer and editor 1988-1992 for a variety of corporate clients like A.C. Nielsen, CASE and Carrier.
Anne Williamson began covering the USSR for the Wall Street Journal in 1987, just when Americans were learning to pronounce perestroika. Over the years, she has written for a broad spectrum of publirations, including The New York Times, Spy Magazine, National Geographic, and World Net Daily. An expert on Soviet-Russian affairs, Ms. Williamson testified in September as an expert witness before the House Committee on Banking Activities hearings on Russian money-laundering through US banks. Her book, Contagion: The Betrayal of Liberty - Russia and the US in the 1990s will be available in late 2000.
Andy Bihun was Commercial Attache at the US Embassy in Kyiv's Foreign Commercial Service from 1995 to 1999. He also served on the board of directors of the American Chamber of Commerce, promoting the interests of foreign investors and businesses before the Kuchma Gore Commission and developing the Kharkiv Initiative. He was with the Department of Commerce before his posting to Ukraine and helped set up the BISNIS network. Mr. Bihun is actively involved in The Washington Group, a Ukrainian-American professional organization.
Nestor Scherbey is the president of Customs, Trade Sr Risk Management Services Ltd., a global customs consulting and specialized trade services firm. While serving as a customs and duty drawback specialist with Volkswagen of America, he pioneered the use of the US Foreign Trade Zones program and represented the US Motor Vehicle Mftrs. [sic] Assn. to various subcommittees. In the largest customs fraud case in history brought by Canada against Amway Corp., Mr. Scherbey was able to obtain a favorable ruling and headed the global customs compliance and international logistics department of Amway for 10 years.
John Hansen is economic advisor at the World Bank in Kyiv with 30 years of experience. His special focus is macroeconomic development.
Markian B. Silecky established the Silecky Firm's offices in the US in 1988 and in Kyiv in 1994, after serving as managing partner to one of the largest foreign-owned law firms in Ukraine. Concentrating on international and domestic corporate matters, he represents North American and European firms in such areas as telecoms, oil, air navigation systems, real estate, and food production and distribution. With a law degree and a BA in International Relations, Mr. Silecky is also a member of the Board of Governors of the Ukrainian Bar Association.
Dick Shriver is a partner in the L'viv Consulting C;roup and a member of the L'viv Oblast Advisory Council on Foreign Investment. Prior to that he was the head of technical assistance programs to the NIS for IESC after retiring as Senior VP and Group Executive for the Chase Manhattan Bank. Mr. Shriver is also a former assistant Secretary of the Treasury as well as a former director of telecoms, command and control systems for the Department of Defense.
Adam Mycyk is legal counsel for Altheimer & Gray, a Chicago-based law firm with offices in Kyiv since the early 1990's. Mr. Mycyk has been practicing law in Ukraine since the mid-1990s.
Irina Faliashvili founded one of the first private law firms in Kyiv in 1992 and expanded to Moscow in 1994. Prior to that she served as general counsel to Microprocessor and Electronmash, among the largest industrial complexes in Kyiv, negotiating large-scale export-import transactions and JVs. With a PhD from Shevchenko State University Law School in Kyiv and an LLM in international and comparative law from GWU, Ms. Paliashvili has been a professor of law at SSU. She is on President Kuchma's Council of Independent Experts, which mediates disputes between investors and the Ukrainian Government.
Sarah Carey is legal counsel for Squires, Sanders a Dempsey, a US law firm with offices in Kyiv since the early 1990s.
Ross L. Wilson is the Principal Deputy Special Advisor for the NIS. He interned in 1978 with the State Department's Office of Soviet Affairs, entering the Foreign Service in 1979 and serving twice in the US Embassy in Moscow. In 1990-92, Mr. Wilson was also Special Assistant to Robert Zoellick, Under-Secretary of State for Economics and Agricultural Affairs and Counselor of the Department.
Trevor Gunn is deputy director of BISNIS, the Department of Commerce's business information service for American investors interested in the Newly Independent States.
Kempton B. Jenkins, president of the Ukraine-US Business Council, is a retired career diplomat with 31 years of service. He has specialized in the FSU since 1960, starting as political officer in Moscow (1960-62), moving to the State Department's Office of Soviet Affairs (1962-1965), then as assistant director at USIA (1968-1973), working for the Secretary of State (1973-1978), becoming Deputy Assistant Secretary of Commerce for East West Trade (1978-80), and representing US business interests in the region since then.
Van Yeutter is director of international business development for Cargill, a major US agribusiness corporation. Cargill does business in Ukraine in farm chemicals and seed development and initiated a $40 million grain elevator development project in Donetsk oblast this past year. During the last 10 years, Mr. Yeutter has been working business unit strategy and corporate mergers for the company. He has an MDA in international Business and an MA in International Relations from the University of Chicago.
Irina P. Vakhraneva is a senior account administrator with the Bank of New York's ADR Division. She is responsible for the largest CIS and Russian Depositary Receipt accounts, including three NYSE-listed companies, and is involved in developing the DR business in the region. A native of Belarus, Ms. Vakhraneva joined BONY in 1998 after graduating in Business Administration from Georgetown U.
Gene Czaplinsky founded the Kozak Fund in 1996 after several years of working with the Central Bank of Russia on gold bullion and negotiating similar projects with the National Bank of Ukraine.
Matt Walther manages the international operations of Matlid Publications, Inc., the publishers of Eastern Economist, EE Daily, Dining Out In Kyiv, and MoneyMaker. An electrical engineer by training, he has been a professional technical translator since 1987 and helped establish Eastern Economist.
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