East-West Conference 2003

Es gilt das gesprochene Wort.

Good afternoon, esteemed ladies and gentlemen. Like any other student who returns back to his alma mater in a number of years after graduation, I feel now a strong sense of jubilation and awe. At the same time there is one prominent trait that makes a meeting with JVI quite different from most of ordinary "graduate parties", namely you never get this forlorn feeling that you have traveled back to the past. It doesn’t matter how mature and clever a graduate becomes in the years to come, JVI never falls behind, constantly enhancing its ways, always ready to offer something new and enticing that would be quite adequate to the present-day needs. 

12 years ago, when Ukraine appeared on the map of Europe, it was initially referred to by the whole world as "one of the former Soviet Union republics". Then it got the name of "a CIS country". And only recently it has been recognized as "a newly independent country in Eastern Europe". Similar evolution of attitudes and values was happening in the country itself, and this was clearly reflected in the economic developments, and, most importantly, in the hearts and minds of Ukrainians. Changes in mentality, primarily of "decision-makers", can be viewed as probably the most prominent factor of the market reforms currently under way in Ukraine. And that’s, to my mind, what JVI means for all transition economies. 

Nowadays Ukraine looks forward for its involvement in the global development processes as a pier. In this context, Ukraine’s accession to the World Trade Organization is viewed as an extremely important step in the right direction. The issue of Ukraine’s WTO accession happens to be the major pre-requisite for success of our on-going reforms. And if that’s not enough, we consider the accession to be some sort of a traffic-light, and when it turns green – it means that we moved through dire straits, both in terms of our integration with the world trading system at large, and further enhancement of domestic reforms. By the way, of these two factors the latter is more important. And it stands to reason, because we can declare any landmarks in our international trade and foreign policy, but the compass is securely placed inside the country, so its needle will turn any direction depending on how sound our domestic economic transformations are. And that’s the main reasoning behind our strategy to consider the WTO accession as primarily a very potent incentive for our domestic economic reforms. Looking at the top ten of the advantages provided by the WTO-governed trade system, we consider the tenth one as the most acute for our present needs, namely -quote- "the system encourages good government" -unquote-. 

Since I have mentioned the key role that the WTO plays in our domestic structural transformations, let me draw your attention to the importance of this organization at the global scale. Nowadays, both economy and trade, as its "communicative" integral part, keep increasing their influence not only over national political interests, but over foreign policy as well. Transnational corporations’ performance and capital flows entail political consequences, and stand-alone countries are not able to tackle them on their own. When the annual volume of trade in goods between EC and US reaches half a trillion dollars, and when more than a half of European investments is channeled overseas, it becomes obvious that it’s trade that defines the relations between EC and US, which forms the backbone of relations world-wide. This statement is supported by Ulrika Gero, a German expert, who said – quote – "with a certain degree of exaggeration one can come up with the following idea: NATO that served as a transatlantic bridge for a long time is being substituted by WTO." 

If we extrapolate this tendency over other aspects of international life, we can state with a high degree of probability that unilateralism has to give way to multilateralism. To my mind, the recent transformational processes, painful at times, in all international organizations and conglomerations, from UN and WTO to CIS and EU, should be viewed not as a crisis but as the movement to the next level of the endless spiral of evolution – to the place where it’s law and not force rules the day, where all aspects of international life are regulated by democratic multilateral procedures equally applied to every country regardless of its size. I cannot predict how long it will take to get there, but I’m quite sure that it will be reached by means of trade – by boosting world trade and cross-border economic links as much as possible – there’s no alternative way. Brad DeLong, professor of economics at the University of California at Berkeley, labeled this process as a neoliberal crusade for development 1), stating that – "This strategy may not be a winner, but it is a strategy of last resort." 

Both Ukraine and Russia, another accession country, are swirling with heated debates about the expediency of the accession, with lots of arguments against it. I’m neither trying to put a halo over the WTO, nor do I consider the mere fact of Ukraine’s accession as a tool to resolve all the problems it is facing. But is there any viable alternative? Let’s look at the Czech Republic where on the eve of referendum on joining the European Union they decided to use the propaganda purposes board with a "SayYes!" exclamation and "Is there any other way?" question placed side by side. That’s exactly the question I would like to pose to all those, both inside and outside Ukraine, who is trying to intimidate my country with negative consequences of its WTO accession. We fully recognize all of them, but there’s just no other way to become an equal player in the world trading system, and to participate in setting its rules. 

So it seems to be quite symbolic that the WTO has recently joined in 5 other key international organizations sponsoring the JVI performance. I had a chance to visit the new premises of the institute, and I’d like to say that I even felt a little bit jealous of today’s students. I’m convinced that during the time I was a student in the building on ?rdberstrasse, new "palace of knowledge" has the same JVI spirit: democratic values and market economy. He, who happens to spend a few weeks here, will forever be devoted to the latter. 

Ukraine faces new tasks and challenges while building up its capacities for democratic society and market economy. In order to be able to benefit from the advantages provided by the WTO membership and the status of the next-door-neighbor of the "wider Europe", in order to preserve beneficial relations with the CIS countries and, at the same time, not to get stuck in the past by losing the gained momentum of its development, Ukraine needs extraordinary people, experts with broad scope of knowledge and even broader sense of perspectives. With all these tasks in mind, we are establishing appropriate educational institutions in Ukraine, for instance the Foreign Trade Academy, the National Academy of Public Management under the President of Ukraine, etc. JVI is viewed by them as a model, and a number of JVI graduates, your humble servant being one of them, teach students in them. Moreover, JVI, being quite unique in what’s it doing, could become, on the one hand, a nucleus around which a whole network of respective training centers could be formed in the countries with transition economies, and, on the other hand, it could serve as sort of a nursery that provides such centers with tutors. 

And finally, I’d like to say a sincere "thank you" to all the organizations-founders of the JVI, OeNB (Oesterreichische National Bank) and the government of Austria for an extremely important effort in educating the students from the countries with transition economies, for whom this knowledge is essential to transit from central planning to market economy. I’d like to say "thank you"for active involvement which, together with multilateralism, shall become, I believe, a key principle of international relations in future. Thank you for your attention.
1)J. Bradford DeLong (2001), "Crisis of Development," Worldlink (September/October).