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Nuland: Ukrainian Reforms Two Years After Maidan Revolution And Russian Invasion – Statement

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By Victoria Nuland, Assistant Secretary, Bureau of European and Eurasian Affairs

(Statement Before the Senate Foreign Relations Committee) — Thank you Chairman Corker, Ranking Member Cardin, members of this committee for the opportunity to join you today and for the personal investment so many of you have made in Ukraine’s democratic, European future. Ukraine still has a long way to go to meet the aspirations of its people, but your bipartisan support, your visits to Ukraine, and the assistance you and your fellow members have provided have been essential to our policy.

Before I begin, let us take a moment to honor the sacrifice of Ukrainian pilot and Rada Deputy Nadiya Savchenko, who was seized in Ukraine in 2014, dragged across the Russian border and unjustly held and tried in Russia. Today, her hunger strike continues as the court in Rostov again delays announcement of its verdict. Nadiya’s struggle is a stark reminder of the severe pressures and violence Ukraine continues to face even as it works to build a stronger, more resilient country for its citizens. I thank this Committee for its continued focus on Nadiya Savchenko and all Ukraine’s hostages, and for the passage of Senate Resolution 52. We call on Russia to release her immediately, and return her to Ukraine and to her family before it’s too late.

Like Nadiya, all across Ukraine, citizens are standing up and sacrificing for the universal values that bind us as a transatlantic community: for sovereignty, territorial integrity, human rights, dignity, clean and accountable government, and justice for all. The United States has a profound national interest in Ukraine’s success, and with it, a more democratic, prosperous, stable Europe.

We have stood by Ukraine for more than two years as Russia has sought to stymie its democratic rebirth at every turn – with political pressure, economic pressure, and with unprecedented military aggression and violation of international law. Any set of leaders would be challenged to lead their country in this environment. Today, however, Ukraine’s European future is put at risk as much by enemies within as by external forces. The oligarchs and kleptocrats who controlled Ukraine for decades know their business model will be broken if Maidan reformers succeed in 2016. They are fighting back with a vengeance, using all the levers of the old system: their control of the media, state owned enterprises, Rada deputies, the courts and the political machinery, while holding old loyalties and threats over the heads of decision-makers to block change.

Against this backdrop, Ukraine’s leaders have been locked for months in a cycle of political infighting and indecision about how to restore unity, trust and effectiveness in the reform coalition, and reboot the government and its program. Every week that Ukraine drifts, reform is stalled, IMF and international support goes undisbursed, and those inside and outside the country who preferred the old Ukraine grow more confident. More than 3 months ago, Vice President Biden spoke before Ukraine’s Rada, its President and its Prime Minister and called on all of Ukraine’s leaders to set aside their parochial interests, reminding them: “Each of you has an obligation to seize the opportunity of the sacrifices made in the Maidan, the sacrifices of the Heavenly Hundred. Each of you has an obligation to answer the call of history and finally build a united, democratic Ukrainian nation that can stand the test of time.”

The ability of the United States and the international community to continue to support Ukraine depends upon the commitment of its leaders to put their people and country first. All those who call themselves reformers must rebuild consensus behind a leadership team and an IMF- and EU-compliant program of aggressive measures to clean up corruption, restore justice, and liberalize the economy. With more unity and leadership, 2016 can and should be the year Ukraine breaks free from the unholy alliance of dirty money and dirty politics which has ripped off the Ukrainian people for too long. Without it, Ukraine will slide backwards once again into corruption, lawlessness, and vassal statehood.

It is precisely because Ukrainians have worked so hard, and come so far already, that their leaders must stay united and stay the course now. And it is because the reforms already taken are cutting into ill-gotten fortunes and cutting off avenues for corruption that the forces of revanche are fighting back. Here’s the good news: since I last testified before this Committee five months ago, Ukraine has largely stabilized its currency and is rebuilding its reserves; seen some modest growth in the economy; passed its first winter without relying on gas from Gazprom; approved a 2016 budget in line with IMF requirements; passed civil service reform to create competition and transparency; recruited a new corporate board for Naftogaz; broke its own record for greatest wheat exports; stood up an independent Anti-Corruption Bureau and Special Prosecutor; and, begun to decentralize power and budget authority to local communities to improve services and policing for citizens.

The very week in February that the current government survived a no-confidence vote, Rada deputies also approved five critical pieces of reform legislation to stay on track with IMF conditions and advance Ukraine’s bid for visa-free travel with the EU, including laws on:

  • Privatization of state owned enterprises;
  • Improvements in corporate governance of state owned enterprises;
  • Asset seizure and recovery;
  • The appointment process for anti-corruption prosecutors; and,
  • Mandatory asset disclosure for public officials, which the President just sent back to the Rada with several fixes.

U.S. assistance has been critical to these efforts. Since the start of the crisis, the United States has committed over $760 million in assistance to Ukraine, in addition to two $1 billion loan guarantees. U.S. advisors serve in almost a dozen Ukrainian ministries and localities and help deliver services, eliminate fraud and abuse, improve tax collection, and modernize Ukraine’s institutions.

  • With U.S. help, newly-vetted and trained police officers are patrolling the streets of 18 cities;
  • In court rooms across Ukraine, Free Legal Aid attorneys, funded by the U.S., have regained their credibility and won 2/3 of all acquittals in Ukraine in 2015.
  • Treasury and State Department advisors embedded in Ukraine’s National Bank and related institutions helped Ukraine shutter over 60 failed banks out of 180 and protect assets.
  • The U.S. and our EU partners are supporting privatization, freeing up about $5 billion in Ukraine’s coffers and pushing the largest state-owned enterprise, Naftogaz, to form an independent supervisory board that operates without interference.
  • And, since there can be no reform in Ukraine without security, over $266 million of our support has been in the security sector, training nearly 1200 soldiers and 750 Ukrainian National Guard personnel and providing: 130 HMMWVs, 150 thermal goggles and 585 night vision devices, over 300 secure radios, 5 Explosive Ordnance Disposal robots, 20 counter-mortar radars, and over 100 up-armored civilian SUVs. In FY16, we plan to train and equip more of Ukraine’s border guards, military, and coast guard to help Ukraine secure its border, defend against and deter future attacks, and respond to illicit smuggling.

But first, Ukraine, President Poroshenko, Prime Minister Yatsenyuk, and the Rada must come together behind a government and reform program that delivers what the Maidan demanded: clean leadership; justice; an end to zero-sum politics and backroom deals; and public institutions that serve Ukraine’s citizens rather than impoverishing or exploiting them.

What Ukraine Must Do

The 2016 U.S. assistance program is designed to support all these priorities. Specifically, we will support Ukraine as it takes steps to:

  1. Clean up its energy sector by passing legislation to establish an Independent Energy Regulator, reduce unsustainable energy subsidies, and accelerate de-monopolization of the gas market, efficiency of procurement and revenue management, and the unbundling of services;
  2. Appoint and confirm a new, clean Prosecutor General, who is committed to rebuilding the integrity of the PGO, and investigate, indict and successfully prosecute corruption and asset recovery cases – including locking up dirty personnel in the PGO itself;
  3. Improve the business climate by streamlining the bureaucracy, moving ahead with the privatization of the largest state-owned enterprises in a manner that meets international standards, and further recapitalizing and strengthening the banking system;
  4. Strengthen judicial independence, including the certification, dismissal, and recruitment of judges;
  5. Improve services and eliminate graft in key service areas that affect every Ukrainian: healthcare, education, and transportation; and
  6. Modernize the Ministry of Defense, squeeze out corruption in logistics and supply chains, and move toward western standards of command and control and parliamentary oversight.

Minsk Agreements

Of course, Ukraine’s greatest challenge remains the ongoing occupation of its territory in Crimea and Donbas, and its efforts to restore sovereignty in the East through full implementation of the September 2014 and February 2015 Minsk agreements. These agreements remain the best hope for peace, and we continue to work in close coordination with the “Normandy Powers” — Ukraine, Russia, Germany, and France – to see them fully implemented.

The last time I came before this Committee, Ukraine was in a better place. The September 1 ceasefire had largely silenced the guns, and some Ukrainians were even returning home to Donbas. But today, things are heating up again. In recent weeks, we have seen a spike in ceasefire violations, taking the lives of 68 Ukrainian military personnel and injuring 317. In February alone, OSCE monitors reported 15,000 violations, the vast majority of which originated on the separatist-controlled side of the line of contact. And, there were more recorded ceasefire violations in the first week of March than at any time since August 2015. And despite President Putin’s commitments to the Normandy powers last October, combined Russian-separatist forces continue to deny OSCE monitors access to large portions of Donbas and to harass and intimidate those who do have access.

At the last meeting of Normandy Foreign Ministers in early March, Ukraine supported concrete steps to pull back forces on the line of contact, increase OSCE monitors and equipment in key hotspots, and establish more OSCE bases deeper into Donbas and on the border. Taking these steps now and releasing hostages will greatly improve the environment for compromise in Kyiv on election modalities and political rights for Donbas. In the meantime, neither Moscow nor the self-appointed Donbas authorities should expect the Ukrainian Rada to take up key outstanding political provisions of the Minsk agreement, including election modalities and constitutional amendments, before the Kremlin and its proxies meet their basic security obligations under Minsk. Although the U.S. is not a party to the Normandy process, we maintain a very active pace of diplomatic engagement at all levels with Kyiv, Moscow, Paris and Berlin to facilitate implementation of both the security and political aspects of Minsk, and to help the parties brainstorm solutions.

Here again, with will and effort on all sides, 2016 can be a turning point for Ukraine. If security can improve in coming weeks, if hostages are returned, if the parties can finalize negotiations on election modalities and other political issues, we could see legitimate leaders elected in Donbas by fall, the withdrawal of Russian forces and equipment, and the return of Ukraine’s sovereignty over its border before the end of the year. We will keep working with Ukraine to do its part to implement Minsk, and working with our European partners to ensure Russia stays under sanctions until it does its part – all of it. And of course, Crimea sanctions must remain in place so long as the Kremlin imposes its will on that piece of Ukrainian land.

Mr. Chairman, Mr. Ranking Member, members of this committee, we knew Ukraine’s road to peace, sovereignty, clean, accountable government and Europe would be difficult and rocky. Today, the stakes are as high as ever. With strong, unified leadership in Kyiv, 2016 can and should be a turning-point year for Ukraine’s sovereignty and European future. If and as Ukraine’s leaders recommit to drive the country forward, the United States must be there to support them, in our own national interest. At the same time, we must be no less rigorous than the Ukrainian people themselves in demanding Kyiv’s leaders take their responsibility now to deliver a truly clean, strong, just Ukraine while they still have the chance. I thank this committee for its bipartisan support and commitment to the sovereignty and territorial integrity of Ukraine and to a Europe whole, free and at peace.

I look forward to your questions.

3 thoughts on “Nuland: Ukrainian Reforms Two Years After Maidan Revolution And Russian Invasion – Statement

  • March 16, 2016 at 4:08 pm
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    What a JOKE , A Jew interested in the wellbeing of Ukrainians. Ukrainians and Jews have been at odds with each other for centuries. In past centuries the Cossacks would sharpen up their sabers ,saddle up their horses and have a slaughter to correct the situation. Bogdan Khmelnitsky did it and a city is names after him. Need more Bogdan’s.

    Reply
  • March 16, 2016 at 7:59 pm
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    No one in America should take Asst. Sec. Nuland’s self-serving testimony seriously. She herself, with CIA help and $5 billion US taxpayer dollars (she bragged), chose A. Yatsenyuk and P. Poroshenko to serve as US puppets in Kiev. In April, 2014, CIA Director Brennan went to Kiev to start the attack on the Eastern provinces for which Russia has been steadily blamed in the West.
    The encirclement of Russia with NATO members is not something Russia will tolerate under any pretext. (We also tried with Georgia in 2008). Before he died, lead US diplomat George Kennan said clearly that the West must respect Russia’s security needs. Just as the US did not tolerate Soviet missiles in Cuba, Russia will not tolerate ABM sites in Western Ukraine aimed at Moscow under whatever pretext. The only US scholars with the guts to stand against Ms. Nuland’s policies are Prof. Stephen Cohen and Prof. John Mearsheimer of the Univ. of Chicago. Go into You Tube and listen for yourself their criticisms of Ms. Nuland’s policies in this respect.
    https://www.youtube.com/watch?v=UzyT8q4kIq0.
    Regardless of what Ms. Nuland says, this US puppet govt. is very unpopular in Ukraine and Mr. Yatsenyuk narrowly survived a no confidence vote in the Rada. Ms. Nuland is already planning to replace him with another US puppet, current Finance Minister Natalie Jaresko.
    In my opinion it is past time to get the neo-Cons out of the US government. Why Obama or Sec. Kerry has not fired this woman is beyond comprehension. It must be because she is married into the infamous Kagan clan, neo-Cons who run think tanks to supply weapons in the US useless wars around the globe, from which American citizens do not benefit and which cause immense destruction and suffering. The current destruction of the Middle East (Afghanistan, Iraq, Libya, Syria) is all based on neo-Con policies engineered by Paul Wolfowitz, Richard Perle, the Kagans and others.
    These policies enrage Muslims and increase terrorism. When the terrorism hits the territorial United States, we will all be sorry we tolerated these war criminals.

    Reply
  • March 18, 2016 at 6:08 am
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    the hypocrisy of Nuland and the endlessly repeated lies are mind boggling. I doubt this will pass muster with Rohrabacher, one of the last truly American Senators who actually wants things done in a genuine way, the right way.

    Ah, Ukraine was not dependent on gas from Gazprom! Where does Nuland think the gas which Ukraine buys from neighboring states comes from if not from Gazprom? So if Slovakia imports gas from Gazprom and then sells it to Ukraine, this isn’t gas from Gazprom!

    Ukraine has American advisors in every ministry! And that is considered a free and independent Ukraine?

    Meanwhile, Kiev tried already three times to sell its state assets and couldn’t find any buyers. The one buyer which might have been interested – Russia- was a priori excluded. 60 banks were closed as they failed – genuine economic success. What Nuland omits is that pensions were cut by 50% and that people struggle to survive on $85/months. And then she wants to cut the “unsustainable” gas subsidies. And how is the population supposed to survive that way? No questions asked. The living standard in Ukraine fell drastically. GDP halved. The currency devalued by 200%. Exports to the EU decreased.

    Meanwhile, Poroshenko can’t get federalization of Ukraine passed in the Rada, which means he cannot implement the Minsk agreements. So now they want to have increased OSCE controls in Donbas, notably along the border. But that border isn’t under Kiev’s control until the Minsk agreements are instituted fully. Which means those areas are not under the authority of OSCE. Instead, it is a foul ploy to get control of Donbas without institution the Minsk agreements. Hence the false accusations against the rebels for cease fire violations. It is clear and has been clear from the beginning that Kiev is only waiting for its military to be trained better by the US in order to attack Donbas again to get control by force. Did Congress get a copy of the OSCE report? It likely tells a different story.

    There never were any Russian troops in Donbas – hence Russia cannot withdraw any troops. The Russian volunteers who are most relatives of the people in Donbas are not under Russian government control. Nor would it be wise for the rebels to let the volunteers go before Kiev institutes the Minsk agreements.

    Which makes it clear that Ukraine is used by the US as a foul pretext to maintain sanctions on Russia and coerce the EU to maintain its sanctions against Russia. Given that the EU is in recession in most countries due to these sanctions, and that the EU risks to lose its export markets for its produce in Russia permanently, it is also clear that the larger goal of the US Ukraine policy is to destabilize both, Russia and the EU. The current migrant crisis of mostly refugees from Afghanistan and Iraq and Libya – all areas of instability and war produced by the USA, not Russia, confirm that. What does Nuland mean that US supervision in Ukraine will work towards a more democratic Europe? Europe is as democratic as it will be for a long time to come. Changing some of the structures inside the EU is a matter for the EU, not for the USA. With respect to Crimea: it will not return to Ukraine, neither voluntarily nor by war. Russia will defend it. Nuland can forget about that. Nor will NATO fight a war on Russia – it would destroy Europe as much as Russia and Europe, that is the EU who makes up most of NATO, will not agree to it. The US tried hard to lure Russia into a fight against invading Turkey – a NATO member – in hope of getting NATO involved in a war on Russia. Well, that didn’t work. Instead, the entire US policy in Syria failed. Not only will Assad not leave, but the current peace negotiations are based on the condition of the geographic and political integrity of Syria as a secular state. That ends the US dream of partitioning Iraq to create a Sunni state from Mosul to Raqqa and Amman.

    Russia stood up to the USA. Ukraine chose the wrong side. Now it is stuck with an association with the EU from which it has no benefit while losing the much larger benefit that would have come from either neutrality or joining the Eurasian Union of Russia and Central Asia. Instead of restoring Ukraine’s economy, Yatsenyuk shut down every source of revenue because it was connected to trade with Russia, with the result that there is in essence no economy left in Ukraine.

    Reply

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