The world of today, which is still bearing the consequences of a global financial crisis, lacks success stories of the counties that can be called role models. Austria, a fragment of the former Habsburgs’ empire, can serve as example of a country that managed to transform fast, shake off the whole burden of the past, and develop. In the course of a two-hour-long meeting with Den’s Summer School of Journalism students, Wolf Dietrich HEIM, the Austrian Ambassador to Ukraine, spoke on the secrets of his country’s success, on the importance of history for diplomacy, and on the importance of speaking English or French during negotiations with Brussels.
Yaroslav NAZAR: Austria and Ukraine have a lot of common things in their historical past because Western Ukraine was a part of Austro-Hungarian Empire. Have these historical ties preserved in our relations and do you see an influence of Austro-Hungarian spirit on modern Ukraine?
“The history is of an enormous interest in diplomacy as much as in general life. I myself studied history, but my major was in commerce and management. In this context I would like to refer to a comprehensive paper on Galicia ‘Reality and myth,’ recently written by Jakub Forst-Battaglia, the director of the Austrian cultural forum in Kyiv. This article will be printed in a few weeks time in the second edition of the Ukrainian-Austrian Meetings – a book that we published two years ago in both our languages. We have also an outstanding short article by Andreas Kappeler, a Swiss born historian, who is one of the leading historians when it comes to Russian and Ukrainian history. He started 30 years ago before Ukraine became independent to focus on Ukraine’s history. He managed to summarize the very essence of Ukrainian history on 20 pages in this abovementioned book.
“This is really in a nut shell what an average Austrian or average European reader should know about Ukrainian history. This is particularly difficult because there is so much to say and it is not an easy story that you can tell on one line.
“I have a strong interest in history, I read more and more of it in Ukrainian language, but it is not my role as a diplomat to come up with strong opinions, history is too delicate to be used for other means as professional approaches. We have a fortunate situation here in Kyiv, we have a remarkable crowd of knowledgeable colleagues and of course academia here is as much as in other parts of the country.”
“I have a strong interest in history, I read more and more of it in Ukrainian language, but it is not my role as a diplomat to come up with strong opinions, history is too delicate to be used for other means as professional approaches. We have a fortunate situation here in Kyiv, we have a remarkable crowd of knowledgeable colleagues and of course academia here is as much as in other parts of the country. But if I just look around some of my colleagues Henrik Litvin Polish ambassador, Jan Tombinski, the head of European delegation, who both know your country well. Jan Tombinski also knows Austria extremely well. He did very interesting research on the Custom Union that was on the table in Austria at the late 1920s. If you run into Jan Tombinski you may ask him about the proposed Union that was nonstarter in Austria in late 1920s. This Custom Union with Germany (which never materialized) would have deprived Austria of much political sovereignty, and this offers an analogy of a development as I think would be the case for Ukraine today if it were to choose to relinquish its powers to formulate trade policy to a foreign capital city.
“Coming back to the ‘Reality and myth’ here on 20 pages you have very clear picture of what historical Austria and present-day western Ukraine have in common and this is something I would certainly recommend to give moment for more details. Because it is still topic that keeps people interested and a lot needs to be done in this part of the world to shed light on recent history, large parts of authentic sources which have been closed to the public. There are a lot of myths and intentional disinformation circulating and I must say – and this is not only a compliment to you – one of my daily routines is to read Den and its very solid history pages, as much as I can with my Ukrainian teacher. I am at this stage much better in reading and understanding most of it.”
Ya.N.: Two years ago died Felix von Habsburg-Lothringen the older son of former Austro-Hungarian emperor Carl the First. After the Second World War he played quite a valuable role for uniting Europe and had some influence on Austria. Is there in Austria nostalgia for Austro-Hungarian Empire times and are there such leaders as Otto von Habsburg-Lothringen was?
“I would bluntly say no, there is no nostalgia in Austria. There is a lot respect and admiration for the role of Habsburg dynasty and family.
“To most Austrians I must say the later decades of the monarchy were not perceived as a very modern and liberal, progressive political system. At some moments in the second half of the 18th century and also 150 years ago the monarchy was a progressive political system providing constitutional rights and liberties to all citizens, rule of law, and religious freedom. These moments have been well reflected here in Bukovyna and Galicia. Of course, it can be debated, but probably the most progressive and liberal reforms we have seen in the Austrian empire were at the late 18th century when the son of Maria Teresia, Joseph II initiated ground breaking reforms in education and the religious sphere at the time well before the French revolution took place.
“At that time the Austrian administration in present-day western parts of Ukraine – compared to what we have seen at the time in the bordering regions of the Russian empire or others – was more liberal and more open society, granting religious freedom to all different groups and providing education that was dissociated from religious sphere and providing higher education in Ukrainian language.
“These things are not always perceived in modern Austria when remembering the monarchy, more so their longer conservative phases in the first half of the 19th century, known as Biedermayer and the decades long repressive reign of Count Metternich.
“There is all that much sympathy for the monarchy in Central European countries that were once part of an empire, like in Bohemia/the Czech Republic, Moravia, Slovakia or Hungary. In 1860 we had abolition of serfdom, democratic reforms that were well ahead of what we saw in the wider region, like in the Russian empire, but also in other eastern countries. If you move west and south from Kyiv you will see that this territory was on a border of three empires.”
Mykola SIRUK: You may know the Austrian essayist Robert Menasse. I had an interview with him last year. He considered that Europe lacks visionaries in contrast to the founding fathers of European Union which have shown that you can make visions reality step by step. But today we have some political elites that are going back step by step without visions. What can you say about that?
“To a certain point I would agree with him, but on the other hand European integration is often misunderstood. To me European integration is work in progress, this is something that needs to be seen. It is not a static union.
“European integration at times has been sort of a rocky road with crises and difficult moments where the British, for instance, have had quite a bit of a diverging view on some of the key issues and where the French and Germans have had a very strong say in driving things forward.
“Now the European Union is working in ways that the six founding members at the origin conceived the European Communities. The French were very skilled to offer the administrative practices as a model for the inner working of European institutions. Because I’ve studied at Ecole Nationale d’Administration in France I recognize a lot of it outside France and I see a lot of benefits in sound administrative procedures. I discovered that European administration, the institutional framework is probably more based on French administrative logic than on any other member state’s administrative culture. In a way it’s useful because it has a strong objectivity and meritocratic approach.
“And I think the French administration can be extremely powerful. It provides the coherence in the whole country. And to me that is also relevant because Ukraine in a way is administered in the same logic, or at least the same aspiration. You have the governor that is not elected but who’s very close to the presidential administration and the government at large. And that in France is the prefect who is nominated by the Minister of the Interior and who like an ‘ambassador at home’ in his region, guarantees and provides the rule of law, proper administration and coherence of the state policy where interfaces are sometimes not working smoothly. I mean, France is almost as large as Ukraine but historically it’s also quite diverse. You have quite different historical influences e.g. in northern, southern or eastern France. Nobody really worries about it in France these days. I think, that is one of the examples, that I can say – I’m not worried about Ukraine falling apart or seeing a gap in between – I don’t see that.
“But in that sense, European integration is work in progress and to put it simple, whenever there’s a major crisis we’ve seen the need to come up with another step of integration in terms of policy and scope.”
M.S.: Mr. Ambassador, French Ambassador said that the French like Napoleon but not like Bonaparte. I have read one article and it said that Napoleon was the first euro integrator. What can you say about that?
“I think there’s a lot of positive if you look at the Code Civil (also known as Code Napoleon) and its impact. The overall perception of Napoleon in the non-French parts of Europe is more of a Machiavellian hegemonic approach. In that perspective, the Habsburg monarchy was quite different. In Austria we always describe it with the Latin bonmot – bella gerant alii, tu Felix Austria nube – meaning others may lead wars, while Austria enlarges its empire through marriage and family bonds.
“And this is basically how Ukraine started Christianization and statehood – in a very similar spirit. But basically with this strategy Habsburg Empire grew. There have been wars and conflicts but they were to maintain and retain of what had been established. I think one of the interesting moments in our history is the reign of Maria Theresia (1740-80), an Empress that I am very fond of; she is one of my favorite characters in Austrian history. The large part of the Austrian administration up until the time when computers and software were introduced was based on Maria Theresia’s well-thought rules of administration.
“As for another part of the European integration, I think you have to have a command of one of the languages to be able to actively participate in any administrative political process. If you’re a Head of State and you do not speak English or French it may be very difficult to make yourself heard and understood within the EU. You can deliver speeches, you can send in your paper but you’re not able to talk at the side of the conference table with your partners, with your allies. European integration is not a rock solid alliance building exercise. For one it is rules based. Then it’s always spontaneous, situative alliance building with changing partners to find common ground for new regulations and legal ground. And you have to find out your partners for any given topic – and countries that you have very little in common with. You find on environmental issues a lot of partners and on other issues we would find entirely different ones. But this is one of the reasons why Austria in times when we had to restructure, scale down, close embassies, we have not closed any of the embassies in any of the small EU-member states.
“I think, Austria was the only country that opened embassies in Cyprus and Malta when they became EU members. Because we see this picture and we want to know how small EU-member states feel about certain policies and where we have common ground and where we can help and where we need to work together. I think this is something, that other member states, for instance, of similar size – Sweden, Finland, Ireland – don’t have a comprehensive network within the European Union. But such a network very much explains how dynamic this process is, how much you have a say in the policy shaping – this is actually still difficult for many new members who joined EU in 2004 and after. This, looking back, was a lengthy learning process for us. But for many Eastern and Central European fairly new members of the European Union – the experience they are making – they have to be well-qualified in command of the languages to make their input arrive in good time.
“But for Austria I would say EU membership has brought enormous benefits and not only tangible things, measured in trade flows and money. But in political terms, we had the need to really redo the way we administer the country.”
M.S.: Could you, please, give more details about benefits?
“There was a full screening in the early 1990s when Austria joined the EU. And we discovered when we did that – there were so many laws that entirely outdated. They were just there, in force (hardly anybody thought about them), entirely irrelevant. And that’s why you know – when you screen and look whether you comply with European standards and regulations, you discover a lot of it is outdated, useless and actually not coherent with other laws and regulations. And that was a good moment to get rid of them.
“If I follow things here in Ukraine, I think it would be a good exercise for any administration, any country to screen and to find out that there’s so much text that is not in harmony with itself. And it could be much easier and much simpler and it would then also be able to be fulfilled, respected, and enforced.
“This was the first real benefit when we joined the European Union. We got rid of so much ballast that was weighing down public life, the economy, and kept the administration busy. Of course, it also helped to modernize and to streamline our economy and make it fit in an ever more globalised world.
“We are now among the biggest investors in Romania, Turkey and most countries in Central and Eastern Europe. If you look at Turkey and Romania – this is outstanding because Austria is not a large country, but we invested there a lot more than Germany, France, UK, and many other countries. In Romania alone more than 10 billion euros. Here, in Ukraine, it’s 3.5 billion euros – that’s also a lot – we’re among the top 5 investors but in fact it could be a lot more, if the conditions were right.
“Another point in political terms that is extremely interesting is that our currency policy has been (until the euro was introduced) more or less shadowing the German Bundesbank. Now with the euro we have a full voice, we have voting rights in the European central banking system. We can also offer our advice, our expertise and we are not only heard, but we have a very strong say in the European currency regime and policy shaping. This is certainly much better than what we had before when we were basically really in literal terms – shadowing what happened.”
Ihor SAMOKYSH: Your country was forced to get a neutrality status. And it helped Austria to get rid of Soviet Army. And nowadays we’ve got a question, thus: is such neutrality status relevant today, when the world became global? And what is the cost of this status? Might it not be better for Austria to join the collective system of defense?
“Neutrality was the key to succeed in finding a formula that would make all four allied powers leave Austria in 1955 and make Austria come together as one piece. And as it were, later on many Austrians discovered the many benefits of neutrality in the cold war period.
“Since 1995 when we joined the EU we are in full solidarity with the European decisions taken in the field of foreign policy and security. And that anticipates that we assume and hope for the common foreign security policy to develop further. And we are actively involved in developing it in the understanding that there is a European Union apart from NATO structures. Of course, NATO is not to be underestimated. And nobody wants to redouble NATO with European structures.
“When we joined the EU in 1995 we modified our Constitution – simply put an amendment – when there is European foreign policy and security policy decision, then neutrality is secondary. The same applies to UN mandates or OSCE decisions.
“Where there is no common European position we are neutral, so ‘for all the rest we are neutral.’ And this is interesting, because this is what the French Prime Minister Clemenceau said after the First World War when Europe geography was redefined and the Austrian monarchy lost most parts of the non-German speaking territories. Clemenceau said: ‘Le reste c’est L’Austriche’– sort of ‘All that remains – is Austria.’”
Iryna LAZURKEVYCH: One of the most frequently discussed topics which concerns Europe is a question of economic crisis in it. What is the position of Austria about the causes of this crisis? And what the model of solution of this crisis do you support: measures of stiff hard economy or development package of financial stimulation? As it is known, the first model is supported by Merkel and the second by Hollande.
“This is a question of my liking, because I’m more of an economist than anything else. For me it’s not a ‘Euro crisis,’ it is a global crisis that is not so much currency related but it is sovereign debts crisis. And that means that any state, region, city or community has a problem if they overspend.
“If you have a deficit – you have a problem, if you have a structural deficit for too long, you build up debt and if you have too much debt than you get to a point where you’ll eventually be bankrupt. In a time of crisis (and most crises arrive unexpectedly) people realized one simple and plain truth in economic theory – that is lesson number one – that risk and return has a clear relation: the higher the risk the higher the return, the lower the risk the lower interest rate you’ll get on your account. This is something that in Greece or in Cyprus a lot of people were willing to ignore.
“Back to the currency, the euro system is strong enough to make sure that we will do what it needs to keep that system up, and to maintain stability it is necessary to establish the banking union. This provides for the stability and makes sure that the large banks are under proper supervision and if they fail, there is a basis for resolution and recovery. This is now in place and provides after 2-3 years of preliminary arrangement in Europe a solid, properly established basis, and if any major systemic banks in Europe should fail, there is not only the money, but also the rules to recover and resolve this problem without causing any havoc.”
Kostiantyn HONCHAROV: Unemployment in the euro zone reached a record 12.6 percent. Austria now has the lowest unemployment rates in Europe. How do the Austrians manage to keep their jobs during the crisis?
“One of the reasons why in Austria we have very low youth unemployment is a system, where especially young people of lower qualifications are offered a dual training program which we call ‘do training and work.’ And that has been there for generations. It means that young people, when they finish school at the age of 15, and they choose not to go on to high school, they have three years of job with segments of training, so they have a regular workplace, where they work and in addition they spend several modules from three to six weeks, where they learn the basics of their career, about their profession, and then there is the qualifying process and diplomas are awarded.
“Youth unemployment is not only a European phenomenon, but unlike in the United States, the mobility of labor force here is very limited. And this is also where Ukraine comes into the picture, because any skilled Ukrainian worker is and will be extremely interesting for the European business. Not only Ukrainians would like to earn money and to get a job. But this what we see today and evermore in 5-15 years with the underlying demographic trend, skilled Ukrainian worker who speaks foreign languages will be in high demand.”
M.S.: Menasse once told Den that the European Union is making a big mistake in relation to Ukraine. The European Union says, “Make order, reorganize your nation, and then we will see what we do with you,” instead of helping Ukraine to become fit for the post-national system of the European Union. What do you think about this?
“I think it’s important to see how Ukraine develops and how it progresses on the road to European integration. If we look at history, for instance Greece, Spain and Portugal after non-democratic phases, were rapidly admitted to European Union. In Ukraine we focus on the core democratic and rule-of-law criteria – that’s the common understanding in the EU, if you don’t have clear commitment to democratic principles and certain minimum levels of rule of law it would be premature to discuss step 2 instead of step 1. Then of course, in last few years Austria was actively involved in the debate that we need another criteria – apart from the so-called Copenhagen criteria for enlargement – that is whether the European Union itself and its institutions are capable of absorbing enlargement, in case of large countries in terms of population and geography, without adapting its rules and institutions.
“On the other hand, e.g. Romania has not been able to absorb all the European funds that are on the table. Some member states every year fail to absorb the billions of euros that could be invested according to the rules. That’s also true for Ukraine, some of the money that is available is not being used, because some of the basic requirements – in public finance administration, in public procurement etc – are not in place. I’ve been here for 3 years and, honestly, in terms of these requirements the rule of law has not improved much if at all. Some key democratic principles, how elections are organized, we are still in very rocky territory. That’s why the European Union has great interest in improving and rendering the electoral legislation more susceptible to manipulation.”
M.S.: Mr. Ambassador, is your country for signing Association Agreement in Vilnus?
“We are very much in favor of signing, within the limits of the three defined areas where progress is needed, still for a lot of progress we are waiting. It has not yet been delivered and with the summer break of the Verkhovna Rada, it will be September or October. We follow events daily, but focus on judicial reforms and electoral legislation, they are of very high importance. I think, it’s not so much about Austria, I don’t expect to see any complications in my immediate area of work, but the decision will be prepared by 28 foreign ministers and eventually taken by heads of state, it will be 28 member states and the European Parliament, which has to be in favor of signing and then ratification.
“I’m confident that we will be able to take this big step and, ideally, also see provisional implementation of a wide range of elements of the Association Agreement, including comprehensive free trade of goods and services. It is a base for assuring real progress in relations, and also a good base for economic development of Ukraine and would help to strengthen rule of law.”
Maria PROKOPENKO: In 2012 Austria was among the top 5 investors of Ukraine, but some German companies are leaving Ukraine. What about investors of your country? Are they not afraid or did they adapt to Ukrainian business-climate?
“Some businesses are leaving, and one Austrian bank (Erste Bank) has refocused their strategy. I think, for Austrian banks and business Ukraine is as challenging as it always has been. Few people say it was much better five or seven or ten years ago. It’s challenging, I agree, and it remains difficult for some time. But in banking, for instance, other markets like Hungary and Romania are also keeping headquarters busy. The question is: if I have to readjust my strategy and I’m able to sell certain assets, but I think that is in the overall situation a relevant question and I would assume that Ukrainian assets are not the ones which I would sell.
“For many Austrian businesses Ukraine continues to be profitable, but a high risk engagement, I think, profit makes a difference and makes it easier for shareholders and for the owners, to justify that it’s risky.
“The perspective of European free trade encompassing Ukraine would certainly help to reduce the overall risk and to see more rules respected and less discretionary decisions taken without legal basis.”