Archive for the ‘consultancy’ Category

h1

Ukraine begins to lobby DC – professionally

January 7, 2017

Many times it has been written that Ukraine would be wise to lobby Washington DC beyond the abilities of its own diplomatic mission and occasional delegations.

So it comes to pass, and probably due to a Trump presidency almost being upon Ukraine, the national leadership has decided to engage professional lobbyists to champion Ukraine inside “The Beltway”.

That said, whilst Ukraine as a State has taken its time to arrive at this decision, many of the Ukrainian elite have long since lobbied their own causes/interests within DC.

personal-lobbying

Ms Tymoshenko outspends all others (despite her meager income according to her e-declaration.)

The Ukrainian State has chosen to spend a seemingly meager sum of $50,000 per month having BGR Group strengthen ties between the USA and Ukraine, and further encourage US investment and/or US investors to look at Ukraine.

bgr

Not before time, and perhaps only because of who the next US president will be, has Ukraine as a State started to spend money where many of its nefarious elites have done so for years.

1

2

3

The contract would seem to last for the duration of 2017.

Although this is definitely the right policy for the Ukrainian State to engage in – indeed to belatedly engage in – a reader may ponder just what returns can be expected for $600,000 per annum when considering that Ms Tymoshenko spent more than that amount in 2014, that same amount in 2015, and would appear to have very little to show for it – unless her lobbying was intended to insure very little was publicly shown regarding her.

So, what do you get for $600,000 of lobbying inside “The Beltway” (even if leveraged with a cooperative Ukrainian Ambassador and embassy)?  BGR Group and 2017 will provide the answers!

h1

Chernobyl reactor entombed at last

November 29, 2016

A very short entry to firstly acknowledge a major piece of engineering, and secondly the symbolic entombment of a toxic Soviet legacy within a western funded and built sarcophagus – (Sarcastic readers are now pondering whether the Verkhovna Rada should be next perhaps?)

chernobyl_shell1

The full facts and figures can be found at the EBRD website, together with a video showing the final settling of the sarcophagus in place, outlining what a major feat of engineering the project has been.

Bravo to all concerned.  A truly significant achievement.

h1

Corruption, jurisdiction, and stopgap roles to European public figures

September 19, 2016

With the cleaners still clearing up after the YES Conference in Kyiv, and the Davos Conference in Kyiv on-going, a reader may be forgiven for missing the fact that Denmark has been appointed “point man” for the EU with regard to implementing a 3 year anti-corruption programme worth €16 million.

The Danish Foreign Minister Kristian Jensen, and the Danish Ambassador to Ukraine will have a difficult task when it comes to achieving any benchmarks (whatever the benchmarks are) relating to this programme and accounting for any successes or failures.

Indeed the Danish FM is on record sharing a very dim view regarding the retarded attempts by the Ukrainian political class to neuter the legislation it passed regarding e-declarations – “We fully share the view of the anti-corruption committee – there should be no changes made to the law.  Commissioner Hahn and I raised that in our meetings with Prime Minister Volodomyr Groisman.  Delays have already left a bad impression. No-one should forget that the EU is watching carefully as the final decisions are taken on visa liberalisation.

Anti-corruption activists however, perhaps naturally, expect more than robust rhetoric and diplomatic pressure and are advocating joint prosecutor teams for joint jurisdiction cases.

It has to be said that in the diplomatic and political circles there is indeed discussion over some European judges taking a role in any specialised anti-corruption court if and when one appears in Ukraine.  Quite how that will sit within existing Ukrainian legislation is unclear, or indeed how it would sit constitutionally too.

There are also issues over joint jurisdiction, what it actually means, and how it would fit within any Ukrainian legislation and/or the Constitution.  Lest it be forgotten the ratification of the Rome Statute – an instrument relating to the ICC – was long delayed (and was this year postponed for 3 years when it should therefore enter into effect in accordance with Ukraine’s EU Association Agreement obligations after Constitution changes).

It should be noted that the ICC jurisdiction is complimentary to national courts –  and even that complimentary status was a constitution hurdle – yet there are far less political (and perhaps socially) prickly issues than that of joint jurisdiction that is concurrent .  An issue perhaps irritated further by whether a State adopts a monoist or dualist approach to regional or international law.

None of that should prevent prosecutors and investigators working together of course, the issue will be at which court due process occurs and arguments over where any criminal act was actually committed.  Neither do such jurisdictional issues prevent any EU nation from enforcing its own laws (which they all seem to do with the Ukrainian elite far, far more often than not) regardless of Ukraine failing to enforce its own .

Whatever the case and the issues of joint jurisdiction, or indeed any agreed (or not) definition of corruption aside, as EU “point man” Denmark will be implementing a pilot anti-corruption programme in 2 regions of Ukraine – it is to be hoped that some irreversible headway is made.

Perhaps nailing and jailing the regional elites will be far more efficient than the attempts to do the same with the national elites which clearly remains a major problem.  “Family Yanukovych” may not longer be on a corruption, coercive, corporate raiding blitzkrieg, carpet bombing and plundering the nation of any State and/or private asset that took their eye, but a slightly more subtle “sniper-fire” of more targeted plundering and raiding still actively continues.

Only today was the blog approached asking if there were any names of European public figures it was in contact with that could sit as executive or non-executive directors on corporate boards where their presence may then keep “Mr Kononenko and Co” (their phrase) from acquiring them against their will (now or in the future).

board-member-vacancy-graphic

So, for the likes of Carl Bild, Lady Ashton, Stefan Fule, John Herbst et al., there is still a job they can do for Ukraine by actively assisting in the fight against corruption/coercive corporate raiding.

There are Ukrainian firms that would appreciate such personalities accepting positions on their boards for no other reason than in the hope that such public profiles can be sufficient to dissuade the current wolves.  Executive and non-executive roles are waiting for such specific personal qualities only such a cadre can offer.  There is clearly a demand and there is a very practical role that can be played which will not interfere with the richly deserved lecture circuit/punditry/think-tank leadership/consultancies and the rewards they give.  It is not the “offensive” (ability to open doors, insightful comment, strategic awareness etc) perceptions that come with such names, but the “defensive/preventative” capabilities that come with them name that are sought.

It is of course a stopgap solution being sought by some in Ukraine to the continuing failure of the current elite to get a firm grasp on the rule of law.  Hopefully The Kingdom of Denmark will implement a trail-blazing anti-corruption programme that is spectacularly successful and swiftly repeated throughout all regions, but as  innumerable European diplomats and bureaucrats have said ad infinitum, when it comes to removing corrupt leaders in Ukraine, then “Ukraine has to own the process” (read “do it”).  As that is not going to happen at the very top, in the meantime a few emails to a few “European public figures” have to be written.

h1

The imminent changes at the top occurred – Now what?

August 29, 2016

A few days ago an entry appeared forewarning of changes at the top within the Ukrainian political and civil service elite – forecasting that Boris Lozhkin would move on from Head of the Presidential Administration (as he has been trying to do for some time, wanting to return to the business world) and that in all probability Igor Rainin would cease to act as Head of Kharkiv Regional Administration and replace Mr Lozhkin (due to Mr Rainin being the least controversial choice for those that will be remaining within the Presidential Administration – and also the easiest to replace holding an Oblast level position).

It went on further to suggest Mr Lozhkin would not be completely released from the Presidential grasp/circle but could very well be appointed head of the newly invigorated National Investment Council.

Lo, all such predictions came to pass on 29th August – with the minor deviation of Mr Lozhkin assuming the position of Secretary to the National Investment Council.  (Nevertheless, hopefully most readers would agree the predictions made were close enough for a free to read blog.)

Mr Rainin will be a competent, adequately discreet (and fairly discrete) safe pair of hands as Head of the Presidential Administration.  Shocks to the system he will not cause.

Mr Lozhkin thereby leaves the Civil Service (prior to e-declarations going live with effect from 1st September) yet remains within the Presidential grasp and therefore presidential team no matter how indirectly it may appear.  Regardless of title and position, his unofficial “shadow rank” within the elite of the Ukrainian elite firmly keeps him within the inner sanctum of trusted Presidential advisers with easy access to the body (President).

He is now therefore free to return to the business world without annoying e-declarations and other such bureaucratic requirements, whilst also promoting (and to be blunt he will be driving) the National Investment Council.

Presumably the existing Investment Support Office will be rapidly (although probably not officially) subordinated to the NIC – and by extension to Mr Lozhkin.  Reading between the lines of Prime Minister Groysman’s statement regarding Mr Lozhkin’s new position such inference can certainly be drawn.

Boz

A reader may ponder who Mr Lozhkin will attract to the newly invigorated National Investment Council as he is very well though of internally and externally of Ukraine – and it was he that invited and convinced the foreigners that formed part of the Yatseniuk Cabinet.  Ergo it would be no surprise to see some very competent people appear as leading lights within the NIC.

Clearly with Ukrainian GDP growing at about 1.5% per annum that is not enough to provide a “feel good” factor among the electorate to return President Poroshenko (and parliamentary team) to power when elections arrive.  Annual growth of approximately 5% however could well (and probably would) do so as long as elections can be kept to their projected timelines per statute and not forced to arrive early.

Although it may be wishful thinking, 2.5 years with GDP growth of 5% (or more) consecutively wins a lot of votes – especially in mercantile cities like Odessa.

Mr Lozhkin will therefore be faced with the same existing statute that prevents significant FDI that has frustrated Governor Saakashvili, whose long list of legislation that requires repealing and/or amending has seen no traction within the Verkhovna Rada.

It seems unlikely that Mr Lozhkin will succeed without forcing some (if not the majority) of the very same statutory and de-regulatory issues already raised and submitted to the Verkhovna Rada by the Odessa Governor.  The question therefore is whether Mr Lozhkin can gather Verkhovna Rada momentum swiftly in order to give himself a chance of changing the economic fortunes in time to support the president by the time elections come around?

Further where is FDI going to be most effective when it comes to national development (and no doubt also in his mind, winning the Poroshenko political entities votes)?

The days of mining and metals as economy leaders, and with both being major employers (and exporters) are on the wain.  Road and rail infrastructure projects, of which there are innumerable, are potentially significant employers.

The necessity to bring the Ukrainian Military Industrial Complex to the modern day also presents significant opportunity.

The IT industry which suffers no oligarchy market capture, and boasts a significantly high proportion of globally recognised qualified people, simply has to be left to do its innovative thing – with support where necessary/possible, but otherwise unobstructed or interfered with.

Agriculture is and will remain a major economic driver (and should any reader have $150 million(ish) for investment in a 230 hectare, high tech farming corporation – this blog is aware of one discreetly for sale “off market”).  Thus the agro-industrial complex will have to be a top priority for FDI if the sector is to become more efficient.

The Ukrainian aerospace industry appears to be doing fairly well, but can do much better with some smart investment and a “harder” sales initiative.

The continuing clean-up of the banking sector by the NBU presents an ever-improving market place for entry (and if a reader has $40 million(ish) the blog is aware of a particularly healthy bank for sale “off market”).

There is of course the impoverished yet potentially massive tourism industry (perhaps with the “added incentive” of legalised gambling returning one day).  The blog is aware of numerous experienced international gambling entities waiting to enter Ukraine – Turkey, Israel, Georgia etc have all contacted the blog regarding legislative updates and visited potential locations for casinos in the past 9 months.  FDI money for this there is – legislation prevents.  (Should a reader have $12 million(ish) the blog is aware of a small gated and profitable beach front resort for sale “off market”).

There is also the expansion of the existing pharmaceutical and chemical industry that should not be overlooked – neither should energy extraction/production/infrastructure.

(Getting out of the way of SME’s wherever possible will also bring about swift local economy benefits, but clearly this falls outside of the competence of a National Investment Council charged with finding and protecting big money investment.)

Thus it is not only going to be a question of how many $ billions Mr Lozhkin can attract (and protect) by way of FDI (and in what time scale), but also what areas are deemed a governmental priority and his ability to nudge investors that way.  Investors can be strange creatures and want to invest in areas that are not governmental priorities – unsurprisingly.  Some have no interest in PPP, others only in PPP.  Some are quite rigid in their internal governance and expectations, EBRD etc., where as others, for example “Investment Fund X”, may be far more flexible.

Having now written all this, a reader may perhaps ponder just how much time Mr Lozhkin will have to return to his own businesses, and the business world – which was the reason for his wanting to leave the Presidential Administration in the first place.

(As an aside – Teasers for the “off market” assets mentioned (and others) are available for investors subject to the usual NDA/contractual requirements.)

h1

54.5% of people in Odessa……..

August 21, 2016

A friend from within the Brussels bubble sent this blog a link regarding a recent SOCIS opinion survey made in Odessa.

What caught the eye in Brussels was “In addition, according to the majority of Odessa residents, the situation is tense in the city – 54.5%.  Some 30.1% of respondents said the situation was more or less stable, 9.9% called the situation explosive and 5.5% of residents were undecided.

Eyebrows therefore raised within the EU institutions regarding the stability – or not – of Odessa based upon this quote.  After all, which policymaker these days has time to do anything more than scan a few bullet points, or at most a paragraph or two, of any document pushed under their nose?

op

Questions of methodology aside, just as important if not more so, is how exactly were the questions worded to solicit the answers given – those questions simply falling outside the time available for those struggling to find time to scan and absorb bullet points.

The exact wording of questions frames outcomes as the below satire makes clear.

Therefore how was the question worded that solicited such a response?

The question was worded thus “How do you assess the situation in….?

Those surveyed then answering Stable/Tense/Explosive/Don’t know.  Looking at the results there are no other options.

Naturally the definition of  “stable“, “tense” and “explosive” is open to personal interpretation and thus perception unless specifically defined parameters are within the possible survey answers.  In short, this blog’s understanding of “stable” may be very different to its readers etc.

Indeed there may be a multitude of reasons why somebody surveyed in Odessa may describe the situation as “tense“.

Perhaps due to the increasing militarisation of Crimea?  Maybe due to the recent “incident” as claimed by the FSB in Crimea?  Perhaps due to another significant rise in utility prices from 1st September and social friction that may result?  An expectation of a Russian offensive?  A bubbling local war between the criminal elements?  Could it be due to open political warfare between Governor, Mayor and major businessmen in Odessa?  A possible provocation on Independence Day or during the City birthday events?  Dysfunctional and/or feckless governance – central or local?  The real possibility of yet more early elections, be they national or local?  A fear of yet more subversive acts?

Any one or more of these issues may determine an answer of “tense” rather than “stable“.

That “explosive” managed less than 10% is surprising, for traditionally the people of Odessa manage to return a solid 15 – 20% survey return that is completely removed and at odds from the answers that the rest of the local constituency gives.  Indeed 15% in a survey stating that black was really white, or that the moon is just the sun at night would come as little surprise.

Again however, what are the factors that influence the less than 10% surveyed to arrive at “explosive” as an answer?  Is there a core reason, or many?  Which reason, if any, would result in the “explosive” actually exploding – and how would it manifest given the numbers attached to any specific reason?

No policymaker in Brussels has time to get answers to these questions, even if they have a mind to ask them – which is doubtful.

Perhaps worse by way of framing perception, the link sent to the blog from within Brussels only gave the results for the “How do you assess the situation in….?”  as far as Odessa was concerned.

The survey asked for two perceptions.  One for Odessa that got attention within Brussels as the results were displayed in the link, and one for Ukraine as a whole, which didn’t, as those results were absent.

The results for Ukraine as a whole were 6.3% stable, 64.2% tense, 26.1% explosive and 3.4% undecided/don’t know.

Ergo those surveyed in Odessa found the city to be far more “stable”, far less “tense” and considerably less “explosive” than Ukraine overall – yet this did not appear in what was being read by this blog’s friends in Brussels prompting the nudge about the mood and how reflective the poll truly was.

The poll maybe entirely accurate, but of course it is very subjective when considering the question and perhaps wooliness of definitions and perceptions in the answers.

The survey questions and results can be found here – and perhaps they are far more useful in understanding the local constituency priorities with regard infrastructure and institutions – notwithstanding political positioning – than they are regarding anything approaching a genuine risk assessment.

h1

Demographic voter bases (The Saakashvili target) – Ukraine

May 24, 2016

As stated in an entry some months ago when there was some doubt over the formation of a new Cabinet of Ministers materialising, Ms Tymoshenko and the political vehicle the serves her (Batkivshchyna) had already begun electioneering – with her trademark usual populist nonsense and Robert Mugabe-esque economics naturally to the fore.

That pre-election electioneering has not stopped – quite the opposite, it seems to be gathering momentum.

A reader may ponder just how such flapdoodle is financed – and will continue to be financed for months ahead – considering the amount of prime media time she is commanding (compared to others).

(A reader may also cynically ponder as to just why the media still bows to her ego and accepts her prerequisites that former investigative journalists turned MPs such as Sergei Leshchenko must have left any television studio prior to her arrival and subsequent populist monologue.)

Ms Tymoshenko is clearly aiming to gather in the pensioner vote (in the absence of the Communist Party and now defunct Party of Regions) and the agrarian vote too, in an effort to add them to her traditional and fairly solid 13% of the constituency.  (Somebody has to try and win over the old Communist voter base, so why not Ms Tymoshenko, and why not start now?)

Whilst President Poroshenko continues to broadcast the actions of Russia, as indeed he should for Russia will remain a significant threat (through its various measures) to Ukraine far, far into the future, the domestic constituency sees reform as the most necessary and top ranking issue facing Ukraine – and quite rightly.

The net result is that President Poroshenko, now perceived to control the Prime Minister and Prosecutor General (how long before the Interior Minister is replaced by a Poroshenko man?) is fully responsible for all progress and ills of the nation domestically (as well as internationally) despite constitutional responsibilities.  Thus only reforms will save President Poroshenko at the ballot box – regardless of how much he may prefer to orate of the dastardly and illegal deeds of The Kremlin.

Likewise only reforms will save his prodigy as Prime Minister and (latest) chosen man to head the PGO – and it is these people that face a far immediate and difficult political horizon when it comes to early national ballots and securing sections of the demographic voter base as a foundation.

It is perhaps interesting therefore to note the comments of Davit Sakvarelidze of 24th May in Kharkiv – for they indicate the voter base demographic that any new Saakashvili associated and/or led, party will be targeting – that of the Ukrainian SME.

It is not a demographic that will easily take to the populist nonsense of Ms Tymoshenko, nor will it feel represented by the remnants of Party Regions under the various flags these parliamentarians will be flying, for historically they are associated with big business and the oligarchy.

Samopomich still remains too provincial to capture the imagination of SMEs nationally, the Radicals have nothing to offer by way of competent policy, and thus far the Poroshenko (and to be annihilated at the next election) People’s Front coalition are perceived to have completely failed SMEs – even to the point of not providing the most basic of idiots guide to the newly opened EU market via the DCFTA..

SMEs therefore would appear to be fertile ground for a new party – and a new party supported by and/or led by Misha Saakashvili there will be in preparation for the inevitable early Verkhovna Rada elections.

sme

It seems hardly a difficult matter to create a party manifesto based upon repealing so much legislative and bureaucratic codswallop that currently suppresses and thwarts SMEs and entrepreneurs in Ukraine – even if that is all that is in a party manifesto.

Indeed any manifesto that promises nothing other than repealing current legislative nonsense may prove to be far more popular than the usual populist promises of quick (and unachievable) fixes based upon Zambian economic theory, or providing subsidies far beyond anything responsible governance would allow.

As is often the case with policy, legislation, and governance, less is more – so why not in a party manifesto?

The target for any new Saakashvili supported and/or led party would be (realistically) to achieve approximately 20% of the national vote – for no other party seems likely to reach 20% of the national vote.  That would leave them in a solid position for coalition building – or opposition.  (To be blunt it seems unlikely that any party will pass the 20% mark at the time of writing, and the last polls seen by the blog had a Misha Saakashvili anointed political entity currently only half way to that 20% nationally – prior to identifying a target demographic.)

The question to be asked therefore, now that the demographic of SMEs has been identified by Mr Sakvarelidze as the target for any Saakashvili blessed political entity, is how any such political party will frame what it will do for this vital section of the society/economy.

A humble suggestion would be to work on the “less is more” principle, publicly and repeatedly identifying what obstacles and legislation will be removed and repealed to ease the SME burden – that and to begin an education programme posthaste for SMEs regarding how to achieve market entrance to the EU as a preparatory electioneering act – which would be far more useful when it comes to potential voter traction than any voter listening to a prime time monologue delivered by Ms Tymoshenko.

h1

NABU – Partnerships, potential suspects and results

May 11, 2016

The 11th May saw a Memorandum of Understanding signed between the National Anti-Corruption Bureau of Ukraine (NABU) and the Consultative EU Mission for Civil Security Sector Reforms in Ukraine.

The intent behind the signing of the MoU is to increase the depth of cooperation in implementing anti-corruption reforms in Ukraine.

The MoU, as inferred by the declared goals, therefore facilitates external funding (as provided for by the Law of the Anti-Corruption Bureau of Ukraine) and appears to concentrate upon altogether rather sensible issues – such as enhanced and continued training, internal management and control, and facilitating on-site, modern interview rooms.

nabu

The MoU also provides for a permanent on-site office for the EU Advisory Mission within the NABU building.  Whether or not that office will be permanently staffed or simply used for regular “drop-ins”/scheduled meetings to discuss implementation benchmarks (whatever those benchmarks may be) is presumably a matter for the EU Mission leadership.  It would seem rather foolish not to place a few staff members in the building permanently now the opportunity presents itself – for numerous obvious and not so obvious reasons.

By the very nature of NABU investigations, they are not going to be quick.

Even the most simple of investigations are likely to take many months.  Some will take years.  Not all investigations will lead to sufficient evidence pointing to guilt beyond reasonable doubt to present before a court of law.

That investigative time cannot be reallocated, yet neither are any investigations that fall short of a reasonable chance for successful prosecution necessarily wasted.

However, there will be, and there are, expectations both domestic and externally of Ukraine regarding NABU bringing (successful) prosecutions.  All will be expecting several prosecutions to reach a courtroom before the end of 2016, even if those prosecutions be those that are the least complicated (and thus swift to complete).

It remains to be seen whether the judiciary will have been reformed by the time many such cases begin to reach a court fairly frequently – but it is not for NABU to find guilt, simply to present a strong prosecution case with a good chance of a conviction.

There seems little point in taking a case to court that the NABU personnel themselves would estimate of having a 50% – 60% chance of conviction based upon the evidence that they have gathered.  Considering the current judicial prevailing headwinds, perhaps only cases deemed to have a minimum 70% chance of conviction should actually reach a courtroom – at least until NABU gathers a reputation for a reasonable success rate and/or the judiciary find some form of institutional integrity.  The latter will not happen particularly swiftly looking at the proposed strategy to reform the judiciary and the tinkering with what there currently is.  (It is worth considering building a new parallel structure that can replace what currently exists on “X date”.)

It thus falls to NABU to look to prosecute cases of the strongest of evidence, with evidence chains of the uppermost integrity, and all statutory defences covered.  Perhaps some may argue a 70% chance of successful prosecution in the current climate is too low when an institutional reputation for success has to be built, however this blog would argue it is sufficiently high and any higher would eliminate justice being done on behalf of the public in far too many cases.  It would seem a reasonable position – for now.

The scope of individuals that fall under the NABU terms of reference (Article 216 Criminal Procedural Code of Ukraine) provides that their potential suspects are all rather slippery and will be at the very least reasonably careful in conducting their misdeeds.  In fact, with the entering into force of the Civil Service Law on 1st May, that potentially criminal catchment area grew by another 500 – 600 people as Categories A and B civil servants became clearly defined.  Both of these top tier categories fall within the NABU remit.

In total there are now more than 22,000 politicians, senior civil servants, all judges, SOE CEOs and top uniformed personnel subject to potential NABU investigation.

A cynical reader will no doubt suggest that NABU is therefore understaffed when the perception internally and externally of Ukraine is that almost all that fall within their remit have misdeeds to hide – either past or present – or both.

It will therefore be a question of what the internal NABU criteria is that prioritises their investigations.

Clearly external support for NABU remains high – albeit undoubtedly less so among the Ukrainian elite who now fall within the NABU terms of reference.   Nevertheless, time and tide wait for no man, and a reasonable person, including external supporters, would expected to see a fairly steady trickle of NABU cases begin to appear before the courts during the Autumn – no matter how poor those courts will be.

%d bloggers like this: