Archive for August 31st, 2015


Big picture, little picture, FDI – Odessa & Ukraine

August 31, 2015

Some time ago an entry was published here that raised certain questions surrounding the “projects” and “project selection” machinery of Sasha Borovik and team, Governor Saakashvili’s “project manager” for the “Odessa project”.

“Specifically concentrating upon those volunteers that end up with Sasha Borovik who looks after “projects” (are casinos and gambling projects for the Singaporean dream?) within the Administration, there have been some highly visible, and eyebrow raising incidents with regard to recruitment of those that have ended up as his volunteer pool/team. Incidents that anybody who frequently drops into the Bristol Hotel in Odessa on a weekend cannot have failed to miss over the past months.

The Bristol Hotel on a weekend for the past few months has been home to regular visits (and stays) by a lot of successful businessmen and politicians from Georgia. Somewhat questionably some of these people have apparently been pre-interviewing/pre-screening volunteers. They claim to be (and perhaps they are) assisting Misha (Saakashvili) and Zarub (Adeishvili) in the processing of volunteers and their appropriate team placement.

Meanwhile Koba (Nakopia) it is rumoured is involved in the interviewing process for top Oblast positions, such as Oblast architect, customs chief etc – Not a role for executive search and selection companies?

That this occurs in the open and in a public (if rather swanky) location may indeed make such events legitimate and deliberately transparent – or it may not.

Some may see it as a brazen way to select volunteers for Mr Borovik’s team in “projects” by those affluent and connected that will be submitting “projects” that get the approving nod of the volunteers and are passed further up the chain – rather than being dismissed upon initial presentation.”

It concluded – “Is this messy impression all simply a matter of a discombobulated approach to the administrative issues surrounding voluntarism within public administration, when the paid administrative personnel are really working very hard in the boiler room generating and implementing change themselves in oder to make the boss look good? A matter of daily administrative priorities resulting in a disjointed and ad hoc response to a very large response by volunteers?”

Sasha Borovik

Sasha Borovik

Whatever the case, Sasha Borovik is the man who seemingly has the ultimate decision over what “projects” will become projects and which won’t – whether those “projects” come from local sources and the local constituency or indeed from external sources (recognised or not).

For the external recognised sources, generally it can be presumed that they will also have had some engagement with the relevant Oblast Rada committees, throwing another decision maker/interested party into the decision making/negotiating mix – for better or for worse.

Whether there is an Oblast plan into which “projects” will fit (or not), who knows?  Certainly not the constituency of Odessa Oblast.

Perhaps some indication will be forthcoming from a major investors conference in Odessa on 10th September?  Perhaps not?  Perhaps there is no plan other than trying to simulate the “Singaporean Model” – somehow.

Naturally to reform and reinvigorate the Oblast, not only does there have to be societal “buy in” but also financial investment too – both from central government and external actors.

Clearly as a corporate/private investor in Odessa, you do so in order to make a profit on your investment.  Such returns upon investment are not normally associated with “public goods” or investment in local governance/democracy promotion – at least those returns are not directly associated despite any long term benefits.

Likewise, the same can be said of “democracy promotion” with regard to democratic and local governance infrastructure that provides both greater access and a sense of inclusiveness.  Odessa Oblast is bigger than Belgium with far worse infrastructure.  Therefore if it is exceptionally difficult for the constituents in far flung corners to get to the Oblast Rada in Odessa, then perhaps the Oblast Rada should go to the far flung corners of the Oblast?

An entirely reasonable “project” that Sasha Borovik and team should consider?  Particularly so if external parties are willing to pay for this Oblast Administration projection?

On 23rd June there was meeting between the East Europe Foundation, representatives of the Oblast Rada and Sasha Borovik regarding just such a project.  A project that the East Europe Foundation has instigated in several other Ukrainian Oblasts.  It is one of those organisations that anybody with an interest in developing local governance, local economics, local society, local energy efficiency etc., hopes will comes knocking at their door rather than to have to chase after it and try to gain its attention.

The EEF planned to open 10 administration centres across the Oblast and create on-line facilities to accompany them.  The total investment (in Swiss Francs) was to be SF4 million over a four year period.

Needless to say the Odessa Oblast Rada was very much “on-board” with the concept and very amenable to signing the ubiquitous “Memorandum” that accompanies such agreements.  It transpires however that Mr Borovik was not so keen.  In fact not keen at all.

We now enter the realms of “big picture” verses “little picture” and the priorities that Mr Borovik is expected to have as a representative of the Oblast Administration against those of somebody in the National Administration – if indeed they are conflicting.

Questions were asked of the fund as to why such projects were not occurring in all oblasts across the nation.  The suggestion of “Balkanisation” was made – no joke!

To this one must ask whether Mr Borovik asks all potential investors in Odessa why they are not investing equally in other oblasts?  The answer is probably not – in fact almost certainly not.

If there are going to be investment hot spots in Ukraine (Kyiv, Odessa, Lviv where ever) is that not an issue for central government to address, perhaps pointing more domestic investment into the regions where other investment won’t go rather than an issue for somebody charged with a hand in Odessa Oblast development?

There is absolutely nothing wrong with keeping the national (and even international) picture in mind when making Odessa Oblast “project” decisions – but would 10 Oblast administration centres constitute “Balkanisation” or a threat to national security/unity?

If so, do the preexisting projects through this fund in other oblasts reflects the relevant local decisions makers inability to consider the “big picture” when putting the local “little picture” and their constituency’s accessibility to the Oblast administration first?

One has to suspect not.

It would appear that Mr Borovik wants only one main Oblast administrative centre, and that those that need it will manage to get there regardless of the inconvenience and time taken to navigate the crumbling Oblast infrastructure to do so.

Apparently the 4 year investment period was also not timely enough.  Investment is required now and there is (and perhaps will remain) a single Oblast Administrative Centre that will happily accept funding.

It should go without saying that on 23 June there were a lot of surprised faces both from the EEF and the Rada Oblast representatives.

Is it a logical statement to make regarding the “Balkanisation” of Ukraine when a fund has invested in certain oblasts but not others?  Perhaps it will invest in the all over time?  Would Mr Borovik prefer Odessa was last?  Does Mr Borovik consider both the Oblast and Ukraine too weak to open alternative (and subordinate) Oblast local government offices lest control over them be lost?

Was it simply (yet another) unwise/ill-considered statement by Mr Borovik (albeit this one made privately rather than publicly) to rebuff a “project” that could not be kicked back lower down his “Project Team” chain?  A “project” that he simply doesn’t like and that doesn’t fit into his Oblast plan (if there is a plan)?  Was it a poisonous seed planted by first deputy chairman of the Odessa Regional State Administration Vladimir Zhmak, the source of much recent discord and disinformation from within and amongst the Governor’s administration?  (In fact Mr Zhmak is perhaps deserving of his own entry at some point.)

So leaky is the Governor’s administration, when making such questionable statements it should be anticipated that employing the term “Balkanisation” when talking to an international investment fund, that such things will not remain private – so why say them?

Misguided or otherwise, if Mr Borovik’s is placing the “bigger picture” (as he sees it) before the “little picture” of Odessa Oblast, is it an indication that he believes he will not be here long and anticipates a move to “the centre” where the “big picture” is concentrated?  If so that will happen in tandem with the Governor in all likelihood.  How long to give them before they move on?  A year?

Perhaps there are similar “projects” that have already been given the “Borovik nod” – and it is simply that nobody (seriously nobody) knows about them?

If this project fails to materialise despite available finance and experience within Ukraine of the relevant fund, in all probability to the detriment of democracy, Oblast accountability, and societal access and inclusiveness in the far flung corners, we are perhaps to presume that almost all “projects” submitted will require to have an economic output (one or more Georgian owned/backed casinos in Odessa perhaps?) , rather than a democratic or administrative constituency benefit in order to get his approval?

Whether Mr Borovik has had a rethink and whether during the 2 months since the meeting of 23rd June a Memorandum has been signed – or if not whether this “project” will ever get signed off by the “Oblast Project Manager” – is unknown.

Nevertheless the entire incident, and particularly the “Balkanisation” reference, seems somewhat bizarre prima facie.  There must surely be more diplomatic ways to question the intent of potential international investors in the Oblast.  Can or should Odessa, and by extension Ukraine, be seen to be turning away solid investment in local governance projection and administrative infrastructure at the expense of societal access and inclusion?  Probably not!

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