00:00Krystia Freeland is former deputy prime minister and foreign secretary of Canada and recently became an unpaid economic advisor to the Ukrainian president.
00:09She was there for the Trump Zelensky meeting. So, Krystia, you spent the week in Davos in part as an unpaid economic advisor to President Zelensky of Ukraine.
00:20He had a meeting on Thursday with President Trump. Did you get a readout on that meeting and how it was perceived?
00:27So I'm not speaking for Ukraine, David, but as let's say as a friendly observer, what I am hearing and I think what everyone else is hearing from the Ukrainians, from the Americans and indeed from the Europeans is that at this point, the Ukrainians, the Americans and the Europeans are all pretty much on the same page when it comes to this negotiation.
00:54And that's actually a remarkable outcome when you think about how rocky the path has been to get here.
01:04So, you know, it feels like there is quite a lot of optimism from Ukrainians, from Americans, from Europeans.
01:14And I really think the bottom line is that the ball is in Putin's court.
01:18You have been focused for some time on what comes after the war and the economic rebuilding of Ukraine.
01:26And you're advising President Zelensky now on that subject. At what point do we make that pivot?
01:33I think we need to start making that pivot now. And, you know, I really think, David, you know, for the past four years of war,
01:41we have been quite rightly, I think, focused on Ukraine as the virtuous victim.
01:48But I think this is going to be the year when we pivot to seeing the Ukrainians quite differently.
01:54And when we start seeing them as a really strong ally, as Europe's military shield, as Europe's arsenal,
02:04the country that knows how to build, knows how to wage modern war and knows how to build the weapons for modern war.
02:11And in addition to all of that, as a huge economic opportunity, the opportunity has started now.
02:19There are a lot of companies in Ukraine investing, particularly in defense technology.
02:25One investor described defense tech as Ukraine's oil.
02:32So the investor said, you know, what oil has been to the Gulf states, defense technology is going to be to Ukraine.
02:39It is now. And when the war ends, that will be even more the case. And I think that's absolutely true.
02:44What level and type of investments required first to have Ukraine play that role in the defense area,
02:52but then presumably to go beyond that in its economy to have a more diversified economy beyond high-tech warfare?
03:00It's going to take a lot of money. I think the good news is we've seen what happens when countries in the Warsaw Pact,
03:10in the former Soviet Union, reformed their economies and joined the European Union.
03:16You know, in 1990, when the Warsaw Pact collapsed, when the Soviet Union collapsed,
03:23Poland and Ukraine had roughly the same per capita GDP.
03:27Today, Poland's per capita GDP is five times the per capita GDP of Ukraine.
03:34In 2004, you had countries of Eastern Europe and the former Soviet Union join the EU,
03:42and those countries saw their GDP triple.
03:47One of the most important things about the economic opportunity for Ukraine
03:52is that Ukraine is now on a clear path to EU membership.
03:56When you say it's going to take a lot of money, how much of that will come from private investment
04:03as opposed to governments such as the United States and various European governments?
04:06How much is public? How much of it will be private, do you think?
04:09There is a lot to rebuild, and there is a very significant commitment already from the European Union
04:18to support Ukraine. The World Bank has been doing a lot. Ukraine right now is negotiating an IMF program
04:27of support as well. And it is going to take some public money, some public support from Ukraine's allies
04:36around the world. And, you know, I think it's very impressive the degree to which the EU is there.
04:42But what I think, and I think people get that. I think people understand that Ukraine is going to need
04:47the support to rebuild. The opportunity that I don't think people are fully focusing on right now
04:53is there's going to be a tremendous economic opportunity. And we've seen this story before.
04:59Some of the great investment opportunities in the world happened in Poland, in Eastern Europe,
05:05when you had the collapse of communism and the building of a market economy,
05:10and then joining the EU. And you're going to see a version of that happening with Ukraine.
05:17Some of it can, some of the investment can start now. What I'm hearing from a lot of investors is
05:22the big investments are going to come when the war ends, and that security is a precondition
05:28for major investment. And I think that makes sense. But I think the smart players are starting to look
05:34at Ukraine and see this is going to be a place where you can really make some very significant
05:42investments, earn some really, really significant returns. Defense tech, I think, is going to be a
05:47really, really hot sector in Ukraine. And the smartest players are already there. But I think you're
05:53going to see people looking also at agriculture and agri-food. I think you're going to see people
05:58looking at forestry. I think you're going to see people looking at technology more generally.
06:03Ukraine is a very high tech society. It's part of the reason that they've been able to do so well
06:07in the drone wars. And so I think you're going to see investments in technology more generally,
06:14including some technologies going from military use into civilian use, including with AI.
06:21And then I think you're going to see a really big privatization program. Ukraine has 3,000 state
06:26owned enterprises. It has a plan to privatize them. So, you know, I think this is going to be a
06:32version of the emergence of market economies in Eastern Europe in the 1990s at the beginning of
06:40this century. And that is going to be a huge opportunity for investors and also really great
06:46for the people of Ukraine. We began your week in Davos focused really on Greenland and what President
06:52Trump was saying about Greenland and dealing with the Europeans. That seemed to have shifted on
06:57Wednesday when President Trump said that they had a framework for an agreement of some sort.
07:02What is the allied reaction? You talk to all of the allies, the European countries.
07:08What is the reaction to the drama we saw over Greenland this week?
07:12You know, it was a very volatile week. And I think there were a lot of experts here
07:19and across Europe who suddenly became experts in Greenland.
07:27There were a lot of ups and downs. I would judge the mood of the Europeans to be
07:32right now a feeling of relief and that a bullet has been dodged. And I think people are very happy
07:39that an off-ramp seems to have been found. But I do think the whole episode has been another,
07:47has been just the latest wake-up call for Europe. And I think, you know, what the Europeans are feeling
07:54more and more is that they have to become united, that they have to strengthen their ability to
08:03militarily defend themselves, that they have to strengthen their economies to do that. You know,
08:10I would say the most popular writer and philosopher this week in Davos has been the Greek general who
08:21wrote about the history of the Peloponnesian Wars. The Athenians said, look, we're stronger than you.
08:28We're going to do whatever we want to you. The strong do what they will and the weak suffer what
08:35they must. This is the line everyone is repeating. And Ukraine actually fits in here because I think
08:42the Europeans are now seeing Ukraine not just as needing to be defended because the rule of law
08:50needs to be defended, not just needing to be defended because Ukraine is on Europe's border,
08:55but the Europeans are really starting to see Ukraine as a very important strategic ally.
09:02I've heard a lot of people saying, you know, Ukraine actually has the strongest army in Europe.
09:09Ukraine has held off the Russians for four years. We need the Ukrainians right now as much as they need us.
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