Oleksandr Klymenko: “We should not stand with our hands streched out due to loans and lose our national interests”
The leader of the “Uspishna Kraina” party in the “Big interview” program about economic course of the Cabinet of Ministers, state budget 2017 and recipe of saving Ukrainian economy.
Andrey Blinov: We are on the air of Radio Vesty, radio of news and opinions. Good day! Andrey Blinov is speaking. Today we are going to have a discussion with Oleksandr Klymeko, the leader of the «Uspishna Kraina» party, former Minister of revenue and duties, in our circuit studio. Good day, Oleksandr Viktorovich.
Oleksandr Klymenko: Good day.
Andrey Blinov: Ukraine has adopted a budget for 2017. It has been adopted at 5 a.m. for the third time. Nevertheless, I believe that this document differs from other budgets. First of all, it is rather restrained in the context of budget deficit. I’ve noticed your primary emotional reaction. It demonstrates that the budget is not perfect. What are your main remarks about Ukrainian budget 2017?
Oleksandr Klymenko: The issue of budget – is not a matter of ordinary calculations. It comes about financial definition of the state’s life. It comes about its [state] direction, its priorities and opportunities for development. Let’s try to be objective. There is no black or white, there are always tones. Concerning the pros, the only thing I can say – is exactly the same words about restrained deficit at the level of 3%. However, you know that the entire work of the government – is one big shell game: where to hide and how to cheat. If you go deeper, the budget does not include the hidden deficit: starting from arrears of pension in Donetsk, Luhansk, ending with issue of government bonds for financing of the Deposit Guarantee Fund, hidden deficit of Naftogaz, and other things that affect the budget indicators. Concerning the cons. First of all, it is military budget. Defence spending has been increased and reached approximately UAH 130 billion. For the economy – we are talking about economy today – we should end the war in Donbas. It is a political decision, which is a cornerstone that does not allow the country to move forward. The second point – is modernization of military power. It should be carried out gradually. I’m not even talking about the fact that this factor [the war] is used by power as a last bastion that covers all the failures. Why is it everything bad around us? Because of the war! There is an aggressor! Such rhetoric, which is imposed, is absolutely harmful for Ukraine. Moreover, it is not a secret that military issue for plethora groups has become a business.
Andrey Blinov: You mentioned the deficit of Naftogaz. I must say that this company – oil and gas corporation – is expecting for profit at the level of UAH 21 billion for the first time in 2016 due to increase in prices for this resource. Could you specify, which deficit of the company are you talking about? If we take into account the fact of increase in prices for energy resources produced by the company and predicted deficit, the meaning of reform becomes absolutely unclear.
Oleksandr Klymenko: If we talk about National Joint-stock company Naftogaz, there are two components. First, it is the structure of the enterprise itself, and the debts that are not secured. I would like to go back to my thesis that all operation of the government – is a shell game. De jure, it comes about one course of event. In fact, I am quite sure that we will see a deficit again, which will be updated by the state budget. It will be carried out by either issue of government bonds, or other way. The work of the state corporation itself is absolutely unclear. Concerning the second point. Let’s find out, why is the revenue increasing [National Joint-stock company Naftogaz]. The state is climbing into the pocket of Ukrainians via the tariffs. When we worked in the government, and negotiated with the IMF, we also had an accurate issue related to tariffs. Each time all the consultants stated: «You should increase tariffs». We had a strong position that first of all, we have to carry out reforms, namely, to introduce energy-saving technology and reporting system. Initially we have to increase the income of the population. After that we wanted to go back to the issue of raising tariffs. At the same time, it is necessary to increase investments, state support to enterprises that operate use energy independence. For instance, operation of bioethanol, companies that want to extract shale gas, negotiations with China for processing coal into gas. This is a comprehensive program.
Andrey Blinov: I can agree with you in terms of necessity of such a sequence. However, when you have no money, when your expenses are increasing, including for military actions, when your revenue is decreasing due to problems of the economy, due to reduction of the population territory, due to breaking of foreign economic relations, it is obvious that you will need these resources. All the states, which were carrying out price liberalization, including in terms of energy, were following this path. At some point it was impossible to wait. For instance, I am absolutely sure that in 2014 one of the key problems of devaluation and beginning of price growth was funding of Naftogaz deficit, which, in fact, has required that price growth. However, nowadays, according to the management of the corporation, it turns out that there is still no deficit. Are you mixing up the deficit of Naftogaz and funds, which are required for subsidies that are allocated by the Ministry of Social Policy? There is more than 50 billion.
Oleksandr Klymenko: … Each time you appeal to the fact that there is an official statement, which should be followed by an action. I would like to tell you: during the last three years, a statement of official is not equal to the action, which he declares. The next point: we are talking about the fact that Ukraine has no money today. Even in this context I would like to argue with you and offer an alternative. Not because everything goes bad. If we talk about the state budget filling, there are two sources today. First – if a person is Ukrainian, it is possible to take away his money via military tax, raising utility tariffs, price growth, not to mention the taxes…
Andrey Blinov: Wait, that’s two different areas. There are taxes, there are prices. Nevertheless, we can’t state that utility tariffs go to the budget.
Oleksandr Klymenko: Okay, let’s focus on taxes. You can collect the taxes from a person. We offer an alternative – to collect taxes from large financial and industrial groups. We are talking about transfer pricing, which is not included to the budget. It is rather difficult to explain its absence. I have a right to talk about it. In 2013 I was an initiator and driver of these changes. We have discussed the Law with the business, in the Parliament. It was adopted and came into force. In February , the term was postponed for a year, and the whole meaning of the law was eviscerated. It also relates to billions. Each time representatives of the party and I are stating that this area of tax revenue can bring billions. Thus, it will remove fiscal pressure from ordinary citizen and/or entrepreneur.
Andrey Blinov: We have logically approached the topic of taxation in Ukraine. What do you think about the taxation of so-called individual entrepreneurs or small companies that are doing small business (those, who pay Single Social Contribution)?
Oleksandr Klymenko: You know, I have always stood, and I am standing, and I will stand for maximal development of small and medium-sized business. What was it about earlier? … A moratorium on inspections of small business – is an initiative that was implemented by my team… As a result, we have received more than 50% growth of the category [small and medium-sized business], more than 200% increase in payments to the budget. We cancelled the control over cash discipline and replaced it with online service. It was an enormous issue, when representatives of tax agencies were coming and monitoring all the cheques. It was a corrupt machine. All entrepreneurs were complaining. We just changed the procedure of administration and introduced the IT-technologies … I believe that the state should support [entrepreneurs] and not to interfere. Support consists from stable rules, which should not be changed each year. The last, but not the least, is resources, long resources for business development.
Andrey Blinov: We continue our interview with Oleksandr Klymenko on the air of Radio Vesty. We have just discussed a small business. I would like to ask you a question, which is not often asked due to the fact that people usually do not talk about the pressure on small business. However, if you look through the statistics of working population, you will see that there are 10 million people in Ukraine, who belong to working population. At the same time, they cannot be found on the labour market. They do not stand in the queues to the State Employment Service, they do not pay taxes. Maybe some of them work abroad, other people work illegally. It does not mean that they are dealing with criminal (weapon, drugs, or some jewellery). However, at the same time, it comes about large number of people, who do not represent themselves as entrepreneurs. It comes about taxi drivers, or different couriers. There is plethora fields and people in it. What should we do? Here we have some kind of injustice. You offered to levy a tax on large corporations and rich people. You want to control over paying taxes by those entrepreneurs, who work transparently, but, in fact, a few million people fall out of this range. Consequently, it turns out that the rate of their real tax – is a zero.
Oleksandr Klymenko: You raised the issue, which Ukraine is trying to cope with during the last 25 years. In other words, it comes about salary in envelopes. I am talking about the shadow income that is not taxed. However, I have always consistently advocated, and I will advocate for the main thesis of taxation, namely, justice. What is the difference between teacher of doctor and entrepreneur, which receives taxes? Teachers and doctors pay taxes from their salary, meanwhile shadow entrepreneur, who gets a salary in envelope, does not pay taxes at all. In this case, it is necessary to follow the two ways to meet each other. On the one hand, this is reduction of income tax rates, in particular, salaries, individual income tax …
Andrey Blinov: … Salary fund.
Oleksandr Klymenko: Yes, you are absolutely right. It should be reduced.
Andrey Blinov: It turns out that you support the current government, because in 2015 the government decided to reduce the rate of Unified Social Contribution to 22%. Nowadays, in general, this tax is amounted to 41,5, meanwhile recently it has exceeded 50%.
Oleksandr Klymenko: I support the trend, but I do not support actions of the government. I will say it again: it is impossible to support something that is always cheating you.
Andrey Blinov: How can you divide the action of the government and the trend?
Oleksandr Klymenko: Reducing the taxes on salary fund – it is absolutely right way. Though, if we take the offer of our party, we state that it is necessary to reduce even more – from 22% to 15%. 10% out of it should go to the budget, and 5% should be left on personal account in order to provide individual with an opportunity to make savings and administer funds in future: either to pay for necessary expenses for medicine and other social needs. Thereby, it gives a person an understanding that it is not some mythical funds from the future, but it is real his/her money. If we provide people with an opportunity to dispose of part of this money today…, the person, who gets salary in envelopes, will understand that he is losing today. He will lose in future too. However, trust in the state is required…
Andrey Blinov: You know that any politician, any party will support the idea of 15% of tax on salary fund. Imagine a situation, when you make such decision and the Ministry of Finance together with IMF will come to you and ask: “How should we compensate missing income?”. Even in case of reducing the rate of the Unified Social Contribution from 37,5 to 22 billion avg, we have about hundreds of billions of missing income. You can observe the dramatic jump of pension fund deficit.
Oleksandr Klymenko: During my work as a Minister, I was always asked this question. They came to me, including the IMF. I have always been stated: if we fight for income, I would like to show you 3-4 methods, including a transfer one, how this income can be…
Andrey Blinov: Show us these 3-4 methods.
Oleksandr Klymenko: First of all, it comes about transfer taxation. We are talking about billions. If we take the EU member states or the CIS area, transfer pricing – is a standard of living today. CFC – is a controlled foreign corporation and its taxation – is a standard of living. Nowadays, Ukraine in this context – is one large offshore. Thus, we have a huge hole, which absorbs billions, meanwhile we are trying to block some tiny streams in order to find something… In some measure Ukraine is a feudal country, where there are clans, clans have their own representatives, who defend the interests of and fight for it …
Andrey Blinov: Well, transfer pricing, what else?
Oleksandr Klymenko: Trust.
Andrey Blinov: Who should trust? In whose trust?
Oleksandr Klymenko: It comes about the trust of the State to business, when an entrepreneur realizes that he has a salary fund, which can be economically paid. On the other hand, he can pay salary in envelope. I’m talking about the system of cashing.
Andrey Blinov: All of us are talking about it. You told that you would cope with it. Those, who came after you, also told about it. Anyway, this system exists today. You can find such systems even after the collapse of plethora banks, which were dealing with it…
Oleksandr Klymenko: This is a systemic work.
Andrey Blinov: …Due to the fact that it is systematically beneficial. It has an economic meaning.
Oleksandr Klymenko: When we started to fight, the VAT [which was collected to the budget] has increased from 3 billion to 7 billion (average indicators) and has exceeded all the macroindices. We were struggling with it [system of cashing]. It was a systemic work. I can wear the shoes of an entrepreneur, who understands the following: today he can cash out UAH 100, he will lose a certain percentage and will have criminal problem in future. He will face with this problem some time or other. Or he has an economic potential to pay salaries to his staff. This is extremely important. The state takes a step forward. How? It lowers prices. It is a comprehensive program.
Andrey Blinov: In general, can the state lower the prices in case of reduction of taxes?
Oleksandr Klymenko: It comes about lowering salary taxes and assistance to enterprises in modernization. Here is a comprehensive partnership program. I can assure you that the business will meet halfway.
Andrey Blinov: Ok, you said that you have 4 methods. What is the third one? Is it recommendation of compensators and covering the deficit of the social system (primarily), which is related to reducing the tax on salary fund?
Oleksandr Klymenko: You are absolutely right. We have discussed transfer pricing, reducing salary taxes, additional stimulation of entrepreneurs, businesses, in order to provide them with access to legal and transparent part. We were talking about the fight against the converting. The tax system. The National Bank is able to close the system and to make it impossible. The third point is an urgent step, which should be done today during the presentation of the budget. In particular, I am talking about growth of the budget’s paying capacity.
Andrey Blinov: How to increase it? Just to raise the salary? Groysman has raised it up to UAH 3200.
Oleksandr Klymenko: Raising the minimum wage, which was carried out by Groysman – is a shell game again. This growth of minimum wage gives nothing more than pressure on business. Let’s see, the average salary in Ternopil region is amounted to UAH 3760. Nowadays, minimum wage is UAH 3200. Is there any industrial growth? Have we ramped up our potential? Or is the minimum wage [its raise] required for fixing the line, which will be additionally taxed? We understand that business does not talk about development, but survival today. Business will go into the shadows. The problem related to salaries in envelopes will be aggravated. Business will be shortened [in terms of payment of official salaries]. It will leave 0.25, instead of half rate for the employee. There is no economic possibility to pay such minimum wage… There will be inflation, another phase of weakening of national currency. No more no less. Thus, these measures – are declarative. This is a PR action. It has nothing in common with needs of the economy.
Andrey Blinov: We are on the air of Radio Vesty, Oleksandr Klymenko – the leader of the «Uspishna Kraina» party, former Minister of revenue and duties, in our circuit studio. You know, we are talking about taxes. However, during the 30 minutes of our conversation, I have not heart a favourite slogan of the last decade. All the politicians mentioned it. It comes about real estate tax and luxury tax. Almost all people to a great extent, who are related to fiscal authorities, to revenue and duties, to the Ministry of Finance, have always stated that it’s a real compensator of taxation of rich people. It is not about corporations, but individuals. Nowadays, we are aware of the amount of rich people with the help of electronic declarations. We also know, how many of them have not submit this declaration. What are your offers concerning the taxation of real estate and luxury?
Oleksandr Klymenko: Concerning the luxury – it is easy. The first stage of implementation of the luxury tax should be the tax on the fact of electronic declaration. It is definitely necessary for Ukraine today. It is a global trend, the practice.
Andrey Blinov: So let’s clarify the notion «luxury». What is it? There are plethora discussions … is it about fur coat, or the car, which costs more than 30 thousand dollars, or 50? What is it?
Oleksandr Klymenko: I believe that the luxury tax should depend on income. What should it include? Planes, yachts … We should understand that 90% of them were imported in Ukraine on a temporary basis. A procedure of customs fixing is required. Otherwise, it should be taxed [entering Ukraine] in order to prevent from tax evasion by owners…Concerning the fur coats, gold, jewellery, I have already discussed it. I asked: «How can you administer it? It is easy to use slogans, but how to administer it? How to administer expensive watch? The luxury tax must be introduced gradually starting from those items that do not cause social discussions (in cases, where it is possible in terms of administration) ».
Andrey Blinov: It turns out that administration is related to cars because it has vehicle registration plates, which are registered in the Ministry of Internal Affairs, and the real estate agencies should be registered. Does it mean that you advocate for a single transparent register of all Ukrainian real estate? What about the land?
Oleksandr Klymenko: The land too. However, you should look carefully. Don’t throw the baby out with the bathwater. The real estate tax, which was introduced, has nothing common in with the luxury tax. Our party takes quite successful steps and we will appeal against unfair introducing of this tax in national courts and cancel decisions of local councils.
Andrey Blinov: Wait a second, the authorities decided that the luxury starts from 60-120 square metres of a city apartment or a country house respectively.
Oleksandr Klymenko: Here is the question – is it a luxury? For instance, if we take a house in a village, we will see the injustice when both barn and vaporium will be included [under the taxation].
Andrey Blinov: What are you trying to equate with? Is it about the cadastral value?
Oleksandr Klymenko: We offer to equate it with residential area, but it comes about large space.
Andrey Blinov: Is it possible that cost of the administration of this tax is excessive?
Oleksandr Klymenko: No. Everything should be as automatic as much as possible. When we were considering the introduction of property tax, I, as a minister, stood for the fact that pensioners and residents of “hruschovka” should not be taxed. In order to achieve this, it is necessary to develop electronic databases of the Bureau of Technical Inventory. In addition, the situation should not be in manual mode, but in automatic one. That is why, the government should accept an obligation to transform it into electronic version, which should be convenient for administration. It comes about cooperation of tax services and local authorities. We started such work together with the Bureau of Technical Inventory and local councils.
Andrey Blinov: Okay. According to Mr. Klymenko, where does luxury housing start?
Oleksandr Klymenko: Starting from an apartment 300 square metres.
Andrey Blinov: Okay. Nowadays, we all know that the government is planning extremely slow pace of the economic growth in 2017, about 3%. Plethora people call it recovery growth. All of them state that economic growth, of course, has to be stimulated under these circumstances. The growth is so weak that we will achieve the level of 2013rd in 10 years. I would like to quote Saakashvili, the former governor of Odesa region. Which methods of economic policy are offered by your party?
Oleksandr Klymenko: Firstly, we talk about an urgent step, which I have already mentioned. It comes about the growth of the budget’s paying capacity of population. Secondly, it is launch of large infrastructure projects. In this case, the party offers to allocate funds for restoring Donbas. It is a well-known economic theory.
Andrey Blinov: Do you know, what will be stolen in this situation? Who will control it? Money can be allocated only in case of severe control. Nobody should take an extra penny.
Oleksandr Klymenko: You are absolutely right. However, we should proceed from idea to administration issue. First of all, in terms of administration, it is, of course, location [of involved contractors]. It is 90% of the domestic producer. Otherwise, it makes no sense. It is also about the monitoring system, including public control, which must be pretty clear. We, as a party, offer and are ready to take responsibility for this direction … We have one of the best teams, who deal with Donbas. I am talking about “Restoring Donbas” community initiative, which has been operating for more than 2.5 years. We have real experience in this field.
We are standing on the threshold of global changes in the world economy. Currency printing period has finished. Nowadays, we will observe changes of the situation. Where is Ukraine in it? What should we do? If we go to nominal GDP, the fact of current growth, means absolutely nothing. It has nothing in common with the real product. We can play with numbers and play around statistics, but it is important, what does an ordinary person feel. We state that a part of the military budget should be distributed in favour of increase in salaries of state employees and the cost of living. Yes, it’s about social things, which stimulate the growth of domestic market. The second point is large infrastructure projects. We should understand that the war in Donbas must be terminated. This is a political decision, which is backed by plethora other decisions, including economic, including a breakthrough for the country. Nowadays, we can talk about Donbas coal, which is essential for Ukraine. We can talk about the existing industrial potential. Finally, we are talking about people, who live there. Donbas is a part of Ukraine. Donbas can be that large infrastructure project that can give an opportunity to create new workplaces. After all, we discuss unemployment today. When the global economy is exhausted, the state should become a driver [of creating workplaces in the country]. We can talk about nationalization of the Privatbank, where the government is going to pour billions into. Is it really the best way of using money?
Andrey Blinov: Here is the history. I seriously oppose you [in terms of] allocation of state funds for infrastructure projects, because we remember Euro 2012 (for instance), when it was spent money on the stadiums and airports during realization of the project. Well, unfortunately, an estimate has been almost doubled. I understand that it corresponds to joke about the builders, who need 3 times more time and 2 times more money. Nevertheless, we clearly understand that money was used inefficiently. At the same time, I can agree with you that military expenditure is not transparent and we cannot see growth, for instance, in mechanical engineering field, which is related to maintenance of combat vehicles, machinery and other weapon and military equipment. Why do not you stand for dividing risks between executors of ideas and the state? I mean a large-scale program of compensation of interest rates. All the politicians state: Yes, we have high interest rates on loans, yes, it should be reduced, but we should give it somehow. After that, it is followed by various initiatives: starting from printing money to coercion of the state banks into issuing cheap loans. Why do not we make absolutely normal risk-sharing mechanism in strategic areas? Let’s say that the state compensates … I do not know. 10% per annum, but the risks are divided between the entrepreneur and the state. We will hear the answer to this question in our next part.
The final part of the interview with Oleksandr Klymenko. I have just asked you the question during our previous part: «What should we do with the idea of compensation of rates on loans? Ukraine can cope with such a mechanism. What has been preventing all governments from it for many years?
Oleksandr Klymenko: The system is an obstacle. You know, it is difficult to beg for business. Where an official is, a risk of corruption starts. The same course of events is everywhere, at every stage. If we remove this stratum or minimize its [official’s] influence, we will get a result. Starting from small things – as it was, when we put maximum effort in order to transform 90% of tax reports into electronic version. Here is the same. I advocate for governmental programs. The state must accept risks. Let’s have a look at agriculture. The season has finished. What can we see? It was decided that transportation by cars should be limited by 20 tonnes. Rolling stock was not enough. I talked to one of the farmers, who said: I have a corn, I cannot use elevator for it. Accordingly, if I do not use the elevator, I will not have drying and it will rot.
Andrey Blinov: Well, listen… In fact, weight complexes were not delivered to Ukraine. Thus, they continue to carry a load exceeding the 11 tons. There is a permanent discussion “why do we have problems with the roads again”.
Oleksandr Klymenko: It is not even about the roads, but the fact that the state is not provided with rolling stock. If we look through the statistics, the amount of written-off and produced carriages of rolling stock, we will see that this is a problem… 20 new carriages are equated to 100 written-off carriages. We are moving towards collapse.
Andrey Blinov: The point is that the state should not deal with carriages or grain transporting.
Oleksandr Klymenko: The state should provide the infrastructure and assist in launching the plants. Consequently, it will be able to produce open wagons. Here is the process. The state accepts the risks. It is not a secret that Ukraine is located in an effective place [in terms of transit potential]. Logistics can become one of the breakthrough point. However, there is no state position, meanwhile the business cannot accept all the risks in current economic situation. And if we talk about the compensation of rates, it will end with refusal. Business will go around in circle.
Andrey Blinov: Well, wait, what does it mean – give us a cheap resource. Where should we get it? If we take it out of the budget and give entrepreneurs, media and society will state that it was given to friends of the President, Prime Minister (it does not matter, who is the President and Prime Minister). As a result, it turns out that he owns these companies. This is the Ukrainian history at least during the last 10 years.
Oleksandr Klymenko: Everything should be transparent. It is extremely important. Moreover, it can be ensured today. Yes, there will a huge issue of mistrust. However, we know that everything happens for the first time. When I started to work in tax service, I was told: you will change nothing. Though, we have changed. We eliminated queues, opened 560 service centres, etc. … I will not focus on it. We should have the politicians, who are ready to take responsibility. We, our party, are ready. The second point. We state that these reforms should allow ordinary Ukrainians to get real income. That’s important. If a person feels that he has an opportunity to make process in Ukraine, that his income has increased, that procedures are transparent, we will see an unprecedented surge of interest …
Andrey Blinov: You know, when we speak of trust and transparency, I have a feeling that there was no «Livela» company in Ukrainian history, or the VETEK group of companies (Serhiy Kurchenko). When do people and their structures, which are growing from nothing, arise? It grows up due to the fact that they have an opportunity not to pay taxes, for instance. We remember the import of fuel free of duty. It affects not only the competition, but the whole budget. Here are the opportunities you are talking about. It always arises.
Oleksandr Klymenko: …Concerning the stories of different companies, it is necessary to understand, where the truth or lie is. Yes, it happens, but times are changing. We must go further. We should act… Look, we are talking about Donbass. I cannot ignore this topic, because this is my home. I am worried about it. It is necessary to carry out an international conference, to invite donors, to ask for assistance. You are absolutely right that it is extremely important to make procedures transparent. Neither penny should be stolen. I ask: «Is it difficult to organize if you have a political will? ». Not at all. You know, when I was dealing with the issue of struggle against corruption, I invited the best specialists in this field in the world to the Ministry. They were from the UK, Poland, etc. I said: «I am a Minister. What should we do step by step? ». We were doing it. I would like to repeat; this is a question of a political will. Without these changes, our attempts to restart the economy will be nothing more than patching holes. There will be no overhaul. We should talk admit the fact that KPI (Key Performance Indicators) of the government – is creating workplaces and modernization…
Andrei Blinov: You are right, all the officials use these clichés. Here is the next question, which is difficult to answer. It is about sales markets. Where to sell it?
Oleksandr Klymenko: I have an advantage. I’m not an official.
Andrey Blinov: I am also not an official.
Oleksandr Klymenko: You say that all officials state. I am not an official.
Andrey Blinov: Well… you are a former official. Anyway, you know, how to work.
Oleksandr Klymenko: Nowadays, I know the system from the point of business. I came [to the public service] from business.
Andrey Blinov: Well, where are these sales markets? We came to the conclusion that the ordinary Ukrainian citizen is poor, he has no money. The majority is on the edge of poverty. Next, we are talking about the fact that a significant part of the markets has declined. State’s transition from the agricultural status is still related to the loss of engineering and metallurgical markets. Where are the markets?
Oleksandr Klymenko: Everywhere. Markets are in the East and the West. We must develop in order not to please the creditors, but for the sake of our interests. Trading with Russia is beneficial for us. Nowadays, it is not a popular topic. People are afraid of it. I advocate for economic trade relations with Russia, Poland, and other countries. I believe that we have to defend our national interests. How can we support export? I would like to go back to times, when I was a Minister of revenue and duties. I saw: when our exporter came on the markets of other countries, he did not know where to go. I was an initiator of creating departments, representative offices in embassies, which cooperated with tax and customs authorities and provided assistance. During my time in the Ministry, we also created the most powerful Investment Board, which included entrepreneurs. We were talking about the agenda, which they are interested in. We did not invent rules of work by ourselves. We asked the business about it. Let’s ask, which problems do exporters have? They will tell you: today we have big orders, but there is no advance payment, there is no accreditation. Could you help us with authorization documents, simplify customs procedures? Let us import technological equipment in instalments. All these things can be done by the state.
Andrey Blinov: Let’s discuss national interests. The final question. What should be the priorities of Ukraine/ Ukrainian government (it does not matter) in terms of international organisations? Ukraine as a subject of international law should want something from international organizations and cooperation with it. What exactly?
Oleksandr Klymenko: I will tell you, probably, very unpleasant thing. First of all, we should not lose subjectivity. Nowadays, Ukraine depends on external creditors, including the [International] Monetary Fund. Ukraine loses its subjectivity and becomes the object. In fact, they get Ukraine under control. We have to defend our national interests on the basis of the facts, which are beneficial for us or not. In particular, if we talk about payments of [external] debts, it is necessary to discuss the conditions, under which the loans were issues, and the conditions, under which we can afford to pay for it.
Andrey Blinov: Thus, you offer partial write-off…
Oleksandr Klymenko: …either write-off, or instalments. However, I definitely support the idea that the percentage, which we will pay for the growth, should not contradict national interests.
Andrey Blinov: What else is included to agenda?
Oleksandr Klymenko: Defining and defending our interests. We should dance to someone’s [external] tune. I would like to give an example of my life again. When we talked to the IMF, they told me: remove the benefits for farmers, because it is income. I said: Do you understand that you want us to deal with production of monocultures? Thus, we will have to buy other high value-added products [in Europe]. That is, we will sell you grain for dollars, and then we will buy pasta, milk, sour cream, etc. For the same dollars. It won’t be like this.
Andrey Blinov: So, do not work with IMF, work with the World Bank, work with European Bank for Reconstruction and Development, take loans for development of infrastructure.
Oleksandr Klymenko: 100%. Me and the party declare: we should not stand with our hands stretched out due to loans and sell our national interests. It is unacceptable. If our national interest – is development of the agricultural sector, we have to understand and look for partners, where we can. China. Russia. We definitely should not carry out blindly the will of the creditors, who pursue their own goals. Their goals – it is not our development, not a strong Ukraine. Our goal is powerful Ukraine. Successful Ukraine.
Andrey Blinov: We are on the air of Radio Vesty in our circuit studio. It was an interview with Oleksandr Klymeko, the leader of the «Uspishna Kraina», former Minister of revenue and duties of Ukraine.
Link to source: Radio Vesty