KHMELNYTSKYI, Ukraine – Oleksandr Symchyshyn has been the mayor of Khmelnytskyi for less than three years – a blink of an eye for a 600-year-old city.
But Symchyshyn believes he has already made a difference in this city of 268,000 people, located some 280 kilometers southwest of Kyiv.
Symchyshyn, among Ukraine’s youngest mayors at 37, boasted of his successes in a Sept. 11 interview with the Kyiv Post – he says he has stopped corruption in the city council, improved the roads and started turning the city into a transport hub between the western and eastern parts of Ukraine.
“In the past three years we have done more than in all the previous years of Ukraine’s independence,” the mayor told the Kyiv Post in his office.
Behind him, an office sideboard is covered with religious icons, a reminder that Symchyshyn was elected on the ticket of the conservative, nationalist Svoboda (Freedom) Party.
But for all his boasting, Symchyshyn admits that the city still faces a number of serious challenges: it needs to attract investment, up budget revenues, and learn to save energy in the face of soaring gas prices.
Stopping corruption
A history teacher by profession, Symchyshyn was elected the mayor of Khmelnytskyi in November 2015.
He is a member of Svoboda, Ukraine’s oldest and best-known nationalist party. Its members hold only six of the 423 seats in the national parliament, but are a stronger force in Khmelnytskyi, where they have 10 out of 42 city council seats.
Symchyshyn says he has two main goals: the cultivation of patriotism and fight against corruption.
“Besides the national flag, for the past three or four months we’ve been raising the red-and-black flag,” he said, referring to the flag used by the Ukrainian liberation movements in the 20th century, now used by Ukrainian nationalists.
So, patriotism is being cultivated. Ending corruption has been a bit more complicated, however.
“We’re trying to eliminate the bad things that have traditionally been here before – kickbacks, corruption arrangements that objectively could hurt the city,” Symchyshyn said.
According to Symchyshyn, there have been many attempts to give him bribes, all of which he says to have rejected. Once, he said, he was given a book. When he opened it, there was an envelope full of cash. He says he threw it back at the giver and threatened to report him to the police.
He has never in fact reported any attempted bribes. He also wouldn’t name the people who tried to bribe him. He says he would report them if they tried to bribe him for the second time, with the first time counting as a warning. What’s important, he says, is that eventually people stopped offering him bribes.
“Over the past year, I cannot remember even a single case (of attempted bribery),” he says. “Everyone has realized that there is no point in doing it anymore.”
Better infrastructure
Of the city’s problems, the most noticeable is its poor infrastructure. Khmelnytskyi needs to improve its roads and transportation in general, build more schools and kindergartens, and improve energy efficiency. Symchyshyn said these issues are top of his list of priorities.
The mayor boasts that starting from 2017, the city started completely resurfacing its roads, instead of just patching potholes, as it used to do before.
“We remove the top layer of asphalt and put down a completely new layer. It’s much better than repairing individual holes, which we’re planning to stop doing altogether in a year or two,” he said.
But with a total of just 40 kilometers of roadway – or less than 10 percent of Khmelnytskyi’s total road length of 428 kilometers – repaired in the past three years, a lot of work clearly remains to be done. Twelve more kilometers of road will be repaired this year, but according to Symchyshyn, half of all the cities’ roads are in a dire state. Some are not even surfaced at all.
Another thing that Symchyshyn has focused his efforts on is modernizing the way the city buildings consume energy, especially when it comes to heating.
The city has started to repair municipal buildings to cut their heat losses. In the past two-and-a-half years, it has installed heat insulation at 15 out of the city’s 40 kindergartens, and in a perinatal hospital.
“The perinatal center now spends around 40 percent less on energy than it did in previous years,” says Symchyshyn.
To make apartment buildings more energy efficient, the city offers to compensate 70 percent of the cost of insulating a building, with the remaining 30 percent being paid by its residents. But so far, only 10 apartment buildings in Khmelnytskyi have taken up the offer, according to Symchyshyn.
Another infrastructure challenge is the serious shortage of kindergartens and schools. The city has built two new kindergartens in the past two years and is constructing a new school.
“Overcrowding in school classes is catastrophic – in one school we had to set up 11 first classes,” he said. “There are 36-38 children in each class.”
Labor problems
With a total population of some 268,000, Khmelnytskyi also suffers from a labor migration. Finding an employee, whether it be a skilled or non-skilled worker, is a big problem for the city, the mayor acknowledged.
With the average salary in the region being Hr 7,500 ($260), many workers, especially from the city’s prominent sewing industry, prefer to work abroad, mainly in Poland.
According to the Indeed.com job ad website, a factory worker in Poland makes on average $10.4 per hour, or $1,660 a month – more than six times the average salary in Khmelnytskyi.
According to the mayor, there is a serious labor shortage in several sectors.
“In the municipal sphere we have around 200 vacancies. We’d hire workers immediately if only we could find them,” said Symchyshyn.
And while it’s tough enough to keep workers in the city, another problem is making employers hire them officially – and pay the taxes on which the city budget depends.
For example, rhere are between 250 and 280 sewing businesses in Khmelnytskyi, employing from 25,000 to 35,000 people by different estimates, says Oleg Demchuk, director at ASTAR agency for sustainable development in Khmelnytskyi.
However, it’s impossible to say for sure how many workers there are, said Symchyshyn, because some businesses don’t hire workers officially to avoid paying taxes.
The city government is talking to businesses, trying to explain why it’s more important than ever to pay taxes: Because of the decentralization reform in progress since 2014, more local tax money stays in local budgets, meaning that the cities’ well-being now directly depends on how much tax is raised locally.
Symchysyn estimates that about 4,000 workers in Khmelnytskyi have “moved out of the shadows” and been hired officially.
Attracting investment
To improve the local business environment, Khmelnytskyi’s authorities are encouraging big companies to set up shop in the city, while offering small local businesses financial help.
One big success for the city was the decision of Nova Poshta, the Ukrainian e-commerce shipping giant, to build a 9.5-million-euro logistics center in the city. The new center will open in 2019, bringing 300 jobs and processing 18,000 shipments per hour.
“We chose Khmelnytskyi because it’s a national transport hub, a transit point between the western region and the rest of the country,” Oleksandr Bulba, CEO of Nova Poshta, told Kyiv Post in an emailed comment.
Another big new investor is SEBN (Sumitomo Electric Bordnetze), a German manufacturer supplying wiring to the Volkswagen Group, including for luxurious car brands like Bentley. The manufacturer is opening a plant in Khmelnytskyi in late September 2018 and is to invest 6 million euros and create 500 jobs, according to Iryna Shvaykevych, a communications specialist at SEBN.
But the mayor is especially proud of the city’s new program for stimulating small businesses.
Since one of the main complaints of the businesses is the high interest rate on loans from Ukrainian banks, the city offers to subsidize loans at the National Bank of Ukraine key policy rate. That is, if a business takes a loan at a 25 percent annual rate, then currently 18 percent of the loan repayment is reimbursed by the city. The city has allocated Hr 1 million for this program.
However, the offer is only available to businesses that manufacture goods, and for loans under Hr 300,000 ($10,700). So far, only one company has taken up the offer, although four more have applied and are about to get reimbursements.
“One paper packaging company has received such a refund, of Hr 20,000, from the city budget, and will be getting it monthly,” said Symchyshyn. Some doubt the effectiveness of the program, saying the Hr 300,000 limit is too small.
“It’s not really enough to start and operate a business,” said Demchuk.
Several local civic activists whom the Kyiv Post asked about Symchyshyn’s work as mayor gave him mostly positive reviews.
“There are no major complaints about his work,” said Oleg Chernenko, a local representative of the Chesno anti-corruption watchdog.
Andriy Popyk, the deputy head of the Khmelnytska Initsiatyva NGO, says that the locals aren’t always happy with Symchyshyn, but “it’s natural.”
“Some want more fountains and festivals, others are against it and think the money should be spent on hospitals, and so on,” Popyk said. “In general, the city is going in the right direction, although I think the changes aren’t happening as quickly as they could be.”
