Business Ukraine april 2015 by Business Ukraine magazine

April 2015 www.bunews.com.ua

NETHERLANDS

IN UKRAINE Dutch-Ukrainian ties - from agriculture and industry to retail real estate

Also inside: Monthly American Chamber of Commerce in Ukraine Newsletter

APRIL 2015 The Netherlands is among the biggest investors in Ukraine. This month Business Ukraine takes a look at commercial ties between Ukraine and the Netherlands and speaks to some of the Dutch executives doing business in Ukraine.

April 2015 www.bunews.com.ua

OPEN AIR SEASON IS OPEN! Kyiv summer terraces in review

NETHERLANDS

IN UKRAINE Dutch-Ukrainian ties - from agriculture and industry to retail real estate

Also inside: Monthly American Chamber of Commerce in Ukraine Newsletter

From the editor Democracy fatigue over Ukraine threatens future of EU Russia’s intervention in Ukraine has served to highlight the extent to which the Kremlin has mastered the art of aping the architecture of democracy in over the past year, we have witnessed a plethora of Kremlin-controlled news organizations producing fake reports in a range of international languages, all designed to justify Russian conduct and demonize Ukraine. Fake NGOs and think tanks have produced polls and surveys in support of the Moscow narrative. Fake election observers have been deployed to provide a veneer of credibility for sham referendums conducted under military occupation. Rent-a-mob crowds have staged fake protests - generally coordinating their actions with the aforementioned news organizations. Meanwhile, armies of paid trolls have been unleashed to conquer comment sections all over the world. An entire alternative reality has been carefully constructed using state-of-the-art communications techniques and employing world-class production values which make these imposters appear almost indistinguishable from their Western counterparts. The question is not why Russia engages in these tactics, but rather why such cynical mimicry has not provoked more emphatic resistance from countries where democratic values hold genuine sway. Why are the fundamentals of a free society, which the West spent the ger considered sacred?

about a lack of real choice. Distrust of mainstream journalism has become the This collective loss of faith could not have come at a worse time for Ukraine. A quarter of a century ago, the democratic values which Ukraine is currently struggling to adopt would have been immediately recognizable to Western audiences as a mirror of their own aspirations. Instead, there is a very real sense that Ukraine has arrived at the party just as the drinks ran out. The West’s pro-democracy rhetoric over Ukraine has admittedly been consistently strident, but in the absence of accompanying action, it has often rung hollow. Revealingly, there has been no roadmap towards future EU membership, while NATO members have literally fallen over themselves to rule out any military role in defence of Ukraine’s choice. Financial aid has been disappointingly moderate, and has come with many strings attached. Even relatively minor gains like visa-free travel remain off the radar. This approach is both dangerous and shortsighted - dangerous as it risks handing a game-changing victory to Russian authoritarianism, and shortsighted because there can be little doubt that after taming Ukraine, Moscow would turn its attentions to fresh targets in the Baltics and elsewhere in eastern Europe. Today’s Russia is an unapologetically revisionist power which has made no secret of its desire to reverse what it regards as the unjust

towards democracy appear to be stuck somewhere between complacency

by seducing individual EU member states and supporting anti-EU political parties. It is reasonable to assume

and contempt. The self-assurance which underpinned 1990s proclamations about ‘the end of history’ has long since given way to a mood of introspection which leads many Europeans to focus on the imperfections of their own de-

that this is merely a taste of what we could expect if the Kremlin succeeds in derailing Ukraine’s European integration. rope has long been taken for granted, but it is actu-

of the current Russian information war, many choose to regard it as no worse than the manipulations which their own governments and mainstream me-

ally far more fragile than many appreciate. Unless Russia is stopped in Ukraine, the unity of the EU itself will come under direct threat, and with it, the

War have come to be seen as victims with valid grievances, while the winners

entire basis of European security. Democracy-

have lost the laurels of liberation. This trend has been gaining momentum for some time. Robbed of any discernible ideological competition since the early 1990s, Western democracy has

building may no longer be politically fashionable in Brussels, but it is surely preferable to the new era of authoritarian imperialism which Russia seeks to usher in.

the mature democracies of Western Europe and North America is locked in a broadly downward trend, while political participation among younger generations is falling dramatically. Apathy is increasingly widespread amid complaints

April 2015

U.S. ARMY IN UKRAINE TO TRAIN NATIONAL GUARD

American paratroopers of the US 173rd Airborne Brigade arrived in Ukraine in

provide Ukraine with the modern weaponry which the Ukrainian govern-

April to begin a six-month training programme designed to boost the combat

capabilities of the Ukrainian military as it confronts a Kremlin-orchestrated insurgency in the east of the country. Three hundred U.S. troops are taking part in the half-year training exercise, which is one of a number of training initia-

Ukraine. At a ceremony to mark the start of the ‘Fearless Guardian’ training -

tives from NATO member countries aimed at improving the performance of

of Ukraine, but a war for freedom and democracy in Europe and the whole world,” the Ukrainian leader told assembled troops. Russia has slammed the

training programmes. However, at present no NATO country has agreed to

U.S. Army training could ‘destabilize’ the situation in Ukraine. www.bunews.com.ua

image of the month

April 2015

De-sovietizing Ukraine Taras Kuzio on Ukraine’s ‘de-sovietization’ laws and Russia’s demonization of Ukrainian patriotism Ukraine’s parliament has recently passed anti-totalitarianism laws which equate Soviet Communism with Nazism. To many Ukrainians with Soviet

stood one-dimensionally as its ideology evolved into democracy and social

sympathies, these direct comparisons between Nazi and communist re-

soldiers were simply patriots, not ‘fascists’. Ukrainian nationalism has been denounced and attacked by Russia for centuries, ever since the 1709 Battle

ronment? Donbas, with some also in the swing regions of Kharkiv and Odesa. It is not

1945-1990 the Soviet regime attacked Ukrainian nationalism as ‘Nazi’, ‘fas-

therefore a widespread phenomenon and has been in decline since 2014. I do not think equating Soviet and Nazi crimes will be problematic as the majority

themselves rely on real Nazi volunteers from Russia). Russian notions of

of Ukrainians, including in the East and South, have negative views of Stalin and believe the Holodomor was genocide. Destalinisation has been taking place in Ukraine since the late 1980s and there have been profound changes in identities - the opposite to Russia, which has seen re-Stalinisation since 2000.

Ukrainian ‘fascism’ are applied to any Ukrainian patriot, whether communist, social democrat, liberal, nationalist or politically moderate supporter of the Orange Revolution and Euromaidan. In Moscow’s eyes, there are only good Little Russians and bad Ukrainian ‘fascists’ in Ukraine.

independence Ukrainian presidents (Yanukovych) while the others, especially Kuchma, were inclusive in their approach and talked of the entire war period from 1939-1945.

This year Ukrainians will hold a day of remembrance and reconciliation on the eve of the traditional Victory Day celebrations. How can the rival historical visions of WWII which persist in today’s Ukraine be reconciled in a way which protects the country’s fragile but growing sense of national unity? By using Kuchma’s inclusive approach to World War II, which is also the apert Magocsi.That is, honour all sides who fought for Ukraine - Soviet Ukrainian,

Is it academically appropriate to place all of Ukraine’s 20th century indeUkrainian parliament attempts to do? I do not think that politicians should become involved in historical disputes. This should be left to the media, academics, and civil society. Ukrainian history ry textbooks then discussed everybody who fought for ‘Ukraine’. For example,

The ties between WWII Ukrainian insurgent groups and the Nazi regime remain a source of international controversy, making Ukrainian steps towards rehabilitation particularly problematic. Should Ukrainians be trying to encourage international audiences to explore the nuances of the choices facing Ukrainian patriots during WWII, or would such efforts merely fuel further claims of ‘fascist’ revisionism?

in Italy and the graveyard there includes very many Ukrainians who fought in

Under Vladimir Putin, the Soviet role in the defeat of Nazi Germany has become the chief symbol of Russian greatness and the perfect antidote to revulsion at the crimes of the Stalin regime. Do international audiences appreciate the continued potency of WWII to modern Russians?

of economic modernisation and victory in World War II. Downplaying Stalin’s permit the rehabilitation of Stalin and to deepen Russian ignorance over Sta-

I reiterate that history, especially contentious history, should be not taken up by politicians but by academics, journalists and civil society activists. We

lin’s collaboration with Hitler.

know that it takes decades for countries to come to terms with past deeds - it took the French 3-4 decades to begin to discuss the Algerian War of Independence in which 1.5 million died and French forces widely practiced torture.

Most world leaders are boycotting Putin’s Victory Day parade in Moscow this year in protest over Russia’s military intervention in Ukraine. Some diplomats have even suggested that Kyiv would be a more appropriate

Ukrainian academics are making progress in being more open and honest in discussing OUN’s ideological closeness to Italian fascism in the 1930s, but

place to mark the end of WWII, given Ukraine’s role as chief victim of both Hitler and Stalin. Should Ukraine seek to raise awareness of its status as

there is a long way to go. There are various inter-related problems holding up this evolution: the Ukrainian diaspora (including emigre OUN Bandera and Melnyk groups) have not invested

the epicenter of 20th century European totalitarianism, or would Ukrainian society be better served by focusing on the future? Soviet Russia was barely occupied by the Nazis and Timothy Snyder in his book

‘Bloodlands’ demonstrates that the biggest crimes and bloodshed occurred in

ists whose views are close to Russia’s. Only one diaspora academic, Alexander Motyl, currently writes balanced studies on the subject. OUN itself cannot be under-

that Kyiv (or even Warsaw) would be far more appropriate venues for WWII commemorative events.

Dr. Taras Kuzio is Senior Research Associate at the Canadian Institute for Ukrainian Studies (University of Alberta), Senior Research Fellow at the Chair of Ukrainian Studies (University of Toronto), and Non-Resident Fellow at the Center for Transatlantic Relations (Johns Hopkins University-SAIS). www.bunews.com.ua

Ukrainian tax reform still a work in progress Failure to simplify Ukrainian tax system continues to hamper growth and government revenues In the current challenging economic environment, the Ukrainian government

on certain businesses has in practice increased. The declared objective of tax

budget. One of the most direct options is increased tax collection. In 2014, the Ukrainian authorities announced a programme of tax reform with the stated

businesses.

objective of achieving the following goals: decreasing the number of taxes, simtion. It was the view of the Ukrainian government that these measures would

Businesses concerned over greater tax check authorities

simplify tax administration in the country and motivate Ukrainian businesses to become more transparent in the tax area. As a result, there was considerable

new laws did not introduce any sound changes, except to switch from tax to statutory/IFRS accounting for corporate tax purposes. This change is of ques-

expectation that the result would be increased tax revenues.

tionable value, because the Ukrainian tax agencies have also received new au-

Tax weaknesses undermine Ukrainian competitiveness

the Ukrainian business community is currently concerned that such tax audits will only increase compliance time and costs. To summarise, the changes in Ukraine’s tax laws introduced at the end of 2014 have not improved the tax climate in the country. They have also failed to create an environment where there is any marked potential for increased tax revenue collection. The Ukrainian government should therefore urgently revise its approach to the way it imposes and collects taxes in the country.

It is widely believed by industry observers that the above goals are the corconsistently shows that Ukraine suffers from two key drawbacks in the tax area when compared to the tax policies of more developed economies. First and foremost are the very high social security charges imposed on individual Ukrainian businesses. In practice, these high social security charges fuel a culture of shadow payrolls in the country and, as a result, are also responsible for a lack of tax revenues for the government. The second key issue is the ambiguity of the country’s tax laws and general complexity of compliputes and exposure to additional tax assessment and penalties. This serves as a genuine barrier to the development of a better tax compliance culture among domestic businesses.

Initial tax reform fails to meet goals before the end of 2014. This was a clear breach of Ukrainian legislation, which prohibits the introduction of any new tax rules six months prior to the beginning of a new calendar year. Analysis of these initial changes, and of their impact on the Ukrainian business sector, shows that the declared goals of the reform process have

In terms of the improvement of the country’s tax administration processes, the

Upcoming tax reform efforts Ukraine is currently approaching a new round of tax reforms. In line with the announcement of changes in the country’s tax administration leadership, new tax initiatives were also announced. According to the most recent vision, as outlined in public communication between the Ukrainian government and representatives of the IMF, the next round of tax legislation reform will focus on a number of key directions: State Fiscal Service reform by means of decreasincome tax administration, introduction of the ‘single window’ concept during customs clearance, and improvement of dispute resolution procedures. In order for this fresh round of tax reform to have a positive impact on Ukrainian tax collection, it is crucial that it should be well structured, intensively prepared and carefully launched.

Taxation challenges: still more to be done

taxes were actually abolished. Some other taxes

While there is general agreement over the current proposed directions for

of tax computation and reporting rules. Meanwhile, the announced decrease in

the next round of tax reform, many industry observers see several other areas where tax reforms should be conducted. These additional focuses include daily control over transfer pricing (the control mechanism is already covered in the

social security charges cannot be practically implemented by transparent businesses in 2015. The new laws have in many cases increased the existing taxes and introduced

thoughtful approach to changing the tax regimes governing extraction and ag-

new taxes, such as a tax on the retail sale

and simplicity of the Ukrainian tax system. In the current situation, where

of excisable products, a commercial property tax and importation tax. It could therefore be

only increase tax rates, but also improve tax collection and consider reducing

argued that the tax burden

When planning tax reforms it is crucial to recognize the value of stability

expenditures.

ABOUT THE AUTHOR: Oleg Shmal is Senior Manager with PwC Ukraine and Vice-President of the Union of Tax Advisors of Ukraine. 8

www.bunews.com.ua

Raining on Putin’s Parade Moscow Victory Day celebrations set to highlight Russia’s international isolation over Ukraine The difference between the integrationist mood of 2005 and the anthe centre piece of events to mark the seventieth anniversary of the defeat of Nazi Germany. But what was originally planned as a dem-

gry defiance of 2015 will be impossible for the Kremlin to hide. The recent flood of WWII anniversary rejections is irrefutable evidence

onstration of Russian might and prestige will instead highlight the

of Russia’s growing international isolation, which is itself a direct

Russia internationally.

highly sensitive to claims that its actions in Ukraine have isolated

World leaders reject Moscow parade invitations Over the past few months a steady flow of foreign dignitaries and cited Ukraine as their reason for rejecting the Kremlin’s invitation, while others have simply confirmed their non-attendance. The general message from both Europe and North America has been that it would be totally inappropriate to mark the defeat of Hitler as guests of a man who stands accused of tearing up the post-WWII European status quo by launching his own war of conquest. Few Western leadwhile overseeing a parade of Russian military hardware.

was regarded by some as particularly offensive, given modern Germany’s traditional readiness to both demonstrate remorse for the Nazi era and to build bridges with Russia. The crowning insult came in early April, when the usually dependable Kremlin ally Belarus dictator Alexander Lukashenko made his excuses and announced that he would not be attending. Lukashenko’s unexpected decision highlights the scale of the Russia’s isolation, and points to the fact that even those who have traditionally aligned themselves with the Kremlin have been left alienated by Moscow’s military intervention

Victory Day as symbol of Russia’s world power status

the country internationally, but on 9 May this isolation will be on display for all to see. Ever since the Kremlin ordered the invasion and occupation of Western world have entered into a sharp downward spiral. Sanctightened in response to alleged Russian orchestration of the separatist insurgency in east Ukraine. Most observers currently expect these measures to be extended until at least the end of 2015, if not further.

Cold War part II or WWII rerun? Moscow has fought back with its own counter-sanctions, while also pushing a line of virulent anti-Western rhetoric not seen or heard media has rejected accusations of Russian aggression in Ukraine, instead depicting the conflict as a purely defensive struggle against encroaching Western imperialism and rampant Russophobia. However, while the mounting confrontation between Russia and the Russia itself opinion has tended to hark back to WWII itself. As the Ukraine crisis has escalated over the past year and a half, Russian journalists and officials have routinely portrayed the Ukrainian military, Ukrainian politicians and Ukrainian patriots in general as Nazi-like fascists. The use of WWII memes in the propaganda battle over Ukraine is no accident - in today’s Russia, the conflict with Nazi Germany remains the holy of holies, which serves as both the foundation stone of national pride and the trump card with which to counter revulsion over the Stalin regime’s crimes against humanity. By positioning the Ukraine conflict within the context of WWII, the Kremlin has been able to frame its policies in a way which few Russians would feel

celebrations in Moscow, which have in recent times served to strengthen perceptions of modern Russia’s place among the family

comfortable rejecting. It is no surprise that the militants fighting in eastern Ukraine have adopted one of the symbols of the Soviet

of Western nations and at the top table of world affairs. The parade in 2005, the last to mark a major WWII jubilee, was attended by a

victory in WWII - the orange-and-black St. George’s ribbon - as a symbol for their own modern struggle.

host of Western leaders including George W. Bush, who famously

Victory Day: Putin’s favourite holiday This recent resurrection of WWII polemics has only served to

tion agreements between Moscow and Brussels since the collapse

reflects the continued resonance of the conflict among modern Rus-

just been brought to power on the back of the pro-European, anti-

biggest holiday of the year, with the possible exception of New Year

Kremlin Orange Revolution, attended the Moscow parade in 2005. 10

www.bunews.com.ua

geopolitics

year. The holiday accorded religious reverence and positioned as a source of enormous national pride and an antidote to negativity towards the Soviet past. Dissenters are accused of betraying their grandfathers who fought to defeat fascism. Many commentators seem to be under the impression that this was always the case, but in fact for much of the Soviet era a number of

sia could have won WWII all by itself, without the help of the other Soviet Republics.

Failure of the post-Cold War security system Given the symbolic importance attached in Moscow to the memory of the Soviet role in WWII, the West’s decision to collectively snub

socialist associations, was generally afforded more official fanfare, while the anniversary of the October Revolution on 7 November was also seen as politically more important. It was only during the later

Moscow will not be without visiting world leaders on 9 May, but -

circumstance associated with the biggest Soviet holidays. For example, Brezhnev was the driving force behind the construction of

ily associate with the defeat of Hitler. As a result, the holiday will serve as a very public demonstration of the collapse in ties with the West and the failure over the past two decades to find a common

Kyiv’s colossal Rodina Mat (‘Motherland’) WWII memorial monument, which was not completed until the early 1980s.

language with the democratic world.

the West, or whether he will cut his losses and continue to look for alternative partners less inclined towards unfavorable moral

clear his intention to rehabilitate the Soviet past via his symbolic decision to adopt the old Soviet national anthem as the anthem of

judgements. Kremlin officials repeatedly stress that the currently strained ties are not of their making and are in nobody’s interests,

the Russian Federation. He also sought to counter the debilitating soul-searching and introspection of the 1990s by emphasizing the positives of the Soviet past - most notably the victory over Hitler.

but this conciliatory rhetoric must be balanced against actions on the ground in east Ukraine, which suggest that Russia is in no mood to back down and will continue to fuel the conflict for the

Russians were told that they should not allow foreigners to make them feel ashamed of their past. Instead, they were encouraged to

foreseeable future. One thing seems clear - the days when Western and Russian leaders came together to celebrate Hitler’s defeat

take pride in the decisive role played by the Soviet Union in the de-

are long gone.

April 2015

Ukrainian IT outsourcing gets more expensive Rising salaries forcing Ukrainian IT experts to seek new strategies to maintain robust growth

The fall in value of the Ukrainian national currency since the start of 2015 should theoretically have resulted in major gains for Ukrainian companies providing outsourcing services to international clients, but this has not proved the case in Ukraine’s fast-maturing IT outsourcing

ness growth amid rising costs and decreasing levels of global competi-

Ukraine have now been reduced to the relatively marginal level of 2030%, and even these margins continue to shrink. Evidence of the rising expense of hiring Ukrainian IT professionals can be found at www.dou. ua, the most respected online community among the country’s IT industry workers. Here salary discussions are the hottest and most-read topics, and the trends outlined in online discussions highlight the fact that IT salaries are currently rising, despite the decreased cost of living in the

tiveness.

country and the generally challenging economic environment.

Ukrainian IT salaries on the rise

Rising costs undermine competitiveness

The example of one international businessman, who we shall call Frans, is instructive. Frans had successful previous outsourcing experience in

perience of Frans is far from exceptional. ‘For Israeli clients, going to

Ukraine of building up an R&D center of 50+ IT professionals before selling the company to Sony. As a result, he saw Ukraine as a desirable

Ukraine is not interesting anymore in terms of cost optimisation,’ says the country manager of one Ukrainian IT outsourcing company. He

outsourcing destination when he recently decided to open up a new venture. In doing so, he aimed to overcome problems in recruiting enough seasoned specialists at short notice, and also expected to enjoy highly

then the only reason for them to outsource to Ukraine would be a lack of good people compared to locally available professionals.’ In practice, this

competitive levels of cost optimization. However, Frans was surprised to

means that as a result of increased salary levels, the total cost optimiza-

learn that reality no longer matched his expectations for the Ukrainian IT outsourcing market. While Ukraine still boasts a good pool of IT talent which can cut recruit-

additional overheads in managing people remotely, while also covering the additional risk factors involved in working in Ukraine.

ment times, the overall cost of hiring experienced Ukrainian IT specialists (including salaries, taxes and overhead costs) is now starting to

Even if we put politics to one side, outsourcing to Ukraine from Russia also makes less and less economic sense. Both countries have recently

approach levels encountered in more mature markets like Denmark,

suffered seriously from the devaluation of their national currencies. However, average IT industry salaries in Ukraine have actually become www.bunews.com.ua

After a number of years spent in the outsourcing industry working for Western digital agencies, many of Ukraine’s more experienced IT

tors, while Ukrainian companies have historically focused on providing services aboard.

professionals are now keen to identify new opportunities. Increas-

The rise of English-language ambassadors

industry

New IT frontier: R&D opportunities

higher than in Russia. This is mainly due to fact that the Russian IT industry has traditionally focused more on the domestic Russian market, -

ing to attract Ukrainian IT talents to set up their own R&D centres,

Despite the trend towards rising Ukrainian IT industry salaries, there are a number of options available for companies looking for mid- to longterm cost optimization. There is still a substantial portion of the Ukraiusually overlooked by specialist outsourcing companies because work in IT outsourcing typically requires a good command of English. As a result,

reside in code for equity and setting up local R&D centres. At a recent conference, he presented the example of an outsourcing company in Kherson that was mainly built around serving a single valued client covering up to 80% of revenues. As a result of acquisition by the client

the salary expectations of such employees are considerably lower. The trick that ‘smart’ companies are trying to utilize now is to hire a

promoted and acquired a seat on the management board of the parent company, while the Kherson outsourcer was converted into a local

team of professionals with poor English-language skills and partner them up with English-speaking ‘ambassadors’ (either in management or technical leadership roles). This does not mean that companies need to shift from distributed software development to classic ‘over the fence’ outsourcing. It means that there is an opportunity to bring more owner-

R&D centre. For foreign companies acquiring a Ukrainian outsourcing asset, this process generally creates opportunities to better manage overhead costs and rising salaries. It also creates a positive working environment where management genuinely cares about outcomes and not only output.

this can be achieved by hiring consultants or highly experienced managers that can bring a newly formed team up to speed and will serve as the primary point of interaction between headquarters and Ukraine.

Beyond IT:

Expanding horizons of Ukrainian outsourcing Historically Kyiv, Lviv, Dnipropetrovsk, Kharkiv and Odesa have been the most preferred outsourcing locations in Ukraine. This happened mainly due to the fact that these cities have good international air connections. erally not shortlisted during the selection process for setting up new development centres. However, these smaller regional cities boast a pool of low-cost resources in the areas of web development, design (including responsive design for mobile devices) and quality assurance. This advantage becomes even more relevant when you consider that there is growing demand for new product development and corporate technologies associated with mobility and the ‘bring your own device’

While Ukrainian IT salaries continue to demonstrate steady growth, other outsourcing-compliant skills and professions in Ukraine could still be seriously underpriced. SupportYourApp is an IT company that has ex-Google management on the board, but which actually employs very few IT professionals. Due to the nature of their offering, most of the employees are multilingual support professionals. This is just one illustration that there are a wide range of opportunities to outsource the skills of professionals in areas that lie beyond IT, including business process in Kharkiv), language workers, customer support, and remote salesforce services such as insurance, freight shipping, and recruitment. nities and people in Ukraine are no exception. Those with the relevant

from the advantages of being based in Ukraine’s smaller regional hubs

are moving to more developed outsourcing destinations in order to earn greater salaries in the IT industry. But we are talking here about just 10% of the most active segment of the professional IT population.

is InternetDevels (listed as one of the biggest Drupal developers in the world). InternetDevels is now hiring 110+ IT professionals in Lutsk.

local market to revive from the recent currency drop, and for salaries

Their market rates are 50% of those in Kyiv. The tricks that make this possible include cheaper location, a delivery model using a local ambassador, and a focus on process,

in the local IT and other industries to catch up with growth trends. Meanwhile, Western companies could use the current momentum to invest in Ukraine and to gain the

quality and risks assurance allowing them to guarantee delivery.

talent pool.

ABOUT THE AUTHORS: Dmitry Kanevsky is a Senior Manager at Ciklum Consulting. He has about 10 years

Yuri Lapin is Head of Ciklum Consulting and leads a team of about 15 technical/business consultants at the Danish-Ukrainian IT company. He has more than 12 years of experience in IT and over the past 5 years has worked with dozens of European and US clients including such names as Thomson Reuters, SEB Pension, and Cupid.

April 2015

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Shell Onshore Tight Sand/Shale Oil & Gas Operating Principles Infographic

netherlands in ukraine

Ukraine has only one option: to reform Netherlands in Ukraine: Ambassador Klompenhouwer offers overview of bilateral ties The choices Ukraine makes today will greatly Ukraine made a clear choice by choosing a proEU president and pro-EU parliament. This has At the same time, Ukraine is confronted with the biggest security and macro-economic chalUkraine has only one option: to reform.

conditions of the International Monetary Fund, and budget policy. The banking sector is seriously restructured. Nevertheless, there is still much work to be done, notably to reform the tax and custom administration. This recent implementation can be seen as an encouragement to reform other crucial sectors, such as rule of law, judicial task of reformation, it is important that Ukraine makes use of the grips offered by the international community â&#x20AC;&#x201C; especially the EU member states. The Association Agreement, including the nating and prioritizing is essential in implementing these extensive reforms, and the EU is ready to step in and assist. The Netherlands assists Ukraine in the reform process, one that we see as vital for the success of the course that Ukraine wants to follow and that the Dutch encourage. There are several

strengthening civil society, promoting human rights and enhancing democratic governance and rule of law. Furthermore, we promote the

my experiences with the Ukrainian people and

ways in which our two countries cooperate, multilaterally and bilaterally. Multilaterally the

participation of Ukrainian experts in international conferences on judiciary, constitutional

but necessary reforms. Only this will lead to a predictable, transparent, and fair business and

Netherlands is active in different ways, such as

reform and security and stability.

investment climate which will strengthen our economic ties even further.

they are up to the task of implementing painful

Besides this, one of the core tasks of our Em-

ian Security Sector Reform (EUAM), as well as a partner of Ukraine in our constituency group in

bassy is to encourage and facilitate Dutch business here. Dutchâ&#x20AC;&#x201C;Ukrainian economic relations

edy. As you know, the relationship between the

Netherlands is the third largest foreign direct investor in Ukraine and among the top ten EU

Netherlands and Ukraine was deeply impacted by the tragic crash of MH17 last year. This tragedy, which cost the lives of many innocent people,

the IMF. Linked to this, the Netherlands bilaterally shares technical expertise and knowledge example between the Ministry of Finance, Tax

import and export partners. There are currently

Services and NBU. Bilaterally, I would like to highlight also our MA-

approximately 250 Dutch companies active in Ukraine. All these companies are confronted with challenges on a daily basis. Ukraine stands

tion with Ukraine, and I am grateful to say that it strengthened our bond. The empathy expressed by all Ukrainian people has been heartwarming.

process in Ukraine through Ukrainian NGOs in

but in the almost two years that I have lived here,

Together, we will bring those responsible for this tragedy to justice.

ABOUT THE AUTHOR: Kees Jan Rene Klompenhouwer is Ambassador of the Kingdom of the Netherlands to Ukraine

April 2015

Economic ties between Ukraine and the Netherlands Netherlands in Ukraine: how a small country became a big partner in trade and investment

Relations between the Netherlands and Ukraine go way back, some say as dam. Today’s bilateral ties were formalized on 31 December 1991, when independent state. On 1 April, 1992, the countries established diplomatic relations and since then economic ties have developed steadily, with the Netherlands consistently among Ukraine’s most important European trade partners.

Dutch-Ukrainian economic cooperation There are currently more than 250 Dutch companies active in Ukraine, working in a range of different sectors. These include agrifood, horticulture, transport and logistics, consulting, construction and infrastructure, engineering, (renewable) energy, IT, services and the water sector. An overview of Dutch businesses present in Ukraine can be found in the online database The Orange Directory, which was launched last year by the Nethbusiness contacts and relevant partners (http://orange-directory.com.ua). Trade between the Netherlands and Ukraine is intensive and remains dynamic despite the current economic hardships being experienced in Ukraine. As of the beginning of 2015, the Netherlands is the third largest direct investor in Ukraine with the volume of direct investment standing at USD 5.1 billion – 11.1% of total direct foreign investment. In recent years,

ensure economic growth and exchange rate stability. Nevertheless, the enthusiasm of Dutch businesses to develop a presence in Ukraine remains. A great example of this is the Dutch trade mission to Lviv and Lutsk on 22, 23 and 24 April, organized by the Netherlands Embassy. Twenty Dutch comattractive locations with their geographic proximity to the European Union The Netherlands Embassy in Ukraine also aims to help companies learn tices’ initiative: every month, examples are provided on the Netherlands Embassy website of companies that serve as examples of successful business cooperation between the Netherlands and Ukraine. The aim of these articles is to give advice to companies which are interested in working in is Dekoplant, a genuine Ukrainian-Dutch success story of how a Ukrainian entrepreneur with Dutch support managed to become a Ukrainian market leader in the hobby plants segment within the space of just a few years.

Ukrainian agriculture and Dutch farming innovation One of the most important sectors for trade between the Netherlands and Ukraine is agriculture. The famously fertile Ukrainian soil, coupled with highly competitive local labour costs and the abundant availability of com-

dominantly in the agricultural sector. The Netherlands is a top 10 EU im-

modities, make the Ukrainian argiculture sector particularly appealing. At present, about 125 (semi-)Dutch companies are present in the Ukrainian

port and export partner, exporting USD 1.1 billion in goods and services to Netherlands is the second largest importer of Ukrainian agricultural prod-

agro-food sector. Approximately 50% of all investment from the Netherlands is focused on this sector. The Netherlands also plays an important -

ucts. The main export products to the Netherlands in 2014 were grains, ferrous metals, fats and oils, and oil seeds. The key imported goods from the

edge, equipment and propagation materials. All the main seed potato companies and Dutch producers of vegetable seeds are active on the Ukrainian

Netherlands were pearls and jewellery, plastics and polymers, machinery,

market. Subsectors with relatively high potential for Dutch businesses in the upcoming years include dairy, food processing, horticulture, biomass and poultry. In March, a consortium of Dutch companies (Food Tech Link)

Learning from Dutch-Ukrainian success stories

in the food processing industry signed a covenant to help the Ukrainian

Despite these positive trends, it cannot be denied that the Ukrainian econ-

food industry develop the sector according to the European Food Safety

and the Donbas has had a direct negative impact on the economic situation,

event, which aims to bring Ukrainian farmers into contact with Dutch expe-

resulting in the loss of around 20% of Ukraine’s economy. It has also had an indirect impact, which, combined with the lack of essential reforms for the

riences and equipment, will be held again.

past 20 years, is provoking a severe economic recession and strong depreciation of the hryvnia currency. Ongoing reforms are desperately needed to

EU Association Agreement opportunities Another great opportunity for Ukraine is the recently signed EU Assowww.bunews.com.ua

economy, can be quite a source of confusion for Ukrainian companies

is the most far-reaching partnership of its kind which the EU has ever signed with a non-member country. Full implementation of the agree-

and foreign companies doing business with them. To help counter this -

ropean Union standards and markets. It will not only facilitate easier and greater access to the EU market for Ukraine, but will also improve

in several regional capitals. These roadshows have sought to explain to

the business climate within Ukraine itself. In preparation of the agree-

Ukrainian SMEs how to best prepare for the changes and opportuni-

already started removing customs duties on Ukrainian exports to the

the Netherlands Embassy currently contributes to the development of

netherlands in ukraine

the most of the new EU opportunities which are opening up for them. Free Trade Area. The agreement offers a roadmap for transforming and modernizing Ukraine, its institutions and its economy. This agreement

Ukraine increased its exports of agricultural products to the EU by 40% compared to 2013, while Dutch imports of agricultural products from -

and how to support Ukrainian companies looking to export to the EU.

sible in the long term, much needs to be done in Ukraine. Reforms, both in economic sectors and in other sectors of government, are necessary in order to comply further with the terms of the Association Agreement, and also in order to make the country more attractive for foreign investnomic aspects of this far-reaching reform process. The Netherlands, as one of the founding members of the European Union, has been actively supporting this process and will continue to do so.

reform agenda is coming from the Dutch Ministry of Finance, the Dutch National Bank and Dutch tax services, which provide technical assis-

Helping Ukrainian businesses make sense of EU advantages

and customs. In addition to this, there are several Dutch governmental support programmes currently underway, most of them aimed at Dutch companies interested in doing business in Ukraine. A special form of assistance for programme, which connects entrepreneurs in developing countries and tive in supporting Ukrainian companies with their expertise (www.pum.

The Netherlands in general, and the Netherlands Embassy in particular, are working to make sure Ukrainian companies are able to make

April 2015

Ukrainian banking sector reform Interview: ING Bank Ukraine Country Head Erik Versavel discusses need for reform roadmap Banking sector reform is widely regarded as one of the cornerstones

than that. From a supervisory perspective, we have no doubt that

of the current efforts to rebuild the Ukrainian economy along European lines. The task which the country’s banking sector leaders cur-

the NBU’s efforts are focused in the right direction. The dilemma the NBU faces is how to address systematic problems in the banking

rently face is genuinely Herculean in nature, with a severely devalued currency complicating the process of reversing decades of financial mismanagement. Ukraine’s ability to adopt and adapt international

system without damaging the Ukrainian economy.

standards to local needs will have an important role to play in this reform process, with international banks operating in Ukraine serving

ing sectors of the ‘tiger economies’ of South East Asia. Are there any lessons from this region which you feel are particularly ap-

as on-the-spot advisers to assist the process. ING Bank’s Ukraine Country Head Erik Versavel serves as the Chairman of the Forum for Leading International Financial Institutions (FLIFI), which brings together representatives of international banks present in Ukraine in a bid to engage in dialogue with the Ukrainian authorities and implement best international practices of management and supervision for the Ukrainian financial market. He spoke to Business Ukraine magazine about the challenges the Ukrainian banking sector faces and explained why recent measures implemented by the National Bank of Ukraine are cause for cautious optimism.

plicable to today’s Ukraine? Not all Asian countries are the same and not all Asian economies have been successful, so I don’t think we can talk in general terms about an ‘Asian model’. I believe each country needs to develop its own model, and this applies to Ukraine as well. At present there is an absence of a vision. Instead we currently see a focus on regulations and paperwork, which doesn’t get you anywhere. In most Asian countries, government officials and also many ordinary people in the street can tell you their country’s economic vision and competitive strategy. Here in Ukraine we see an absence of goals, with people just muddling through. That is the key difference. Ukraine needs to decide where it wants to be and where its competitive strengths lie, and then it needs to build on that and do everything possible to

What role do you see international expert groups like FLIFI playing in the process of reforming the Ukrainian banking sector? It’s very important to understand that foreign banks cannot operate without local banks. We need a strong local banking sector which can contribute to a sense of trust in the financial system. FLIFI tries to share best international practice and advise the central bank and the government. It is not always easy because we are often faced by Ukraine’s default bureaucratic or regulatory approach. In broad terms, we think there needs to be a clear vision and a roadmap of where the authorities want to see the country and the country’s financial system going. At the moment we are still at the fire-fighting stage.

without saying exactly what this means in terms of the country’s competitive position or its strengths and weaknesses. We’re basically talking about non-delivery. It is unfortunate but inevitable that in the absence of a vision or a roadmap for Ukraine, the competitive position of the country has further deteriorated. Even the currency devaluation has failed to improve Ukraine’s competitiveness.

Does your interaction with government officials leave you with

The Netherlands has one of the world’s oldest banking traditions. What support can Dutch banks like ING provide to Ukraine during the current transition period? One of the key roles ING has to play is in developing people. We

the impression that there is sufficient political will to create a fully-functioning European banking system in Ukraine?

have a reputation for building and developing talents in the market who are capable of taking on senior roles in the country, both

It is always dificult in Ukraine to distinguish between genuine intent and verbal support. What I can say is that we have been pleased so far with the efforts to clean up the Ukrainian banking sector, which

within the banking sector and beyond. We try to move people away from a reliance on bureaucracy and encourage them to be independent thinkers.

is largely the work of the new management of the National Bank of Ukraine. This is a very dificult job and it will remain a difficult job

How have the developments of the past year impacted on ING’s

for quite a long time to come.

Your professional background includes experience in the bank-

The Ukrainian authorities have already significantly reduced

strategy for the Ukrainian market? ING has been in Ukraine since 1994. Obviously we are concerned about the financial and economic condition of the country, but our

the number of banks operating in the Ukrainian banking sector.

business model and strategy are clear and can survive the current

Have they gone far enough or should we expect further closures? I cannot speak for the NBU, but from the point of view of FLIFI and ING, we are pleased to note that after so many years without any

crisis. Actually I hesitate to use the term ‘crisis’. If you view the current situation as a crisis, then you are going to have problems. If you look at it as a permanent state of development with periods of great-

reforms, we are now seeing action being taken. We fully support the management of the NBU in this gigantic task. It is not possible to

er and lesser success, then you can adjust your business model to the state of development without taking very significant measures when

undo more than 20 years of financial mismanagement in the banking sector in the space of six months. It is much more complicated

the country experiences deeper problems. If you talk about a ‘crisis’, you are effectively shifting responsibility for what is happening to www.bunews.com.ua

netherlands in ukraine

the outside world. This is a very typical situation in Ukraine. Blaming outside factors allows people to deny ownership of the problem, instead of focusing on the fundamental problems which exist domes-

actions of the central bank and of individual banks now need to be geared towards building trust. This sense of trust can be very difficult to define or quantify, except when it is absent and people no

tically where people can actually make a difference.

longer trust the banking system. I think we are currently seeing actions which are slowly tipping the balance back towards a restora-

To what extent does the success of the Ukrainian banking sector depend on the stability of the nationâ&#x20AC;&#x2122;s hryvnia currency? A healthy financial system has instruments and checks and balances

tion of trust. More and more small steps are being taken to rebuild trust rather than erode trust, so we are confident that the situation will continue to stabilize.

in place to manage currency fluctuations, so exchange rate changes should not be a major problem. It only becomes a problem if there

What do you see as the next steps along the road to reform?

are no financial instruments in place to manage these fluctuations. The gradual depreciation of a currency is to be expected in develop-

FLIFI believes that it is urgent to start talking about how to develop the economy rather than shrink it. We have formulated some core

ing countries, and this process will inevitably lead to financial crises from time to time if exchange rates are not allowed to adjust â&#x20AC;&#x201C; es-

areas to try and contribute to this debate. First of all, there is no escaping the fact that a country needs an independent court sys-

pecially in highly dollarized countries which finance their development with an influx of foreign currencies. The new NBU management -

tem able to implement justice and, in financial terms, provide protection for creditors. Secondly, we need to encourage import and export trade, and try to ensure that we get export credit agencies

nancial distress which had accumulated over more than two decades and had insufficient political independence which exasperated the

to insure commercial and political risk. Foreign banks and foreign governments can both help this debate develop and can contribute

problems they faced. This is why we are where we are today. The

to the sustainable economic development of the country.

April 2015

Instruments for change in a challenging climate Netherlands in Ukraine: long-term Dutch support for Ukraineâ&#x20AC;&#x2122;s expanding civil society sector

Netherlands in 1994 as an instrument to promote social transforma-

of professional ethics in a variety of sectors, including a more clientfriendly civil service, access to justice for all, tolerance and diversity among community members.

was to support the development of an open, democratic society, where the rule of law functions properly and where citizens influ-

Building trust in Ukrainian institutions

ence decision-making processes and are free to assume responsibility for shaping the society in which they live.

change-making potential of activities. In that sense, the programme

ed in Ukraine over the past two decades. Throughout this period, a distinct factor has been the willingness and capacity to change.

has been aligned even closer with the path of reforms that Ukraine has chosen to follow. It is a challenging path that, in relation to economic development and investment climate, creates ample oppor-

MATRA-supported projects are characterized by a strong ambition

tunity. A few examples may serve to demonstrate the change-mak-

of civil society organizations to improve transparency in decisionmaking at all levels of administration and governance in diverse sectors of society. In order to improve transparency there was a

ing potential of some projects. In the area of rule of law, examples include the project Law Enforcement Reform in Ukraine, aimed at lobbying and promoting fundamental changes in law enforcement,

strong desire for capacity-building and monitoring of zero tolerance towards corruption, establishing and strengthening accountability

and the project Fostering Ukraineâ&#x20AC;&#x2122;s Energy Independence through Legal Environment Supporting Energy Efficiency and Equal Access

of the government, and enhancing professionalism of journalists. At

ernmental Officials in Democratic Society, which aims to transform www.bunews.com.ua

man Rights Fund deals with new challenges by assisting internally displaced persons and children in, or affected by armed conflicts.

suring proper law implementation practices in the spheres of local self-government and public service in general.

Several successful initiatives can be mentioned in this respect. For instance, the project ‘Legal empowerment of gender-discrimina-

An attractive investment climate is closely related to the degree to which the sector is trustworthy. This trust relates to rules and regulations, but also to the capacity of government structures and the

granting legal aid to women and raising their awareness of domestic/sexual violence and labour rights. Almost 30 lawyers provide

private sector to adopt self-regulatory measures promoting trans-

free legal assistance to victims of gender-based discrimination in

years, supported activities that promote social dialogue, address organizational changes, improve client services of public institutions and strengthen capacity for monitoring and redress. These are

lobbies for the improvement of gender legislation in cooperation with Ukrainian parliamentary deputies, and organises discrimination prevention trainings for local employment services employees.

important components of mutual trust-building – a prerequisite for attracting foreign investors.

flict in Ukraine’ implemented by the All-Ukrainian Foundation for

Supporting Ukrainian human rights

institutions, as well as non-governmental organisations, to deliver services to children, such as education and health. The project foresees close cooperation with the Ukrainian Ombudsman to develop

Another important tool that ensures the success of democratic reforms is human rights. In order to promote its human rights policy and to improve human rights worldwide, the Dutch government established the Human Rights Fund. Through this fund, the Netherlands Ministry of Foreign Affairs and embassies support numerous projects in target countries in line with the priorities set forth in the Ministry’s human rights policy document ‘Human Rights For All’. In Ukraine, besides concentrating on such important human rights priorities as access to a fair trial/freedom from torture and ill-treat-

April 2015

netherlands in ukraine

the civil service culture to promote respect for law, responsibility for decision-making, and improve interaction skills between governmental institutions with the aim of eradicating corruption and en-

Ukrainian professionals with the opportunity to experience Dutch culture and know-how in a variety of sectors: i.e democracy and the culture and water and sanitation. The Netherlands will remain committed to strengthening democracy and human rights in Ukraine in the years to come.

8 Years of Ukrainian History Industry: Outdoor sector leading advertising market upswing

Interview: Walid Arfush on the need to shake up state TV

Real Estate: New re-registration process eases developer concerns

VICTORY CHAMBER

NEWS

wanted:

green shoots

CHAMBER The Chamber Newsletter is produced in association with:

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Ukraineâ&#x20AC;&#x2122;s monthly English-language current affairs magazine since 2007

September 2011 www.bunews.com.ua

November 2014 www.bunews.com.ua

SPECIAL ISSUE: LVIV IN FOCUS CONECTING TO THE EU MAINSTREAM CITY BRACES FOR EURO 2012 DEBUT LEMBERG CHIC: LVIV FASHION WEEK INTERNATIONAL AIRPORT ON ARRIVAL BRAIN OF UKRAINE: TRY OUR PUB QUIZ

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Also inside: Monthly American Chamber of Commerce in Ukraine Newsletter

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netherlands in ukraine

Surviving in times of turbulence and uncertainty Philips Ukraine General Manager Karsten Vierke on challenging Ukrainian business environment Businesses in Ukraine are experiencing an uncertain and unpredictable situation at the moment. Both consumers and companies lack reliable and exact information about the situation in general, about the currency exchange rates, ability in all spheres of our lives. Few of us could imagine a couple of years ago that the situation would develop this way, and to be honest, few of us are able to predict how everything will go this year. Everyone feels unsecure while living and doing business in Ukraine in the current climate. This is especially true for those who purchase products in euros and sell them in hryvnias, as we do munity at present is how to deal with the situation and manage one’s business effectively. There is no common recipe about how to successfully manage one’s business during tough times, since all companies and situations differ. Nevertheless, I would like to share my vision of overcoming turbulent times, which focuses on four key elements: start with your internal audience, use headquarters, choose the right connections, and be creative.

Start with your internal audience cially when the situation is coloured by uncertainty. You can’t change the political and economic situation you are operating in, but you can manage your working with. You can provide them with comfortable working conditions and a stable emotional atmosphere to ensure they are meeting their goals. The key communication objectives during times of uncertainty should be lowering emotional tension, bringing the team together and letting your people feel secure. Since corporate culture in different companies is different, you should consider an appropriate communication format to establish a two-way dialogue within your company.

2014. Our goal was simple - to run as one team, all together in the same place. It turned out to be an exciting and inspiring activity: we were dressed in similar

don’t hesitate – just ask. share accurate information on the situation. Make sure you give them information about potential dangers before they ask you. For example, weekly updates might help. Remember that if you are not proactive, then they will be proactive. You should understand that headquarters is a powerful resource which can provide you with guidance.

Choose the right connections During turbulent times everything changes rapidly, including people. However, it is worth remembering that while the identity of senior managers can often change quickly, second-line decision makers don’t tend to change as often. Therefore, it is worth keeping connections with these second-line decision makers to make sure you are able to stay in touch, even when faced by top management changes. In addition, I would also advise fostering connections with other international companies in order to share and exchange experience.

on during the race. Such joint projects aim at team-building and increasing employee trust in the company. The key point is that whatever the measures to establish a dialogue may be, they are vital for company success.

Be creative

Besides creating a comfortable working atmosphere, you should also pursue a clear agenda so that employees can see and understand your steps. And last

a time for sales and marketing to shine. So be creative. Look for new opportunities to help your customers, the country and yourself. For example, you can pay

but not least, when a comfortable working atmosphere had been created, you may see the need to revise employees’ roles by inspiring them to take more responsibility and thus bring more success for the company.

more attention to the development of new sales channels. This may include cross promos, using online promotions and other tools. But remember that during turbulent times, decisions on investment and development projects

Use headquarters

And last but not least – every crisis is an opportunity for your business. This is

should be based on sound business reasoning.

in Ukraine. I would advise them to ask for support from company headquar-

My recipe for managing a company during turbulent times would be the following: focusing on the team, ensuring headquarters support, fostering the

ters. During turbulent periods they might be able to provide you with examples of best practices from other countries which have faced similar challenges. So

right connections with the external world, and staying smart and creative to identify new opportunities.

ABOUT THE AUTHOR: Karsten Vierke is the General Manager at Philips Ukraine

April 2015

Dutch developer bringing international standards to Ukraine Interview: Multi Ukraine Director Gawein Minks encouraged by growing Ukrainian middle class

How long has Multi been active in the retail real estate business? Multi was founded in 1982 in Gouda, the Netherlands. After operating

Kharkiv â&#x20AC;&#x201C; Forum Kharkiv and Forum Artem, which have been prepared for commercial development. Multi is present in a wide range of European retail markets. What aspects of the Ukrainian retail market stand out as unique? Ukraine is one of the most challenging markets in Europe and not just

Is it accurate to refer to Multi as a Dutch-based international retail real estate company?

because of the current economic and political situation. Retail real estate development is a business that touches many disciplines: commer-

with development on the level that we aim for. That means that in many

with local experts as much as possible, because local knowledge is key to a successful operation. How long has Multi been active in the Ukrainian retail real estate sector?

cases we have to reinvent the wheel, whether it is a leasing contract or architectural challenges. What is very pleasant however, is that we see a lot of appetite from Ukrainian consumers, and that the demand for and appreciation of quality projects is growing. The rapid appearance of shopping malls has been one of the most

followed in 2008, but were temporized. Since 2011 the Forum Lviv shopping center has been in active development, with construction starting in 2013. The grand opening is scheduled for August this year.

visible indicators of Eastern Europeâ&#x20AC;&#x2122;s transition from communism to consumer economy. How much room for growth is there in the current Ukrainian market?

What assets does Multi currently have in Ukraine?

Ukraine should be every retailerâ&#x20AC;&#x2122;s dream country: a European country with a large, highly urbanized, well-educated population willing to

Lviv project. Besides Lviv, Multi Ukraine also owns two plots of land in

spend a large amount of disposable income on consumer goods. There is tremendous potential for retailers and shopping centers alike, but

Ukraine is that the capital city is not as dominant as in other countries. There are many other burgeoning cities. Because spending power is still fairly limited, new projects should focus on reaching as many con-

communist to market economies.

sumers as possible, so logically larger cities such as Kharkiv, Odesa and Dnipropetrovsk are the most obvious candidates for further de-

Which segments of the retail industry are generally most popular among Ukrainian retailers and consumers?

velopment. However, before the current crisis there were many par-

netherlands in ukraine

this depends on the general socio-economic development of the coun-

Ryh, and Kherson. These cities will be attractive when Ukraine’s econenormous income differences. You would have consumers that could

omy is back on track.

majority had to settle for cheap markets. This is changing. Especially in the large cities there is a middle class, and we now see parties like Reserved, Zara and Mango operating successfully. The market is eagerly

Which trends from elsewhere in Central and Eastern Europe do you see entering the Ukrainian market in the coming years? There is gradually intensifying competition in the Ukrainian market,

to reach a wide audience with very competitive prices.

which will inevitably lead to a shakeout of the weakest market players. Quality and value for money will become even more important, and this

ment plans in Ukraine? Not many people realise that Lviv is actually closer to Berlin than to Donetsk. However, because Lviv shares its currency with these problematic areas, of course the city and our project are also affected. The general economic climate means additional negotiations and cost-cutting are necessary to make sure that the project can be delivered to the market

Which Ukrainian cities offer the most exciting prospects for further retail sector growth?

the inner cities. Retail parks outside of the city do not offer the same experience as inner cities. At a time when shopping is moving to online channels, retail real estate needs to offer more than just shops, it needs to offer an experience. In the mid-term, the Ukrainian model will be the classical ‘mall’ model, but once a certain saturation has been achieved, demand for better central projects will grow, and more car-oriented destinations will suffer. Winners will be those parties that dare to take one of the many central locations that Ukrainian cities have to offer, for example because a Soviet factory collapsed and the land plot has been sitting unused for many years. Developers that manage to turn that type of location around will be successful for years to come.

Our customers may choose the type of product corresponding to their needs, be it the production of highly effective modules for roof-top structures of private houses where the area for photoelectric module placement is limited, or the so-called ‘solar farms’ where there is no problem with the area and it is allowed to use cheaper and less powerful modules. Pillar Group B.V. is a holding company of production companies in Spain and Ukraine, as

The geography of our product sales is broad and covers USA, Europe,Taiwan, China, Japan

well as a trading company in Malta. Pillar Group B.V., the Netherlands, keeps counting on

and other countries. Besides, due to the proprietary unique technology of polycrystalline

its Ukrainian subsidiary, Pillar LLC, the manufacturer of mono and multi wafers for the

silicon production, our company is able to meet the binding requirements to the local

photovoltaic industry.We are experts in the fabrication of high tech silicon materials in

component, approved by the current version of the Law of Ukraine on Electricity.

our Kyiv-based factory with more than two decades of experience. The stability and support for R&D in the Netherlands with the dynamic but production-

Hoping for cooperation with you!

oriented environment in Ukraine make the Dutch investments in Ukraine a strong and competitive combination. Pillar Group capacity is 250 MW of mono wafers and 300 MW

Our contacts:

of multi wafers.Wafers and ingots are made of high quality raw materials using innovative

PILLAR GROUP B.V. Address: Hullenbergweg 369-F 1101 CR Amsterdam The Netherlands Telephone: +31(0)20-3416750

process developments, including: Multi Feeder system; Upgrade of the multicrystalline ingot system; The commercial equipment works based on IMCC (induction melting in cold crucibles) technology etc. The main parameters of our products are: Wafer type

LID, %

LID Power,Wp (relative), %

MONO FSQ, N-type

22,0%

5,35

MONO FSQ, P-type, Ga doped

18,9%

4,60

MONO FSQ, P-type, B doped

18,9%

< 2,5%

4,50

MULTI HIGH-EFF/PERC line

18,4%

< 1%

4,44

MULTI/USUAL line

17,3%

4,16

April 2015

PILLAR LLC Address: 3 Pivnichno-Syretska St., Kyiv, Ukraine Telephone: +38044-490-99-71 E-mail: info@pillar.kiev.ua

More than cheese and wooden shoes Netherlands in Ukraine: bilateral cultural ties include everything from Dutch movies to DJs Since the start of diplomatic relations in 1992, cultural exchange and public diplomacy initiatives between Ukraine and the Netherlands have flourished. In many cases, this cultural exchange has taken place without the direct involvement of the Netherlands Embassy itself. For instance, famous Dutch DJs like Tiesto and Armin van Buuren have found their way into the hearts of Ukrainian music fans and always draw large audiences to their Ukrainian concerts. Many Ukrainian artists and musicians are also given a warm welcome in the Netherlands: for instance, Dakha Brakha has developed a niche fanbase in the Netherlands. Also almost every year Dutch movies travel to Ukraine, thanks to partners like the Molodist and DocuDays film festivals and Artmedia. The Netherlands Embassy, together with leading Dutch companies, has also established a successful tradition of hosting anThese concerts are wonderful business networking events in their own right, as well as exchange opportunities for Dutch and Ukrainian musicians. The Netherlands Embassy always tries to add a social component to such business occasions. A very special edition of this event took place in early 2013, when the Dutch Jostiband Orchestra performed together with Kyiv Soloists in the tiband Orchestra is the largest music group of mentally disabled musicians in the world.

designers are often invited to Ukraine to

Their visit to Ukraine was an overwhelming success, and the audience was deeply moved

serve as as members of the jury of design or architecture contests, or as speakers for pro-

with a workshop. The Embassy will also be contributing to

by the sincere and emotional performance of the Jostiband musicians. Their visit, and the landslide of positive media coverage it

fessional workshops.

the upcoming celebrations of Europe Day in

Coming soon: urban architecture & Europe Day

be invited to Mykhailivska Square in the

generated in Ukraine, contributed to better awareness of the full range of capacities that every person has. The Netherlands is known worldwide not only for cheese and wooden shoes, but also

In 2015 one of the cultural focuses of the Netherlands Embassy in Ukraine is architecture. This year the Embassy is supporting the well-

for innovative, sustainable, and efficient so-

Ukrainian capital, where representatives of the European Geography Association from will have an interactive booth featuring a virtual map of Kyiv. Kyivans will be able to give scores and assess the quality of public

lutions in different fields such as agriculture, architecture, logistics and urban planning. A great example of this is the successful battle

School, a non-formal postgraduate architectural school that aims to change the landscape

spaces in Kyiv. This knowledge will serve to create a dialogue between the authorities and citizens of Kyiv. In addition to this, two

against water levels via centuries of innova-

from the premises of Telychka, a post-industrial site in Kyiv. Theo Hauben, a famous Dutch ur-

Dutch childrenâ&#x20AC;&#x2122;s movies will be screened on 17-21 May as a part of â&#x20AC;&#x2DC;Krylaâ&#x20AC;&#x2122;, an Interna-

located below sea level. This success is well known in Ukraine, as many leading Dutch

banist and one of the partners of architecture company De Zwarte Hond, is coming to Kyiv on

tional Film Festival for kids which is hosted in Ukraine. www.bunews.com.ua

netherlands in ukraine

King’s Day: origins of Dutch National Day

Netherlands in Ukraine: royal traditions behind most colourful celebration on Dutch calendar On 27 April, Dutch communities around the world will celebrate King’s Day, a national official holiday in celebration of the King’s birthday. The tradition of celebrating the Dutch monarch’s birth-

King’s Day, King Willem-Alexander and other members of the royal family participate in public festivities during visits to one or two towns. This year, the royal visit will be to the town of Dordrecht, where the King and Queen will take part in several cel-

came Queen’s Day after King Willem III’s death in 1890. Initially, Queen’s Day was primarily a festive day for children as it coincid-

On King’s Day each year the whole country celebrates and turns into a sea of orange, which is the national color of the Netherlands, referring to the name of the Royal Family. Everywhere in

ed with the last day of the summer holidays. As time passed, more and more people were given the day off to celebrate, and Queen’s

the Netherlands people take part in open-air celebrations, with many concerts, flea markets and festivals dominating the festive

Day became an official national holiday. This year promises to be a jubilee occasion as it marks the 200th anniversary of the Kingdom of the Netherlands, which dates from 1815, when Willem I was inaugurated as King. Traditionally on

scene. In Amsterdam, the canals fill up with boats full of people dressed in orange. In Kyiv, the Embassy will celebrate King’s Day this year with a special reception for their contacts and for members of the Dutch community in Ukraine.

April 2015

Official newsletter of the American Chamber of Commerce in Ukraine April 2015

Reinforcing the Voice of the Business Community Andy Hunder, President of the American Chamber of Commerce in Ukraine

I am delighted to be appointed President of the American Chamber of Commerce in Ukraine, and thrilled to represent an

Organization that has, for almost a quarter of a century, been the voice of the internationally oriented business community operating in Ukraine. As the most active and effective non-government, non-profit business association operating in Ukraine, the Chamber unites the largest and most responsible employers and taxpayers contributing to the State budget and creating opportunities for the people of Ukraine. At this most challenging time the role of business cannot be overestimated. Only as a united and proactive force can we reach much needed changes and improvements in the countryâ&#x20AC;&#x2122;s economy, contributing to overcoming the crisis and reaching a prosperity level and well-being that Ukraine and its people truly deserve. I am happy that I will now, together with the excellent Chamber team, be able to contribute even more to the development of the business environment in Ukraine and to attracting new investment the country so badly needs. Transparency, rule of law and international best practices will continue to be key in all sectors and spheres of the Chamberâ&#x20AC;&#x2122;s operations, and we will further work towards enabling and reinforcing the voice of the business community. Our key focus will be working on: - being the voice of business; advocating for a business environment, governed by a fair and transparent application of the rule of law - promoting Ukraine as an attractive investment destination - providing most up-to-date and important business information - offering Business Networking and business development opportunities.

2015 Chamber Official Service Providers:

April 2015

# march-april

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SUCCESS STORIES

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position papers

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MEETINGS WITH STATE OFFICIALS

CHAMBER EVENTS policy meetings

top-level events

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BUSINESS NETWORKING EVENTS Chamber experts with wide experience of working with Asian markets shared own ideas, thoughts and concerns regarding Asian Tigers phenomenon as a possible scenario for Ukraine. Sponsors of the Event

Traditional “St. Patrick’s Day” Business Networking Cocktail was the first this spring Business Networking event. Its friendly and informal atmosphere helped Chamber Members find new business partners and connections. Sponsors of the Event

XIV Chamber Annual Indoor Football Tournament was not only two spring weekends of Group games and playoffs but also a great team building opportunity for Chamber families, friends and colleagues. Sponsors of the Event

The launch event of Creative Management Series taught our Members how to look beyond good old sales techniques and stand out from the crowd of salespeople. Partner of the Event

April 2015

CHAMBER EVENTS IN PICTURES

Alexa Chopivska shares her experience in advocating for Ukraine in the U.S. Congress

Exchanging opinions and plans regarding packaging waste management reform

Mr. Serhiy Taruta explains own view on how to build up a successful country

Ms. Bronwyn H. Hall speaks on innovations, challenges & opportunities of the present

Debates on macroeconomic forecast for Ukraine

Experts discuss anti-corruption instruments in construction industry

Representatives of the State Fiscal Service at the Chamber's Tax Committee Meeting

WELDI: female CEOs discuss common challenges women face on the top of business

Early morning Mr. Adam Smith explains the main aspects of US sanctions

2015 Chamber Board of Directors

Mr. Graham Tiley Chairman Vice-President & Country Chairman Shell

Mr. Sevki Acuner Vice Chairman Director and Country Manager for Ukraine EBRD

Mr. Steven Fisher Vice Chairman CEO and Chairman of the Board Citibank

Mr. Jean-Paul Scheuer Treasurer General Manager Ukraine and Belarus Sanofi-Aventis

Mr. Antoine Brun Secretary General Manager P&G

Mr. Grzegorz Chmielarski Director General Manager McDonald's

Mr. Serhiy Chorny Director Managing Partner Baker & McKenzie

Mr. Penko Dinev Director General Manager IBM

Mr. Bryan Disher Director Managing Partner PwC

Mr. Roger Gauntlett Director General Manager Coca-Cola

Mr. Martin Schumacher Director Managing Director METRO Cash & Carry

Mr. Evgeniy Shevchenko Director CEO Carlsberg

Mr. Andriy Tsymbal Director Managing Partner KPMG

Ms. Nadiia Vasylieva Director General Manager Microsoft Ukraine

Mr. Sergey Yanchyshyn Director Managing Director Oracle

Lifestyle

Kyiv summer terraces in review Open air wine and dine options during the summer season in the Ukrainian capital

www.bunews.com.ua

Open: 09:00 - 02:00 Praha offers a taste of out-of-town grace and splendor inside the Kyiv city

lifestyle

PRAHA Address: 1 Akademika Glushkova Tel.: +38-044-5269990

limits, making it the ideal place to escape the hustle and bustle of downtown life without spending a long time in transit. The elegant Praha summer terrace sits stylishly amid lush parkland on the banks of a lake which is also home to white and black swans. Guests can enjoy the shade of oak trees and maple trees while unwinding with a range of cocktails or dining in tranquility.

April 2015

WEST UKRAINE’S LIFESTYLE GUIDE

The heart of Europe - the soul of Ukraine

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The best of Lviv since 2008

lifestyle

CITY BEACH CLUB Address: 176 Gorkoho Street Tel.: +38-066-6295555 Open: 09:00 - until the last client

Located on the roof of the Ocean Plaza entertainment complex, this vast beach complex boasts two large swimming pools, a range of lounging options and a restaurant with tailored menu. City Beach Club claims to offer guests the chance to enjoy all the delights of a top Mediterranean resort holiday without leaving the Kyiv city limits. Visitors can spend the day enjoying city panoramas and topping up their tans while preparing for an evening of quality clubbing in the open air to the accompaniment of big-name DJs.

CONCORD CREATIVE CUISINE RESTAURANT Address: 42/4 Pushkinska Street (located inside Credit Agricole

Concord is quite simply a Kyiv classic. Dating back to 1996, this fashionable downtown rooftop venue was one of the pioneers of fusion cuisine in Ukraine, and has remained a trendsetter ever since. The summer terrace offers panoramic views of Kyiv city centre, with guests able to relax on comfy sofas

Business Centre) Tel.: +38-044-2347788, 2359555

surrounded by summer greenery while enjoying their choice of French, Italian and Japanese cuisine. Expert sommeliers are on hand to guide you through the venueâ&#x20AC;&#x2122;s extensive wine list and selection of

Open: 12:00 - 02:00

exclusive international beverages.

April 2015

KURENI UKRAINIAN RESTAURANT Address: 4 Parkova Doroga Tel.: +38-044-2531724 Open: 12:00 - until the last client

Kureni is a little pocket of traditional Ukrainian countryside hospitality located close to the very centre of Kyiv. The venue boasts stunning views of the Dnipro River and summer terraces on three different levels. Individual dining areas in the style of thatched Ukrainian village pavilions provide a degree of intimacy and seclusion for individual parties. The menu at Kureni the open air. Children’s entertainers are on hand to keep kids occupied at weekends at this family-friendly venue.

JAGUAR LOUNGE Address: 6 Feodorova Str. Tel.: +38-050-4418181 Open: 11:00 - 06:00 The ultra-hip Jaguar Lounge terrace is an exact copy of the World Design Capital Helsinki 2012 Pavilion, and was constructed using the latest Finnish architectural know-how. The venue offers a range of both dining and nightlife action, with an eclectic international menu on offer throughout the week and clubbing daily from 22:00. The menu features everything from burgers and classical bar snacks to Japanese rolls and Thai noodles alongside caviar and cold boiled pork dishes. Jaguar Lounge’s comfy sofas make it a hard place to leave, while the venue’s democratic pricing also encourages visitors to stick around. Management prides itself on the speed and friendliness of its service, with regular shift changes helping to keep the service standards fresh. Each Friday and Saturday Jaguar Lounge offers an added attraction, with culinary commentators providing guests with expert advice and tailored menu insights. Karaoke is also available in the venue’s spacious hall. 38

www.bunews.com.ua

lifestyle

AVALON Address: 3 Leontovicha Str. Tel.: +38-044-2347494 Open: 12:00 - 06:00

First opened in May 2014, the rooftop Avalon summer terrace offers stunning views of downtown Kyiv in all its golden-domed splendor in an atmosphere which the venue claims provides a mix of traditional Provence warmth and French Riviera refinement. Guests can count on an excellent and extensive wine list, a range of flame-grilled dishes and live jazz and soul music. This is a popular social spot at both sunset and sunrise.

BOCCACCIO ITALIAN RESTAURANT Address: 2 Mechnikova Str.

Situated in the very heart of the Ukrainian capital, this conveniently-positioned venue is particularly popular for business meetings and working lunches. The decor is designed with classical Mediterranean styles in mind, with plenty of greenery

(access Lesya Ukrainka Boulevard) Tel.: +38-044-3775545

to create a pocket of tranquility despite the downtown location. Reservations are recommended if you wish to secure a table on the terrace during business hours. Each evening the terrace menu features seafood from the Mediterranean prepared by

Open: 08:00 - until the last client

the Boccaccio head chef, hookah pipes and exclusive desserts by Masha Vasilieva.

April 2015

lifestyle

Ukraine must wait for literary revolution Andrey, you have attended numerous international literary forums over the past year and have become something of an unofficial cultural ambassador for Ukraine. What aspects of the Ukraine crisis are your international literary colleagues generally most interested in? The questions my collegues ask today are not different from questions that come from ordinary audiences: what do you think will happen next? Will Russia start an open war? Are you afraid of Ukrainian far-right political extremists? The types of questions I am asked have changed since last spring. Then people did not have much information and believed what was coming from Moscow. My ‘favourite’ 2014 question was: “How many fascists do you have in the Ukrainian government?” Over the past year have you noticed any marked changes in international understanding of the situation in Ukraine? Yes. Those people who are sincerely interested in the Ukrainian situation have been eagerly looking for information and try to compare all possible news. Those who were ideologically leftist or sympathetic to different anarchic movements have tended to believe Russian sources more than the Western media. Of course those who were and are anti-American became automatically proRussian, since they believe that Russia is the

Ukrainian. Russian theaters in Ukraine are full and are fully subsided by the state. Russian-speakers live in every region of Ukraine and yet somehow they became “mistreated” and “protected” by Russia in

the past year impacted on your relations with fellow writers from the Russian Federation and from other parts of the former USSR? I don’t have many contacts with writ-

only anti-American (and and-imperialist!) force in the world.

regions where almost nobody speaks Ukrainian. This was definitely the case in Crimea

ers from Russia. Collegues and friends with whom I was close have remained my

and the Donbas. You are one of Ukraine’s most prominent Russian-language authors and have been

Times of war and revolution have histori-

friends, though some of them have now moved to Europe or spend more time abroad than in Russia. I am talking about

outspoken in your rejection of Kremlin claims to be protecting the rights of Rus-

cally often also been periods of heightened creativity. Do you see a new wave of liter-

Vladimir Sorokin, Liudmila Ulitskaia, Boris Akunin, and Tatiana Scherbina.

sian-speakers in Ukraine. What would your message be to anyone concerned about the rights of Russian-speakers in

ary inspiration emerging from the historic events currently taking place in Ukraine? Not yet. It won’t happen too quickly. First of

Do you have any plans to produce any fiction set against the backdrop of current

today’s Ukraine?

all we’ll have a period of creative ‘fast food’.

events in Ukraine?

Let them compare the print-runs of newspapers, magazines and books in Russian and Ukrainian languages which are pub-

Then, maybe in several years, we’ll begin to see new literature and ‘a la carte’ art in general, offering deep analysis, quality and

Not really. I have a novel that was stopped by Maidan in November 2013 and my duty is to finish it! And this novel is not about

lished in today’s Ukraine and they will see that approximately 80% of printed media

sincere emotions.

Ukraine - it’s about Lithuania and Europe. If I feel strongly that I am fit to write a novel

and books are published in the Russian language, not in the official state language

As a member of the Russian-language literary scene, how have the events of

set in Ukraine in 2014-2015, I will think about it. But also without any hurry!

April 2015

Back in 1987 Irish rockers U2 had a hit with the single ‘Where The Streets Have No Name’. Bono and Co. would no doubt been fascinated by modern Ukraine, where in many instances the streets have three names - the Russian and Ukrainian Soviet-era names, and the postSoviet Ukrainian language name. More often than not, all three are in current usage and can be deployed interchangeably. This confusing state of affairs over street names has long be symptomatic of Ukraine’s broader failure to distance itself from the Soviet past, or to even determine definitively whether the Communist era should be viewed as a time of foreign oppression at all. For many millions of today’s Ukrainians with mixed ancestries, regarding the Soviet Union as a colonial aggressor necessarily means seeing their own

What about more abstract place names related to quintessentially Soviet things like the May Day holidays, or place names glorifying favourite Soviet themes like manual labour and space exploration? What about streets and squares named after foreigners who were deemed politically suitable for Soviet audiences? Should these also be wiped from the country’s maps? Even if the answer to all the above questions is ‘yes’, it would be physically almost impossible to achieve. Ukrainians would spend the next few years preoccupied with the painting of new street signs and the reregistration of addresses.

family members as part of an oppressive empire. Understandably, not everyone has been happy to do so. The issue of Ukraine’s lingering Soviet era street names is now back

Dnipropetrovsk: in need of a new name

on the national agenda following the recent passing of a series of ‘de-sovietization’ laws, one of which paves the way for the renaming

classically Ukrainian populist move in a political culture where such grandstanding remains all too commonplace. Nevertheless,

of all streets, squares, towns and cities named after Soviet personalities. The law in question, which equates Communist and Nazi propaganda while placing blanket bans on both, is predictably unclear as

there are a number of particularly glaring examples of Soviet place names which should by all rights be changed. The worst offender is almost certainly the city of Dnipropetrovsk, which is named in

to exactly how this name-changing initiative should proceed. Nevertheless, it represents a potentially major step away from the ambigu-

honour of senior Soviet official Grigory Petrovsky, who is widely regarded as one of the architects of the 1930s Holodomor terror

ity of the early post-Soviet years.

famine which claimed the lives of millions of Ukrainians. This name has long been inappropriate, but never more so than in light of the

Stalingrad, Karl Marx and May Day

Ultimately, it is most likely that this exercise in gesture politics will fall short of full implementation. It has all the makings of a

Some critics have called the law banning Communist symbols a crime

role Dnipropetrovsk has played in the current conflict as a bastion of Ukrainian patriotism. Such cases as Dnipropetrovsk are arguably

against history which attempts to erase seventy years of Ukraine’s national story. Practical minds have also stressed the impossibly vast scale of the undertaking. Practically every single village, town and city in

justifiable, but they are the exception rather than the rule. Instead of issuing blanket bans, Ukraine should look to set up a commission drawn from a cross-section of civil society which could then

Ukraine remains littered with Soviet-era street names. There is barely a settlement in the land - at least outside of West Ukraine - where at least

identify suitable candidates for name changes like Dnipropetrovsk, without dragging every single town and village into a vast renam-

a handful of Soviet names have not survived. Then there is the question

ing initiative.

April 2015

lifestyle

The politics of Ukrainian place names

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Kyiv restaurateur Maxim Radutskiy on the challenges of running Kyiv’s downtown beach club Maxim, where did you get the idea to open a beach club in the centre of the Ukrainian capital city? It all came about pretty much spontaneously. I received a phone call from the management of the Ocean Plaza complex inviting me to consider creating something on the roof of the complex. When we visited the site, we

photo diary: september 2012 lifestyle

Bringing the beach to the city

soon realized that it would be an ideal venue for a beach club. You’ve been involved in a number of different businesses. What attracted you to the restaurant and leisure industry? Almost every sphere of business I’ve been involved in has been connected to food or recreation. So in terms of my career trajectory, opening up a leisure complex was a logical step. Ukrainian restaurateurs often comment on the difficulties of finding staff with high-level service skills. How difficult have you found it to recruit personnel able to meet your service expectations? In order to create a staff of 40 top professionals and build a genuine team, we have seen almost 600 employees pass through the company. Whenever we have identified someone with a lot of natural talent but not much experience, we have tried to invest in them and allowed them to grow within the company. Your venue combines swimming pools and bars. What measures have you put in place to guarantee the safety and security of guests? Our security service is our pride and joy. All of our lifeguards and security guards know a minimum of two languages. The only conflict we’ve ever had centred on a lost mobile phone, which turned up within twenty minutes! Our security standards were also significantly enhanced thanks to cooperation with the Israeli Embassy. We hosted a major event for the Israeli Embassy involving over 3,000 guests. Our security personnel were placed under the direction of the embassy’s security service, which provided us with invaluable experience. The devaluation of the hryvnia has forced many Ukrainians to postpone plans for foreign beach holidays this year. Do you expect to have more guests as a result? To be honest, I don’t think that in the current economic climate it is possible to know exactly what to expect even a week from now. We hope for a busy summer season and I can guarantee that we can offer a holiday experience every bit as good as top foreign resorts.

April 2015

Networking events Ukrainian Sculpture Salon Kyiv’s prestigious Mystetskiy Arsenal venue played host this spring to a major exhibition of Ukrainian sculpture. The ‘Sculptural Salon’ show, which was being held for the seventh time, featured the works of more than 70 Ukrainian artists, including over 200 sculptures displayed in public for the first time. (Photography: Kirill Gaidai)

www.bunews.com.ua

photo diary:events networking september 2012

Fryday Afterwork on the Heaven Summer Terrace With the advent of the summer terrace season in Kyiv, networking group Fryday partnered with popular venue Heaven to host an Afterwork event on the beautiful Heaven summer terrace. Fryday is a growing global networking franchise with Ukrainian roots which recently marked its 5th anniversary.

April 2015

Annual Real Estate CEO Conference The annual Real Estate CEO Conference 2015 was held in early spring at the Fairmont Grand Hotel Kyiv. The conference was organized by the Ukrainian Real Estate Club and the Confederation of the Constructors of Ukraine. Key themes included construction opportunities arising from the planned redevelopment of infrastructure in the Donbas region, and legislative reforms related to the construction and real estate sectors in Kyiv.

www.bunews.com.ua

networking events

International Networking at the Hyatt Regency As spring sprung in the Ukrainian capital Kyiv-based international networking group Fryday welcomed representatives of the Ukrainian business community to the Hyatt Regency Hotelâ&#x20AC;&#x2122;s Brunello Bar. More than 200 guests attended the event and enjoyed an evening of socializing with a business flavour.

April 2015

last word

Ukraine as Ground Zero of 20th Century Totalitarianism Ranking crimes against humanity in order of magcomes to the massacre of large numbers of people, there can be no moral hierarchy of victimhood. Likewise, ongoing arguments over the relative guilt of Hitler and Stalin are not only academically futile - they reduce the most shameful chapters in European history to the status of mere statistics. Nevertheless, it is impossible to understand the modern that Ukraine was, to all extents and purposes, the Ground Zero of twentieth century totalitarianism. Both Hitler and Stalin committed many of their worst atrocities in the lands which make up today’s Ukraine. From the early 1930s until the mid 1950s, there was literally no deadlier place on the face of the entire planet. Other nations and peoples suffered comparably appalling fates at the hands of either the Nazi or Soviet dictators, but only Ukraine For many years this terrible distinction was repressed domestically and shrouded from international audiences by the collectivist Soviet

rial and reconciliation on the eve of the traditional WWII Victory Day celebrations. Instead of being forced into the grotesque charade of picking sides

relatively few people outside of Ukraine know

ern Ukraine begins to make sense. It explains the gaping holes in society where a shared national memory should be, and the lack of ownership felt by many Ukrainians towards events in their own country. It explains the continued susceptibility to polarizing propaganda, coupled as it so often is with a seemingly paradoxical distrust of all authority. It also sheds light on the sense of hesitancy felt by some Ukrainians towards embracing what would be regarded in most countries as runof-the-mill patriotism. In a great many small but meaningful ways, it can often seem as though the ghosts of Stalin and Hitler continue to haunt the subconscious of today’s Ukraine.

anything at all about the millions who perished in the 1930s Holodomor terror famine. Fewer

These totalitarian scars will never completely heal, but placing the emphasis on Ukraine’s

visions and distract attention from more pressing issues. Victory over the divisive past can only come

still have ever attempted to link these two catastrophes together, or place Ukraine’s totalitarian tragedy into a single and unbroken historical

uniquely traumatic experience at the hands of Europe’s two bloodiest dictators would at least open the door to some form of partial closure. A

in the shape of a pluralistic, democratic Ukraine. There can be no stronger argument in favour of this democratic choice than a recognition of the stag-

narrative. And yet it is only when viewed within the context of this totalitarian tragedy that mod-

step in the right direction will be taken on 8 May, when Ukraine will hold a national day of memo-

century totalitarianism, in all its manifestations.

times, it has been lost amid the geopolitical grandstanding and identity polemics associated with Ukraine’s post-Soviet role at the crossroads of the Eurasian divide. Indeed, such is the continued ignorance of Ukraine’s twentieth century totalitarian suffering that for many international observers, the country’s WWII experience is more likely to be associated with allegations of collaboration in the Nazi Holocaust than with the conservative

have a chance to unite around the staggering huThis emphasis on reconciliation is crucial for the continued consolidation of the Ukrainian nation. For far too long, independent Ukraine has been trapped in a futile cycle of memory wars which it can never hope to win. In reality, there were no winners in Ukraine’s totalitarian experience, and repeated attempts to revise the verdicts of the Soviet era have merely served to deepen existing di-

Published by: Director: Susanna Dickinson

Business Ukraine is distributed every month at a wide range of leading business centres, the Ukrainian capital.