Victoria Nuland
Assistant Secretary, Bureau of European and Eurasian Affairs
Assistant Secretary, Bureau of European and Eurasian Affairs
Statement Before the Senate Foreign Relations Committee
Washington, DC
March 15, 2016
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:
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;
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;
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;
Strengthen judicial independence, including the
certification, dismissal, and recruitment of judges;
Improve services and eliminate graft in key
service areas that affect every Ukrainian: healthcare, education, and
transportation; and
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.
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