Wait..What Ukrainian Oligarchs?

Can Ukriane play by our rules?

With the understanding that going into a war zone is not forthe faint-hearted, there are pockets of high-risk, high-reward capital globally that thrive under extreme conditions.

Private contractors were omnipresent both in Iraq and Afghanistan, among other tough spots globally. Hence, it is important to enable private capital to scout the opportunities in wartime and post-war Ukraine. It is hard to but not impossible to imagine all the largeamounts of private investment in Ukraine while the war continues.

But after, that is a different story.  

In August, the World Bank, the European Commission and theUkrainian government put aggregate losses in the country as of June 1 at more than $252 billion, with estimated reconstruction and recovery needs at $348.5 billion.

But that was before Russia stepped up its conflict bytargeting Ukrainian power facilities and cities. An op-ed that appeared in The Washington Post this weekend estimated the bill could even reach $1 trillion.

Like many over the holidays, I refamiliarized myselfwith one of the top nation building report. RAND’s America’s Role In Nation-Building, from Germany to Iraq, 2003. 

This report contains the results of a study (Paid by the DoD) on best practices in nation building. Its purpose is to analyze U.S. and international military, political, and economic activities in post conflict situations since World War II, determine key principles for success, and draw implications for future U.S. military operations.

Within this report are the lessons learned from each ofthese operations, then applies them to the case of others such as Bosnia. Although, none of the cases were identical towhat may be expected in Ukraine, I forecast the Bosnian case fits best due to the homogeneity of the peoples and regional cultures.

In my Future(s) forecasts with regards to World Building, Ukraine, as of the printing of this article, has a lot already going for it.

Its already has a working 20th century banking system, Internet (via SpaceX), a somewhat democratic system is in place, no internal warring parties, or sector enemies to appease so EVERYONE is on the same
page to the end goal. Plus, strong ally miliarybases nearby and a pending application into NATO.

This is where the tricky park comes in.  

Since Ukraine was under the Russian sphere of control for 44 years its picked up a few bad habits and is among the most corruptcountries in the world, according to Transparency International has ranked Ukraine as Europe's third-most-corrupt country after Russia and Azerbaijan.

An editorial by The Washington Post detailed how hundreds of millions of dollars in foreign aid has been siphoned off in recent years by Ukrainian oligarchs, describing how the government has been complicit in allowing them to use Ukraine’s state-run companies as ATMs.

Transparency and accountability will make or break their construction effort and these major Patrons (like you) will be looking for cast-iron guarantees from Kyiv that the funds will be used for their intended purposes.

This is where advice and recommendations from long-time donor institutions like the World Bank and International Monetary Fund can come in handy. US economic support, legislated through Congress, already holds significant accountability measures.

I am optimistic and will be watching and it was encouragingto see at the World Economic Forum gathering in Davos last May, young Ukrainians loudly swearing that the people will no longer tolerate the wrenching corruption that had permeated their country.

Building trust in Ukraine’s ability to get it done right is paramount. 

Already, Vladimir Zelinski and Black Rock’s Larry Fink haveagreed to focus in the near real term on coordinating the efforts of all potential investors and participants in the reconstruction of our country channeling investment into the most relevant and impactful sectors.

Zielinski previously spoke with Fink lastSeptember and Kiev has indicated some Black Rock leaders will visit Ukraine this year.