"I am ready to be integrity investment nanny." The mayor of Chervonograd on requirements for rear towns, mines and development prospects
Andriy Zalivskyi, the Mayor of Chervonohrad
Chervonohrad is quite an atypical city in the west of Ukraine. It is located almost on the border with Poland, but it has similarities with the coal-mining regions of eastern Ukraine - from the structure of its budget to its population, which is used to working around the clock in continuous production. Several state-owned mines operate in Chervonohrad, and the city itself has long-standing partnerships with Pokrovsk, Myrnohrad, and other cities of Donbas.
However, the community is trying to develop in other directions to reduce its dependence on a single industry. These efforts are being helped by cooperation with the City of Integrity project of the EU Anti-Corruption Initiative (EUACI), which began in 2019 and is working in several domains. How this city in the rear met the war, what the prospects are for the development of this coal-mining region, and the importance of anti-corruption activities - in an NV interview with Andriy Zalivskyi, the Mayor of Chervonohrad.
What were you able to implement from the plans that had been made for 2022, and what had to be radically changed after the full-scale Russian invasion?
We are in the deep rear. Therefore, I would divide 2022 into three major stages. The first is February-April, when all our actions were aimed at helping the Armed Forces. The second stage began in April, to which support for internally displaced persons (IDPs) was added. And starting from September-October, the third stage began, involving the protection of the civilian population in the community when rocket attacks intensified and things like power cuts began.
Last year, we had planned to solve many problematic issues in the life of our city. Of the large projects planned, only one was implemented: the reconstruction of the reception department of the Chervonohrad Central City Hospital. Other projects were canceled by the war or postponed to this year.
What were the main reasons for this?
First of all, a decree from the Cabinet of Ministers was put into effect which set forth the priority of allocating funds from budgets. This decree is still in force.
Secondly, as of April 1, the city budget did not receive UAH 27 million. This is the biggest drop in all 7 years that I have been mayor.
What is the reason?
The first quarter is always difficult for us, because 1/3 of the local budget is filled by miners. And there were no revenues for the payment of salaries from the state budget at that time. Businesses stopped paying taxes in full: many stopped making payments, and some people were mobilized.
How did you solve this issue?
Everyone was confused. It was necessary to cut costs. Thanks to our cooperation with the EUACI City of Integrity project, we adopted an Integrity Plan in 2020, which constitutes a set of specific anti-corruption measures with clearly defined executors. By the time the full-scale invasion began, it was 70% complete. Therefore, our work with the program over the past three years has strengthened the institutional capacity of the city council and prepared all employees of the executive committee for similar challenges.
That is, you had an anti-crisis plan of action formed in advance?
Yes, the Integrity Plan sets out a certain behavioral model for officials, particularly the political will of the leadership. I'm not saying that everything is turning out perfectly, but we are still heading down a certain path. You are creative in how to do it, not how to avoid it.
That's why we started with ourselves, not with teachers or anyone else. I canceled my own bonus for three months. Employees of the executive committee received minimal bonuses. The restrictions also affected managers of communal enterprises and the like.
Has the situation improved over time?
The spring months were the biggest challenge in terms of funding. As of June 1, we had filled our revenue plan for 5 months. Then payments to miners stabilized. Businesses and enterprises have resumed operations. Beyond that, tax revenues from the military started coming in.
Is anti-corruption work, one of the elements of which is the Integrity Plan, beneficial for the community?
I do not consider being in the mayor’s office to be an end in itself. This is an opportunity for achieving my goals, but what kind of goals do I have while in office? Personal enrichment, or making the community attractive? I believe that the community should develop. Ukraine must move to the European Union, which means we must meet the standards that exist there.
I like to start small. When the go-ahead is given for the start, we will already be ready. Then it will be easier to show results and achieve success. Thanks to cooperation with anti-corruption programs, we already have a foundation. But in addition to this foundation, we also have a desire to be everywhere and move within a system.
IDPs and humanitarian aid
Is there anything in the Integrity plan that has been needed during wartime from a practical point of view?
A few years before the start of the war, a person started doing anti-corruption work at the city council. Everyone already knows that without her signature, documents do not go any further, even now when, for example, there was a temptation to change bidding processes [when purchasing goods and services]. I assigned this person to monitor the humanitarian aid situation so that there are no abuses.
Is this person accountable to you?
At the city level - yes. But it is also accountable to the National Agency for the Prevention of Corruption.
How exactly is work with humanitarian aid organized?
In the first days of the war, by order of the mayor, a Humanitarian Headquarters was established under the executive committee. 715 tons of humanitarian aid was received from charitable foundations and organizations from Germany, Poland, France, Lithuania, Latvia, etc.
Most of this aid headed south, east, and northeast, to Kyiv-Bucha-Irpin, Kharkiv, and Luhansk Oblast (in the direction of Popasna). A large generator brought from Germany was also handed over to the city of Voznesensk in the south.
20 tons of food products were sent to our defenders and much more.
That is, you have a single body that takes care of these issues. Do you involve representatives of other organizations and cities in its activities?
At first, there were many public organizations and people of good will in the city who were working on these issues...but over time, our Humanitarian Headquarters has taken over. It cooperates with religious communities, as well as with people from Kramatorsk and Pokrovsk, who centrally help their compatriots.
The main thing is to unite people, communicate with them, and coordinate work. Then the result is much better.
For cities in the "deep rear," one of the key areas of work is IDPs. How many of these people are there in your community, and how do you help them?
Up to 15,000 internally displaced persons were registered on the territory of our community. There is now a stable presence of 6,500 to 7,000.
Those who came with the first evacuation trains mostly wanted to move on to Europe. Back then, we were a transit point where people stopped to rest for a day or two. Over time, the majority of people arriving began to stay with us, so there was a need for shelters. Kindergartens were the first thing that came to my mind. They were able to accommodate up to 800 people.
When they realized that all this would not end quickly, we started to prepare other shelters in parallel. We began to allocate funds from the city budget and to attract funds from international donors. Some people helped with furniture, others with building materials, others financially, and yet others still with household appliances. We have already created several such shelters. Several hundred people can be accommodated there.
We also organized food provisions. From the first days, the staff of our kindergartens received food through our humanitarian headquarters and prepared food. At first there were three meals a day, and after Easter two meals a day. Now there is a one-time hot meal for everyone who lives in our facilities. Almost 2,000 food kits from World Central Kitchen were also distributed in the city.
You spoke about repairs in places that would become shelters. What facilities were chosen for this?
In one of the towns of our community, there was a youth center. We moved it to a neighboring venue and repaired it. People are already living there. There was a music school in which one section out of three wasn’t operating. They started work on it. There are other premises in which people who arrived by evacuation trains from Pokrovsk and Myrnohrad live.
Are internally displaced persons finding their place in your community?
A survey among IDPs showed that more than 70% wanted to stay in Chervonohrad. Some people, after living in a shelter, found a job and started renting. Someone even bought a home.
But there are people who have a difficult time, who are living entirely on social benefits. The government's task is to help.
What has changed in the work of the city council after the start of massive rocket attacks?
The primary task was to provide critical infrastructure facilities with generators. But we went further and decided to provide Resilience Points [dedicated facilities with generators, heating, and shelter during power outages – ed.] and heating points with Starlink satellite communication terminals. We have already purchased them. And we have resources for additional purchases if necessary.
On October 14, 2022, the library on Hrushevsky Street was opened after renovation. In fact, it was turned into a modern space with a children's area and a co-working area. Funds for reconstruction were allocated from the city and state budgets. The EUACI financed the purchase of furniture.
"I hope that it will be an attractive place both for young businesspeople who will look for inspiration here, and for freelancers who can work here, and for internally displaced persons," said Allan Pagh Kristensen head of EUACI, at the opening.
This is the first such space in Chervonohrad, where we can hold events, discussions, training workshops, and discuss problematic issues.
Donors and transformation
You mentioned working with donors. It seems to me that not all Ukrainian cities are still able and willing to do this. Could you share your experience?
We did not have a lot of experience communicating and cooperating with donors before the war. The situation forced me to apply to them, because there were a lot of requests from IDPs. At first, local residents provided food, but as needs grew, we began to look for other sources. We understand that international partners could help.
What is the possible secret of our success? My deputy, Nadiya Zemnytska, who is in charge of the Humanitarian Headquarters, assembled her young, active, determined youth. Most of them speak foreign languages and they started to make contacts.
Transparency also helped. Donors saw that the humanitarian headquarters in Chervonohrad reports on its operations every day (what was received, from whom, and where it went and began to contact us themselves.
Perhaps the city already has projects implemented with grant funds?
Yes, we did energy audits of 60 communal buildings, including educational, cultural, and medical institutions. Now we are looking for donors to carry out thermal modernization and heating with alternative energy sources. We also want to modernize part of our heat supply system.
How do you see your cooperation with EUACI for this year? Do you already have everything set?
There are no limits to improvement. Today we are waiting for the results of the audit of our Central City Hospital. The second is an electronic reception system and resident portal, so that everyone can see at what stage of consideration all complaints, requests, and appeals are. And the third project, which was born with the support of the Anti-Corruption Initiative and is being implemented together with a team of experts from the NGO Lviv Regulatory Hub, is the streamlining of the order of obtaining land plots, which every person has the right to receive free of charge. No one has ever done this in Ukraine. We want transparency and accountability.
In 2019, a geoinformation system was implemented in Chervonohrad. "5 subsystems have already been implemented, with another 2 in progress," says Taras Havunka, mayoral advisor.
On the portal you can find:
- register of community real estate;
- investment map;
- city land cadaster;
- register of advertising media;
- budget map.
In the near future, an Analytical Module and Surveyor's Portal will appear. "This is a portal of opportunities," says Andriy Zalivskyi, the mayor of Chervonohrad.
Investments and investment attractiveness
What is the coal industry for your community? Is it a problem or an opportunity?
I will answer from the point of view of the city’s mayor. 1/3 of the revenues of the city budget of the community comes from coal enterprises. Is the community willing to voluntarily give up a third of its income? Probably not. Do we understand that this may happen in the future? Yes.
In fact, in the spring of last year, you had a simulated situation of a sudden disappearance of income from mines...
Yes, and we saw what we could face. We have to find a replacement. The main thing is to set a goal and constantly work towards it.
So our actions should be aimed at diversifying in 2-3-4 different directions. But we understand that a miner who loses his job needs to be offered another profession, in which his earnings will be lower not by 50%, but by 10-15%. Otherwise, he will not agree.
How important is the work on improving the investment attractiveness of the city during martial law?
My main mission in this position is the image of our community. When I have conversations with businesses, I always say that at the start that they’ve already earned 10% profit - because they don't [need to] give bribes!
Can you give examples of investments?
When an external investor comes, it speaks to the prospects of the city and the community. Before the war, we began the construction of a shopping center. It was very good, because the investment was not local, but from Lviv.
It was supposed to be opened in March, but everything stopped. We managed to convince the owners and the shopping center opened in June. The same owners bought a plot at the land auction and plan to start construction of a 3.5 hectare technology park this year.
As part of the transformation of the coal regions, we worked out documents for a large industrial park - about 80 hectares. Now we will register it. It will be a community enterprise.
Our task is to show everyone that the city has a future, and what will life be like with or without the mines.
Do you have enterprises that have relocated from the east or south of the country?
There are several companies. For example, an enterprise from Rubizhny wants to resume production of plastic packaging for medicines.
But we do not emphasize relocated or not relocated. There are people who want to invest in the community. I always ask them: "How can the community be useful to you? How can I, as the mayor, help you? Do you need to be an investor? Yes, I'm ready to be one!" Community development is important to us.
Is there a particular type of business you are betting on?
We have a very developed furniture building cluster. During the war, a new furniture enterprise was opened, with modern equipment imported. This is a Polish investment. At the start, there should be 200 jobs with the prospect of increasing to more than 1,000.
The second cluster is the processing of agricultural products. I met with members of the European Parliament from Italy at a time when there were difficulties with grain logistics. And they asked me: “Why don't you build a factory for the production of Italian pasta? You are 20 km from the border!" Why export a large tonnage of grain when it and other agricultural products can be processed here in Ukraine?
Some of our coal enterprises are closing down and their areas are being freed up, and they could become another center of gravity for the creation of new enterprises. The mining workforce is also being released, and they are ready to work in shifts. In our community, life goes on 24 hours a day: 4 shifts at the mines, while other enterprises have night shifts.
It has been said for many years that Ukraine could become a European China. Do you feel an opportunity for this, and do Europeans have this need?
In December 2021, I had a meeting with the Dutch, who want to build a plant for processing lard into fat for perfumes and antiseptics within our community. They have an enterprise in another country (I won't say which one). And even then I offered them to move production here, closer to the border with the EU. It is precisely because of the fact that, let's say, a certain worldview discourse with China or with other countries may arise in the future. They thought...
European business is ready to invest in Ukraine. But after the end of the war. For my part, I ask them to name the conditions under which they are ready to invest, so that we have time to prepare. We are given 10 conditional points that are needed, and we work on their implementation over 5-6 months. When the war ends, and they will say "We are ready!" and we will answer "So are we!"
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