Canadian foreign minister brings $600 million in aid to Ukraine (11/03/96)

Canadian foreign minister brings $600 million in aid to Ukraine

by Roman Woronowycz
Kyiv Press Bureau

KYIV - Canada's Foreign Minister Lloyd Axworthy came to Ukraine on October 23 loaded with $600 million (Canadian) worth of financial treats. It was a week early for Halloween, but this financially starved country readily accepted the financial aid and new business investments that Canada handed out.

On October 24, Mr. Axworthy, meeting with Ukraine's Foreign Affairs Minister Hennadiy Udovenko, announced a series of agreements that would develop Ukraine's energy sector, including a $150 million project by Northland Power for reconstruction and modernization of Ukrainian electric power plants, and a plan to build a "World Trade Center" in Kyiv, the cost of which is estimated at $400 million.

Other agreements include $2.8 million, financed by the Canadian International Development Agency (CIDA), for the implementation of a $200 million program funded by the World Bank to modernize hydroelectric plants that is being coordinated by Hydro-Quebec International, as well as $ 7.5 million in technical assistance to increase security and develop an inspection licensing system for the Chornobyl nuclear power plant. His entourage included representatives of 60 leading Canadian companies.

Foreign Minister Axworthy explained that the time is right for expanded investment in Ukraine. "When you look at the new Constitution, the new currency and the new economic stability, these are major changes," he explained, adding that the new agreements expand the already close relationship between the two countries.

"After these agreements are signed today, Canada will become one of the largest investors in Ukraine," said Mr. Axworthy. Canada has already committed more than $120 million through CIDA for the development of the energy sector, economic reform and relief for victims of the Chornobyl nuclear disaster.

The Canadian minister also announced that a Canadian consulate will soon open in Lviv and that Air Canada will begin air travel services to Kyiv beginning sometime next year.

Foreign Affairs Minister Udovenko, explaining how the business climate in Ukraine has developed, said that what Ukraine has done in five years in developing an infrastructure for business is just short of miraculous. "We are a young country that had to develop everything from point zero. We had no banking system or any free market structures. We have come a long way. I cannot name another country that has developed economic, banking and financial systems this quickly," said Mr. Udovenko.

At the same time he admitted that bureaucratic snafus and red-tape entanglements that still exist must be resolved.

Mr. Axworthy said he had talked with President Leonid Kuchma about how to "move aside the continued barriers to business investment and to do it constitutionally. That topic was specifically discussed."

Commenting on the state of economic development in Ukraine, the Canadian foreign minister said, "Today the glass is not half empty but half full."

Mr. Axworthy also held talks on the Bosnia crisis, NATO expansion and the Black Sea Fleet issue. He met with Prime Minister Pavlo Lazarenko, Chairman of the Verkhovna Rada Oleksander Moroz, Chairman of the National Security Council Volodymyr Horbulin, Vice Prime Minister Ivan Kuras, Minister of the Environment Yurii Kostenko and Justice Minister Serhii Holovaty.