The recent ruling of the Ukrainian Constitutional Court on anti-corruption reforms created new impetus for judicial reform, and the G7 Reform Support Group works closely with the Ukrainian authorities on that, says Ambassador of the Federal Republic of Germany to Ukraine Anka Feldhusen. In an interview with Natalia Richardson for Brussels Ukraїna Review, she shared her worries about legal insecurity for investors and spoke about the support that Germany provides to Ukraine as well as about her love for this country where she is currently posted for the third time. “What never changes is the warm-heartedness with which the Ukrainians receive me,” says the German Ambassador with a smile.
What is the best achievement and the worst failure of Ukraine under Zelensky?
That is for Ukrainians to judge. Many in the international community were impressed when President Zelensky came into office with an enormous amount of enthusiasm and willingness to implement change. He managed to push through very difficult legal projects that had been deadlocked for a long time. One of them is the unbundling bill for the gas sector that was adopted in November. Another one is the land market reform, which has been debated for an even longer time. In addition to these huge legal projects, there were many smaller, but similarly important initiatives. For us as long term partners – and also perhaps as Germans in particular (laughs) – the challenge posed by this energized and quick-paced work environment is a continuous staff rotation in government and state institutions.
What about the Constitutional crisis and anti-corruption reforms now? Ukraine is plunged into another crisis. How does it impact Kyiv’s relations with Berlin?
It seems that the Constitutional Court ruling has, indeed, hit the anti-corruption structure in a sensitive spot. As EU and G7 Ambassadors, we have consulted with the Ukrainian side on quite a regular basis to help facilitate a solution. In any case, what I consider a real opportunity in this difficult situation is that the ruling has brought judicial reform into focus. As part of the EU and the G7 Reform Support Group, we have put together a few ideas for judicial reform and have presented them to the Ukrainian side.
For ordinary Ukrainians this crisis has also other implications. There is some information that the European Commission might suspend the visa-free regime because of failure to provide anti-corruption reforms. Do you think that Ukrainians will need visas to travel to Schengen?
I think the visa-free regime is one of the biggest achievements since the “Revolution of Dignity” in 2014. People-to-people contacts were already strong before, but the new rules have helped enormously. Can Ukraine lose this privilege? Anti-corruption structures were a certain precondition for the visa-free regime. For the time being, I think, the EU will certainly continue to monitor current developments. From our side, we will support our Ukrainian partners as much as we can to adapt the course. Personally, I am optimistic that Ukraine will keep the visa-free regime.
Mrs. Ambassador, one of the most pressing issues for Ukraine is the situation in Donbas. Do you see any changes, any positive signs in this development?
Progress remains slow. Still, from my point of view, there is no alternative to the Minsk process. President Zelensky and his team have clearly demonstrated that they are ready to take initiative. And they have been very active throughout the last year, indeed. The main achievement is the ceasefire that has been in place since last summer and that has saved the lives of soldiers and civilians alike. In addition, the lasting ceasefire contributes to people on both sides of the contact line getting used to this relative stability and calm. Pressure will grow to secure this situation, since people crave for a normal life. Therefore, we should all fully support the continuation of this ceasefire. Among other achievements are the two prisoner exchanges and the opening of two more entry/exit points, unfortunately only by the Ukrainian side. These are concrete issues where a lot of progress has been made, and I believe once the pandemic is over, we will see more results. From a humanitarian point of view, and also with regard to “winning the hearts and minds of the people”, issues like pensions for those living in the non-government controlled territories remain, so does drinking water supplies, and so on. This is where the implementation of the Minsk agreements can really make a difference in a shorter term. These issues are debated and can be solved in the Minsk working groups. We are working intensively to support that. In any case, a successful and economically attractive Ukraine, will serve best as a role model and, thus, also as a magnet and also for those living in the non-government controlled territories.
What about Germany and France? Some experts say that representatives from these countries should be more involved in the process.
For the time being, I can hardly imagine where Germany and France could be more involved in mediating between Russia and Ukraine. Minsk has to serve as a long-term process because we are convinced that, in the end, there can be only a political and not a military solution for this war. And we continue working tirelesslyfor that.
We know that Germany supports Ukraine’s European integration. But what does Berlin think about real chances of Kyiv joining the EU?
Yes, we want the closest possible degree of integration. And there is still quite a way to go. Ukraine can and should do its part – by implementing reforms, by becoming economically more successful, by creating fair and equal conditions for foreign and domestic investors.
Among other problems of Ukraine in the international arena is the construction of the Nord Stream-2 gas pipeline. Washington is apparently preparing new sanctions against the project. What is the reaction of Germany to this?
Germany, together with the EU, firmly opposes extraterritorial sanctions. Unilateral sanctions against close allies are definitely not the right way. A concerted approach towards Russia’s behavior could strengthen our transatlantic unity. Germany takes Ukraine’s concerns very seriously. That said, we are already working with our Ukrainian partners on future sources of energy supply. One of our focus areas of support and cooperation with Ukraine is ‘green energy’ and energy efficiency. In order to deepen this cooperation, we have implemented an Energy Partnership last year. So, with regard to energy, Ukraine is and will remain an important partner.
What about the case with poisoning Alexey Navalny? Did the mood in Germany towards Russia change, also including Nord Stream 2?
Of course the German public took great interest in Mr. Navalny’s case when he came to Germany for treatment. Many were shocked by the heinous poisoning. We were glad that he made a full recovery. And when laboratories in Germany, Sweden and France found evidence – later confirmed by the OPCW – of the use of a military-grade nerve agent, we came to be a bearer of bad news to the international community – about a grave breach of international law. On a European level, this then resulted in sanctions by the EU-27 against Russian individuals deemed responsible for this crime and breach of international norms, based on their official function, as well as an entity involved in the Novichok programme.
Germany is one of the biggest investors in Ukraine. What do German business people say about Ukraine’s investment climate? What problems and obstacles do they have?
Indeed, Germany is a big investor in Ukraine. There are more than 2,000 German companies active in Ukraine, many of which have been here for a long time and most of which being quite satisfied. They are earning good money, and they are employing many Ukrainians. Some enterprises, especially the automotive ones in Western Ukraine, are now even thinking about expanding further to the east in Ukraine in order to satisfy their demand for labor. By the way, one of the biggest German investments lately came from Kostal, that invested 39 million euros to produce automotive parts near Boryspil.
Nevertheless, both newcomers and those German companies that have been around for longer face problems that have not changed much throughout the last couple of decades. The first and foremost problem remains legal insecurity. We observe a relatively constant change of legislation in Ukraine. However, foreign investors are often bound by strict compliance rules and can thus not act the same way as their rival Ukrainian companies. This is why we support local efforts in establishing clear and sustainable rules in order to enable investors for long-term commitments in Ukraine.
Investors remain interested in Ukraine – especially with what we have learned from the pandemic. There is the concept of “nearshoring”, which means that companies have understood that focusing exclusively on production sites in, let’s say, China or India may not be ideal when global supply chains are cut off by something like a pandemic. Many companies have therefore already expressed interest in building production sites in Ukraine, especially in the field of pharmaceuticals because of the pre-existing strong pharmaceutical industry in this country.
Quite recently Berlin made a voluntary contribution of EUR 1 million to support the implementation of the Council of Europe Action Plan for Ukraine to help the country in the areas of human rights, the rule of law and democracy. Can you give us other recent examples of Germany’s support to Ukraine?
That is my biggest “problem” – there are so many projects that I always find it hard to name only a few of them (laughs). Overall, our support is focused mainly on “3+1” sectors. We work most actively in, first, the area of decentralisation and good governance. Our second focus is on energy efficiency and green energy, and the third being on support for small and medium enterprises. In these three fields, we have been active for decades and we have gained quite a lot of experience and established reliable partnerships with Ukrainian institutions.
Our “+1” sector is the support for the oblasts that have welcomed a majority of Internally Displaced Persons (IDPs) from the non-government controlled territories after 2014. Those smaller projects especially have an impact for people who live along the contact line and suffer from war. For example, we have strengthened social infrastructure in these communities by helping to renovate kindergartens, hospitals, schools, and cultural centres along the contact line. We have supported local administrations in municipalities that have worked with IDPs. I have recently been to Kramatorsk and visited a hospital there where we were going to renovate a laboratory. Last not least, Germany provides treatment to Ukrainian soldiers in Germany who have been wounded in the war in Donbas.
Personally, I am often touched by “little” projects that aim at people-to-people contacts on site. For instance, we carry out a project for female bloggers from both sides of the contact line to exchange their views. I think these micro-projects are so important because they create platforms where people can still talk to each other after six, almost seven years of war.
You have been the German ambassador for over a year now. What are the best, the brightest moments during this period?
One thing that never changes is the warm-heartedness with which the Ukrainians receive me. It was like this in the ‘90s, it was the same from 2010 till 2015, and it has been exactly like that since I arrived in 2019.