Monday, June 29, 2015

West gave Ukraine unrealistic economic expectations

World Politics Today



European media: the West gave Ukraine unrealistic economic expectations. Even though European leaders promised the Kiev authorities to improve the economic situation, major investors withdraw their assets, and the preliminary conclusions about the effectiveness of Western Ukraine are disappointing, writes New Europe. 

Money in the Ukrainian treasury becomes every day less and less, while Western leaders predicted improvement in the economy is still not in sight. Last spring, the head of the European Commission, Jean-Claude Juncker, attempted to quell fears of an impending economic collapse in Ukraine, stating: "You continue to reform, we We continue to support. " Has it benefit? Facts contradictory, but preliminary conclusions are not inspire hope, the newspaper notes. 

The military conflict in the Donbass in Ukraine cost 5-7 million dollars a day, which is approximately 5% of annual GDP.Despite several packages of financial assistance from international lenders, after taking into account the necessary payments on loans the country received a total of one billion dollars in 2014. At the same time Ukraine is required over the next four years, about $ 40 billion, according to the article. Reforms under the austerity policies, which requires Ukraine to the West, led to the fact that in this year, inflation in Ukraine will be 46%, while the country's GDP will fall by "unexpected" 9%. Ukraine's state debt in June reached 100% of GDP, investors quickly began to withdraw assets, leaving the country without foreign funds and opportunities to strengthen the economy. 

Gas prices for the population grew four times after the abolition of state subsidies. Thus, many citizens can not pay the bills, the newspaper reminds. Estimated benefits of the measures taken Kiev, and remain unsold.Meanwhile, major international energy companies - Chevron and Shell - are refusing to work in Ukraine. Both of these events, "dealt a devastating blow" to hopes on investment, while the country is trying to find foreign partners and to stop the outflow of capital, writes New Europe. In addition, the fight against oligarchs, who are the current Kiev authorities, may be mixed political motives that can also scare off potential investors. 

They imagine a country where aggressive possible alienation of property and excessive interference by the state, says the article. In this approach, when the West accused Russia of fomenting the conflict in Ukraine and trying to isolate the Russian Federation, also requires revision. 

Western leaders should work together with Russia, Ukraine to become economically strong and prosperous, but remains neutral in military terms by the state, believes the publication. "In the interest of full implementation of the Minsk Agreement and to restore the territorial integrity of Ukraine and the EU should work with Moscow, and Kiev. However, we have the West not forge far, isolating Russia while placing less responsibility in Ukraine, "- writes the New Europe.

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