The AI-322F engine displayed by Ukraine’s Madasich Engine Company at an international weapons exhibition in Kiev
Unite with Canada to demand immediate release of Chinese Communist Party
Ukraine is united with Canada and Ukraine calls on the Chinese Communist Party to release them immediately, Foreign Minister Kuleba said on the same day after the Communist Party began the trial of two Canadians behind closed doors last Friday (March 19).
Kuleba tweeted that the trial of the two Canadians must be conducted with honesty and transparency, and that they must likewise be guaranteed the right to a legal defense and the consular services provided by Canada.
Ukraine has in the past been generally cautious in its international stance when it comes to Chinese Communist Party matters. Ukraine’s support for Canada’s criticism of the Chinese Communist Party at a Time when its relations with Canada are currently chilly is a move that is not unusual for Ukrainian diplomacy.
Canada has helped Ukraine and Kiev is repaying the favor today
Ukraine and Canada have always had close ties. Canada has a large Ukrainian immigrant community, and many of the local Ukrainian diaspora have actively supported the 2014 Ukrainian Square Revolution.
After Russia’s annexation of Crimea and invasion of eastern Ukraine, Canada provided significant assistance and support to Ukraine. Freeland, a prominent Canadian political figure, was active in promoting Canada to help train Ukrainian military personnel during his tenure as foreign minister. Freeland, whose mother’s Family immigrated to Canada from Ukraine, has worked in Kiev and speaks Ukrainian.
Communist Party freezes all assets and real estate of “Madasic”
On the same day that Ukrainian Foreign Minister Vladimir Kuleba issued an article supporting Canada’s criticism of the Chinese Communist Party, a court in the capital city of Kiev ordered the freezing of 100 percent of Madasic’s shares and all of the company’s real estate, which was placed under the control of a Ukrainian government department. This department is responsible for investigating, arresting and managing assets acquired through corruption and crime. The state-owned Ukrainian Defense Industry Corporation, which is responsible for arms exports and the defense industry, has already expressed its intention to participate in the management of Madasic. The Ukrainian government has earlier decided to nationalize the company “Madasic”.
Ukrainian media reported that Chinese investors currently own about 75% of the controlling stake in “Madasic”. However, the management and operation of the company is still in the hands of the team of the former owner Boguslaev. Boguslaev has been leading the company since Soviet times. Chinese investors tried unsuccessfully to hold a shareholders’ meeting in January this year to seize the management and operation of the company. Ukrainian security agencies sent special forces military police to patrol and stand guard at the factory at the time, and local parliamentarians stepped in to organize a public demonstration at the site to stop the Chinese investor from taking control of the business.
Different reactions will affect the investment climate and the interests of retail investors
“The Madasic incident has not only become the focus of attention in Ukrainian society, but has also provoked a variety of reactions. Many people support the authorities’ nationalization actions. According to Poltnikov, an influential Ukrainian media personality and current affairs commentator, the authorities’ move has successfully prevented Ukraine’s cutting-edge technologies from falling into the hands of the Communist Party of China.
However, some members of the Ukrainian economic and business community believe that the nationalization of Madasic shares, which are freely tradable, has tarnished Ukraine’s image as a country, especially in terms of the investment climate, and will discourage investors from coming to Ukraine.
“About 19% of the remaining shares of Madasic are held by minority shareholders and retail investors, including some of Madasic’s employees. The shares held by these employees were acquired in the privatization of the company. These minority shareholders had expected a big increase in the price of their shares after the takeover by Chinese investors, but now they have been turned into scrap paper.
Ukrainian activist Shemikhigiko, who represents the interests of minority shareholders, said that the interests of some 3,500 minority shareholders and retail investors were harmed when the court froze 100% of the shares and transferred them to government agencies, and that the losses could reach $100-200 million.
Russia Concerned About Opportunity to Take Advantage of Ukraine’s Attempt to Balance Forces
Russia is also closely following the development of this incident, especially the possible future direction of Ukraine’s relations with the Chinese Communist Party. Russian media have been extensively reporting and analyzing the Chinese Communist Party’s acquisition, as well as the various possible retaliation by the Communist Party against Ukraine. Some analysts believe that the failure of China’s acquisition of the Ukrainian engine venture will result in the CCP’s continued dependence on Russian engine supplies and an increase in orders from the CCP that Russian companies will receive. Moscow likewise hopes that the CCP will be more on Russia’s side on Ukraine.
Ukrainian Foreign Minister Vladimir Kuleba has said that how to deal with the “Madasic” incident and Ukraine’s relations with the Communist Party depends on how Ukraine balances its forces and influences.
Ukrainian strategic scholar Burkovsky said that the Communist Party of China does not like Ukraine to fall too far to the West. If Ukraine can balance its forces and strengthen itself, it can be more confident in its dealings with the Communist Party.
Burkovsky: “If Ukraine is politically stable at Home, if the country is growing in strength and is an important balancing force between the EU and Russia, in the Black Sea and Central Europe, in this case it will be easier to find a coincidence of interests with Beijing.”
Communist China is currently Ukraine’s top trading partner. Ukraine is dependent on the Chinese market for its exports of iron ore, metals and especially various agricultural products. Beijing’s response so far has been limited to statements by the CCP’s Foreign Ministry asking Ukraine to defend the rights of Chinese investors.
At the same time, the first shipment of new vaccines provided by the Chinese Communist Party to Ukraine arrived in the capital Kiev on March 25.
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