Denmark is known for its highly-competitive industry, generous system of social security, and per capita income of 47,390 dollars. What is the secret behind Denmark’s success, and what role does the government play in the country’s development? Is Ukraine interested in the Danes’ experience? These and other questions are raised in The Day’s exclusive interview with Ambassador Extraordinary and Plenipotentiary of the Kingdom of Denmark to Ukraine Uffe BALSLEV.
“DEMOCRACY IN YOUR COUNTRY IS MATURING’”
Mr. Ambassador, what is Copenhagen’s view of the early parliamentary elections in Ukraine?
“At this stage it is too early to speak about final conclusions. I can only say that the Danish observers who were present at the elections have stated clearly that they were held in a democratic way, meeting all international standards. Therefore, I can only congratulate Ukraine. I believe that democracy in your country is maturing not only in terms of elections but also in terms of political life. The election was aimed at resolving a deep crisis in the country, which was also worrying us. I am very hopeful that all the political forces will use this possibility in order to move ahead and reach a compromise needed between all sectors of Ukrainian society. Obviously, some important political problems should be resolved next year, and they cannot be solved on the basis of a small majority. There is a need for a broader consensus on certain questions, in particular, concerning amendments to the Constitution and regaining credibility for the legal system.”
Does Ukraine need a second state language and neutral status?
“Of course, both these problems are very politicized in Ukraine, and your country has to solve these questions on its own. These issues are political ones; therefore they can be solved in a political way. The Council of Europe gives good recommendations to Ukraine concerning ways to treat minorities and implement regional languages, and NATO — concerning cooperation with the North Atlantic Alliance. As far as I can see, Ukraine is applying the recommendations of both organizations.”
Some Ukrainian political forces say that certain European countries use two or three languages. Can this experience be applied to the Ukrainian situation?
“I think Ukraine can surely pick up European experience. But if you consider different European countries, you will see that different edicts on minorities were adopted there. Fortunately, Denmark is a homogeneous country; therefore we hardly have any of the problems experienced by Ukraine. I think that, on the one hand, Ukraine has to find its own equilibrium to secure nation building and national culture, and on the other, to provide national minorities with possibilities for national and cultural development. If you look at the Belgian, French, and Finnish experiences, they all have different models and approaches to satisfying the language needs of their national minorities.”
“NEUTRALITY IS NOT A GOOD IDEA FOR DENMARK”
What is your view of the appeals of certain political forces in Ukraine to reject accession to NATO and become a non-allied state?
“With regard to Ukraine’s entry into NATO, there is nothing bad about Ukraine’s decision to join NATO or not to join this organization. This is a political problem that has to be solved by Ukraine alone.
“Denmark is happy to be in NATO from the moment it was established in 1949. We experienced neighboring big countries and have proved to ourselves that neutrality is hardly a good idea for Denmark. It did not work and the country was occupied by the Nazis. On the other hand, our neighbors Sweden and Finland had a nice experience of non-allied and neutral status, although the world has changed greatly since 1949.”
Should the Verkhovna Rada adopt a resolution on joining NATO or should the people decide through a referendum? Which way would be best for Ukraine, in your opinion?
“I want to stress it again: this question must be solved by Ukraine alone. Both ways are democratic. We in Denmark have had several examples of resolving very important issues by means of referendums. In particular, we settled our relations with the European Union and participation in the euro zone with the help of a referendum. ”
“In other cases, we solved the question with the help of representative democracy. Both ways are possible. I have the impression that political forces in your country consider the question of NATO membership should be solved by a referendum. The sole question is when this referendum should be held.”
“THERE IS HARDLY A COUNTRY IN EUROPE THAT DOES NOT CONSIDER UKRAINE A EUROPEAN COUNTRY”
Let’s talk about Ukraine’s European integration. Is our country moving toward Europe at a slow or fast pace?
“In general, I can say that there is movement. The European Commission positively assesses the development of EU-Ukraine relations. Although, in some branches, the people in Brussels say, Ukraine has to make a big effort, especially where the reform of the judiciary system is concerned, which will secure the independence of the courts and the liberalization and simplification of business-regulating legislation. But the general picture is quite positive. We have to admit that the six-month political crisis meant that Ukraine lost some time for implementing political and economic reforms. I am sure that the pace of reforms will be restored. Ukraine is performing quite well. The next step will be to conduct negotiations on the new enhanced agreement between the EU and Ukraine. Both sides think that this agreement will be quite ambitious. It is not aimed at political PR. I want to say that the agreement on partnership and cooperation signed 10 years ago is quite advanced in terms of trade liberalization between Ukraine and the EU. The reason behind the preparation of the new agreement is that we want to take a large step ahead in the development of bilateral relations. With this goal in mind Ukrainian legislation should be harmonized to the European level for further trade liberalization, not only in terms of goods but also services and the free transfer of capital. I am sure that in a short period of time a new, deeper process of integration between the EU and Ukraine will be achieved.”
What did you mean when you said that Denmark supports Ukraine’s wish to include the EU membership prospect in the agreement?
“The European Commission that has received a corresponding mandate is taking part in these negotiations on behalf of the European Union. Therefore, our country does not express its opinion individually. The official position of Denmark does not differ from the position of other countries and the European Commission. To summarize this position in a few words, according to Article No. 49 of the Treaty of Amsterdam, any European country can apply for membership as soon as it meets all standards. I think there is hardly any country in Europe that would not regard Ukraine a European country. Second, the agreement, which is the subject of current negotiations, does not mention preparation for membership. This agreement does not precede Ukraine’s membership problem. Third, it is important to keep the focus on practical work in order to maintain the process that is regulated not by calendar or far-reaching visions but rather by results and practical achievements.”
What should the borders of the Eurocommunity look like in 10 or 20 years?
“This is a political problem that is being debated all over Europe and in Denmark too. There is no official resolution on where the EU borders should be drawn. Tough discussions are being held concerning Turkey’s EU membership. Obviously, some Asian or African countries are not European in terms of geography; therefore, they cannot join the European Union. But there is no clear-cut definition of where the EU’s borders should end.
Do Danish citizens support Ukraine’s membership in the EU? Are there any statistics on this issue?
“I haven’t seen any statistics on the Danes’ attitude to Ukraine’s membership in the EU. Obviously, much will depend on the extent to which Ukraine meets certain categories. In general, the Danish population has a positive attitude toward Ukraine’s integration into Euro- Atlantic structures. I think that in most cases, one will receive a positive response to the question whether Ukraine should move closer to NATO and the EU.”
“WE HAVE ALWAYS BEEN STRONG SUPPORTERS OF FREE TRADE”
Denmark is a highly competitive country with a high employment rate and generous package of social security. What is the secret behind Denmark’s flourishment?
“To understand the secret of Denmark’s success, you have to go back 150 years. I will name three reasons why the Danish economy is successful. The first one is that since the mid-19th century the government paid great attention to general education, not just educating the elite in universities, but peasants and laborers too. Therefore, the level of education in Denmark is very high. By the end of the Industrial Revolution, Denmark was ready for many changes; innovations that were needed to make the application of high technologies possible and to adapt to the new situation. It enabled laborers, peasants, and lower-level managers to work more independently and, as a result, to adapt faster to the situation. Education is still free, including at universities. But I must add that this does not mean that it does not cost anything: it is paid through high taxes.
“The second reason lies in openness and readiness to compete in the global world in contrast to protectionism. Over the course of history a small country like Denmark exported two-thirds, even three-quarters of produced output. And it cannot be a protectionist country. We have always strongly supported free trade in the world and in Europe. And the fact that our society is ready to compete means that our companies have always encountered strong competition abroad. Therefore, they have to realize their production structures and implement new technologies and labor organization.
“The third reason is that for 125 years Denmark never experienced any natural or political catastrophe, wars, aggression, and other disasters that could have led to the loss of industrial potential and human resources. During World War II, Denmark was occupied by Germany. But we managed to survive the war with small losses. We admit that, in comparison to Denmark, Ukraine had many external factors that affect the current situation in the country.”
Does the Danish government have any instruments for affecting the economic development of the country? Does it implement strategic planning?
“Yes and no. Denmark has very high taxes, so we have a large public sector. At the same time I must admit that the ideology of nearly every party, starting from the social democrats to the liberal conservatives, says that the state should not interfere in business life. It has to create the best possible conditions for business to flourish, but not interfere in business. Securing a high level of education and good infrastructure is one of way of creating framework conditions for business. Therefore, a planned economy is not suitable for Denmark at all. The Danish business infrastructure consists of many medium-sized and small companies. We do not have too many large enterprises. Therefore it is absurd to think that they could be managed with the help of state structures and planning.”
“UKRAINE HAS TO CONTINUE TO LIBERALIZE ITS FOREIGN TRADE”
Can any part of Denmark’s experience be applied in Ukraine or is any being applied at the moment?
“We are in a different situation. But, of course, Ukraine can pick up the Danish experience and achieve success. I will return to the problem of openness and free trade. Ukraine will gain much by entering the World Trade Organization and creating a free trade area with the European Union. Ukraine is not an underdeveloped country; it has a good level of society in terms of means of production, education, knowledge, and know-how. Ukrainians are well-prepared for competition on the world market. Therefore Ukraine has to continue to liberalize its foreign trade and secure the fastest possible rationalization of Ukrainian companies’ production, reduce expenses and apply the newest technology, thereby improving the welfare of Ukrainian society. Another sphere that distinguishes Denmark and the other Scandinavian countries is the way of organizing society, called flexicurity, which consists of two words: flexibility and [social] security. Many foreign investors regard this as one of the positive aspects of our society. They ask how we manage to achieve a high level of social security, high unemployment benefits, and other rules that guarantee security for the business climate, and simultaneously to secure a flexible labor market, where it is easy to hire workers who meet market requirements. We managed to achieve this thanks to the state, which created framework conditions for a free business life. Many social benefits, which are paid by employers and employees in other countries, are paid through taxes in Denmark. This guarantees that workers are less unyielding when a manager wants to reorganize a company in a way that it will meet market requirements. They understand that they can be flexible enough and eagerly consider changes and implementation of new technologies.”
Do you see any interest from the Ukrainian side in applying Danish experience?
“Of course, I think it would be reasonable for Ukraine to send many people not only to Denmark but to other countries as well, to familiarize them with their experience. Ukraine has decided to accept Danish help with reforming the public sector. I signed an agreement in mid-September, according to which Denmark will give 12 million Danish kroner for the implementation of the first stage of a project to reform the public sector on central and local levels. At this stage we are sending two international experts: to the main department of the public service and to the Cabinet of Ministers’ Secretariat. They will give advice on administrative and public sectors, organize training sessions and seminars, and determine spheres of activity in the following stages of the four to five-year-long program, where we can assist Ukraine. This can be a reform of self- government organs. Denmark implemented this kind of reform last year and has a lot of good experience in merging small and less effective units into larger and more effective ones. And this experience can be applied in Ukraine. Therefore, close cooperation is being developed between Ukraine and Denmark, especially in this sphere.”
ON THE EU EMBASSY AND THE UNITED STATES OF EUROPE
At one time Denmark closed its embassy in Ukraine and re- opened it later. Can you imagine that one day there will be a single European Union Embassy in Ukraine, and the countries that belong to the EU will recall their embassies? Is this a real prospect?
“I don’t rule out that one day in the distant future there will be a single EU embassy instead of the embassies of EU countries in third countries. But there are no such plans at the moment. The EU countries will resist such a scenario. But I can’t rule out such a development. Now, when negotiations are underway about the new reformational agreement under the Portuguese presidency, there is a plan to strengthen the EU’s foreign policy service. This means that the European Union will build an EU diplomatic service. One can see even now that the equilibrium in questions of gathering information and developing a common position concerning foreign policy is moving from the states to Brussels. This will be a gradual movement, and I am sure that in 5 or 10 years such a foreign policy service will be consolidated and become stronger and more efficient.”
Can this consolidation lead to the creation of the United States of Europe?
“I don’t think so. Danish Foreign Minister Per Stig Moller said recently that the beauty of the European Union is that it does not aim at becoming a new United States of Europe (USE). We want to remain individual states. We want to continue to cooperate in the way it is being done today. Everyone is very much insisting on the subsidiary principle, which means that when a problem can be solved on a national or regional level, it should happen this way. Meanwhile, some political problems should be solved on the EU level in Brussels. I don’t think that we will come to the USE in Europe. But I don’t know where we will arrive. Europe is constantly developing in different directions: it enlarges geographically, in depth; it adds new spheres of cooperation. If you look at Europe like it was 10 to 40 years ago, it has changed immensely.”
EU ENLARGEMENT, CONSOLIDATION, AND AMBITIONS
It is commonly held that if some union enlarges, it becomes weaker at the same time. Can the inclusion of underdeveloped countries lead to the weakening or even collapse of the European Union?
“This matter is under discussion in the EU at the moment. The accession of the Balkan countries and possibly Turkey is being discussed too. If we turn back to the 1960s, there were discussions then on including Great Britain and Denmark. At the time people in France and other countries kept saying that including these two countries would weaken the European community and that it would probably collapse. There have been discussions on enlargement and deepening. Therefore, there were periods when the EU was dramatically enlarging and also when there were talks on halting the enlargement in order to consolidate our achievements. This is positive, too.”
Mr. Ambassador, if the EU reform is implemented and the Eurocommunity has a foreign minister, does this mean that the European Union will turn into a new pole?
“The EU aims to become the most important player in the world. One can say this in the sense that the EU has ambitions along with other players, like the US and China, to play the most important role in the world arena. On the other hand, the EU recognizes strongly that we have to play a different role than the US. We always have to act in tandem with the US as a strong partner to achieve the goals we have set in the world. Large volumes of trade are also our political instruments, like support for upholding human rights and a civic society. On the contrary, the US is better at implementing ‘tough force’ and it has always been stronger in the military respect. We can provide ‘soft force’ and the US — ‘tough force.’ If the US had not executed ‘tough force’ in many parts of the world, we would never have had any opportunity to apply ‘soft force.’ The issue is not about confrontation but about complementary ways of action in the world arena. Of course, the EU wants to have a common harmonized foreign and security policy and to act as a unilateral player in the world arena, but by means of cooperation, not confrontation with other partners of the world community. The world is not a ‘zero-sum’ game.”
