A postcard from Sir Vince in Kyiv

The main evidence of war in Kyiv in the last few days has been a series of loud bangs in the middle of the night – Russian rockets meeting Patriot Missiles apart from the one which got through and hit a power plant.

Otherwise, Kyiv is a normal and beautiful, bustling European city of 3.5 million with busy pavement cafes and restaurants, flourishing shopping centres and street stalls, traffic jams and young people zooming round on e-scooters. After a while you notice the numbers of burly off-duty soldiers in uniform, the exhibitions in civic squares honouring war casualties and the forest of flags to the memory of those who died in Maidan Square in the 2014 Orange revolution. So, not so normal. A war for national survival is taking place, to expel the Russian invaders.

One of the practical consequences of war is that airports are closed.

I came to Kyiv to talk to entrepreneurs, students, academics and politicians (from the various liberal parties which support President Zelensky) arriving after a 15-hour bus ride from Warsaw. My hosts expressed great appreciation for an in-person visit from the UK. In fact, there was unaffected praise and thanks, more generally, for the generous support from the UK. Whatever our – mostly negative – views of the Boris Johnson era, he made the correct call on the Ukraine war. Continued British backing, with weapons and economic aid, remains vital for what could be a long struggle: easy to say but harder to deliver when there are already difficult issues around the public finances (and other moral imperatives such as our aid to the poorest countries).

By contrast, other supporters have started to wobble. Most seriously, a row has broken out with Poland, hitherto one of Ukraine’s cheerleaders. Putin’s blockade of Ukraine’s grain exports from the Black Sea has led to some diversion to Europe resulting in protests from Polish and other farmers. There is an election looming in Poland and the government has played to the nationalist gallery, blocking not just Ukrainian grain exports but badly needed military supplies. And on the bus back, crossing the Polish frontier, I saw ridiculous and petty Polish bureaucracy making Ukrainians feel decidedly unwelcome. Elsewhere in Europe, pro-Russian parties continue to make progress – most recently in Slovakia – sapping political support for the Ukrainians.

The most crucial ally is the USA and, while President Biden continues to deliver the high-tech weaponry Ukraine needs, there is strong resistance from Republicans in the House. The nightmare of a Trump Presidency is all too plausible. I was repeatedly told that the Ukrainians’ great fear is that the West is losing interest and patience when what is needed is stamina and a willingness to stay with Ukraine’s slow but successful military campaign. That is why Britain must remain 100% committed.

I saw the reasons why Ukraine sees the war as a life-or-death struggle. At Irpin, despite rapid rebuilding, there is abundant evidence of systematic bombing of civilian housing; and in the town cemetery are the bodies of many refugees who were killed trying to escape. Serious people talk of a genocide in occupied territories with much yet undiscovered or unreported.

Before war crimes can be pursued there is important humanitarian work to be done. I met women, their faces etched with anxiety, whose partners are in Russian POW camps. Prisoner swaps should be negotiable. Then there is the appalling abduction and theft of children. The more time passes the chances of tracing and returning the children diminishes.

I became involved in Ukraine because of the economic issues around reconstruction. A few months ago, the main multilateral agencies estimated that around $400 bn was required but that sum is a big underestimate and escalating as the Russians try to, systematically, destroy Ukraine’s infrastructure. Investment cannot wait for the end of the war which could be years away. Private investors are, however, unsurprisingly, inhibited by war risk though Ukraine has offsetting advantages in an educated, skilled and low-cost labour force. Western governments are worried about their own budgets. It would greatly help to use the currently frozen assets of the Russian government and oligarchs. At present our governments are worried about legal complications though Putin’s Russia itself breaks every law in the book. A way forward could be to use the assets to provide guarantees. There is real urgency to get investment flowing.

President Zelensky rightly enjoys hero status at home and abroad. But mistakes have been made and acknowledged. One has been a failure to mobilise major countries of the Global South who trade with and politically indulge Putin’s Russia: India, China, South Africa, Brazil, Saudi Arabia in particular. The policy makers I met were very pragmatic; they want help, however limited, from China in particular. Despite the pro-Russian rhetoric, China is demonstrating serious limits to its ‘friendship without limits’ and is seen as useful on economic issues, nuclear safety and potentially reconstruction. The last thing Ukraine wants is to be used as a pawn in a new Cold War between the USA and China.

Until I visited Ukraine to see for myself – my first visit since the Khrushchev era – I indulged in armchair statecraft and military strategy from the safety of my London suburb. I now realise how valuable is Britain’s solid support for the war effort and how vital it is to sustain it as the war drags on.

Photo above of Kyiv by Roman Cherednychenko, Flickr CCL

* Sir Vince Cable is the former MP for Twickenham and was leader of the Liberal Democrats from 2017 until 2019. He also served in the Cabinet as Secretary of State for Business, Innovation and Skills from 2010 to 2015.

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4 Comments

  • Sandy Smith 24th Sep '23 - 9:55am

    Excellent article though I worry slightly about the phrase “It would help greatly to use the currently frozen assets of the Russian government and oligarchs. At present our governments are worried about legal complications….”

    Describing the possible stealing of assets belonging to rich Russian citizens, because they are rich and Russian, is not just a ‘legal complication’….it is just plain wrong and to do so would seriously undermine the ‘Western values’ we claim to be supporting by helping Ukraine in its fight.

  • “we know how to win on the battlefield. Another important task for us is to achieve victories in the economy as well as to be an attractive country for investors” Volodymyr Zelensky September 2022.
    Yesterday’s fringe The role of land value capture in the reconstruction of Ukrainereviewed the white paper published by the Albright Stonebridge Group ASG White Paper: Land Value Capture and Ukraine’s Reconstruction
    Ukraine’s reconstruction is not only about the reconstruction of infrastructure but crucially how to break free of decades long economic stagnation.
    Despite a highly educated workforce, an abundance of natural resources, an internationally renowned IT industry and well developed nuclear power generation Ukraine has struggled to develop economically since breaking free of the shackles of the Soviet Union. Ukraine has seen wide-scale deindustrialisation and a 15% fall in population since 1991 due to low birth rates and mass emigration. The country was struggling in the face of these demographic headwinds even before the Russian invasion THE UNDERACHIEVER Ukraine’s Economy Since 1991
    Since 1991 the economy has been dominated by Oligarchs competing for power and generating political instability fuelled by Russian interference in its affairs.

  • How Ukraine finances its economic reconstruction is as important to its future as the reconstruction itself. The vast sums required to finance the reconstruction cannot come from international institutions like the IMF, World Bank, EBRD and EU cohesion funds alone. Rostyslav Shurma, deputy head of the Ukrainian president’s office in charge of economic policy has estimated that 70-80% of the financing will come from private money.
    This accounts for Ukraine’s efforts to attract investment by undergoing economic liberalisation like slashing collective bargaining power and worker protections. Its energy and natural resource abundance, skilled workforce, low labour costs and potential integration with the EU make it an attractive investment location once peace comes within clearly defined borders.
    The danger for Ukraine is that it swaps Russian supported oligarchs for Western private equity firms that burden it with unrepayable debt and/or IMF funding conditional on austerity programs. That would make it very difficult to achieve the kind of economic growth needed to attract back the Ukrainian refugees dispersed across Europe and North America.
    There are good examples of successful post-war reconstructions that have used Land Value Capture as the principal means of economic recovery. For instance, Taiwan greatly reduced instability between 1950 and 1980 by introducing three types of LVC – a land value tax, a land value increment tax, and a house tax. These addressed problems arising from heavy land ownership concentration among a small elite class and laid the foundation for the country’s impressive rates of inclusive economic growth in the 1980s and after.

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