U.S. Policy and Ukraine: A "Square Table" Event

On November 10, 2004, a "square table" event was held at The Nixon Center to assess what U.S. policy should be toward Ukraine after the presidential elections.

Nikolas K. Gvosdev, senior fellow for strategic studies (and executive editor of The National Interest), opened the session by noting that so much attention had been focused on the presidential campaign between former Prime Minister Viktor Yushchenko and current Prime Minister Viktor Yanukovych that the fundamental question of what are the vital U.S. interests in Ukraine was being obscured. To what extent are U.S. interests affected by the victory of one candidate? Can Washington have a productive, working relationship with a President Yanukovych, or are close relations possible only with a President Yushchenko? And how is Ukraine's westward trajectory affected by this election campaign?

Eduard Prutnik, a special advisor to Prime Minister Yanukovych, called attention to the stable growth of the Ukrainian economy (with GDP growth projected to be 13.5 percent with inflation held in check at 8.5 percent). The pursuit of economic reforms, especially reforms in tax and investment policy (such as a 13 percent flax tax), was bringing more of Ukraine's economic activity out of the black economy and producing more revenues for the budget. This was also creating more favorable conditions for foreign investment in Ukraine.

Prutnik noted that Ukraine at present has "balanced" relations in trade and economic terms with both Russia and the European Union. He noted the need for a policy toward the EU based not on Euro-romanticism but Euro-pragmatism--a considered process of integration that enhances rather than detracts from Ukraine's economic growth.

He observed no matter what happens "life continues after the election" and the strong bases of support for both candidates means that the losing side must still be represented and its voice heard.

Kempton Jenkins, president of the Ukraine-U.S. Business Council, identified the premier interest of the U.S. in maintaining Ukraine's alliance with the West. In the past, Ukraine has worked with the United States in fostering some of its key security goals--including giving up its nuclear weapons, ending cooperation with Iran on nuclear projects, and contributing forces to Iraq. Rather than picking sides ahead of time, the United States must be prepared to work with whoever wins the election.

He warned against characterizing the election as a choice between Russia and the West.  No Ukrainian government, he noted, can afford to ignore either, and given Ukraine's geographic position and economic relationships, any Ukrainian administration will have to work with Moscow and does not have the luxury of ignoring Ukraine's largest neighbor and trade partner.

He noted the tremendous improvements in Ukraine's economy and its business climate over the last five years--based on the policies of successive prime ministers (Kinakh, Yushchenko and Yanukovych). The glass is half full but is getting fuller is his assessment, and he concluded by noting that both candidates represent a new, post-Soviet generation of leadership committed to economic reform and closer ties with the West.

Ron Asmus, a senior fellow at the German Marshall Fund, opened his remarks by noting that, after the completion of the strategic vision for Europe of the 1990s--integrating east-central Europe, the question is whether it is time for the next big wave of Euro-Atlantic expansion. In the 1990s, the main thrust of U.S. policy toward Ukraine was to consolidate its independence and sovereignty rather than to promote its integration with the West. Now, is it time to undertake what will be an effort over the next decade to bring Ukraine within the institutions of the Euro-Atlantic world?

The United States has an interest in the elections process. It is true, the United States will have an important relationship with Ukraine no matter who wins the election--but whether the conditions for a real U.S.-Ukrainian partnership that can lead to Ukraine taking the steps needed to more fully integrate into the Euro-Atlantic world in the next decade depend on whether the elections produce a government that can be a partner with the United States and Europe. Strategic and economic interests are "necessary but not sufficient" in creating a real U.S.-Ukraine partnership; there must be a shared vision and a government committed to putting that vision into practice. He cited the Baltic States in the 1990s as an example for what a Ukrainian government needs to do in order to put itself on track for full integration.

Donald Jensen, director of communications for Radio Free Europe/Radio Liberty, addressed the implicit question of whether Ukraine's domestic developments matter in its foreign policy relationships, particularly with the United States. He noted that this was a critical point for U.S. policymakers--how to balance strategic interests with our desire to shape domestic events in the direction of democracy and pluralism. How elections are conducted, how open and transparent political and economic processes are, and how issues like corruption are dealt with are also important, as the ultimate U.S. interest is to promote peaceful democratic development in Ukraine.

However, he did present a cautionary warning--for the United States not to overestimate the levers at its disposal for helping to shape the process.

Anders Aslund, a senior associate at the Carnegie Endowment, offered his assessment that Viktor Yushchenko had effectively won the first round of the elections. He noted that the United States needed to demand a proper counting of ballots in the second round to ensure against fraud.

Should Yushchenko be declared the victor, he said that this would mark the greatest democratic breakthrough in the former Soviet Union since August 1991.  The United States, accordingly, must learn from its mistakes a decade ago. It is not sufficient to rely only on a president to push further reform--there needs to be a complete overhaul, with parliamentary elections as well. Technical assistance also needs to be offered to enable Ukraine to be able to more quickly reform its institutions, especially its legal framework, and concrete steps taken to open real doors for Ukraine to begin to move toward full membership, first in the World Trade Organization, and then in NATO and the European Union.

But in any event, he noted that Ukraine's ongoing economic integration with the West should continue, no matter who wins, and that if there are concerns about fraud and corruption, the United States should sanction individuals and specific groups.