FOR WHOM THE BELL TOLLS. Victor Yushchenko President of Ukraine 2005–2010

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No need to ask for whom the bell tolls now… For all of us!

Security issue is already knocking at every door

Today 90% of the military conflicts on the continent are concentrated in Eastern Europe. Six out of seven armed confrontations in Europe are happening in the East. Thus, we can certainly say that Eastern Europe is a zone of instability. This zone brings great risks to the European government and to the world order in general. Therefore, we must quickly imagine that the issues that are now in the Crimea or Donbass are not Ukrainian issues, but Russian. Issues in Transnistria, South Ossetia and Abkhazia, Nagorno-Karabakh as well as in twelve occupied regions of Azerbaijan are Russian issues. The events that are going on in Eastern Europe are purely geopolitical. Those are not conflicts of national or intra-national dimension. Since they are geopolitical events, they may only be settled by geopolitical instruments. We need to show solidarity to this, the fact that we understand the problem and have the solidary plan to fix it.

No matter who you are today, the issue of war comes in the first place

Talking about business, about a teacher, about a physician is very difficult unless you answer to Ukraine’s own identity, its sovereignty and independence at first you have to answer the question – how to defeat the enemy. Not how to establish peace! For peace is always after the war. Either victorious or losing, but after the war. And when we speak about the arrangement of the present day – we must remember that war is the first question on our agenda.

Віктор Ющенко Президент України

Winning the war is a case not to be solved in one year, but a case for Ukrainian business

Military history can teach you a couple off lessons. On the one hand, we have to maintain national spirit at a high level. For if the spirit falls – neither Kalashnikov rifle, nor BUK rocket will help. This is rubbish. When muscles are at war, economy is the second front line. This is an indirect competition of economies.

Ukrainian economy is a sleeping elephant

I have been deeply committed to the idea of Ukrainian economic uniqueness

There is no other European economy as undeveloped as Ukrainian. We cannot be replaced by Polish economy, or Czech, or Bulgarian, or Romanian, no. In fact, we are talking about an unicum. Unicum, that we all have to work for; we have to find a common denominator and figure out how we can make it work. How can we get this little-developed region of Europe going to the global level?

Everything less than 5% is a waste of time

My love to economic debates is endless, and I have my own view regarding launching Ukrainian national economy with dynamics starting at 5%. Because everything less than 5% is a waste of time, it is not an interesting model; it is not worth wasting resources. Again, we need solidarity for that. But not solidarity of simple dimension. It is necessary to make a joint assessment of all the drawbacks that hamper the economy today. If we make a consolidated and correct assessment of what restrains us – we will get an action easily. Because if the diagnosis is wrong, the treatment is wrong too.

We are a deficit-free country

The questions posed by business form an action plan for responsive government

The debt of the Pension Fund has reached 140 billion UAH, the debt of the state budget – 77 billion UAH. Today, being in a war, we remember that 56% of the Ukrainian economy is in the shadow. This is consequence of previous causes. Today business says “we do not like fiscal policy, fiscal administration, we do not like customs at all. We do not like regulatory, registration, land policy.” In fact, there are only 5–7 questions, which need to be answered in order to create a 4–5 months action plan for government that would allow us to go from 56% to at least 36%. And if we manage to reduce the shadow economy by 20%, there will be no state budget debt, we will get rid of half of the Pension Fund debt. When two Ukrainians arrange legal and public work for the sake of victory, for the sake of working places, for the sake of a poor person; removing all the governing mistakes that lead to the growth of shadow economy, we happen to be a deficit-free country

FOR WHOM THE BELL TOLLS. Victor Yushchenko President of Ukraine 2005–2010

I do not like the word fiscal

The first thing to realize is that taxes are paid not charged!

The model should not project the “come and take” fiscal point of view, the model should motivate tax relations with the state. I believe that 90% of business today wants to live honestly. And the 56% working in the shadow is not criminal business, but shady. The level of crime is not higher that 3–5%, just like in Germany or France. The rest want to have honest and transparent relationship with their own state. But in Western Europe, the governance is not about making the taxpayer public, transparent and honest. So yes, we are falling behind, yes, for them it’s a part of history and culture. But we can overcome this gap through correctly organized relations. That’s what teaches us most. Here is an example of chain connection: 56 % of the shadow economy. Shadow economy loves cash. It does not like wire, cards, it does not like public payment. Today, if we take the structure of money supply in Ukraine, one hryvnia out of four is cash, 23%. In addition, this is the least efficient unit, which does not work for the national economy. Each country, each central bank has one goal – to minimize the amount of cash, transfer it into electronic money, money in accounts, deposits, into any form of non-cash nature. Because cashless economy is a resource of economics crediting, low-cost, long loan. And we have a shadow economy that takes all credit resources and transfers them into cash. Because cash is safer to live with having our fiscal, law enforcement, intersubjective organs and so on. The more cash we have, the less credit practice we have. The lower is the lending practice; the higher are the interest rates. And we came to the conclusion that over the past 5 years the concept of lending to entities in Ukraine has been missing.

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If economy works grey, there is no credit

Shadow economy needs cash. Cash flows from banks’ balance. This is the wrong economics. I do not want to give an assessment to anyone. But if we look together at the problem in the same way, I am convinced that we will come to an idea how to combat this problem. The answer is a broad one.

The economy is a lady that will pay you back if you invested in it

In order to reach the growth of 5%, you should invest 20%

Everyone understands that it is necessary to move the economy out of shadow, everyone understands it is necessary to mobilize investment and resources. And in order to reach the growth of 5%, you should invest 20% of GDP. If we have 2 trillion 219 billion UAH of GDP, we need to invest about 500 billion UAH, either deposits, or loans, or investments, or portfolio, or direct. The point is the same, give us a resource, the longer the better, of 500 billion UAH and we will see our economy grow by 5% per year. Because anything less than that I do not consider as constructive or professional. Need-less to say about 1.5 percent of growth and 365-day wait after we failed by 17% three years ago, by 14% two years ago, and that we now live in depression. Such macroeconomics is not for us.

We need to legalize the capital in order to start the dialogue with business

Zero declaration – a confession before the communion

How do you return the capital that operates in offshore all over the world? This is not an easy path, but it is a great job for politicians. Legalizing the capital, we come to amnesty, first of all, fiscal amnesty. These are not popular steps. And those who are going to run for offices do not support it. But those who want to see Ukraine effective will support it. And after legalization and amnesty of capital, the good times will come as a confession before the communion. Because confession for a man is a zero declaration. It does not matter whether you are a public servant or not. Because all the countries from Bulgaria to Baltic countries were guided by the triune principle: legalization, amnesty and zero declaration. This means a person does not declare what they have at home but what they brought deposited and recorded. And from that moment a person begins a new relationship with their government. These declarations are not the reason for the prosecutor’s office to haunt a man. The task of the country is to make the first step towards. It is not like setting the prosecutor’s office on someone’s track, it is like starting new relationship from Christmas. Zero declaration, legalization and amnesty – this is your confession to the state for all these years, and proof that from now on we are together, every Ukrainian starts new relationship with the state. The market will tell us who will remain working, who will be effective in new environment. But your nature must be legal. The criminal component shall be designated as special procedure employment. The government must hear this!

The best financier of the state is its citizen

We need 20 billion dollars

Last three years we have been living with a “sacred” task of IMF issuing us 17.5 billion dollars for 4 years. At the same time, in 2014 people took 8 billion USD from the banking system and 7 billion dollars a year later. Deposits in foreign currency in the banking system are still decreasing. However, the best financier of the state is its citizen. It took us two years to take out the amount of money that the IMF would give us over next four years. Then the question arises – do Ukrainians realize that their economic development depends on them, not on the IMF? In order to have an increase of 5% in GDP, we need $ 20 billion. We have taken away 75% of this resource from us by ourselves. This is not a problem of Europe or the IMF. Yet, Ukrainians say we will not take our money to the banks, because, for example, 2 years ago a deposit income fee on for individuals was introduced in commercial banks of Ukraine. In other words a citizen who brought the money to the bank must pay tax on deposit savings. Does the Government understand that now the investor runs away from the banking system? If there was a huge amount of people willing to get a deposit, the introduction of this tax could be understandable, yet not logical. But now people took away 15 billion in foreign currency, and the government catches up with them and says we will tax what the remaining.

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Віктор Ющенко Президент України

I thought I created a system which no one would overturn

The credo is trust. Banking begins with this word. If the Central Bank is trusted by 12%, commercial banks – 9%, we will have no banking at all. That is why people declare what is at home under the bed, under the sofa, under the mesh netting and so on. Therefore, it was us who created this image of banking system, that we still see from the socialist point of view, and when the bank bursts – we all applaud. 4 years ago, there was financial crisis in Western Europe, Italy, Spain and Cyprus. And Spain, for example… the first program it developed was aimed to save three systemic banks. No one is allowed to play with banks. And we have 88 banks bursting with applause. We developed a habit tearing down a bank every week. We have more assets in Property Fund now than in NAK Naftogaz.

We are wandering the prodigal roads

The retiring age is under discussion right now. Pension fund debt of 140 billion is twice bigger than the state debt. Something needs to be done about it. We have been offered the disgraceful way of going through the consequences instead of eliminating the cause. With an average life expectancy of 63 years, we offer people to retire at 65. That is nonsense. The reason is, we are always trying to work something out with the consequences instead of causes. In other words, we are wandering the prodigal roads.

The first strategic investor is the one who brings savings

What does an investment start from? When a citizen goes to the bank to establish a deposit, it is a sign telling us about the motivation to mobilize resources. The first strategic investor is the one who brings savings, the second is national business, the third is direct or portfolio foreign investment. But it all starts with the depositor. If they accept our motives and reliability, they are the first investor. It is not about a Polish national bringing money here. It starts with your neighbor. If they start believing in banking then it means we are really introducing a global investment policy. If an investor comes today, I can guarantee that in 4–5 months national business will bring their money, and after a year or two we will see foreign investors too.

We need a collegiate body that we would believe

We need someone to come out and announce the legalization of capital. People will not believe the words of the prime minister, they will not believe the words of the president, they will not believe the words of the parliament speaker. Then who is trustful enough? In Europe, those were the Governments of National unity. They spoke about acting unitedly as a dependable power and wanted to announce an effective action plan that was their only way. If we take the advanced countries as a role model, we see that these are countries have national unity, and their national issue is solved. There is no sense in taking up any social or economic reformations until the national issue is solved. It will not work out. First, you have to become a family, the nation has to be integral and united. Second, the countries of high standards are the countries of high democracy. No country of regime will ever possess high social or economic standards. Therefore, I am ready to repeat a million times: a suitable model for Ukraine is national reconstruction policy, democratization and European integration, which provides a road map for further action.

Why Putin wanders in Eastern Donbass

Today we are in a war. This is the hardest test for our sovereignty and territorial integrity. It takes us a step such as complete mobilization. What does the Constitution say in such circumstances? The Constitution says that in times of war you should forget about the elections. Aristotle once said that the first step to the truth begins with definitions. If you correctly formulate the definition, that is, if you correctly identify an issue or a problem, you correctly understood how to solve it. If you give a wrong definition, you get a wrong plan. The Constitution says to stay away from political harassment in times of war. The only thing required from you is internal integration. We did not have elections in 1942, in 1943 or 1944. There were no elections in the whole Germany for four years after the war. Because in 1946, Hitler’s party would win. Therefore, we have to follow the constitutional way of war analysis. Or we should throw away the Constitution. If we do not throw away the Constitution, then under the condition of war, we should not play with it, we should not change it. The Constitution during the war directs us to the formation of national consensus govern ment. We all must learn to speak with one voice at least regarding 10–15 priority issues to defeat the enemy. The nation isformed when 2/3 of the issues are resolved from the single coordinated position. Ask a Polish what is their first issue today? They will tell you it is the abortion issue, and the second question is the percentage of VAT: 21% or 17%. Because they have only one answer to the questions regarding language, history and culture. And we say that it is not important. However, Putin is haunting Eastern Donbass, not only because he is the aggressor, but also because, please excuse me, but this area is the weakest link in our national unity. When Putin goes to Donbas, he can hear Russian language, he walks into Russian church, he reads Russian newspaper, he walks into the Russian theater, and he watches Russian television. This is already the “Russian World”. Those who know Ukrainian history understand why Donbas is Russified and has Russian church. We understand that it is directed policy, which has been conducted for over three hundred years. People have become victims of such policy. But when we decide where should we start, it is not the European integration, not the foreign policy, not the democratization but the national revival. When I waged that policy, rebuilding Baturin, Chyhyryn, and Kruty, all I heard at the press conferences was “Mr. President, isn’t it expensive? Isn’t it expensive to spend 103 million UAH on Holodomor memorial? “I said, “Ask the Jews how much Yad Vashem cost and costs until today? It is not only a tragedy. It is the consolidating thing that touches children and grandchildren. And we are imposed such words as New Russians, Little Russians, Khokhols through the Russian church, media, theater or cinema. I am Ukrainian and there is a rich history and a great contribution to the world development behind me. I am convinced that we will become smarter. We will begin to rely on assets that have not worked before, or were unknown to us. The main thing is not to give up. To avoid disbelief. Not to think that we have a wrong government. Because there are few nations that appear on the European map after living through 300 years of oblivion without a centralized state, and European map is very intricate. There was eternal struggle for every little piece. Now there appears a state, not a new one, but the state, which has thousand years of historical heritage after three centuries of oppression. The state with the largest national territory. I think that there are many political players gritting their teeth. How could it happen that there is a state, which disappeared for 300 years from the map, which was divided with ten borders after the First World War, and was simply forgotten after the Second World War? The establishment of a retro-state like Ukraine is actually the most interesting state project in Europe, with a partially denationalized, Russified society, which still gives us a generation that would live, being focused on our national politics, Ukraine would not be worse than Poles or Bulgarians or Hungarians, or anyone else.

We have learned how to vote, but we have not learned how to choose

Citizen disregard everyone around, because they are responsible for everything themselves

FOR WHOM THE BELL TOLLS. Victor Yushchenko President of Ukraine 2005–2010Democracy is always a full timeclass. Not a part time, not an evening class, only full time. The election itself is enough for one a certain person to understand their responsibility, but someone else might vote their whole life without realizing it. I am not blaming anyone; it is a difficult and time consuming national process. It is important to have great patience for each other. It is not our mission to run after the leaving generation. There is no need and no point in making old people from Donbas speak with Galician accent. We should aim out efforts to their children or grandchildren who know Ukrainian. In other words, national policy must be assertive but reasonable to a person. You can solve issues by war, by catching enemies and beating their faces, but I have heard it is very expensive. So political parties were invented to resolve conflicts arising in society.

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