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Morgan Williams believes Ukraine’s best friend is business
E. Morgan Williams is the director of government affairs, Washington office, for the SigmaBleyzer private equity investment management group. He serves as president of the U.S.-Ukraine Business Council. He is the publisher and editor of the Action Ukraine Report (AUR). He has worked since 1993 on Ukraine’s economic and business development. In 2007, on the occasion of the 16th anniversary of Ukraine’s independence, Mr Williams for his contribution to Ukraine’s development was presented a state award, the Distinguished Services Order, by President Viktor Yushchenko.
On Monday, September 30, 2008, the U.S.-Ukraine Business Council (USUBC) hosted Ukrainian president Victor Yushchenko at a working breakfast in Washington, D.C. Almost 100 USUBC members and guests welcomed president Yushchenko who later that day met with U.S. president George Bush at the White House.
The USUBC, on behalf of its entire membership now representing almost 100 companies and organizations, greeted the Ukrainian president. The USUBC members have billions of dollars invested in Ukraine, have created tens of thousands of new jobs and are totally committed to an independent, strong, democratic, prosperous Ukraine led by a private, market-driven economic and business system and governed by the rule of law.
For the past 13 years, since 1995, the U.S.-Ukraine Business Council has been working to promote Ukraine as a great place to do business, to support U.S. businesses which are investing in Ukraine, and to work with Ukrainian businesses which have operations in the U.S. or would like to invest in the U.S. The USUBC’s membership is now four times larger than it was in January of 2007, which indicates in a real way the growing interest by the U.S. business community in Ukraine.
The USUBC also works with the U.S government, Ukraine’s government, international financial institutions and other organizations to help bring about an improved, expanded, and more friendly business environment in Ukraine. Ukrainian and international businesses are working together to create the hundreds of thousands of new and better jobs needed by the citizens of Ukraine, to increase the wealth creation capacity of Ukraine and to help integrate Ukraine into the global economic and business system.
With its headquarters in Washington, the USUBC is now the largest private business organization in the world working exclusively with Ukraine that is not headquartered in Ukraine. The U.S. business community is proud to be in Ukraine, proud of what has been accomplished and proud to be supporting, in very tangible, effective ways, Ukraine’s integration into the Euro-Atlantic community of nations.
Business is the best friend you have
The USUBC recently advised President Yushchenko that the Ukrainian and international business communities were the best friends he had, the best friends the government of Ukraine had and the best friends the 47 million people of Ukraine had. It is the business community that sets goals and objectives that the president can support.
Ukrainian businesses are moving into Europe and the U.S. to invest, obtain capital and technology. European and U.S. businesses are stepping up, at a steady pace, their activity and investments in Ukraine. Euro-Atlantic integration is already taking place because of the Ukraine, Europe and U.S. business community.
President Yushchenko was also told, on behalf of the USUBC membership, that for business to continue to be Ukraine’s best friend the leadership and government of Ukraine must become a true friend of business. USUBC’s business members strongly believe the Ukrainian government must be more pro-business and must be proactive in its support of business. Too often the Ukrainian government acts as though it were an enemy of business, rather than a friend.
The entire business community knows that Ukraine needs a stable political and government environment to work in; they need Ukraine to be under the rule of law, they need business friendly laws that meet international standards. The government of Ukraine needs to pass legislation that gets rid of the archaic, outdated, soviet structures and laws that still function.
Ukraine’s customs service is considered to be one of the five worst such services in the world and Ukraine needs new laws that could help to radically change the situation with this service. New laws and actions are also needed to resolve the nine year old issue that keeps the U.S. Overseas Private Investment Corporation’s major economic development programs closed for Ukraine; new laws and actions are needed to improve air safety laws. New legislations and controls are needed now to replace those that severely restrict direct U.S. and Ukraine air traffic.
Direct air travel between U.S. and Ukraine cannot expand
In June 2005, the United States Federal Aviation Administration (FAA) conducted a safety assessment of the Ukrainian State Aviation Administration (SAA) — the governmental authority that regulates and oversees civil aviation in Ukraine.
The FAA found that Ukraine’s SAA was not in compliance with ICAO standards for supervision of its airline industry. As a result, the FAA downgraded SAA’s capability to Category II from Category I.
Under U.S. regulations, the Ukrainian airline serving the U.S. — AeroSvit Ukrainian Airlines — was allowed to continue to operate its flight from Kyiv to New York, but was not permitted to expand operations to the United States until the SAA addressed the discrepancies. In addition, no other Ukrainian airline may operate to the U.S. until Category I status is achieved.
As a result, travel and trade between the two countries is now limited. AeroSvit has indicated an interest in increasing the number of flights to New York and also in adding a non-stop flight to Chicago.
Following the downgrade to Category II, the SAA applied to the U.S. Trade and Development Agency (“TDA”) for assistance. A TDA grant was awarded to the SAA in 2006 and a U.S. contractor was selected to help SAA comply with international safety standards and return to Category I status.
The contractor provided the SAA in Kyiv a detailed action plan recommending specific steps to be taken for addressing the discrepancies and provided on-site support. However, progress has been particularly slow due to various governmental reorganizations.
U.S.-Ukraine trade and travel
President George Bush traveled to Ukraine in April 2008, as a demonstration of political support for its leaders. In June, Secretary of Commerce Gutierrez signed a Trade and Investment Cooperation Agreement with his Ukrainian counterpart in the Ministry of Economy, Bohdan Danylyshyn.
The agreement established the U.S.-Ukraine Council on Trade and Investment (“Council”), comprised of government officials. Among other things, the Council is charged with “identifying opportunities for expanding trade and investment… and identify and work to remove impediments to trade and investment between the Parties...” The U.S. Trade Representative’s Office (USTR) chairs the U.S. delegation.
U.S.-Ukraine business council proposal
The new U.S.-Ukraine Council on Trade and Investment is to meet in October in Kyiv for the first time. In light of the new Council’s mandate to “work to remove impediments to trade,” the U.S.-Ukraine Business Council recommended that this issue be raised.
The Ukrainian delegation and Parliament should be reminded about the importance of their dealing with the discrepancies found by the U.S. FAA. They need to take the necessary actions now so that Ukraine may reclaim Category I status as soon as possible.
Growth in aviation is directly tied to economic development. Removing the discrepancies and reclaiming Category I status by the SAA will enable Ukrainian airlines to operate their flights to the United States at higher levels and — with a large Ukrainian population in the U.S. and expanded interest from the U.S. business community — to expand trade and travel between the two countries. The USUBC made this proposal fully appreciating that aviation safety is paramount and must not be compromised for any reason.
Ready to expand investments in Ukraine
The members of the U.S.-Ukraine Business Council are ready to expand their investments in Ukraine. The government of Ukraine needs to do more in the future to create an environment that really welcomes U.S. business investment, European business investment and all domestic and international businesses.
The Ukraine government, after 17 years of independence, should finally throw out the remnants of their Soviet past, learn how to be a true friend of private business, take concrete actions for reform, and work in partnership with the business community.
Dramatic actions are needed now so that the Ukrainian people can have excellent jobs, live under the rule of law, be prosperous, independent, democratic, strong, and fully integrated into the Euro-Atlantic community — and be proud to be Ukrainian.
By E. Morgan Williams
President Viktor Yushchenko, Rayisa Bohatyreva,
Head of the National Security and Defence Council
of Ukraine, Morgan Williams, USUBC president, and
Volodymyr Ohryzko, Minister for Foreign Affairs
of Ukraine at the presidential breakfast hosted by
From left to right: Morgan Williams, USUBC president;
Volodymyr Ohryzko, Minister for Foreign Affairs of
Ukraine; Andriy Honcharuk, Deputy Head of
Secretariat of the President of Ukraine, and Oleh
Shamshur, Ambassador of Ukraine to
the United States.
President Viktor Yushchenko discussing Ukrainian
business issues with Andriy Honcharuk, Deputy Head
of Secretariat of the President of Ukraine (center),
Morgan Williams, USUBC president, and Volodymyr
Ohryzko, Minister for Foreign Affairs of Ukraine.
From left to right: Andrew Pidhirsky, Chairman,
Ukrainian American-Bar Association, Steven Pifer,
former U.S. Ambassador to Ukraine; William Taylor,
the present U.S. Ambassador to Ukraine, and
William Miller, former U.S. Ambassador to Ukraine.