|It has already become clear that commerce
is one of the key features of the new Kharkiv. The more so, that
the city has not changed its geographic location and the status of
the main transportation hub on the routes between the Caucasus, Central
Asia, and Eastern Europe, adding the advantage of being the main gateway
||The BIZNES Weekly (#18,
April 30, 2001) interviewing Kharkiv governor Yevhen Kushnaryov:
Why do you think Kharkiv is often referred
to as "cop city"? Yevhen Kushnaryov: You know, I
am very happy they call Kharkiv a "cop city" rather than "gangster
city". Let them continue calling it that way.
BIZNES: But, certainly, you understand
what is implied here? The matter is that law enforcement bodies are
influencing business. Yevhen Kushnaryov: The implications
are that our law enforcement system is stronger than the mob. And
if this is supposed to mean that law enforcement agencies are somehow
interacting with the business community, then, it's probably better
them than gangsters. However, I stand for that law enforcement
agencies should not become subjects of economic activities and act
as arbiters or lobbyists of certain interests.
BIZNES: Don't you think, Kharkiv has
lost its position of Ukraine's largest scientific and industrial center,
and is increasingly becoming a commercial city, in the meaning of
small-time, kiosk type commerce? Yevhen Kushnaryov:
Yes, I agree that the city has somewhat lost this status now, but
I won't agree with someone saying that it is gone forever. We have
an opportunity to move, quickly and confidently, and become one of
the three leading financial and industrial centers of Ukraine together
with Kyiv and Donetsk. The more so, that impressive economic achievements
of Donetsk are connected with metallurgy, which means they depend
on situation on foreign markets. For us, it is far more difficult
to enter international markets with our engineering products. Once
we get there, however, we would have a much more stable position.
We have huge opportunities on markets of our closest neighbors. Moreover,
we have a powerful resource in science. Its capacity is utilized not
more than for one third for now. In my opinion, references to lack
of funding are not the most decisive reason here. I think that revival
of the machine building sector will require the appropriate research
base. The support to science, in turn, will give a powerful impact
to development of industry.
BIZNES: What sector would you suggest
as investment opportunity to businessmen from other regions? What
do you think will be the most promising industry in the next year
Yevhen Kushnaryov: I think, everything related to agriculture
is very promising. Serious structural transformations are underway
there, and investing in this sector is both justifiable and profitable.
BIZNES: Are there any special
traits that characterize a Kharkiv entrepreneur?
Yevhen Kushnaryov: It seems to me, there are some. First, I
would mention a high educational level of the majority of business
people. For all that, Kharkiv is the largest center of higher education
in Ukraine. By the way, it is thanks to this high educational level
that I would attribute the growing investment business in the region.
BIZNES: Does Russian business have good
prospects here? Yevhen Kushnaryov: No better or
worse than any other serious business. Though, certainly, Russian
businessmen find it easier to do business in our territory, as mentality,
the way business is done, and, if you will, the language - these are
all the factors having a positive effect on establishing normal relations.
Once again, I would like to stress that there are no and there cannot
be any special privileges or barriers for Russian business.
|Historically, Kharkiv is an extremely versatile town,
just like its citizens. This is a great luck, but also a misfortune
for the region. An average Kharkivite is quite an accomplished,
intellectual person interesting to talk to, with an independent
opinion on absolutely everything. Two average Kharkivites would hardly
find it boring on a desert island, having each other to talk to. As
critics of our city argue, however, it is improbable that they would
be able to start a business together. More likely, there would be
|Kharkiv does not smelt metals - either ferrous
or non-ferrous, there are no Donetsk collieries or Dnipropetrovsk
steel plants here to consolidate cash flows and common interests.
Hence, Kharkivites are more inclined to look for any - even if
not so grand - business opportunities. Therefore, the city has
a very broad area of activities and extensive opportunities for conducting
one's own business. One can invest in gas, machine building, hi-tech,
light industry, processing industries, pharmaceuticals, chemicals,
construction, transport, trade. In other words, just anywhere.
|Obviously, the said diversity opens up unlimited opportunities
for small and medium business. Even though, one must admit, it is
mainly still quite small business. With such a range of activities,
it is not so easy for the region to set its development priorities.
Therefore, when Special Regime of Investment Activities (SRIA)
in Kharkiv was being developed, it was decided to include nearly everything
the city has as its priority sectors.
|Radical restructuring processes are currently underway
in the region, after which it is hoped to acquire new traits. Today,
an average citizen of Kharkiv is feverishly looking for opportunities
to make money. Thank God, it's allowed now! In general, Kharkiv
residents have always been very entrepreneurial and could earn well
even when it was prohibited. Not incidentally, it was in Kharkiv
that large-scale underground garment business was flourishing way
back under the Soviets.
|In view of the crumbling machine building
plants and neglected science, people are primarily moving to local
bazaars. One could meet not only university graduates, but also university
professors in market stalls. One sometimes wonders: Is there anybody
in this town producing anything? It looks as if everyone is selling.
And it is everywhere: 50 city markets, underground Metro passages,
near Metro entrances, numerous kiosks, tents, even at apartment block
entrances one could see entrepreneurial babushkas (elderly ladies)
selling sunflower seeds, homemade pickles or matches. And there is
a multitude of shops, restaurants, cafes, and just street stalls,
especially in the downtown area. Probably, commerce for Kharkivites
is an outward manifestation of their long-supressed freedom.
|"Be your own best helper"
- is the guiding principle for the majority of people in the region.
The fact that people have come to realize the vainness of hoping for
assistance from "benevolent" rulers gives some grounds for
optimism. As much as one fifth of able-bodied population or 235,000
people are already involved in "self-rescue"operations in small and
medium business. And that's okay. If the authorities would just leave