Moments in U.S. Diplomatic History

Freezing in the Dark: the First Years of the USAID Mission in Ukraine


Using candles for light, huddling into the warmest room, tapping into government telephone lines to make calls—these were the conditions USAID officers faced when trying to set up a regional mission in newly-independent Ukraine.  Food was scarce in the winter of 1994-95, and temperatures were among the lowest on record. Then politics in both Ukraine and the United States made the situation worse. The Minister of Industry cut off the electricity and telephone to USAID’s temporary office in 1995 following a murky dispute within Ukraine’s leadership.  And the U.S. government shut down over budget disputes that severely impacted USAID’s ability to carry out its development program.

USAID’s new mission in Kiev was one of many U.S. government efforts to engage with the newly-independent countries of Eastern Europe in the years following the Soviet Union’s collapse.  USAID Program Officer Anne Aarnes and her team worked against all these challenges, and persevered in their development work, not only in Ukraine, but in Moldova and Belarus as well.

Anne Aarnes holds a degree in Political Science from George Washington University and had extensive experience with USAID’s Asia Bureau. She would go on to become Deputy Mission Director for USAID in Bangladesh and Egypt, Mission Director in Jordan and Pakistan, and Central Asia Regional Mission Director in Kazakhstan.

Anne Aarnes’s interview was conducted by Ann Van Dusen on August 8, 2017.

Read Anne Aarnes’s full oral history HERE

Drafted by Vinicius Storck

Excerpts:
At one point, AID’s program in Ukraine was the third or fourth largest program worldwide, but it was number 32 in staff size.”

Ukraine after the Cold War: Kiev reminded me of a 1940s movie, very different from the modern western world; the levels of education and cultural sophistication were very high. Ukrainians had never been used to relying on any outsiders because everything had always been run through the Soviet system. Nothing had been established separate from the Soviet government and everything had been run through Moscow, so once the Soviet Union collapsed, it was as though everything had had its head chopped off.

Photographs of elderly people standing in long lines went around the world. The government’s collapse hit the elderly especially hard because their pensions had disappeared, and any savings they had had were worthless because of inflation. Ukraine was desperately short of energy; energy had always come from Russia, very cheaply, and all of a sudden the rates skyrocketed.

So, in AID, we were looking at how to help the country move from being a communist state to being a modern state in a capitalist system. We were also dealing with setting up the U.S. relationship and USAID programs in Ukraine. The new mission was intended to cover Ukraine, Moldova and Belarus. The earmark, when it came, was $250 million a year, including $225 million for Ukraine and $25 million split between Moldova and Belarus. It was one of the agency’s largest programs in the world.

… The winter of 1994 was Ukraine’s coldest winter in about 75 years. On weekends, we rode the trams around Kiev. I never knew where I was because the ice on the inside of the windows was so thick I couldn’t see through it. There was no way to stay warm. Food was scarce and the quality of what there was, was poor. It was difficult to find housing for the AID staff. We put our children into an American international school that had been started a year before by a private U.S. company, Quality Schools International…. There wasn’t much heat in the building, so the children in the American school wore long underwear and four layers of clothes. And winter in Ukraine is long.

… One of the biggest problems was staffing. AID’s staffing always seems to lag far behind program budgets. For the first couple of years, the mission staff was ridiculously small in relation to the program size. At one point, AID’s program in Ukraine was the third or fourth largest program worldwide, but it was number 32 in staff size.

“There didn’t seem to be strong lines of authority from the president and prime minister down to the ministries. Some of the ministries tended to be kind of independent powers.”

Power Outage at the Mission Office: In the first few years [after the fall of the Soviet Union], there wasn’t much cohesion in the government and there didn’t seem to be strong lines of authority from the president and prime minister down to the ministries. Some of the ministries tended to be kind of independent powers. The AID mission was part of a dramatic example of this in late 1995.

The mission was working in rented space on the 19th floor of a building that was under the control of the Ministry of Industry. The mission was having space renovated in another building in another part of Kiev, which was much bigger and better suited to our needs as the mission expanded. Well, like 100 percent of all renovations in Ukraine, work on AID’s new space was way behind schedule. The lease on our current space was about to expire, so the mission kept telling the Minister of Industry that our new space wasn’t ready, and we would extend our stay for another month on the 19th floor in his building. And finally, after a few months of extensions, the minister turned off the mission’s lights and the telephone.

Q: Time for you to leave?

AARNES: I guess so. It wasn’t quite clear why the minister did that, because AID was paying the rent every month and no other tenant was lined up to take the space. The minister’s action was extremely unusual for Ukraine at that time. The U.S. government didn’t have any on-going issues with the minister. It was said that the minister was making a show of power to impress his Ukrainian political opponents in some kind of domestic political dispute, but we never found out for sure. It was a bizarre situation.

The mission’s electricity and telephone were cut off for four weeks. It happened to occur right when the U.S. Government had closed down, between December and January in 1995-96.

… So there wasn’t much of anyone in Washington whose attention we could get. In Kiev, we talked to everybody we could think of up to the deputy prime ministers who were the AID mission’s close counterparts. They were appalled and said they would talk to the Minister of Industry. But the Minister of Industry wouldn’t budge. The U.S. ambassador to Ukraine thought the AID mission should acquiesce, and just move out to an empty warehouse 45 minutes away. We resisted that because it would have been very expensive, and would have brought our work to a complete halt for at least a few months. And it seemed as though giving in to the pressure of this particular minister would have sent an odd signal about Ukraine’s relationship with the U.S.

It was an interesting four weeks. At that time of year, there was very little daylight. The sun was up only between about 9:30 and 3:30. Without electricity, we couldn’t use space heaters. There was only the heat supplied to the whole building, which was minimal. The mission staff spent most of the time trying to stay warm. Everyone on my staff tended to gather in my office because it had windows that let in light and a little bit of heat from the sun. The FSN [Foreign Service National] who was in charge of IT for the mission was very skillful. He tapped into the telephone lines of the ministry so that the mission would have one telephone line coming in. The elevator for the building was still running, so we would get off the elevator on the 19th floor, and step into total darkness. Then we would see a little flicker of candlelight in the distance, and go toward it and greet whoever was sitting at the reception desk next to the candle and that one telephone line. Every few days, the ministry would find out that AID had tapped into the telephone line and cut it off. Then our IT expert would tap into another line. This went on for four weeks. It turned out, as I mentioned, that the issue probably had nothing much to do with the United States — the minister was making a show of strength in a domestic political fight.

… In part, it indicates how fluid the whole of Ukraine’s government was at that time, and its lack of experience in dealing with foreign assistance organizations.

… Then the furlough ended, and people came back to work in Washington. The ambassador got his orders from Washington to fix it and that was the end of it. The electricity and telephones were turned on within a day. It was an uneasy period between AID and the ambassador.

It was so odd, because the U.S. seldom gets treated like this and Ukraine was a strong ally.

“It was very clear that such a big change was going to take a while in Ukraine, and it would require a sustained effort.”

AID’s Legacy in Ukraine: I think the Congress and the Administration had underestimated the tremendous effort that was required to get embassies, AID missions, and other USG operations set up in the former Soviet Union. These things took much of our attention in the first few years.

… In the democracy and governance sector, one of the first things AID did was help set up the mechanisms for presidential and parliamentary elections, with support from IFES (International Foundation for Electoral Systems). NDI (National Democratic Institute) and IRI (International Republican Institute) received large grants to work with a number of local organizations and to train candidates running for the first time in multi-party elections. In the economic growth sector, the work that was done privatizing small enterprises and reforming the banking system was very important.

In the health sector, the Hospital Partnership program was particularly strong. It arranged exchanges and training on key issues for selected hospitals in all countries of the former Soviet Union. We could pair that project with another project being carried out by the NGO Counterpart. Counterpart was getting a lot of hospital equipment from U.S. military bases that were closing in Europe. The equipment helped upgrade major hospitals, and Counterpart trained the hospital staff in how to use it. According to the Partnership project staff that I worked with, the hospitals in Ukraine, Moldova and Belarus were similar to U.S. hospitals in the 1950s, but they could be upgraded to a much higher level of functioning. Through the project with Counterpart, we also worked with NGOs that gave assistance to people in need, such as the sick, the elderly, and orphans.

Q: Were there food aid programs?

AARNES: No, but there were programs to help address issues in agriculture production and marketing. There were also programs, longer-term efforts, to address energy needs.

At the point that AID began to work in Ukraine, Moldova and Belarus, shortly after the collapse of the Soviet Union, I think the assumption in the U.S. was that what the people of the new post-Soviet countries needed was to be introduced to capitalism, and to learn how the private sector worked in the United States…. And then it would take off.

But that assumption wasn’t based on a very good understanding of those new countries. It also didn’t come from a good understanding of change – what it takes to change people’s attitudes, behavior and institutions, and what kind of effort will bring results. It was very clear that such a big change was going to take a while in Ukraine, and it would require a sustained effort.

Q: Did it surprise you that corruption in Ukraine has really flourished and that they went back to a fairly autocratic leader?

AARNES: Sadly, it was not a surprise, depressing and disheartening as that is. I think there are many things that AID, and other parts of the U.S., can help with. But there may be other factors that are deep-rooted that keep democracy from flourishing and allow corruption to continue. AID’s development assistance is important, but a lot of other things have also come into play, over which AID has absolutely no control. Ukraine, especially with the Russian influence, is particularly vulnerable. On the other hand, I know that some of the FSNs have been active in politics, some of them left the mission and ran for office, and others have spouses who are very active in politics. They’re still working to make Ukraine democratic. It’s wonderful that they’re so dedicated because, when we came to Ukraine in 1994, many of them were very afraid that everything would slip back into Stalinism…. It’s remarkable that they’ve stayed active, in Ukraine’s tough environment.

 

TABLE OF CONTENTS HIGHLIGHTS

Education

     BA in Political Science, Oberlin College                                                                           1965-1969

     MA in Political Science, George Washington University                                              1972-1976

Joined U.S. Agency for International Development                                          1969

     Islamabad, Pakistan—Deputy Head/Head of Health, Population,                             1988-1993

          and Nutrition Office      

     Kiev, Ukraine—Program Officer, USAID                                                                          1994-1997

     Dhaka, Bangladesh—Deputy Mission Director, USAID                                                 1997-2000

     Amman, Jordan—Mission Director, USAID                                                                     2003-2007

     National War College—Faculty Member                                                                            2011-2013

     Almaty, Kazakhstan—Central Asia Regional Mission Director, USAID                      2013

     Washington, D.C.—Senior Deputy Assistant Administrator,                                         2013-2014

            Office of Afghanistan and Pakistan Affairs    

     Washington, D.C.—Senior Deputy Assistant Administrator, Asia Bureau                  2014-2015

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