The Ambassador Extraordinary and Plenipotentiary of Ukraine to Germany Ernst Reichel
Five years ago, the Ukrainian people took to the streets to fight for a better life, for a government with integrity, and for a European future for their country. This historic event created a new context – also with regard to German-Ukrainian relations. For the last five years of reform, of change, Germany has stood firmly at the side of Ukraine and the Ukrainian people. Germany – and more broadly the European Union – has a fundamental interest in a stable, independent and prosperous Ukraine as a key member of the family of free European nations.
Since 2014, Germany has provided approximately € 400 million in technical cooperation and more than € 1 billion in financial cooperation to Ukraine in a wide range of fields, focusing on good governance, energy efficiency, and sustainable economic development.
We strongly support the reform process Ukraine is striving to accomplish; we support the rapprochement with the European Union in the Association Agreement framework. With our own historical experience after reunification in mind, we have put particular emphasis on decentralization reform. Moreover, Germany is the biggest bilateral donor of humanitarian assistance in the conflict region in eastern Ukraine, having spent more than € 100 million since 2014 on humanitarian aid projects (including humanitarian mine and ordnance clearance). The aid for internally displaced persons and communities which provide them with shelter is particularly close to our heart and has been a major focus of our work since 2014.
We believe that Ukraine’s development can only be successful if it is a sovereign, independent, democratic and peaceful country. Germany does not recognize the annexation of Crimea. From the very beginning of the Russia-driven conflict in Donbass, Germany has been engaged heavily in diplomatic peace efforts aimed at the reestablishment of full territorial integrity. On the occasion of the commemorations of the Allied landings in Normandy in June 2014, Federal Chancellor Merkel, together with then French President François Hollande, formed the so-called Normandy Format. In this framework, which includes France, Germany, Ukraine and Russia, the Minsk Package of Measures was agreed on 12 February 2015. Germany is also committed to the Trilateral Working Group in Minsk which has been looking for progress on the implementation of the Package of Measures ever since.
Obviously, we cannot be satisfied with the results of the negotiating process so far. Although the agreement of February 2015 stopped the massive bloodshed, violence continues today and is still causing military and civilian casualties every week. The objective of the Package of Measures, the restoration of Ukraine’s sovereignty in Donbass, has not been achieved. However, the provisions agreed upon are the only basis for negotiations on the table and offer a way forward provided the political will for a solution can be found.
Alongside the conflict, Ukraine is undergoing fundamental changes in its society and its economy. Important reforms have been completed over the last few years, including those in the gas sector, the state procurement sector and the banking sector. Others are underway, like judicial reform, decentralization, health sector reform and the establishment of an institutional architecture to prevent and punish corruption. The strengthening of the rule of law is a crucial precondition for improving the investment climate and ensuring significant and sustainable economic growth. There is still work to be done: specific issues in the business sphere which need to be addressed include customs regulations and non-transparent procedures during import and export (e.g. customs valuation and classification), and arbitrary, unpredictable and non-transparent action by state enforcement and control bodies as well as licensing authorities and raider attacks. The “brain-drain” is also an increasing challenge to German companies in Ukraine.
The Association Agreement with the European Union provides the necessary framework and assistance. The hard work of the last five years is already paying off: Trade between the EU and Ukraine is flourishing – Germany is Ukraine’s most important trading partner within the EU.
Last year, bilateral trade between Ukraine and Germany increased by 8 %. Business interest with regard to Ukraine is on the rise: as of today, an estimated 2000 active German companies – including representative offices, branches, and subsidiaries – representing a large variety of business sectors are based in Ukraine and their number is growing. In acknowledgment of this positive development, we decided to set up the German-Ukrainian Chamber of Commerce and Industry in 2016. The Chamber organizes numerous information and consultation events all across Ukraine and Germany, as well as business-to-business meetings of German and Ukrainian entrepreneurs. The contributions by the President of the Chamber and its members to this edition are proof of the growing interest of German industry and business in this country.
Germany Trade & Invest (GTAI), the economic development agency of the Federal Republic of Germany, recently deployed a correspondent to Ukraine who regularly informs German companies about the development and the potential of individual economic sectors as well as about investment opportunities in Ukraine. Together with our Chamber, GTAI provides Ukrainian companies with information about Germany as well as their entry into the German market.
At the end of last year, the III. German-Ukrainian Economic Forum in Berlin, which was opened by Federal Chancellor Angela Merkel and Prime Minister Volodymyr Groysman, attracted around 400 representatives from business, politics, associations and the media who participated in discussions in high-profile panels on topics such as digitisation and Industry 4.0, agriculture and the food industry, logistics, infrastructure and transport as well as communal services, energy efficiency and waste management.
I am very optimistic about the future of German-Ukrainian relations, not only, but also, in business. I would like to encourage the readers of this special edition: get to know Germany, discover the opportunities!
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