Ukraine needs a team of economists

By Vestnik Kavkaza

Russia has invested $200 billion in the Ukrainian economy in the last 20 years, including artificial under-pricing of gas, the Russian Minister of Economic Development, Alexei Ulyukayev, told Russia Today. According to him, one of the urgent issues is still the association agreement between Ukraine and the EU. Russia and Ukraine have about 400 agreements in various spheres of integration within the CIS, including with countries of the Customs Union. “These agreements cannot be simply forgotten,” Ulyukayev thinks.

Alexander Shirov, the deputy director of the Institute of Economic Forecasting of the RAS, believes that “Ukraine demonstrated what can happen in a country in a state of restorative development when it loses dynamism. 3-4 years of development with a low speed of economic growth results in an accumulation of dissatisfaction in society which eventually caused, and we have to objectively admit it, the events in Kiev from November to February.”

Shirov admits that the level of revolutionary emotions and support in society was quite high precisely because of the reasons I mentioned, because the economy lost its dynamics of development, people did not see any prospects but saw high levels of corruption: “This caused those events. They were of course supported by the oligarchs, by the Western structures, but it would not have been possible without that level of dissatisfaction.”

The expert is sure that “the Russian economy is now also entering a phase of decreasing economic growth and many experts think that nothing bad is happening. I think there is a problem. My point will be that the best answer to the sanctions introduced against our country will be economic growth, a high level of reliability of Russian economy secures the positions of our country in the global economy. High speed of growth and dynamic development give us leadership in the post-Soviet space, at least. In this situation, if we develop dynamically, the Eurasian Economic Union and other associations become attractive. But when the Russian economy is not growing, or even develops negatively, all those processes will considerably slow down.”

Speaking about the prospects of the Ukrainian economy, Shirov says: “Unfortunately, I don't see any reasonable changes or reforms in what the Ukrainian leaders say. I have an impression that they simply reproduce  statements from the documents of the World Bank in the hope of loans. But in reality we see that the budget is being brought to a non-deficit state. Spending on defense is growing at the expense of social policy. The income base of the Ukrainian economy is shrinking. I don't see how the economy can grow. The problem is to find a team that can offer a reasonable program of development, but it will take time.”