Ukrainian-Canadian Co-operation
Publication:
The Empire Club of Canada Addresses (Toronto, Canada), 25 Oct 1994, p. 191-201


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Kuchma, His Excellency Leonid, Speaker
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Text
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Speeches
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A joint meeting of The Empire Club of Canada and The Canadian Club of Toronto.
The Ukraine entering the decisive stage of the market transformation of its economy. A programme of reforms to Ukraine's Supreme Rada. Seeking support on the part of the world community. Implementing the policy of reforms with rigour and determination. Six priorities of the economic programme. Building from scratch the requisite market infrastructure: steps taken. Developing financial and credit relations and co-operation between Ukraine and foreign banks, perhaps starting in Toronto. Developing relations with the leading Canadian banks. The insignificant volume of trade between Ukraine and Canada: why and how to improve it. Taking the first steps to improve Ukrainian-Canadian trade relations. Some joint ventures. The need for technologies, managements skills and marketing expertise. Promising areas of co-operation. Examples of Ukrainian-Canadian co-operation. New areas to be explored. Potential for co-operation with companies in Toronto and in Ontario. What the Ukraine has to offer. The right conditions for Ukrainian-Canadian co-operation.
Date of Original:
25 Oct 1994
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English
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The speeches are free of charge but please note that the Empire Club of Canada retains copyright. Neither the speeches themselves nor any part of their content may be used for any purpose other than personal interest or research without the explicit permission of the Empire Club of Canada.
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Full Text
His Excellency Leonid Kuchma, President of the Ukraine
UKRAINIAN-CANADIAN CO-OPERATION
Chairman: Herbert Phillipps Jr.
President, The Canadian Club of Toronto

Head Table Guests

Bohdan S. Onyschuk, Q.C., President, Canada-Ukraine Chamber of Commerce, Senior Partner, Smith, Lyons, Torrance, Stephenson & Mayer; His Excellency Hennadij Udovenko, Ukrainian Minister of Foreign Affairs; James Sylvester, President and Director, The Sussex Admiral Group Limited; Hon. Elaine Ziemba, M.P.P., Ontario Minister of Citizenship; His Excellency Victor Batiuk, Ambassador of Ukraine to Canada; David J. McFadden, Q.C., Chair, International Trade Services and Programs Committee, Board of Trade of Metropolitan Toronto, Partner, Smith, Lyons, Torrance, Stephenson & Mayer; Most Reverend Isadore Borecky, Bishop of the Ukrainian Catholic Eparchy of Toronto; John Yaremko, Q.C.; His Excellency Valerij Shmarov, Vice Premier of Ukraine and Minister of Defense; His Excellency Francois Mathys, Ambassador of Canada to Ukraine; Walt Lastewka, M.P., Chair, Canada-Ukraine Parliamentary Friendship Group; Anwar Heidary, Executive Vice-President and Director, The Sussex Admiral Group Limited; Oksana Bashuk Hepburn, President, Ukraine Canada Relations Inc. and Conference Chair, Doing Business with Ukraine; and John A. Campion; President, The Empire Club of Canada.

Leonid Kuchma

It is my great pleasure to address you here--at the heart of the Canadian business and financial community. That is precisely why it is here that I would like to speak in more detail about Ukrainian-Canadian co-operation, which is based on a long and special relationship.

As you know, Ukraine is entering the decisive stage of the market transformation of its economy. I recently presented a far-reaching programme of reforms to our Supreme Rada and, I am pleased to report, it was received with understanding and support. The programme is demanding, and will require that the President and the government of Ukraine have the resolve to enact tough measures. We are well aware that it is a difficult road that lies ahead.

That is why support on the part of the world community takes on special, even critical significance for us at this juncture. That we have now succeeded in reaching an agreement with the International Monetary Fund should prove, I submit, that we are serious in our intents. This complex programme of macro-economic reforms, which we developed jointly with the IMF, and the financial support that results from the agreement, considerably enhance our position in the field of international economic co-operation.

In its more than three years of independence, Ukraine has never come as close as it has now to making real market transformations. I believe it would be an unforgivable strategic mistake, both on our part and on the part of the West, not to take advantage of this new, possibly unique, opportunity. The timing is equally important. We in Ukraine must feel the benefit of your economic support now--as we implement these difficult reforms--not just after they been implemented. Your support now will inspire us and encourage us, and will be answered with enthusiasm and commitment.

Let me make one thing perfectly clear. My government and I are deeply convinced that these radical economic reforms are necessary, and we see no alternative to this process. We will therefore be implementing the policy of reforms with rigour and determination.

As you know, on the initiative of the Canadian government a conference entitled "Partnership for Economic; Transformations in Ukraine" will be taking place in!! Winnipeg later this week. Representatives of the G-7 governments and of the leading international financial institutions will attend, and I will be addressing the conference. Representatives of the Ukrainian economic ministries and I intend to lay out in some detail our planned programme of economic reforms. I am convinced that with your understanding of the situation, the assistance of international financial institutions and our determined implementation of the economic reforms in Ukraine, we will at last overcome the economic crisis we face and gradually integrate our state into the European and global economies.

The economic programme I outlined to Parliament has six priorities, which I can briefly summarise:

The first priority is to stabilise the financial and monetary system.

Second, to introduce radical institutional changes related to property ownership, thereby establishing a modern structure of production and management.

Third, to introduce a structural policy aimed at developing, as a priority, the science-intensive and high technology sectors of our economy.

Fourth, to ensure continued development of the agricultural sector.

Fifth, to develop and implement up-to-date foreign economic policies, aimed at establishing an open economy and integrating Ukraine into the global economy. (I have touched on this point already and will deal with it again when I elaborate on the future course of Ukrainian-Canadian relations.)

And sixth--the last yet perhaps most important priority--is to put in place a social programme that will arrest the deterioration of our people's standard of living and bring about its gradual improvement.

This, briefly, is the direction we are headed, and I hope you will leave here today convinced that we are serious about pursuing this course unswervingly. For I am convinced that the reforms necessary to create this modern economy--one based on market principles--are crucial to our survival.

At present, we have begun the immense task of building from scratch the requisite market infrastructure. As a first step, we have begun to create in Ukraine a commercial bank network that works constructively with the National Bank. However, in the current state of economic decline this process is fraught with difficulties. There is a sort of vacuum--a lack of financial resources, especially hard currency, to finance production and economic development. This is why attracting foreign investment and credit is extremely important for us. Indeed, success in this realm is both a precondition and catalyst for developing co-operation in other fields of economic, scientific and technical development.

I believe that developing financial and credit relations, and co-operation between Ukraine and foreign banks, could start right here in Toronto. The time is ripe for us to discuss ways to develop relations with the leading Canadian banks, and we have started to do so with the Canadian Imperial Bank of Commerce, the TorontoDominion Bank and the Royal Bank of Canada. So it is only logical that the central banks of our countries--the Bank of Canada and the National Bank of Ukraine--should also establish a more favourable environment for these bank ties to flourish by concluding an interbank agreement.

Ukraine is one of the largest European countries, not only in terms of area and population, but also in terms of scientific and industrial potential. Why then is it virtually unknown in the business circles of Toronto, specifically, and Canada, in general? On the one hand, Ukrainian industry is well equipped to manufacture and export to Canada and elsewhere any number of modern, especially high-tech, products.

Yet so far, the volume of trade between Ukraine and Canada remains, frankly, insignificant. Now, we appreciate that there are explanations for that. We realise that export and import conditions in Ukraine appear rather complicated, what with the various seemingly unjustified procedures and numerous bureaucratic obstacles that discourage a potential partner's interest in the Ukrainian market.

That is precisely why we are now starting, in earnest, to remove these obstacles. The export system is going to be simplified. Indeed, one of my first acts as President was to issue a number of decrees to address these problems--one decree, in particular, "On Improving Currency Regulation," and another "On Measures to Ensure Currency and Export Control." These changes have begun to improve the situation but, naturally, they are only a beginning. They are, however, an indication of the changes which are yet to come as we transform our system into a market economy.

As far as Ukrainian-Canadian trade relations are concerned, both government and business have taken the first steps to nurture these relationships. Last March, for instance, the Inter-governmental Agreement on Trade and Commercial Relations was signed. At the same time was signed a Joint Declaration on Special Partnership, which provides considerable incentive to develop Ukrainian-Canadian relations. Just yesterday, in Ottawa, we signed an agreement to establish an inter-governmental commission for economic, scientific and technical co-operation.

Trade circles in both countries are becoming more active, as well as today's conference organised by the Canada-Ukraine Chamber of Commerce clearly demonstrates. To make our trade contacts with Canada more active, we have just this summer opened a trade office in our Consulate General here in Toronto. We have taken the first steps to develop contacts with the Canadian Exporters Association, and there is considerable potential for co-operation with the Canadian Importers and Canadian Manufacturers Associations.

By the way, this past spring, our Embassy brought these associations together with the Ukrainian Union of Industrialists and Entrepreneurs, which includes 96 manufacturers in the electronics industry, 128 producers of agricultural machinery and the leading enterprises of practically all branches of the Ukrainian economy. This is a voluntary organisation that brings together numerous companies--without regard, I might add, for the form of ownership. In other words, it involves newly privatised companies, as well as state-run and co-operative enterprises.

One of the most attractive forms of commercial cooperation--at least, to judge by its success to date--is the joint venture. Canadians and Ukrainians have set up literally dozens of joint ventures in our country, many of them in the priority sectors of our economy. This type of project successfully combines the needs and potential of both Ukraine and Canada. These ventures work because Ukraine not only possesses extensive raw materials for manufacturing, but also has considerable scientific knowledge and a highly qualified work force.

Combining these conditions with modern Canadian technologies, management skills and marketing expertise allows us to develop products destined not only for Ukraine's domestic market, but also for export to third countries.

This is what we need in Ukraine: the technologies, the management skills and the marketing expertise. These are the kinds of things you can share with us without worrying about the long distance that separates our countries. These are not the kinds of things that depend on uninterrupted transportation to be of benefit.

One promising area of co-operation, then, is joint manufacturing in Ukraine for the transportation industry. For example, shipbuilding, carriage building and aircraft production all require considerable amounts of metals, construction materials, assembly skills and so on, which we have, and also require the latest technology from you. From an economic viewpoint, establishing joint ventures is fully justified in the science-intensive and low material-intensive industries, such as electronics, telecommunications and light and medical industries, where the volume of foreign inputs is usually small.

There are quite a few examples of such Ukrainian-Canadian co-operation, and many new areas to be explored. For example, in the light industry, Canadian partners can contribute their share not only in technologies, but also in raw materials, and can take finished products to Canada as well as to the markets of other countries. Similar areas are the pharmaceutical and biotechnology fields--areas which, I know, are well developed in Toronto. We know that the existence of a thriving biotechnology industry accelerates the production of pharmaceuticals. We will be actively promoting investments in this field for Ukraine because we need these medical products.

The potential for co-operation with companies in Toronto and in the province in general is tremendous. We can use your help in a variety of areas, including electronics production techniques, the application of telecommunication technology and food processing, to name but a few.

And we have a lot to offer you. Ukrainian scientists have outstanding scientific knowledge and can help with the fundamental and theoretical scientific developments that interest Canadian firms. We have expertise in space, aviation, maritime research and technologies, electrical welding, power engineering, new materials, mathematics, nuclear physics, biology, information science and cybernetics. In addition, conversion of the military industrial complex, and the accident management programme at Chernobyl present great potential for co-operation. For example, we propose to use Ukraine's expertise in ballistic missiles for commercial projects and scientific research. We believe the low price we can offer for such launches will open a new market for us and, if managed properly, could save the industry.

In short, ladies and gentlemen, it is difficult to name a field in which there is not the potential for collaboration between Ukraine and Canada. And there is no better time than now to take advantage of the opportunity.

Ukraine does have considerable scientific, technical and industrial potential and has already demonstrated world-level developments and achievements. Yet, the shift from our old production arrangements (with their assured markets in the former Soviet Union) toward a market economy has left us with shrinking markets and uncertainty. As a result, production in our factories has slowed down or, in some cases, ceased. It is vital that we breathe new life into our factories, to start them going again with an impetus for further development. That is why we need foreign investment and expertise. And when our potential is realised, Ukraine will not be the only one to benefit: so, too, will those companies that showed confidence in Ukraine and invested in joint ventures.

We want to do business with Canada--indeed, with all countries--and we are convinced that this co-operation will be mutually beneficial. But for that potential to be realised, naturally, first we need capital, assistance and, equally important, mutual understanding.

I cannot finish without saying a few words about opportunities for co-operation in the agri-business sector, especially in the field of processing agricultural products.

The world knows that nature has endowed Ukraine with fertile lands. It is heart-breaking and frustrating to see my country lose 20 per cent, 30 per cent, or sometimes even more of its harvest because of the inadequacy or absence of food processing and storage technologies. That is why we have singled out this field as a priority. That is why we are interested in attracting Canadian and other foreign technologies in this area for joint ventures (such as the Ault Foods project, for instance). With proper processing and storage of our agricultural production, we could become not only self-sufficient once again, but major exporters of food, earning the hard currency which we need for energy, rather than spending it. Of course, the foreign partner would also benefit from such an outcome. In conclusion, let me emphasise that now, as perhaps never before, we have the right conditions for Ukrainian-Canadian co-operation. I am grateful that your Prime Minister, Jean Chretien, and your government not only comprehend, but also actively support this process. Many of their recent actions testify to this. But you, too, have a role. You, in this room, represent one of the most influential business circles in Canada. The realisation of the huge potential of Ukraine and Canada through co-operation between our two countries depends to a large extent on you. I wish you every success in this activity, and continued prosperity to the city of Toronto and this wonderful province.

Thank you.

The appreciation of the meeting was expressed by John A. Campion; President, The Empire Club of Canada.

The Golden Horde Settles The Prairie

The Iron Curtain and the ideological wall of communism that has, through historical and political happenchance, dominated much of this century, has hidden Ukraine as a separate place from our deep understanding and easy view.

We Canadians, too, are from Ukraine. Ukrainian forebearers from the lands resting between the Carpathian Mountains in the West, the Black Sea in the South and east across the Dneister, the Dneiper and the Don Rivers, to the unmarked divide between the European and the Asian Steppe lands, have made their magnificent contribution to our country.

In three waves, the peoples who had been agriculturalists in your land since the 6th century AD, and who were known as the Slavs, came to Canada to seek a new life.

The first arrived in 1891 from Galicia and Bukovyna, drawn by land prices at $10 per 160 acres.

Before 1914, 170,000 Ukrainians had come to build Canada. Eighty-five per cent settled on the Prairies and faced a back-breaking and solitary struggle against nature. Seventy thousand came in the inter-war years and 30,000 came after World War II.

Through gnawing homesickness, psychological insecurity, alienation and some time discrimination, Ukrainians prevailed and helped make Canada a plentiful and peaceful land.

These Canadians brought stories of an ancient and exotic land of romance intimately connected to the wooded lands and steppes that stood between Asia and Europe, that stood between the Mediterranean world and the largest land bridge on earth and stood between the Baltic States and the Ottoman Empire.

As a mark of the ancient, Ukraine is:

(a) a land mentioned by Homer in the Odyssey as the land of the Cimmerians;
(b)a land known in the Old Testament as being inhabited by the fearsome Scythians.

As a mark of the exotic, sometimes glorious and sometimes painful, Ukraine:

(a) was the regional powerhouse from 880 to 1240 A.D., when Kiev was the centre of trade, politics and military might;
(b) was the object of military defeat by the Mongols, headed by the grandson of Ghengis Khan, when they destroyed Kiev in 1240;
(c) was the origin of the Cossacks, free and masterless men who used their culture and fortress to attack the Tartars and the Ottoman Turks;
(d) was at the cross-roads of empires: that of the Golden Hord, the Polish-Lithuanian, the Austro-Hungarian and the Russian Empires; and
(e) finally suffered under the fierce policies of Stalin and the brutal military attacks of Hitler.

Now, since December 1, 1991, when 90 per cent of the voters in Ukraine voted for independence, we have begun to walk through that destroyed wall and lift that much-discredited curtain.

We now see an ancient land and a proud people and are pleased to know them and their history better. Their history is ours in Canada too. Mr. President thank you for your magnetic and graceful speech.

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Ukrainian-Canadian Co-operation


A joint meeting of The Empire Club of Canada and The Canadian Club of Toronto.
The Ukraine entering the decisive stage of the market transformation of its economy. A programme of reforms to Ukraine's Supreme Rada. Seeking support on the part of the world community. Implementing the policy of reforms with rigour and determination. Six priorities of the economic programme. Building from scratch the requisite market infrastructure: steps taken. Developing financial and credit relations and co-operation between Ukraine and foreign banks, perhaps starting in Toronto. Developing relations with the leading Canadian banks. The insignificant volume of trade between Ukraine and Canada: why and how to improve it. Taking the first steps to improve Ukrainian-Canadian trade relations. Some joint ventures. The need for technologies, managements skills and marketing expertise. Promising areas of co-operation. Examples of Ukrainian-Canadian co-operation. New areas to be explored. Potential for co-operation with companies in Toronto and in Ontario. What the Ukraine has to offer. The right conditions for Ukrainian-Canadian co-operation.