From Soviet-era cadet to influential international businessman, Hares Youssef has done it all in Ukraine.
When Hares Youssef, an influential Ukrainian businessman of Syrian origin, talks about why he left his homeland, he mentions everything except his own desire.
It’s quite easy to understand such sentiments, as he made the move back in 1982, when Ukraine was still part of the Brezhnev-era Soviet Union. At the insistence of his family, Youssef arrived in Kyiv to study at a military tank academy. What he discovered upon his arrival was a country with even less freedom and things to do than in his native Syria.
Soviet Ukraine, he recalls, made him, just 18 at the time, feel extremely depressed. Youssef’s only desire was to get out, and the only way to do so was to get bad grades and be sent home.
Yet his plans didn’t quite work out, as the terms of the exchange program he was in were written into a Soviet-Syrian intergovernmental agreement, and Youssef’s academic performance didn’t matter that much. As a result, he ended up staying at the military school for three years.
“Not much depended upon me back then,” he says philosophically.
Now, 20 years later, this is no longer the case. Youssef owns Vienna-based Hares Group Holding, a company with interests in numerous businesses in the region, which in 2004 had a total turnover of about $420 million. His business is not as massive as the multibillion-dollar empires of Ukraine’s richest tycoons, but it is impressive for a Syrian-born immigrant, who years ago dumped the citizenship of his homeland and opted for a Ukrainian passport instead.
Youssef started the company in 1995, but even before that he had the chance to experience some of the “Wild East” capitalism that was flourishing in Ukraine following the country’s push for independence.
Just before that, Youssef was forced to do a stint in the Syrian army. He tried to desert on several occasions, but this only landed him in jail for a couple of days. Finally, in 1989, Youssef made it back to Kyiv, the place he’d wanted so desperately to leave, and started doing business.
While the country was experiencing acute shortages of pretty much all kinds of quality goods, the former Syrian army officer was buying and selling everything he could get his hands on – from briefcases to VCRs and more.
He says that sometimes he would sell, repurchase and again resell the same VCRs up to five or six times without the goods ever leaving the warehouse. Inflation was wildly high and the market was in total chaos.
“You had to be a completely stupid person not to make money back then,” Youssef said.
He, like many of Ukraine’s newly rich, claims to have made his startup capital precisely during this difficult economic period.
Move to big business
Soon Youssef discovered the huge difference in the prices of steel in Ukraine and abroad. Like others at the time, he dashed to quickly occupy a niche in this lucrative market. He remembers making huge profits, as well as loosing $17 million overnight when the Ukrainian currency took a nosedive in 1998.
Currently, Hares Group owns shares in Moldavian Steel Works, a steel mill better known as MMZ located in the break away region of Transdniester. His company recently won a tender to invest and manage the Hama Steel Plant in Syria. Hares Group also markets Ukrainian, Moldavian, Turkish and Brazilian steel, he says, adding that, unfortunately, there is no longer much for him to acquire in Ukraine, as all of the enterprises have already been sold.
Hares Group owns shares in Cardinal Resources, a British listed company involved in oil and gas exploration in Ukraine. His firm also has interests in industrial engineering, real estate development and the shipyard businesses.
Playing with the big boys
Big business almost always means having good connections with the country’s authorities.
“It is like that in any country, and Ukraine is no exception,” says Youssef, adding that he has been able to have good relationships with almost everyone from Ukraine’s political and business elite. Almost every political party running for Parliament this year has offered him a place on its election list, he said. In exchange, the Syrian born businessman was asked pay up to $5 million.
Youssef says he refused the offers, as “Parliament is not a good place for a businessman.”
Quite the contrary, according to Youssef, being in Parliament is more likely to cause losses to a deputy’s business, rather than benefiting it.
Ukraine’s generous Syrian
Sometimes Youssef would lend his private Falcon jet to Ukrainian governmental delegations for official visits, such as Yassir Arafat’s funeral last year, or the funeral of Saudi Arabian King Fahd Bin Abdul Aziz.
“They actually never sent me a thank-you letter,” he notes. But Youssef doesn’t seem to get offended over such things. He feels the same about being fired last October as an advisor to President Viktor Yushchenko. He was told that his dismissal was meant to prevent a conflict of interest.
There was one time when Youssef says he felt a little offended. Again, it involved his private jet, which was used last year to transport Nastya Ovchar, a little Ukrainian girl who suffered severe burns while rescuing her little sister from a house fire, to a medical clinic in the United States.
Youssef said he wanted to avoid publicity, so his name wasn’t mentioned anywhere in the news. Instead, he says, another businessman took all the credit for it.
Youssef has other plans for the future, which would allow him to give something back to society. The latest of Youssef’s project is to make a movie about the fictional Ukrainian Cossack from Mykola Gogol’s novel, “Taras Bulba,” in cooperation with French actor Gerard Depardieu. Taras Bulba will either be played by John Malkovich or Depardieu himself.
The film will cost some 15 million euros, he says, adding that it will be shot in English allowing for worldwide distribution. If other investors don’t take part, Youssef said he will finance the movie himself.
Ukrainian at last
In 2001, Youssef received Ukrainian citizenship, becoming “Hares Abdulrakhmanovich Youssef” in his passport. He says he celebrated the event, adding that he now considers Ukraine his home. But Ukrainian citizenship for him was also a matter of convenience, since it allows the entrepreneur visa-free travel to Russia or Moldova, which he frequently visits on business.
Youssef says that over the last two years he has been to his homeland for a total of three days, but that he dreams of the day when his mother, who still lives there, will move to Ukraine. She visits Kyiv often, but the climate doesn’t go well with her. He hopes he will have a better chance to bring her to Kyiv when he builds a house in Crimea.
“The southern point of Crimea is closer to Syria,” he added.
