It is the anti-European group that initiated the Dutch referendum, says Dutch businessman Arno Klijbroek
On April 6 the Netherlands will go to the polls in a national referendum on ratifying Ukraine's association agreement with the EU.
The destiny of Europe's biggest nation is potentially in the hands of the citizens of the Netherlands. The future of nearly 46 million people now depends on whether the Dutch decide to support Ukraine's association with the European Union.
This is exactly why, Ukraine Today with the cooperation of Euromaidan Press has launched #DutchInUA project. Our goal is to gather the views and opinions of the Dutch businessmen and entrepreneurs who work in Ukraine. As well as provide analysis by the experts from the Netherlands who can assess the influence of the referendum on the future of Ukraine and the E.U. as a whole.
Joining us now to discuss the Dutch business in Ukraine is the founder and owner of ATM Trade management Mr Arno Klijbroek.
Volodymyr Solohub: Mr Klijbroek, you came to Ukraine back in 1997, you were hard employee, you've been working here for three years, and then in 2000 you decided to start your own company. Tell us why did you do that?
Arno Klijbroek: By 2000 I've been working for Dutch Multinational set up the office in Kyiv, it was basically contract with the international organization, it was time for me to back to Holland, but I have had a chance to work in Ukraine for three years, but then I realized that lots of things were just about to happen in Ukraine so at that point I decided to start a company of my own. We from that moment have been providing legal and practical support to foreign investors on Ukrainian market, and that's what we've been doing since 2000. And I would say with quite good success.
V.S.: Mr Klijbroek, back in 2000, Ukraine was still very uncertain state. There was still president Kuchma in power, there were first political protests happening in the country…
V.S.: And you were in a country where very few foreign businesses were present. Weren't you concerned about starting your own business here?
A.K.: Not at all. And I wouldn't say that there – well of course at that point there were fewer foreign companies in Ukraine than there are now, but Ukraine was very much in the spotlight as one of the countries that just had opened up for business so there was lots of interest from foreign companies, from Dutch companies, most of our clients are Dutch companies, to enter into the Ukrainian market and basically from the first year that we started our company we've had very good business. Especially until let's say 2010 things were going very well for us.
V.S.: Talking about the growth, the development of your business, way your business ran during these 16 years, there were a lot of political turmoil. You've lived through 3 presidents – president Kuchma, Yushchenko, Yanukovych, - oh, 4 presidents! How were these 16 years for you now that you look back in perspective?
A.K.: This has been of course very intense period. Not only we have had several presidents, we have had two revolutions. We've had a few serious financial crises, and lived through them all, lived through them well. And as you were speaking about other political instability all the way, in my experience, from 2010 business in our experience and I'm thinking experience of many companies that were on the market then, business developed almost in a parallel universe from politics. In politics things were also happening, there wasn't really a lot of support from the government for development of business but simply the drive within the people, within the country to really make it happen to develop a market economy in Ukraine, also the foreign investors come along on board in that period, that is what created the development. At a moment we were in situation where further development of Ukraine, of the economy, of the society is only possible by active involvement of the government. And of course this is a process that we'll now have to go through as all.
V.S.: What would you say were your main challenges during the last 16 years of doing business in Ukraine?
A.K.: The main challenges…
V.S.: Ukraine has many ques, and it's not secret, it's a corrupt country. The government, the politicians, the current officials, they are always demanding bribes from businesses. How did you cope with that?
A.K.: Well, our policy has always been and also our advice to our clients has always been to stay clean after it. It's also in my real personal experience this misconception that in Ukraine it is only possible to do business by bribe. It is definitely not the case. It has always taken more time, because of the bureaucracy, to get through the different procedures that exist. Many of our clients have developed successful businesses and stayed clear really as much as possible of corrupt practices. And have done well businesswise in doing so. Fortunately it's not really so that every step of the way, the only way to get somewhere, is to pay to an official. If you're willing to take time needed with comes through most of the processes as it should be done. But it's mostly matter of taking time. Not wanting to rush things. So in that sense we did not have a lot of problems with corruption. Of course it exists, also put it in perspective that clients who were there, were mostly medium sized companies, were few multinational clients, but this is also probably a field where it has been possible and is possible to do business cleanly quite well.
V.S.: Mr Klijbroek, you just said that your business was doing well up until 2010. That's when president Yanukovych came to power and began tighten the screws on the business. What happens in 2010?
A.K.: Basically of course it became difficult from 2008, there were still dynamic for moving forward, then we got to 2010. When the former president got to power there were of course the mood changed. Because really it wasn't clear where we were going, new foreign investors were really not coming any more. Just we had a stable client base that we worked with but really very few companies actually came into Ukraine, actually had too close, some of the companies of the partners that we worked for, the clients that we have. So those were really the most difficult years, from 2010 until, let's say, 2013-14. And at the moment we fortunately starting from last year, end of last year, we see a positive dynamic again, that people are actively approaching us that they want to go ahead again. We had progress, some foreign investors want to, are ready to invest in Ukraine, we're working with the few new companies now, and they're step by step moving at, they're coming actually into Ukraine again. Which is a good trend.
An activist holds a poster reading 'Don't listen to Russian propaganda' and depicting Vincent van Gogh' portrait in front of Dutch embassy in Kiev, Ukraine, Friday, Feb. 5, 2016 (AP Photo)
V.S.: During the times of president Yanukovych, a lot of businesses, including foreign businesses, had to shut down and leave Ukraine. Did you consider that you would have to do the same when things got sour?
A.K.: It did cross my mind because we are here with the family and of course being Dutch we have the free choices, basically, to live and to work where we want. I think since I invested so much of my life into Ukraine, what always made me stay is really to want Ukraine to see the growth, also to get through this period. But of course honestly the last let's say 1 or 2 years from the Yanukovych presidency did cross my mind sometimes that maybe it would be better to move out. But fortunately I didn't. I'm very glad that we stuck through and at the moment we're moving ahead again and for the time being we will definitely be here.
V.S.: What were your emotions, and thoughts during the Euromaidan revolution when you saw these tens, hundreds of thousands people go out on the Euromaidan revolution, the Maidan, main square in Kyiv protest against the government then with all the violence which took place. What were your emotions back then?
A.K.: First of all when all Maidan movement started, the first emotion was being very proud of the Ukrainian people, how they finally left the fear and went out on the street in masse. I very-very well remember the first demonstration (it was, I think the first of December, or the 30th of November) there was the first march of the millions where really probably about a million people flowing through the centre and really making clear that enough is enough. And of course this is what everybody wanted to see long before but until that time people were unfortunately first of all afraid. And at that point people got rid of their fear and took their destiny to their own hands from that moment almost. I'm really amazed by how people start through for three months and managed to get rid of the second biggest dictator in the Eastern Europe. So…
V.S.: What about the times when it got really rough? When there were killings of the Euromaidan activists on the streets? Wasn't it the time when you thought: Okay, this is the time I have to get my family on the plane and leave the country?
A.K.: No I think that time we were in the same mood as the whole country, we were living I think from day to day. We have an office in the middle of the centre, our daughter goes to school in middle of the centre, one street from Maidan, for every day we were confronted by what was happening, and we also went to many of the demonstrations together with the family so we were living through it like everybody else and we were living at that time I would say day by day. At the days of the shooting at Maidan we were not in the centre. But the thought of getting on the plane and leave – we never had it. Actually like many people in Kyiv thinking of how we can help these people by small logistic aid or other types of aid, some by money was collected to provide medical supplies or things like that. So those were basically more the things we were concerned with. Not about leaving.
V.S.: Mr Klijbroek, you have been living in Ukraine for almost 20 years now. You have your family in the Netherlands, you have a lot of friends in the Netherlands. When you first moved to Ukraine, what was their reaction and what was their perception of Ukraine?
A.K.: When I moved to Ukraine I was 24, just fresh from studies, so I think probably… I mean… Many people's response was like: wow! But it was not really surprise that I went to Ukraine because before I came to Kyiv I have already been living in Moscow for a little bit over year.
V.S.: So you're the adventurous type?
A.K.: Well, the adventurous type.. I was one of the people that realized the opportunities that were about to open here. I went to Moscow as a part of an internship within my studies in Holland, I specifically took international business course because it was offering Russian language as the side subject, so basically quite specific that I already was looking firstly to Russia, then as it happened to Ukraine. So the people knew it wasn't really very big surprise that I went in this direction.
V.S.: But obviously once you started living here, you were coming back to Holland, and people would be asking you – what was their perception on Ukraine?
A.K.: For them, Ukraine was Russia. If I go back to Holland regularly so people would say Ok, you're back from Russia! No, sorry, it's Ukraine. So for the people then the Soviet Union just ended, so Soviet Union, Russia, all different states, for many people it was sort of blur, not a very clear picture. But by now, fortunately, people very much realize that Ukraine or Russia are two different countries. But in the beginning yes, it was quite unclear of course why I went there but it wasn't a big surprise because of the …
V.S.: Did you have your friends, relatives visiting you here in Ukraine?
A.K.: Of course.
V.S.: What was their reaction when they came here?
A.K.: Everybody without exception was very pleasantly surprised. Everybody never visited Ukraine, they were very great picture of the country? But people who actually took, came here and have chance to get to know Kyiv of course, mostly in Kyiv when people are visiting, they all pleasantly surprised by the atmosphere, the daily life, the friendly people they meet. In the end, really everybody without exception, nobody left with the grim face, everybody happy that at least now I understand what was the country I was living in.
V.S.: Mr Klijbroek, starting from January 1st of this year certain provisions of the Ukraine – EU Association agreement have come into force. And Ukrainian government was placing high hopes on this agreement to boost the economy, to increase inflow of foreign business in Ukraine. From your perspective, are you seeing the foreign businesses coming to Ukraine more and more?
A.K.: Yes, I think I just mentioned it before already a little. From the end of last year we again see an influx in our business of new clients that wanted to start new business here or extend existing business. The mood is definitely more positive and of course the Association Agreement is the major motor in that doing business really does become easier. Also already simply for Dutch exporters, it will be, it is already –cheaper, easer to get the products in, which everybody of course is hopeful will help in developing the export of Dutch products to Ukraine.
V.S.: So one of the conditions for the EU Association Agreement to come into full force with Ukraine is its ratification by the government of the Netherlands and prior to that, the Dutch government has called on the referendum which even though has advisory nature is still taking place in April. What are your thoughts on that?
A.K.: Of course it's a pity that there is a certain group of people who took the Association Agreement and misused it for their purposes. Because the group that initiated this referendum, it's basically the group that is anti-European. They're against the main structure of the EU, that's the main argument. That's actually quite strange, it is very strange that the Association Agreement with Ukraine is a topic for referendum. These people claim to be pro-democracy, they want more democracy, more saying. Now of course the Association Agreement really does what it does it really promotes democracy on the larger scale in Ukraine. It will help Ukraine develop democratically, and listening to the people that initiated this referendum you would probably be surprised to learn that they proudly claim that they have never read the Association Agreement. I think this is a group for three or four people, most of them have never been even in Ukraine, so they took the Association Agreement as a topic. For what reason – for many people it's not clear. It doesn't serve their goal. I would say there's positive note to the Association Agreement being held, sorry, for the referendum about the Association Agreement being held, and it says that really Ukraine is in the news in Holland now, for the last month and for the few more months to come, and there are also quite a lot of objective and positive news about Ukraine, positive developments that are taking place. People who are really willing to at least spend some time, some of their time in understanding what Ukraine is about and processes that are taking place. Actually, we receive a lot of objective information about what is going on here, and those that take the time, really not that much but just the time to understand a little what the Association Agreement is, what the process that Ukraine is going through is all about. I'm quite confident that those people would vote in favour for the Association Agreement. Also there are quite many people in Holland as well that don't understand why there should be referendum, they are very much bothered that it's going to cost the Dutch taxpayers 40 million Euros and that could've been spent on many other good things.
V.S.: Mr Klijbroek, in your opinion, how does the Netherlands benefit from the Association Agreement between the EU and Ukraine?
A.K.: Well, Holland is a trade country by nature. Until few years ago when the economy was more or less functioning export from Holland to Ukraine was over one bln Euros. Now in the last two years when things got of course difficult, export from Holland to Ukraine has dropped quite significantly. But it very easily also shows: if Ukraine is allowed to develop normally, there is a stable economy, stable trade relationships, export from Holland to Ukraine will easily jump by several hundred millions in quite a short period, I'm quite sure.
V.S.: So you say it's normally Ukraine and also the Netherlands is benefitting from this agreement. If you were voting in this referendum, how would you vote?
A.K.: What do you think? I think yes. And I would very much, of course, encourage everybody to vote yes, it's good. First of all, it's good for Holland. Secondly, for trade reasons. It's good for Ukraine because it really stimulates the development of the democratic institutions of normalization of legislation and I would say people also should understand what a No-vote would mean, basically, a support vote for Russia. And Russia is the country that is also responsible for the death of 200 Dutch people on an MH17 crash. I think that's also very important for the Dutch people to understand that. That a No-vote is the support vote basically for Putin. It will play in his cards and anybody that really understands this would find it very hard to ignore it as well.
V.S.: Well let's hope that your message reaches the Dutch viewers. Mr. Klijbroek, we really appreciated you joining us today, thank you for your time. We were discussing the challenges and benefits of doing the Dutch business in Ukraine with the founder and owner of ATM Trade Management Mr. Arno Klijbroek.
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