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Right idea, but the asset management? – Yatseniuk on foreign trade

July 1, 2015

Arseniy Yatseniuk, amongst his rhetorical fluff, has a gift for stating the obvious.  That is not meant in a derogatory way.  There are times when the obvious must be stated, because the obvious is not obvious to all – or the obvious is obviously not being done, or done as well as it could or should be.

Often when being called “insightful”, policy makers, commentators (and even your author) are simply stating the obvious.  A case of seeing the wood for the trees, root causes amongst the (expedient or otherwise) distractions and symptoms.  The substance (or lack of) under innumerable layers of beautifully veneered (but otherwise empty) form.  If there are those that argue about a glass being half full, or half empty, somebody has to ask if it is indeed the right glass.

Recently Mr Yatseniuk has hit one of the Ukrainian trade nails on the head – at least with regard to what is lacking, although not entirely well with regard to how best to employ the existing Ukrainian tools already projected into other countries.

“The Government is obliged to be an economical advocate of Ukrainian companies abroad. This is the practice of all countries, and I ask you to act in the same way.” – Absolutely!

He then went on to state that Ministers should do far more to facilitate international trade for the nation when on international visits.  He made note of the sterling efforts of the Minister of Economic Development and Trade of Ukraine Aivaras Abromavicius and Minister of Finance of Ukraine Natalie Jaresko in this regard – Quite rightly!

He stated it would be expedient to establish a council of exporters, which will involve “all Ukraine’s companies that are able to export and take over other markets” and determine for each company, how to assist it and in what country. – A good idea, but perhaps a little unwieldy depending upon how such a council will be structured, how it will function and the level of interaction it will have with the government.  A nationally and internationally functioning, rather than existing but regionally insular network of  the Ukrainian Chamber of Commerce?

Something else, if not building on existing entities such the the Odessa Chamber of Commerce in the link above?

Odessa has its own regional Ministry of Foreign Affairs office headed by a friend of you author of more than a decade, Konstantin Rzhepishevski.  He and his office are consistently hosting trade delegations and attempting to promote trade from Odessa to the surrounding nations – amongst other things.  Where would that role sit in any newly formulated council?  Would central Gov UA, do a better or worse job when it comes to knowing exactly what is what in, and from, Odessa, or have such a close rapport with neighbouring nations?

Perhaps the Odessa Chamber of Commerce and its regional MFA Office, plus others, multiplied by all the regions?  Nothing would get done – it would simply become too unwieldy.

priorities

However, returning to the Prime Minster’s words, there are some obvious points – and ommissions.

Rightly he states Ministers on foreign visits should promote Ukrainian trade.  We are to expect then, that all Ministers on foreign visits will be accompanied at the very least by an exceptionally knowledgeable functionary from the Ministry of  Economic Development and Trade, if not a full (or meaningful) trade delegation, henceforth?

Where there is enormous scope for pushing Ukrainian trade, and which is not mentioned by the Prime Minister, is the existing, permanent Ukrainian outposts across the world – its foreign ministries.

Foreign Ministry outposts in the form of embassies and consulates are not, first and foremost, there to supply Ukrainians with new passports should they lose theirs.  They are not there, first and foremost, to repatriate Ukrainians who die abroad.  They are not there, first and foremost, to supply diplomatic assistance to those that fall foul of local legislation.  They are not there, first and foremost, to provide voting locations for Ukrainians to vote abroad when elections are taking place.  They are also not there, first and foremost, for its diplomats to gorge on canapés, attend high brow parties, and enjoy a Ferrero Rocher lifestyle as depicted in television advertisements.

If that is what the Ukrainian government, and the Ukrainian people, expect from its embassies and consulates abroad, then the entire Ministry of Foreign Affairs needs a radical change of institutional culture with immediate effect, as do those with such expectations looking in.

The Ukrainian embassies and consulates abroad will have, or should have, priorities set by government as to their activities.

They are a projection of Ukrainian governance and governmental priorities abroad.  As such, the Ukrainian diplomatic establishments in every single nation should be promoting Ukrainian interests, working to protect the nation through frequent interaction with partner nations, creating ever-closer relationships with the nations within which they are situated, and be prepared to assist Ukrainians caught up in any national disaster in their country of responsibility.

In short, the pursuit of national security and the national interest as priority number one.

The second most vital thing each and every Ukrainian embassy and consulate should be doing very robustly, is promoting trade with Ukraine and Ukrainian business abroad.  If these diplomatic missions are not daily, stoically, trying to further opportunities for Ukrainian businesses abroad, (and opportunities within Ukraine for businesses from within their host nation), then they are spectacularly failing in what is beyond doubt, their second-most important role.

Only then, as the third priority, do we reach what can be lumped together as “consular services” for Ukrainians in distress abroad.

Those are, or should be, the very clear priorities – and in that order.

Prime Minister Yatsenuik further stated “We need to open sales representative offices in the United States, Belgium, Germany, France, China and the Middle East: It should be done by the end of this year.”

Why?

Those offices already exist in the form of every single Ukrainian embassy and consular office.  Certainly there are gains to be made by ramping up the dedicated economic and trade staff numbers (not to mention accountability for trade results) within those diplomatic out-stations, but there seems no real requirement to open new “sales representative offices in the United States, Belgium, Germany, France, China and the Middle East“.

Indeed, when it comes to the USA, a nation that is currently the most critical to Ukraine for reasons of diplomatic and political support, would it not be far wiser to first appoint a Ukrainian Ambassador to the USA, than to prioritise opening a “sales office”?

No offence meant to Yaroslav Brisiuck who has been a capable Chargé d’affaires whilst running the Ukrainian embassy in the USA for the many, many months during the absence of an appointed, credentials accepted, Ukrainian Ambassador, but the continued and open-ended absence of an Ambassador in what is a vital nation for Ukraine is simply very bad diplomatic form.  It is as much, if not much more of a priority, than a “sales office”.

Why is there still no Ukrainian Ambassador to the USA after so many months?

Returning to the issues of increasing trade, does it not make much more sense to bolster the trade and economics personnel within the existing embassies and consulates of Ukraine, than it does to open new “sales offices”?  In doing so, does it not also make sense to give those embassies and consulates a GDP% target for it to bring to the Ukrainian economy via its endeavours?  Should the Ministry of Foreign Affairs not also be tasked with the recovery of the Ukrainian economy, and thus employ its international network to those ends without the need for additional overheads when opening “sales offices”?

Is this not obvious?  (It is surely not “insightful”.)

Of course, all of this will be for naught, if Ukraine does not produce what buyers want, at a price they like, and to standards they expect – underpinned by a legislative environment that is conducive to business and impartiality.

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