Ukraine: who is to blame and what is to be done?

Deputy Director of the Institute of Economic Forecasting Alexander Shirov speaks about the economic impact of the political crisis in Ukraine. With meetings and demonstrations resulting in seizures of several ministries and administrative buildings in the capital, as well as in several areas in the west and center of the country, no one in the opposition pays attention to the fact that Ukraine, which had been on the brink of bankruptcy even before the protests, is now slipping into deeper economic crisis. Due to the political turmoil the country today has already lost $3 billion, and every day the losses will grow. The long-term and short-term sovereign credit ratings of Ukraine are estimated as negative. The economic prognosis for 2014 is becoming increasingly unfavorable, and the hryvnia is being depreciated, inflation and public debt are growing, and the administrative capacity of the government is becoming inevitably reduced. In the negative economic environment almost all Ukrainian regions are experiencing problems: industrial production decreases, mining declines, but unemployment increases. At the same time, the center will have fewer opportunities to provide financial assistance to subsidized regions. The only external source of financing, which can somehow keep Ukraine afloat and allow her to pay the bills of the IMF, is the $15 billion promised by Russia, 3 billion of which have already been obtained.