Valeriy Khoroshkovsky: A Harbinger for Ukraine’s Future?

We tend to forget, with blessings of liberty given by our forebears, that growing a republic out of civil wreckage is a Herculean task at the best of times. Valeriy Khoroshkovsky has not.

Outside of Ukraine, Khoroshkovsky’s is a name known only to students of the remains of the Soviet Union and to a small group of politicians and journalists. He is, however, becoming one of the more important day-to-day politicians in Ukraine’s government, and anyone watching the news these days will see more and more of him.

This is no accident. Since his appointment as First Deputy Prime Minister in February, Khoroshkovsky, always a hard charger, has waded into some of the biggest issues facing Ukraine. His portfolio includes relations with the European Union — far and away President Viktor Yanukovych’s overarching foreign policy priority — and he has shown that he understands the hurdles Ukraine faces all too well.

In a recent interview, Khoroshkovsky made clear that there are three, core issues for Ukraine today: Battling corruption; closer European integration; and creating a stable and inviting business environment. All of that sounds fairly normal in this part of the world, but the critical distinction is that he notes that these issues are inseparable. No one can be resolved without the others.

Put in a way Americans will appreciate, his presence in the Government is a sign that Ukraine is determined to foster the perfect attitude among its citizens toward its government: Benign indifference.

That is no small thing. When Yulia Tymoshenko was Prime Minister, the business world in Ukraine was an unsettled place. One could never tell when one’s business was going to be swept up in one of Tymoshenko’s populist attempts to re-nationalize whole swathes of industry, or indeed, whether Ukraine would be facing East or West on any given day. Many businesses quietly exited the country, and others simply refused to open shop.

The absence of a safe environment for commerce is a fatal stumbling block to a healthy democracy. Without an economic system with established, observed rules, meaningful and lasting economic growth — and growth in employment — is impossible. Without that sense of growing prosperity and the day-to-day interactions that increasing economic activity bring, civil society loses its easiest and most natural channel. People talk and learn and grow together when they trade; removing commerce from human affairs is a slippery slope with North Korea at its end.

Khoroshkovsky was therefore an optimal choice for First Deputy Prime Minister. His time as Economics Minister last decade was marked by some of the more audacious reforms in post-Soviet Eastern Europe — and an iconoclastic spirit that made him both an effective minister and a poor fit for a government not wholly tuned into the need for free-market reforms. A self-made multimillionaire, Khoroshkovsky has made the business environment one of his first concerns since entering government service in the late 1990s.

But he has also worked on the thorniest issue facing Ukraine: European integration. The European Union, which spent years lecturing Ukraine on the importance of rooting out corruption, prosecuting the low and the high, and allowing the judiciary to act independently, is so outraged by the convictions of Tymoshenko and Yuriy Lutsenko that they now demand that Ukraine’s government toss aside convictions, overrule its judiciary, and allow those powerful and wealthy enough to gain Western press attention to escape justice.

Khoroshkovsky, rather than attempting the impossible and trying to inject reason into the collective mind in Brussels, is instead openly working for a compromise solution and resetting the relationship between Kyiv and Brussels. Thus, while many European capitals ignored the historic initialing of the Association Agreement between Ukraine and the EU last month,¬†Khoroshkovsky — while not overplaying what is after all merely a first step, and not even a full ratification of the agreement — has been careful to reinforce the historic nature of the Agreement, and remind both East and West of what it really is: One more incremental step toward full EU integration.

Even with only two months in office under his belt, Khoroshkovsky has not stopped there. He is also tackling systemic corruption in both agriculture subsidies and in government in general with his normal straightforward style. The businessman understands that economic growth will be damaged both by a government too sure of its power not to take over parts of the economy, and by a government indifferent to corruption and graft. He also made clear that as much as the government wants to continue working with the International Monetary Fund, its demand that Kyiv cease subsidizing natural gas for the poor — a curative for Tymoshenko’s disastrous gas deal with Russia in 2009 — a demand on which further IMF loans are contingent, cannot be met until after the upcoming elections. Kyiv cannot abandon the social safety net it owes its poorest, and its politicians cannot be expected to vote to toss their constituents into sub-freezing weather with elections coming.

In some ways, this is a mere recitation, but it hints at the real story. Khoroshkovsky is the telegenic, English-fluent, charismatic tip of a spear, aimed at both those Western governments that are slow to believe in Ukrainian reforms, and in those revanchists in Ukraine who believe reform is a waste of energy and time. He has decades of a bright future in front of him. More importantly, he would not and could not be out on all fronts without the implicit and explicit backing of both President Yanukovych and Prime Minister Mykola Azarov.

That is the critical lesson here. Khoroshkovsky’s bright future lies in his bright present, as the palatable reminder to the European Union that they can expect straight answers, honest dealing, and a Ukraine determined to reform and transform itself into a vital member of the European community of nations — and some day, the European Union itself.

Matthew Lina contributed to this story.

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