Archive for March, 2013

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From Peacekeeping to Peacemaking? – Ukraine

March 31, 2013

As is well known to regular readers of this blog, when it comes to UN commitments, Ukraine is somewhat stalwart in its support and engagement – Quite rightly too when we consider Ukraine was a founding member of the United Nations.

As such it has not and does not shy away from supplying troops and equipment for UN peacekeeping missions.  Ukrainian troops are deployed today in various nations under the auspices of the UN in various parts of the world.

It therefore seems quite reasonable, in light of significant reforms within the Ukrainian defence department – in particular the end to military conscription this year which will lead to a fully contract military half the size of the current numbers – that Ukraine, Poland and Lithuania will form a joint military brigade for peacekeeping missions.  The Ukrainian contingent will comprise of 545 military personnel plus equipment.

Jolly good – but…..

At the same time this announcement was made, the UN announced it was putting together a peacemaking entity for engagement within the Central African Republic.

There is a significant difference between the parameters of peacekeeping, peace building and peacemaking.

If the UN is about to actively enter the far more proactive and assertive realm of peacemaking  – which is nothing short of proactive intervention at a political and diplomatic level, how long before that peacemaking has the inevitable mission creep that will move troops involved in peacekeeping into a far more interventionist peacemaking role?

Thus far Ukrainian military casualties and overt military action in UN peacekeeping roles in the past decade amount to the recent use of a Mi 24 helicopter firing upon compounds in Cote D’Ivoire a few years ago, and a peace-keeper being killed in rioting in Kosovo in 2008.  (Not withstanding accidental deaths due to traffic accidents etc.)

How long before the UN rules of engagement change from those currently in existence for peacekeeping, to rules far more suited to the interventionist role of peacemaking?

How quickly will this new brigade see its UN role change?

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Tymoshenko loses court case – in New York

March 30, 2013

What seems long ago, back in July 2011 in fact, I wrote about Ms Tymosehnko launching legal proceedings against – well anybody involved in her then on-going court case and also anything that could be directly attributed to Dmitry Firtash or his business dealings.  That list has continued to grow, with new names being added to the action every time Ms Tymoshenko felt suitably offended by somebody.

This is the court class action complaint – Number 11 CIV 2794, United States District Court, Southern District of New York.

Back in July 2011, I wrote here – “You have to say the law suit she submitted reads as though it was written by somebody not overly conversant with the fact that every word must be chosen carefully in any litigation process,……. 

………Suffice to say it reads as though it was written by somebody with at best, only a passing interest in law. I have seen far more accomplished legal writing in standard contracts to be honest.”

Well, yesterday, a large part of the class action complaint 11 CIV 2794 was kicked out by the US judge stating there was insufficient evidence.  Having reread the above link, it is hardly surprising given just how terribly written the above class action is.  (In fact having read it again, I was extremely diplomatic in the above quote).

Given Ms Tymoshenko’s liking for suing in US courts – and looking at the standard of the class action prepared and filed that will subsequently get kicked out in its entirety I strongly suspect – perhaps she should consider suing the lawyers that allowed such a poorly written class action to enter a courtroom in the first place?

Anyway, I stated such a course of action was folly at the time – and thus it is proving to be so.

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Regional Development Funding – Ukraine

March 29, 2013

This entry was inspired by a UK MEP named Arlene McCarthy who represents the north-west of England in the European Parliament – although what she said has nothing to do with Ukraine – directly.

Indirectly, her words undoubtedly fit Ukraine – as well as many other EU nations and nations that receive EU regional funds.

One can hardly draw any other inference from her words other than that she believes that central government (in this case Whitehall and the UK government) siphon off large quantities of EU funding meant for regional development.

I do wonder why the funds  are going through Whitehall and not directly to the regions?  Should they not be on a project by project basis as submitted for EU financing directly from local government to EU, without the need to involve central government at all?  At most a cursory informing of Whitehall?

Perhaps the MEP should also concern herself with the funds that do reach the regions and are then siphoned off by the regional and local government in the UK too – either for nefarious purposes or to support otherwise unsustainable pet projects?

Anyway, Liverpool, Arlene McCarthy, Whitehall and the EU can bicker amongst themselves as generally I write about Ukraine (and occasionally the neighbourhood).

Nevertheless, never one to look a gift horse in the mouth when it comes to an easy topic introduction – Ms McCarthy’s words come at the same time that the EU announced Euro 31 million to boost Ukraine’s regional development.

Here it seems the EU is prepared to directly finance the local government and regions rather than send funds via central government.  Insuring it seems, that the projects it supports do run parallel to the national action plan for Ukraine wherever possible.  Very good.

One level of corruption and/or funding miss-allocation removed in the case of Ukraine when going direct to regional/local government.  Naturally not the elimination of corruption and/or miss-allocation of funding.  That is simply not possible no matter how rigorous any process is.  Just as any security expert worthy of the name will state there can never be 100% security, there can never be a system that is absolutely corruption-proof.

After all, the lowest tender in any procurement model is not necessarily the best value for money when other issues from a bidding  entity are considered.  Cost alone simply does not and should not decide the winner of any tender.  Contractor ability, contractor experience, contractor cash flow etc., are all considerations alongside any tender bid.  In short the contractor awarded a contract should have the ability to provide a quality outcome and the cash flow to avoid folding mid-contract.

Having now discounted the lowest tender as always being the best tender – even in the most transparent of circumstances – there are obvious methods now presenting themselves even to the most naive of readers for corruption, cronyism and kick-backs to occur.  And they do.  Daily.  In Ukraine and everywhere else on the planet.

The fact the finance comes from the EU, an entity riddled with accounting “issues” for so long I can’t even remember the last time auditors signed off the EU accounts in their entirety – (15+ years I suspect) – really doesn’t help.

I am reminded of a very caustic letter from a gentleman who managed to account very well in far more trying times than those faced by the EU accountants:

Gentlemen,

Whilst marching from Portugal to a position which commands the approach to Madrid and the French forces, my officers have been diligently complying with your requests which have been sent by H.M. ship from London to Lisbon and thence by dispatch to our headquarters.

We have enumerated our saddles, bridles, tents and tent poles, and all manner of sundry items for which His Majesty’s Government holds me accountable. I have dispatched reports on the character, wit, and spleen of every officer. Each item and every farthing has been accounted for, with two regrettable exceptions for which I beg your indulgence.

Unfortunately the sum of one shilling and ninepence remains unaccounted for in one infantry battalion’s petty cash and there has been a hideous confusion as the the number of jars of raspberry jam issued to one cavalry regiment during a sandstorm in western Spain. This reprehensible carelessness may be related to the pressure of circumstance, since we are war with France, a fact which may come as a bit of a surprise to you gentlemen in Whitehall.

This brings me to my present purpose, which is to request elucidation of my instructions from His Majesty’s Government so that I may better understand why I am dragging an army over these barren plains. I construe that perforce it must be one of two alternative duties, as given below. I shall pursue either one with the best of my ability, but I cannot do both:

1. To train an army of uniformed British clerks in Spain for the benefit of the accountants and copy-boys in London or perchance.

2. To see to it that the forces of Napoleon are driven out of Spain.

Your most obedient servant,

Wellington

So much for progress in our electronic data capable world eh?

However, knowing there to be no perfect model or model that cannot be manipulated, and knowing there are so very few in Ukrainian politics – be they local or national – that are entirely upright and solid citizens of Ukraine, with such integrity that they would never take anything more than the pitiful public servant salary for their time and effort in office, one has to suppose that even when cutting out the Ukrainian central government, the regional fiefdoms will carry out the same nefarious funding function – one way or another – even with projects with a maximum value of Euro 2 million.

Nevertheless, a need for regional development there certainly is.  A regional interface there needs to be – and local/regional government is the most appropriate, no matter how nefarious.  A rigorous auditing model would minimize the opportunities for corruption although it could never eradicate them, but together with the EU producing the invoices they are asked to pay/given as audit evidence for public scrutiny would keep “very generous profit margins” to a more reasonable level.

Most importantly of course is that development of the region occurs – and for those citizens who actually benefit from the development of the region and feel the effects in their daily lives – well do they really care how many Euros it costs or get nefariously appropriated along the way to get what they need?  Of course not!

Perhaps they have a point too.   Accepting there is no perfect method – why do we expect a perfect outcome?

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Open Government – Ukraine

March 28, 2013

Much has been written about open government.  The Internet is full of content on the subject.  Some with easy access and other behind academic walls of one sort of another.

Ukraine has embarked upon the road to open government apparently.  In fact it is quite active.  Of course we should not confuse active with effective.

The UNDP article on Ukraine in the above link, is actually very link heavy – which is why this entry won’t be.

Suffice to say the Ukrainian plan does not reinvent the wheel – quite rightly.

It sticks to the core and most simplistic methods of insuring some form of open government:

Engaging civil society in state policy-making
Promoting access to public information
Preventing and combating corruption
Promoting good governance through improving administrative services and introducing e-government

Anyway, read the UNDP report.  Some interesting stuff in there, and what appears to be some genuine (if limited) effort from the government too – at least so far.

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Shell (companies), Ukraine, hydrocarbons and the limits of Ukrainian journalism (not to mention a willfully blind EU eye)?

March 27, 2013

The day after the EU met with Edward Stavysky, the current Ukrainian Energy Minister, a meeting that will bring about a high level round table over EU sponsorship over the upgrading of the Ukrainian gas transport system (GTS) amongst other things – I am left pondering many things.

There has been a bad smell over the inclusion of a company called GEO Service arbitrarily in Ukrainian government deals with major oil and gas explorers and producers.  The reason for the bad smell becomes a little clearer with this piece in the Ukraine Pravda – but it no surprise.  It is no surprise that the oil majors are going along with it either.  Big oil (and gas) is a very murky business no matter who is involved.  This for them is standard practice no doubt.

However, it does not stop at Geoservice and the inferences made within that article – possibly more so when mentioning the current Ukrainian Energy Minister.

Unfortunately Ukraine Pravda does not go further than to elaborate on what it was spoon fed/given to build a story around – and investigative journalism in Ukraine is not particularly the safest of jobs.

However, if there was a Ukrainian investigative journalist at a loose end, they may not go far wrong in looking at the Energy Minister himself and other seemingly “no value” or “strange” business entities somehow involved in hydrocarbons in Ukraine – other than the infamous Geoservices which seems to concentrate media attention.

If they were to need a few dots to join together, some interesting dots amongst the vast mosaic of opaque vested interests could be a dot/company called “Vodi Ukraine”.  Another dot would necessarily be Nadra Ukraine.  Perhaps those dots could be joined together?

The Vodi Ukraine  (which means Water Ukraine)  misnomer should not put off our investigative journalists.  Vodi Ukraine may have more to do with hydrocarbons than water perhaps?

Maybe if these dots do connect, they should look to the dots relating to shale gas exploration in western Ukraine and who holds the exploration licenses.  The oil majors who are going to explore there know already – it shouldn’t be too difficult to find out – officially or via leaks.

Naturally if all those dots can be connected – that leaves the dot that is the current Energy Minister, Eduard Stavysky.

Now he is not the dot behind Nadra Ukraine.   He is not the dot behind the oil majors exploring shale in western Ukraine.  So how does his dot connect if indeed it does?

As Vodi Ukraine adds no value to the chain but somehow managed to get the exploration licenses in western Ukraine and is therefore within the chain for no apparent reason that to siphon/make a profit from actually doing nothing of value – one might ask, perhaps, who is the dot behind the Vodi Ukraine dot?  Our ministerial dot perhaps?

As I say, I am no investigative journalist, and far be it from me to make categorical statements when lacking the type of evidence produced in the Ukraine Pravda link above, that there would be a story there waiting to be broken – but I was always very good at dot to dot as a child and never once messed up the picture.

Now if all those dots did make a pretty (but nefarious) picture just as the Geoservice dots do, given the open door policy to Ministers the oil and gas majors have, then the EU must have a completed dot to dot picture – and thus must be willfully turning a blind eye – even if for the greater good as they may see it.

Anyway, what chance that an investigative journalist would join all the dots I mention eh?

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Authoritarian, dictatorial, disciplinarian, democratic or “managed” democracy?

March 26, 2013

How would you interpret the following – Authoritarian, dictatorial, disciplinarian, democratic, a form of managed democracy, or something else?

“No one is banned from proposing their candidacy for the mayor.  We are a democratic organization, a democratic party and the united opposition is building its policy on democratic foundations.  Any MP, and not only MPs, but members of the party can be nominated.

 But as soon as the united opposition passes a decision to nominate a single candidate, those who oppose this decision will in fact oppose the opposition and help the ruling party.

Therefore there should be a single candidate.  Anyone who disagrees with this, all those who play along with the authorities, will certainly be expelled from the faction and the party.  Everyone has an opportunity to offer their candidacy and be nominated, but after the decision is made, we should strictly follow it.  This is the principle for our victory.”

Those are the words of Olexandr Turchynov MP, one of the most senior members of the Batkivshchanya Party.

If you genuinely believe in the party but continue to disagree with a party nomination after it is made – does it truly warrant being expelled – particularly so when the party nomination may be for somebody external of your party, as is the case with these tactics of the “United Opposition”?

Should Batkivshchyan MPs be expected (under threat of expulsion) to unconditionally support the nomination of  UDAR’s Klitschko or Svoboda’s Tyahnybok, when these parties and these leaders chose quite deliberately not to assimilate with Batkivshchyna, but retain their own identities and ideologies?

What about society?

Should the voters not have the right to vote for a candidate from the same party they supported and propelled into the RADA, for the position of Kyiv Mayor?  Is it really democracy when voters are denied the opportunity to vote for a candidate from the party they support?

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The elimination of private monopolies – Bill No. 1250

March 25, 2013

I have been critical of the opposition parties lack of policy – let alone detailed policy – of late, when it comes to how they would actually run the country.  Economic policies, social policies, infrastructure policies, local governance policies etc – if they exist within the opposition ranks, then they are a seemingly closely guarded secret.

That said, with the opposition being comprised of 3 distinctly separate parties, they may all have 3 distinctly separate  policies for each and every sphere of public life.  If that is so, then for now it would make sense not to draw attention to that fact when trying to convince the public (and those further afield) of their ability to govern.

Just as with the last time the opposition where in power in coalition, the disunity and disagreements over actual policy will surface – again – because they will be forced to agree or disagree over very specific public policy should they manage to gain power again.

Thus for now – quite rightly from their perspective – it is better to unite around the sole policy that they – and their individual party supporters – can unite around.  That being the ousting of the current parliamentary majority and president.

As somebody far more interested in policy than the political party that champions it, quite obviously I have been hoping that sooner rather than later some form of policies would begin to emerge – preferably policies that all opposition parties could unite around (and receive an overt, if only to be polite, golf ripple applause from external entities of Ukraine in a nod of approval).

Unfortunately, the first real salvo from Svoboda into real economic and business policy and legislation – Bill No 1250 “The Elimination of Private Monopolies” – is not a particularly good piece of draft legislation at all – and only 2 pages long!

It would have to be a very concise and clever document for a complex issue such as monopolies (what is and is not a monopoly, under what circumstances, what is a natural monopoly and what is not? etc.)  and reach a quality legislative outcome within 2 pages.

Aside from the technicalities of critical issues such as relevant definitions of what precisely and legally defines a “private monopoly” that is to be eliminated being entirely absent from the draft- something you would think rather key to a draft legislative bill to regulate the issue – it would seem to be completely at odds with Article 13 of the Constitution of Ukraine which prohibits the State arbitrarily seizing property (other than in emergency or by the military in time of war where the Constitution does allow seizure on condition of full recompense to the owners) which the draft law would empower the State to do.

It also seems to fly in the face of other existing law – Article 12 (1) of the Law of Ukraine (Protection of Competition) which actually does define monopolies quite clearly (35% of market share is the  key base figure in the statute with some mitigating caveats within the law allowing for up to 70%) – and yet there is no mention of this existing law within the draft Bill No 1250, nor mention of changing it to meet the requirements of the proposed law, or indeed repealing it.

The bill proposes the arbitrary State seizure of private property deemed to be a monopoly under certain conditions the draft law would enable.  Specifically, the seizure of entities deemed to have a “private monopoly” that were gained through the privitisation of national assets, or which holds more than a 25% market share.  That market share can be either national or regional apparently.

In effect it would mean the re-nationalisation of an awful lot of previously privatised assets and furthermore make it quite difficult to privatise other State assets – some of which really do need getting off the State books if we are completely honest, as they are in fact liabilities rather than assets.

Whether property seized remain State assets or if the seized assets subsequently are privatised once more remains unclear – but suffice to say, so badly is the draft written that 25% of market share is in effect an arbitrary ceiling for any private entity within its market.

Thus the prospect of the State monopoly again raises its head in Ukraine via arbitrary seizure – or we will eventually face a cartel situation whereby 4 or 5 private entities control 20%-25% of the market each to remain within the proposals of this draft law, but hold the market to ransom nevertheless.

Neither would seem optimal or appropriate for a united opposition who have declared their intention to meet EU norms as often as they have mentioned the name “Tymoshenko”.  In fact the draft law would probably run contrary to the EU/Ukraine DCFTA and AA the opposition want signing as soon as possible.  EU competition laws are rather robust – ask Microsoft or Google who have fallen foul of them.

Most importantly and regardless of any of that, as a consumer in Ukraine – do I get a better service from the State run entities or the private ones?  As that is a rhetorical question, and the State institutions are definitely the worst run and most bureaucratic (no surprise), would I want anything returning to State ownership and management?  Probably not!

It will be interesting to see how the other opposition parties vote on this Bill.  Will they support it despite it being so badly written?  Will they vote against it and publicly rebuff a policy emanating from amongst their ranks, drawing attention to potential governance divisions?  Will they abstain and simply be seen not to support a (currently) key political partner?  Perhaps they will try and convince Svoboda to withdraw its Bill – giving the impression they would prefer it if Svoboda would leave the joined up writing to others?

Whatever the case, Bill No 1250 on “The Elimination of Private Monopolies” is an absolute shambles – at least in its current form.  How anybody within Svoboda allowed it to be submitted “as is” seems quite unfathomable – even if they wholeheartedly support the spirit in which it was written – whilst seeing it as a way to insure the Yanukovych family don’t secure soon to be privatised State assets in all probability.

When it comes to my hope to see real policy (and not just rhetoric) emerge from the opposition ranks, I should perhaps be far more careful in what I wish for if this Bill is to set the standard.

I am sure they are capable of drafting far better legislation than Bill 1250 – so why didn’t they?

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