"A strong international voice for business in Ukraine"

USUBC - Washington Watch - No. 14

(1) Ukrainian Foreign Minister Pavlo Klimkin Does Washington -----
Minister of Foreign Affairs of Ukraine Testifies before the State, Foreign Operations and Related Programs Subcommittee of the Senate Committee on Appropriations:

Last week the U.S. Senate Appropriations Subcommittee, chaired by Senator Lindsey Graham (R-SC),  held a hearing on “Russian Policies & Intentions towards specific European countries” at which Minister Klimkin testified as did the Ambassadors to the United States from Estonia, Georgia, Latvia, Lithuania and Poland. Before the hearing Senator Graham told reporters he wanted to make the case for foreign aid as a national security tool, a point he said the Trump administration’s “budget clearly doesn’t” understand.

It was a good hearing with most of the Members of the Subcommittee actively participating. Mr. Klimkin, in his prepared statement began saying, “Back in 1994, as a young diplomat, I was involved in a process of strategic nuclear disarmament. While working on Budapest memorandum, I have already questioned its effectiveness and feasibility to ensure security for Ukraine. Still, it was beyond my imagination that in 20 years one guarantor of our sovereignty and territorial integrity, a permanent UN Security Council member will invade Ukraine and occupy parts of its territory. Why did it happen?

“Here is the key to understanding what is the root-cause of Russian policies & intentions towards European countries, particularly, Ukraine. For Putin the collapse of the Soviet Union was the greatest catastrophe of the XX century. From the very beginning, he was and still is obsessed with restoring the former Russian greatness. It could be done in two ways. One was to invest in building a strong democratic state with a rule of law and competitive market economy honoring the international principles and order. But it was not the Russian choice.

“Instead, Kremlin resorted to aggressive expansionism in gross violation with the international law in different dimensions: (a) breaking the UN Charter and Helsinki Final Act; (b) undermining arms control and possibly violating the INF and New START Treaties; (c) coercing with trade and energy pressure in contradiction  to the WTO principles; and blatantly violating the human rights.
“The Kremlin has developed the concept of hybrid warfare ….”
COMMENTARY: The Foreign Minister’s statement was excellent, well received and is available through the link below.  During the question/answer session of the hearing Klimkin notes, among other things, there must be no compromise on Crimea and thanked the United States for its strong support adding how very important American international leadership is for Ukraine as well as America’s tangible support. 

In answer to a question he that he had meet with Secretary of State Tillerman and that President Poroshenko has talked to President Trump twice.  He told the Subcommittee that in one of the Presidents’ conversations Poroshenko was asked what Ukraine needed and responded that “Ukraine gave up 1,000 nuclear weapons, can we have 1,000 anti-tank rockets in return?”
Reflecting comments by several other Subcommittee members Senator Durbin (D-IL) focused on the broad elements of the Kremlin’s hybrid war and commented on how important it is for the United States to learn from the witnesses about the Kremlin’s methods because more-and-more it looks like the United States is being subjected to elements of Putin’s warfare.  Chairman Graham commented on the possibility of putting some dollars aside in something like a Counter Russia Account to help address Putin’s aggression.


LINK: The Washington Post article on the hearing:

(2) Ukrainian FM Says U.S. Secretary of State Tillerson Pledges U.S.

Support Against 'Russian Aggression' - Radio Free Europe/Radio Liberty" -----
The Foreign Minister met with the Secretary of State at the Department of State and afterward reported that "[Tillerson] assured me that the United States would consistently continue to support Ukraine in its struggle against Russian aggression, that Ukraine is a key partner of the U.S. in the region, that the U.S. would also consistently support Ukraine on its path of reforms."
COMMENTARY: In the article RFE/RL notes, “Russia rejects accusations by Kyiv, NATO, the EU, and the United States that it is backing the separatists with weapons and personnel despite substantial evidence of such support.” So, again, you have to hand it to Putin and all those Kremlin folks they stick with their lies unembarrassed and count on those lies making it into all relevant stories often enough that far too many people around the world believe them. 

(3) U.S. Senator Marco Rubio assured Minister Pavlo Klimkin of the U.S.Congress support of

Ukraine’s efforts in implementing reforms and countering Russian aggression – Foreign Ministry’s Press:
Senator Rubio is a member of the Senate Committee on Foreign Relations and a member of the Senate Ukraine Caucus.  The Senator assured Minister Klimkin of Congressional support of Ukraine’s efforts in implementing reforms and countering Russian aggression. He also underlined the importance of preserving transatlantic unity and solidarity with our country, as well as rendering further assistance in modernization and strengthening defense capability of Ukraine.

Minister Klimkin thanked Senator Rubio for constant support of Ukraine, and co-sponsoring the set of legislative initiatives, aimed at maintaining and enhancing the U.S. sanctions pressure on Russia and providing further assistance to our country in the security, financial and other domains.


(4) USUBC Hosts Working Luncheon with Francis Malige, Managing Director for Eastern

Europe and the Caucasus, EBRD, & Minister of Finance of Ukraine, Oleksandr Danyliuk -----
The Baker McKenzie law firm hosted the luncheon and the subject of the discussion was Reforms in Ukraine, the business environment, EBRD priorities, financing and funding capabilities. The packed audience heard an excellent and unambiguous presentation by both Mr. Malige and Minister Danyliuk. It was highly reassuring to hear and sense how the EBRD and the Ministry work as a genuine partnership and about the progress that has been made since Minister Danyliuk’s last visit to Washington about seven months ago. 

There was no suggestion that all is well and that Ukraine has solved all its economic/financial problems and specific areas of priority concerns were discussed.  But the guests gave a clear report on things accomplished, EBRD’s commitment to Ukraine (12 billion Euros have been invested and it has 80 people on the ground in Ukraine), willingness to work with the government and with investors.
COMMENTARY: Combined with Minister Klimkin’s visit the USUBC session was a welcome change from many delegations arriving in Washington with mixed and/or muddled messages too often overburdened with personal agendas.  Maybe the freelancing forays into the critical bilateral U.S.-Ukraine relationship cannot be stopped or slowed, but it would be nice if maybe some training and quality briefings could be given to visitors leaving Ukraine to visit Washington.
(4) Why Ukraine is facing its biggest test in the fight against corruption – The Washington Post:
Maxim Eristavi writes: There are good reasons that Ukraine is a country of deeply ingrained cynicism. Yet the remarkable surge of public interest and activism that we’ve witnessed over the past few days shows that civil society and public anger are still a powerful and unpredictable force here. And that, at least, offers grounds for hope
COMMENTARY: According to The Washington Post Eristavi is a non-resident research fellow with the Atlantic Council and co-founder of Hromadske International, an independent news outlet based in Kyiv.  His article essentially set in the streets outside the courthouse where Roman Nasirov, the arrested head of the Ukrainian Financial Service is jailed on corruption charges.

Nasirov is the subject of an unprecedented investigation and arrest involving public corruption. He does a commendable job of explaining the sad on-going legacy of public corruption. It might well be considered nit-picking but if there is a criticism of this article is the lack of historical perspective and important understanding of what has been going on in Ukraine for over 30 years.  Eristavi, at least in this article, sees civil society’s assault on public corruption as manifesting itself on the Maidan three years ago.  
No, the people of Ukraine have been openly challenging systemic public corruption since at least the immediate aftermath of Chornobyl in 1986.  True, their focus and understanding of corruption has grown as their understanding and ability to see beyond the blinders of Soviet repression but Chornobyl unleashed public demands to be freed of the corrupt dominance of “the center” (the Kremlin) that disregarded the nuclear fallout and intentionally left the people of Ukraine exposed and defenseless. 

That corruption (exposed by Gorbachev’s reaction to Chornobyl) was an essential element of Ukraine’s independence movement, the Declaration of Sovereignty and the Declaration of Independence and the 92% majority vote in the referendum for Independence.  
Likewise, learning more and more about public corruption the Maidan of 2004 was about public corruption.  And then, after the Euro Maidan began due to Yanukovych’s abandoning his promise of European integration that 2014 demonstration morphing into the “Maidan” and exploding public outrage over governmental corruption.
Ukraine’s civil society has always been out in front of the country’s government officials and consistently let down by their government. But it is critical to understand that as time passes and the people of Ukraine learn more about free societies, experience time abroad, and compare what they want with what they have their impatience grows. A lot has been done in the last few years, progress has been made.  But much more needs to be done and government officials who do not get ahead of the tide are likely to suffer consequences for a more-and-more sophisticated and restless society.

(5) Fiscal Year 2017 Defense Bill Heads to U.S. House Floor -----

Ukraine Security Assistance Initiative
The bill making appropriations for the Department of Defense for the fiscal year ending September 30, 2017, was brought to the Floor of the House of Representatives five months after the fiscal year began..  Initially two points: (1) Under the Constitution all appropriations bills must be initiated in the House of Representatives; and (2) note that this is for Fiscal Year 2017 which ends in September. 

The 2017 appropriation bill was not completed in the last Congress and so until this bill becomes law the Department of Defense is being funded by what is called a Continuing Resolution which funds the department at 2016 funding levels until it expires at the end of April.  The new appropriations bill closely reflects the Defense Appropriations bill the House passed last summer which did not become law and is consistent with the final National Defense Authorization Act for fiscal 2017.  It does not reflect the expected supplemental budget request from the Administration which Congress has not received as yet. The Ukraine specific language in the bill to cover the remainder of fiscal 2017 is:
SEC. 9014. For the ‘‘Ukraine Security Assistance Initiative’’, $150,000,000 is hereby appropriated, to remain available until September 30, 2017: Provided, That such funds shall be available to the Secretary of Defense, in coordination with the Secretary of State, to provide assistance, including training; equipment; lethal weapons of a defensive nature; logistics support, supplies and services; sustainment; and intelligence support to the military and national security forces of Ukraine, and for replacement of any weapons or defensive articles provided to the Government of Ukraine from the inventory of the United States:

Provided further, That the Secretary of Defense shall, not less than 15 days prior to obligating funds provided under this heading, notify the congressional defense committees in writing of the details of any such obligation:

Provided further, That the United States may accept equipment procured using funds provided under this heading in this or prior Acts that was transferred to the security forces of Ukraine and returned by such forces to the United States: Provided further, That equipment procured using funds provided under this heading in this or prior Acts, and not yet transferred to the military or National Security Forces of Ukraine or returned by such forces to the United States, may be treated as stocks of the Department of Defense upon written notification to the congressional defense committees:

Provided further, That amounts made available by this section are designated by the Congress for Overseas Contingency Operations/Global War on Terrorism pursuant to section 251(b)(2)(A)(ii) of the Balanced Budget and Emergency Deficit Control Act of 1985. SEC. 9015. Funds appropriated in this title shall be available for replacement of funds for items provided to the Government of Ukraine from the inventory of the United States to the extent specifically provided for in section 9014 of this Act. 21 SEC. 9016. None of the funds made available by this Act under section 9014 for ‘‘Assistance and Sustainment to the Military and National Security Forces of Ukraine’’ may be used to procure or transfer man-portable air defense systems.
  Some news reports – certainly several in Ukraine – have mistakenly reported that the $150,000,000 is a reduction from the $300,000,000 included in last year’s bill.  That is NOT the case, many has already been committed under the Continuing Resolution the appropriation here is for the remainder of the fiscal year. Also, the language in the last sentence quoted above about “man-portable air defense systems” is not new. It has been included in previous bills.  There are several Members looking at the possibility of excluding it from this bill.
(6) Let's not make Ukraine policy without talking to Ukrainians – The Hill:
Talk about Ukraine in foreign policy circles these days tends to revolve around two major themes. First, there is a suggestion that Russia and the West may want to negotiate a grand bargain in which Ukraine would be relegated to Russia's sphere of influence. Second, there is impatience with the slow pace of anti-corruption reforms inside Ukraine. The implied corollary to this concern is a question about the value of continuing to provide assistance to the country.

Kenneth Wollack, President of the National Democratic Institute (NDI),  argues it is imperative that what the people of Ukraine think and what Ukraine thinks are critical to any legitimate discussion. Purveyors of false news would have us believe that Ukraine is deeply divided and that those Ukrainians who are not supporting "fascism" are desperate to be rescued by Russia. NDI’s research shows that, in fact, the opposite is true.
COMMENTARY: Wollack presents a compelling case as to where the people of Ukraine stand on the current situation and the future.  It is a case all should understand and weigh.  The ludicrous notion that the West and Russia have any right to negotiate Ukraine’s future without Ukraine’s participation should be ridiculed – savaged – any time  and every time it is mentioned.

(7) Ukrainian Cabinet of Ministers cancels infrastructure minister’s US trip – Kyiv Post:
Ukrainian Infrastructure Minister Volodymyr Omelyan was forced to cancel more than a dozen meetings in NYC and Washington with representatives of the U.S. business community after the Cabinet of Ministers denied him permission to attend the Ukrainian-American business forum in New York.
(8) Ukraine’s Rails, Roads, and Ports Throttle Economic Recovery –

by Oksana Bedratenko, published by Atlantic Council

Ukraine’s infrastructure must develop if it is to stop throttling economic activity. The efficient operation of Ukraine's rails, roads, and ports is crucial to improving the country’s competitiveness and securing its economic growth; its successful transformation will allow Ukraine to unlock its potential as a transit hub by developing transport corridors between Europe and Asia. With attention and effort, it can become one of the economy’s driving forces.


(9) Russia Heats Up Its Infowar With the West – Ilan Berman, Daily Beast:

When it comes to Russian propaganda we have not seen anything yet.  The scope of Putin’s propaganda machine is still not understood by many. They may be aware of channel RT (which the Russian government funds of some $250 million annually.) Then there is Sputnik “news” multimedia website (which is likewise lavishly bankrolled by the Kremlin). But the full range of Russia’s information operations are still truly appreciated only by the small cadre of foreign policy and national security professionals who have been forced to grapple with their far-reaching and negative effects.  

That effort is enormous, encompassing billions of dollars and dozens of domestic and international media outlets in an architecture that dwarfs the disinformation offensive marshaled against the West by the Soviet Union during the Cold War. Its objective is clear and unequivocal: to obscure objective facts through a veritable “firehose of falsehood”,” thereby creating doubt in Western governments, undermining trust in democratic institutions, and garnering greater sympathy for the Russian government (or, at least, greater freedom of action) for its actions abroad.

Now, with Russian Defense Minister Sergei Shoigu having formally unveiled the establishment of a new military unit designed to conduct “information operations” against the country’s adversaries we have, among other things the militarization of Russian propaganda.
COMMENTARY: That greater attention hasn’t been directed to this propaganda by the American government and critically by the American media is appalling. Even though the press has published articles about the Kremlin’s propaganda efforts evidence of the very same press buying into the Russian narrative is published daily and disseminated to viewers and readership. 

(10)  Five ways human rights have dwindled in Russian-held Crimea - Freedom House:
Three years after Russian forces seized the Crimean Peninsula from Ukraine, political repression has affected residents’ lives in a variety of ways. The international community is quite clear on the matter: Russia is illegally occupying Crimea and violating human rights there on a massive scale. In November, the International Criminal Court stated in preliminary findings that the March 2014 annexation of Crimea constituted a violation of Ukraine’s territorial integrity and was “equivalent to an international armed conflict between Ukraine and the Russian Federation.”  The article lists five ways human rights have dwindled in Russian-held Crimea.



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