Interview with ex-Finance Minister Oleksandr Danylyuk (18.05.2019)

In “Eurointegrators,” media expert and ex-Deputy Minister for Information Policy of Ukraine Tetiana Popova sits down with diplomats, heads of international organizations, and Ukrainian power brokers to discuss Ukraine’s European integration.

In this episode, the guests are Oleksandr Danylyuk – ex minister of finance of Ukraine, and member of the team of Volodymyr Zelenskiy – and Brian Bonner – Kyiv Post’s chief editor.

The show is produced by a Ukrainian NGO Information Security and Oboz.TV.

See the text version of the interview: 

Popova: Hello. I present a new episode of the “Eurointegrators” program, and my guest today is Oleksandr Danylyuk – ex minister of finance of Ukraine, and member of the team of Volodymyr Zelenskiy – and Brian Bonner – Kyiv Post’s editor.

Oleksandr, you have recently held a meeting with ambassadors of EU and other European officials. What were the results of those negotiations? And tell us please – would your team continue pro-European course of Ukraine and also move to NATO and EU direction.
Danylyuk: This meeting was held upon the invitation of European side. Of course, our pre- election campaign was very active and we did not hold foreign visits during that campaign, visit to France was the one exception. There were many questions put to our new team – what we are facing ahead and what were our steps to respond challenges. That is why we were invited to Brussels – to answer these questions clearly for our partners. They also wanted to define the points in which we would need some assistance. It was very important that all the 28 ambassadors were present in that meeting. We could put our questions, different questions. We also answered their questions sending our signals to all European states. It was very effective use of time, I think. It would not correctly to say we reached concrete agreements, it was rather answer-question style dialogue. But what we brought out of that meeting – all were willing to support us. And they see the credit of trust we gained in elections, more than 70 percent of people voted for Volodymyr Zelensky. Together we know that such a trust open a huge opportunities for us. And we should not lose those opportunities. That is the reason they want to help our team. But they would assist if we would have a strong reliable team and if we see the right direction to move forward.

Popova: And what is the direction? Where are we moving to?

Danylyuk: We clearly understand the direction. I mean foreign policy direction and I also mean changes within the country. The changes would show whether we have the trust and support of the world. These processes are related. There would not any people`s trust in Ukraine without change. If the situation does not improve ae would also lose the trust of our European partners. There is a connection, right? So, we talked it over, defined our priorities, they are the same we declared in our election campaign. This is fight against corruption, rule of law including judicial reform. We had clearly explained how we were going to restart it. And this is reform of law enforcement agencies. This is the points to start from. In those areas we had a little progress. These institutions are not functioning as it should be. To regain the trust of people we have to make those institutions work. This is our priority.

Bonner: It looks like the president-elect is not going to get a chance to call parliamentary elections. Therefore, you could face a very obstructionist parliament with the public at the same time demanding quick wins. What would be your advice, what would be the quick wins that you could pick up before the next scheduled elections on October 27?

Danylyuk: Couple of things on that. First. There’s no ultimate goal to call snap elections. There’s no goal to dissolve parliament, that institution should work. What I describe are the priority steps that will involve some decision-making by the parliament. Appointing key people: prosecutor general, for example, head of SBU, minister of the foreign affairs, minister of defense. And that needs to be credible people with reputation and the parliament should approve this candidacy when they are nominated by the president. Then there will be laws that will launch the anti-corruption infrastructure, changing the leadership in those institutions that lost credibility, including the agency of preventing corruption for example, symbol for launching juridical reform. And I am not mentioning – actually, I should have started from this – electoral quote. Majority of people understand that under current legislation we wouldn’t be able to get better quality parliament because half of the people are majoritarians, the single mandate, and usually the way to win – I cannot say that everywhere the same but usually – the way to win is a commercial exercise so to say. So when people buy the seats to the parliament they later swap it to some political or business concessions. And that’s called corruption. So, obviously, electoral quote is crucially important. So if that parliament is capable for adopting decisions that Ukraine waited for such a long time – that parliament should work, there’s no reason to dissolve it. It should do the good for a country. If it’s not…

Bonner: Do you think you want to force the vote on lifting parliamentary immunity from the prosecution, presidential impeachment law, put them – members of parliament – on the hot seat?

Danylyuk: Yes. As you know, this is one of the initiatives of president-elect. But we need to put in order what is actually more important, right? And I would start with the electoral quote because it changes the system and it allows also people to deliver the promises. Immunity is another promise that is been promised every election. So that should be one of the priorities. But obliviously without launching the anti-corruption infrastructure and appointing credible prosecutor general the symbol remains the same. It’s not even about who’s going to win parliamentary elections, it’s just bad for the country. To lose the momentum is bad for the country and people. Every time people have hope, and when this hope isn’t realized – it’s bad for morals of the nation.
Popova: If you are not in time to change the parliament – what would happen to those hopes put on the new president which have gained 73 percent of the votes. There is a risk that all your initiatives would be blocked in parliament and government. And you would be unable to work effectively during the half a year period, losing the momentum you mentioned before.
Danylyuk: Well, first of all we realize that 73 percent result it was the figure just of a presidential election with two candidates running. If we talk about parliamentary elections we would see a broader choice of political proposals for voters. This fact will change the overall situation and the voters would be more divided, it is clear. It is a parliament election with many powers taking part, not just a single winner in the end of campaign. There are several parties in the parliament. People are always waiting for decisions. But decisions comes not just after desire to make it. Ability and opportunity is also needed. For example, the reform of Security Service, the removal of some toxic personalities in politics. This is what people expect to get. They hope to see imprisoning authorities for corruption doings. If this would not happen – it would be the negative signal. People want toxic politicians to get out. If we ignore it – the level of trust would reduce for sure. That is inevitable. The only right variant – we should create a team with a positive reputation. And that is really my worry.

Popova: Are you sure they let you do this? Except the presidential administration.

Danylyuk: What could stop us? There are some other posts appointed by president. The Head of National Bank, Security Service as well. The Council of National Security and Defense. The minister of foreign affairs and minister of defense – those are very important posts. And I feel confident the parliament would vote for ones appointed by the new president. That voting would show the real face of the parliament. This team must be a team of quality. If it contains some people to which we have some questions and complaints – it would immediately reduce the level of trust to the President.

Bonner: What role would you think your skills are best suited for?

Danylyuk: Look, I made it very clear since very beginning. There are two stages in my involvement. First – is to help government to change. The government in the broader sense. I believe, and I clearly communicated it before our first meeting with Volodymyr (Zelenskiy) that having Petro Poroshenko for the second term is really bad for the country. Despite everything it’s just bad. They blocked reforms for so many years, they lied directly to people – it’s just really bad to have such person reelected. Let him learn some lessons. And who knows – maybe he will come up with new proposals, maybe people would trust him. But at the moment it would be really bad. In this sense I think the first stage is successful – we have a new president. Second stage is going to depend on my role and who will be the team. And there are some discussions, I can tell you, about this. Because usually it is accepted that you have your role – you mind your own business. That’s wrong. I believe in teams. I don’t believe in the collections of individuals who are acting in their interest. I believe in teams who share the same vision and work towards the same goal helping each other, not fighting with each other. Not one protecting one people’s interest and other – another. This perfect balance in Ukrainian politics blocked Ukraine’s progress for so many years. So that’s why I am so adamant, and I am pushing this. I can say that it’s not always received well. Everybody is trying to – and I can say it’s a normal approach in Ukraine – to cut two pieces and to mind your own part. I really hope that I this case for Ukraine we will get a new team which is exactly as I described – that has the same vision and going to same goal, help each other. If it’s not – I will not consider the role on this team. There’s no reason for me. I am only investing time when there’s opportunity to have an impact. If there’s no opportunity – I already spent enough time on some position fighting with people who were supposed actually to help me to provide political coverage. And pushing changes is against interest of the leadership of the country including the president, prime minister, working against him – I don’t want to repeat it. It’s just not why we have elections.
So, answering your question – it depends on the role. Obviously, getting into my roles in the past I was involved in national security issues, in economic, finance – so it could be anything in the government – but giving that minister of finance is the second position in the government pretty much – I would like the mandate that allows me to use all my knowledge.

Popova: Now you are responsible for international activities in your team, right? This is one of your duties. What do you think – what were the international mistakes made by the previous authorities?

Danylyuk: Oh, well, you want me to criticize my college in the government. Let me to respond in general terms. It is always much easier to criticize than do something, right? In my work I have fully understood this some time. I would like to share what I felt myself. I have got some bright examples. When I worked as a minister of finance I was also engaged in different international cooperation. It has often been about huge amount of money, about trust or mistrust. In this area I had understood many things. What I learned was how not to build relations with international partners. First of all we have to understand what we want. If we do not understand – no one would help us, no one answers our questions. When they answer but we do not understand it seems like formality. In such conditions we try to fulfil that formality in a formal way. It is not effective, it is like dead end. So, we have to know what exactly we plan to achieve and how to do that. The effective team should create a common goal and everyone should work to reach it. We should understand what our country should be like. I am willing to see Ukraine as a strong regional leader which influences the situation around. We should be treated like the center of stability, center of development. I want Ukraine to deal not just with own issues, but to help other in the region who faces challenges. And we also could become the reliable partner for our strategic partners. This is the first point. The second is that we have to provide a trust, we should deserve it. It is very easy to lose but hard to get. I have got very an exemplary case – fight against corruption. We started in 2014, creating National anticorruption bureau, National Agency of Prevention of corruption, introduction of online declarations. I worked as a deputy head of presidential administration being involved in this process in connection with civil societies of course. I was responsible for that, especially the law on NABU, I saw the huge restriction. It seemed corruption was trying to protect itself. It looked like we wanted to fight corruption but in reality it was like all wanted to block our desire to fight it. And all the activities were directed to achieving this «result». But when some time passed our partners opened their eyes and saw what is behind the screen. They had already knew that we are not honest. So, we lost the trust and that is not acceptable. Well, we said we wanted to keep changes but in fact we did not. After such fails it was hardly to hope for increasing assistance, or solving different political issues including situation around Russia. They put a question – why are you not fighting the corruption even during the war. Whу? Does it make your country stronger or it does not. Why do our western partners have to force us to fight the corruption? So, we have understand what we need to do. We should engage our partners just in cases where we cannot handle the problem ourselves and in which we are not experienced enough. So, I would like to develop cooperation with our partners in such a way.

Bonner: You talked about the non-existent fight against corruption during Poroshenko’s years. One of the biggest ones was the 20-billion-dollar bank fraud. You are quite aware of how Ukrainian taxpayers are robbed, and the biggest bank Privat, 5,6 billion, you are quite aware of that. For the public, the litmus test for Zelenskiy’s independence is what he is going to do about the bank fraud that took place. Is he going to get a prosecutor that will take it on and prosecute it or will it go the opposite way or even fall back into the hands of those who allegedly took the money.

Danylyuk:: Let us just separate these two. I know that you are trying to combine, but let us just separate. We need to have a credible prosecutor general one way or another, because it is not only about one case of Privat. We have so much injustice in Ukraine that Ukraine finally deserves, you know, a prosecutor general who will do the job, irrespectively of one or two cases. For Ukraine, we need a strong prosecutor. The first the prosecutor needs to do is to focus on the key cases, but also do reforms of the Prosecutor General’s Office, because it was not a reform. We all understand that it was a fake. So, that is first. In terms of the situation with Privat Bank, what I see is that some other owners, shareholders of the banks that we recognize as insolvent, use the decision by the court that recognizes the nationalization as illegal to start their own processes. That is as a precedent a quite dangerous one. So, what Zelenskiy should do is he needs to appoint a credible prosecutor general, and he needs to launch the judiciary reform which will take time, but if you do not start from the bottom courts, but from the top courts and fix the problems that were crated during the reform, then you can get to the Supreme Court that you can fully trust. It is quite of good quality, but there are some exceptions. So, you need to have an absolutely impeccable Supreme Court and reform the courts which are also at the top of the pyramid. In this case, the cases of Privat Bank or some other cases will eventually get the proper judgment. Whatever this judgment is, it needs to be respected. This is the only way, because in other case, everybody has their own view of what happens with all these banks. I have my view, but eventually, what really matters is the decision of the court. That is what matters. At the moment, when we see this decision, I even do not want to invest any of time to understand the logic behind it, because there is zero trust.

Bonner: To the court. So, the state is a long way away from being strong enough, it sounds like from your answer.

Danyluik: Are you surprised?

Bonner: No.

Danyluik: The question is it is a long way how quickly we can cover the distance. That is what the real question is.

Popova: I have got my questions regarding this issue. In the recent interview of Kolomoisky to Bihus-Info he said there were some schemes of buying undervalued assets using Individual deposits assurance fund. So it was a real robbery. Is that true? Some banks were deliberately made bankrupts to let some persons linked to authorities to own those assets. You used to be a minister of finance.

Danyluik: Look, unfortunately, Individual Deposits Assurance Fund is a separate organization that is not relevant to the government. We had a lot of questions and claims to this Fund. How the assets were sold. We know how it gets the assets. It is clear, if the bank is destructed – the assets are transferred to the Fund. But later those assets had to be sold. But how it was sold – this was a question. It is not correct to see just on concrete examples. When we saw the procedure of selling we noted it was not proper. They asked the assistance of USA to provide their models of procedure to have a real competitiveness – but not just sell it to the owners of those assets at a lower price. Those procedures got improved but not enough, so, we could not say all was sold at market prices. This is my point of view as a financial minister. I clearly understand there were many hidden interests around and also the Fund was under the pressure but this is the case for the law enforcement. I have got some questions with no answers. That is why this is law enforcement who should provide the answers.


Is that a case for National Anti-corruption Buro? As far as I know the head of assurance fund had already left the post. And I suppose he is out of Ukraine now.


Oh, that is interesting. This would be coincidence or not.