BNE: Ukraine reform guru urges more powers for Saakashvili after 100 days in office

(Business New Europe – bne.eu – Graham Stack in Odesa – September 10, 2015)

47-year-old Sasha Borovik is one of the most colourful and controversial of Ukraine’s new team of radical reformers parachuted in to revamp the country’s corrupt and dysfunctional institutions. In early 2015 he broke off a high-flying career abroad as an IT lawyer with Microsoft and other multinational giants to join Ukraine’s government. But three months as first deputy economy minister ended in controversy in May, when the government not only fired him, but claimed he had never been formally appointed to the post. Leaked emails showed that Prime Minister Arseny Yatsenyuk had called for his head, fearing his radical ideas were a sign of mental instability.

Borovik was immediately snapped up by Mikheil Saakashvili when the former Georgian president was sensationally appointed governor of Odesa region in May. Odesa is a strategic historic port location with some pro-Russian sympathies, making it a crucial swing constituency for Kyiv’s still fragile pro-Western administration.

With 100 days gone since he took up the post, Saakashvili has left hurriedly for Kyiv to request extra powers, lest the reform drive founder, Borovik tells bne IntelliNews. “We cannot effectively prevail against corruption in Odesa region unless we have influence over the relevant agencies,” Borovik explains, reeling off a list of most of the central government ‘power agencies’ where Saakashvili wants to see his people installed at the regional level: prosecutor, anti-corruption bureau, tax service, customs service and the state security service SBU.

“The constitution does not allow us to control these agencies in the region, but we want to nominate our people to occupy the top posts,” Borovik says.

Under the constitution, appointments of half of these posts is the prerogative of PM Yatsenyuk, with whom not only Borovik, but also Saakashvili, is at loggerheads. Borovik says Saakashvili already used his influence to block Yatsenyuk’s plans for a speedy privatisation of Odesa Port Plant (OPP), Ukraine’s largest chemicals plant, valued at up to $1bn. “The government was looking to privatise OPP over three months – thus making it impossible for foreign investors to conduct due diligence. It was obvious there was a plan to sell the plant to oligarchs,” Borovik says, echoing Saakashvili’s recent prime time TV attack on Yatsenyuk. “The same applies to government plans to sell off the ports before the end of the year.”

One unstated reason for Saakashvili to put the brakes on privatisation is perhaps a nod to public opinion: 83% of the local population oppose privatisation, Borovik says, with crucial regional elections looming on October 25. The current mayor of Odesa is a former ally of ousted Ukrainian president Viktor Yanukovych, and formerly pro-Yanukovych forces have majorities in both the municipal and regional assemblies.

There is little sign this will change after the elections. With the first 100 days of Saakashvili’s tenure gone, 54% of locals say they see no changes for the better, 41% say poverty and unemployment are the biggest problems they face, while only 18% are prepared to tighten their belts somewhat for the cause of reforms, Borovik quotes polls as saying. At the same time, 53% say battling corruption should be a priority.

Borovik defends his team’s record, pointing to the launch of a modern police force, and moves to create a one-stop shop for all citizens’ paperwork. Saakashvili has also announced grandiose investment plans for Odesa region – the construction of a new motorway to Bucharest, and a second terminal for Odesa airport. But Borovik is coy about where the funding for these projects will come from, considering Ukraine has only narrowly escaped bankruptcy. “Central budget funds, in part, and the motorway could be built as a concession,” he says.

Meanwhile, the local population doubt that Saakashvili means to stay in Odesa long – and Saakashvili said himself in a recent interview that he would stay a maximum of two to three years. But he has vehemently denied reports that he is aiming to replace Yatsenyuk as prime minister in the coming months.

Borovik likewise denies that Saakashvili is planning on returning to Georgia if his Georgian opposition party, the United National Movement, is successful in upcoming elections. “This will not happen, because we know that if Saakashvili returns to Georgia, Putin will simply cut Georgia in two,” Borovik says.

Straight talker

Borovik, who addresses public events in a tennis shirt, is a straight talker quick to correct interlocutors, perhaps the reason behind his personality clash with Yatsenyuk.

At a recent Odesa investment conference, he interrupted a Kyiv region official’s presentation on creating a sponsorship fund for bonus payments to local officials: heads of regional departments currently earn only UAH2,800 a month (€115), meaning the only reason for anyone to do the job are bribes. “We don’t need to throw more money at the bureaucracy,” he interjected, “we need to slash it and reduce state functions.”

Likewise, he publicly rebuked panel participant Russian opposition MP Ilya Ponamarev, an ardent Ukraine supporter, for using the Russian equivalent of ‘the Ukraine’ to refer to his country, instead of the correct form of simply ‘Ukraine’. And anyone calling him by his original Russian name of Alexandr, instead of the naturalised version Sasha, reminds him of being scolded as a child, he jokes.

Borovik’s childhood is part of the controversy surrounding him. He grew up in West Ukraine’s Lviv region, in a Russian-speaking family of a high-ranking local KGB official, who Borovik says targeted corrupt officials, not dissidents. Borovik himself was recruited by the KGB due to his intellectual capacities and studied at the Higher School of KGB in Moscow in the late 1980s.

But during his studying he became disillusioned with the Soviet system, and fell under the influence of Western rock music, particularly Pink Floyd. One night full of doubt in Moscow, after hugging a tree and listening to the 1971 album “Atom Heart Mother”, he resolved to flee the country, crossing the border to the Czech Republic in 1990, where he began a stellar career in law. He is now a German citizen.

It was only the coming to power of pro-reform forces in Ukraine in 2014 that prompted him to return to his homeland. Much has changed since he left, but one thing has stayed the same – his love for Pink Floyd. “I would die to see them perform the ‘The Wall’ here in Odesa,” he says, eyes lighting up.