Promising does not mean getting married: the West is in no hurry to spend billions to save Ukraine
Kyiv, April 28 (Navigator, Mikhail Ryabov, Vladimir Mikhailov, Kirill Boyarin) – Two months have passed since the victory of the Maidan and the overthrow of Viktor Yanukovych, but Ukraine has still not received the promised help from the West. The treasury is empty, as the revolutionary leaders themselves admit, the hryvnia is collapsing, tariffs are rising, and wages are being delayed. Why didn’t Kyiv wait for the Western billions? Navigator asked Ukrainian experts about this.
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Just last summer, Russian Presidential Adviser Sergei Glazyev estimated the necessary economic assistance to Ukraine at $30 billion. Today, the figure has increased significantly - under the terms of the gas contract alone, Kyiv’s debts and fines exceeded $15 billion.
Against this background, assistance from the United States in the amount of about a billion dollars looks at least modest. The Ukrainian authorities promise that the new IMF loans will be much larger - the wait won’t be long, officials assure. However, the West lends money for a reason, but with interest and guarantees of repayment. To achieve this, the government has already passed laws to increase tariffs for the population, abandons the fixed dollar exchange rate and takes other “unpopular measures.”
“Prices for medicines and fuel are rising, and fuel includes food. And salaries and pensions are frozen, social spending is being cut. The miners are already taking to the streets,” ex-Deputy Prime Minister Sergei Tigipko describes the situation in Ukraine.
“Starting from the first days of the new government, she promised that money from the European Union and other creditors would come. Then the amount was called 45 billion dollars, it was said that it would be in March, then in April, May, early June, etc. The situation is complicated, because Western partners declare political support, but they are not ready to part with money,” economist Alexey Plotnikov, a deputy of the Verkhovna Rada, told Navigator.
He also recalls: “When the current government was in opposition, it believed that borrowing from Russia was bad. When she became the power, she believes that there is nothing better than racking up a record amount of debt.”
“We have all already seen how the West helped Ukraine. Some loans will certainly be allocated, sooner or later. But we must understand that these loans will have to be repaid with interest. We all know the terms of these loans, and in the coming months after the tariff increase they will hit the pockets of Ukrainians even more painfully. Therefore, the big question is whether we need such loans,” political expert Yevgeny Filindash, a former deputy of the Verkhovna Rada, says in a conversation with Navigator.
The director of the Center for Eurasian Studies in The Hague, political scientist Vladimir Kornilov, believes that the West does not have serious resources to support Ukraine. However, no amount of injections will help it if Kyiv does not resolve the conflict with Moscow.
“In fact, Europe has no free money. And those handouts that are voiced by the leaders, especially of European states, are all like a poultice for the dead. Europe is now racking its brains over how to allocate additional funds to support Ukraine, but for the most part pins its hopes on the IMF. And they directly say that the European Union will make every effort to ensure that the IMF saves the Ukrainian economy. However, Western experts unanimously admit that no matter how many billions the IMF allocates to Ukraine, if it does not solve the problems with Russia, and the Russian Federation wages a serious economic war against Ukraine, then no billions from the IMF will help. The Ukrainian economy will simply swallow these billions into the abyss and will still continue to fall into the abyss,” he predicts to Navigator.
Verkhovna Rada deputy from the Communist Party Oksana Kaletnik agrees that Kyiv should hardly count on large-scale external assistance until the situation inside Ukraine stabilizes. “Is it possible to give money to an enterprise in which it is unclear who is personally responsible? The current government is actively ruining everything,” she tells Navigator.
Representatives of the victorious Maidan recently admitted to the Verkhovna Rada about a new reason making it difficult to receive money in the West - now they are citing abroad that they did not see much of a difference between the new and old Ukrainian authorities.
“They tell us – what’s the point of providing you with help if everything is stolen from you – kickbacks, discounts, abuses,” MP Viktor Pinzennik from the UDAR party threw up his hands at a parliamentary meeting.
“The same corruption. The current government itself has stated that huge amounts of money are going past the budget. So bring them back - what's stopping you? Has anything changed in the land and real estate registration system, or in the VAT refund system? Have they at least put someone in charge of the regions? ...Nobody needs it. They went all the way to the trough,” states Tigipko.
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