March 01, 2015
KIEV, Ukraine (AP) — War-torn Ukraine is a long way from Wood Dale, Illinois.
But Natalie Jaresko, the country's new finance minister who was born and raised in the Chicago suburbs, says she feels just as much at home here as she takes on a daunting task: overhauling a Soviet-era economy at a time when public finances are being drained by war.
It's been a baptism of fire for the 49-year-old former banker, who only got her Ukrainian citizenship the day she was appointed minister in December but has lived in the country for over two decades. She hopes the fact she is not part of the entrenched political elite will help as she attempts a root-and-branch reform of the economy.
"I don't see myself as a politician," she told The Associated Press at her office in the Ukrainian capital, Kiev. "I'm a technocrat minister and I don't have a political career ahead of me. I'm not running for office."
The job is as big as it is urgent. She estimates that the war has consumed about 20 percent of the economy, taking out a region rich in industry and commodities. Corruption is endemic throughout Ukraine. Red tape and a lack of financing are hindering business. Foreign investors are wary of the geopolitical instability. Inflation is forecast to hit a staggering 26 percent this year as the hryvnia currency has fallen 70 percent since last year, when former President Viktor Yanukovych was ousted by popular protests.
Amid all this, the government is living a hand-to-mouth existence — it must pay Russia up front for gas supplies at a time when it is quickly running out of money. Ukraine and Russia will hold more talks on the gas issue Monday.
Jaresko's first success in the job came this month when she clinched a promise for a $40 billion four-year lifeline from the International Monetary Fund and Western nations. However, that eye-catching headline figure includes up to $15 billion of expected debt renegotiation with private investors by the government in Kiev, a sum which is by no means guaranteed. High-stakes debt renegotiations are likely to start by the second week of March and conclude by June, according to Jaresko, who says her U.S. background gives Ukraine an edge.
"Coming from the private sector and coming from the Western side, I can understand both the demands and the perspectives of the creditors as well as . the Ukrainian side and the Ukrainian perspective," she said. "Bringing those two together is a skill set that I bring to the table."
After studying at DePaul University in Chicago, during which time she lived in the Ukrainian Village neighborhood, Jaresko's moved in the mid-1990s to Kiev as head of the economic section at the U.S. embassy. She then ran the Western NIS Enterprise Fund (WNISEF), which invests USAID funds into small and medium-sized businesses in Ukraine and Moldova.
She and her then-husband later founded Horizon Capital, an investment firm that now manages WNISEF. Jaresko says she no longer has any ownership or control at Horizon Capital. Jaresko's appointment gifted Russia's state media a line of attack — an American banker representing Washington's interests rather than the Ukrainian people — but Jaresko says she does not feel any need to prove her Ukrainian credentials.
"I've always been a Ukrainian. I'm a Ukrainian citizen now, that's a difference, but I have worked and lived in this country - this is my home - for 23 years," she said. "Like any minister right now, I feel the need to prove my credentials as a reformer, but I don't think it makes a difference that I was previously an American citizen."
Ukrainian law obliges Jaresko to renounce her American passport within two years, although she declined to say whether she had yet done so. Jaresko is one of three foreign-born cabinet ministers as President Petro Poroshenko looks to bring in outside expertise. Mirroring the policy that brought her into government, Jaresko has assembled a multinational team partnering U.S.-educated Ukrainians with advisers seconded from the U.S., German and Polish governments, as well as Ivan Miklos, who reformed the tax system as Slovakia's finance minister from 2010-12.
"I think it's important for us not to reinvent the wheel," she said, adding that her foreign advisers should "help us to skip over many of the steps, or many of the mistakes, that may have been made by others in the past."
KIEV, Ukraine (AP) — War-torn Ukraine is a long way from Wood Dale, Illinois.
But Natalie Jaresko, the country's new finance minister who was born and raised in the Chicago suburbs, says she feels just as much at home here as she takes on a daunting task: overhauling a Soviet-era economy at a time when public finances are being drained by war.
It's been a baptism of fire for the 49-year-old former banker, who only got her Ukrainian citizenship the day she was appointed minister in December but has lived in the country for over two decades. She hopes the fact she is not part of the entrenched political elite will help as she attempts a root-and-branch reform of the economy.
"I don't see myself as a politician," she told The Associated Press at her office in the Ukrainian capital, Kiev. "I'm a technocrat minister and I don't have a political career ahead of me. I'm not running for office."
The job is as big as it is urgent. She estimates that the war has consumed about 20 percent of the economy, taking out a region rich in industry and commodities. Corruption is endemic throughout Ukraine. Red tape and a lack of financing are hindering business. Foreign investors are wary of the geopolitical instability. Inflation is forecast to hit a staggering 26 percent this year as the hryvnia currency has fallen 70 percent since last year, when former President Viktor Yanukovych was ousted by popular protests.
Amid all this, the government is living a hand-to-mouth existence — it must pay Russia up front for gas supplies at a time when it is quickly running out of money. Ukraine and Russia will hold more talks on the gas issue Monday.
Jaresko's first success in the job came this month when she clinched a promise for a $40 billion four-year lifeline from the International Monetary Fund and Western nations. However, that eye-catching headline figure includes up to $15 billion of expected debt renegotiation with private investors by the government in Kiev, a sum which is by no means guaranteed. High-stakes debt renegotiations are likely to start by the second week of March and conclude by June, according to Jaresko, who says her U.S. background gives Ukraine an edge.
"Coming from the private sector and coming from the Western side, I can understand both the demands and the perspectives of the creditors as well as . the Ukrainian side and the Ukrainian perspective," she said. "Bringing those two together is a skill set that I bring to the table."
After studying at DePaul University in Chicago, during which time she lived in the Ukrainian Village neighborhood, Jaresko's moved in the mid-1990s to Kiev as head of the economic section at the U.S. embassy. She then ran the Western NIS Enterprise Fund (WNISEF), which invests USAID funds into small and medium-sized businesses in Ukraine and Moldova.
She and her then-husband later founded Horizon Capital, an investment firm that now manages WNISEF. Jaresko says she no longer has any ownership or control at Horizon Capital. Jaresko's appointment gifted Russia's state media a line of attack — an American banker representing Washington's interests rather than the Ukrainian people — but Jaresko says she does not feel any need to prove her Ukrainian credentials.
"I've always been a Ukrainian. I'm a Ukrainian citizen now, that's a difference, but I have worked and lived in this country - this is my home - for 23 years," she said. "Like any minister right now, I feel the need to prove my credentials as a reformer, but I don't think it makes a difference that I was previously an American citizen."
Ukrainian law obliges Jaresko to renounce her American passport within two years, although she declined to say whether she had yet done so. Jaresko is one of three foreign-born cabinet ministers as President Petro Poroshenko looks to bring in outside expertise. Mirroring the policy that brought her into government, Jaresko has assembled a multinational team partnering U.S.-educated Ukrainians with advisers seconded from the U.S., German and Polish governments, as well as Ivan Miklos, who reformed the tax system as Slovakia's finance minister from 2010-12.
"I think it's important for us not to reinvent the wheel," she said, adding that her foreign advisers should "help us to skip over many of the steps, or many of the mistakes, that may have been made by others in the past."
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