Will Ukraine’s Economy Collapse?

After the Orange Revolution, it seemed that Ukraine was off to an auspicious beginning. She embraced Europe and the US, denounced Russia, and worked hard on that GDP growth.

With financial gloom dominating Davos, the Israel-Palestine hysteria, and people being laid off by the thousand worldwide, Ukraine and her problems were virtually ignored. While Eastern Europe is whispering about the nearing economic collapse, the most relevant entry about Ukraine’s economic collapse that a Google search in English produces are dated 1993 and 1998, when the economy was truly going down the drain. It looks like 2009 will also join the ranks.

I will not bore you with the details of all the economic troubles Ukraine is facing. If interested in details, read this Jan 19 report, and make all the bad indicators even worse. Then add the constant fighting between President Yushchenko and premier Timoshenko; subtract the non-functioning government. Can anyone say “imminent collapse”?

There was something that drew my attention a few days ago, but I was too busy writing countless applications to blog about it. A story surfaced in the Russian and Ukrainian mass media about a report supposedly written by Ukraine’s finance minister Viktor Pinzenik. In brief, it augurs the nearing collapse of Ukraine’s economy.

Drawing from my own politics-related experience in Ukraine, a fake report to scare the population and intimidate the government would not surprise me. But it was never properly denounced by the Ukraine’s government.

For any interested speakers of Ukrainian, there is a photograph/scan of the report here. After several pages of sad economic stats and a lot of pathos (if someone indeed faked it, they put a whole lot of effort in it), the report concludes with:

An excerpt from what is believed to be Pinzenik's report
An excerpt from what is believed to be Pinzenik's report

“The country is in danger. The citizens are in danger. (Political) power is not an award. It is first and foremost responsibility to people. I would like to emphasize one more time: there is a way out of the current difficult situation. But we are almost out of time…”

There are also rumors that Rada’s (Ukraine’s parliament) employees, including the MP’s, is behind on the salary payments for this month. For all I know, it might be just rumors, but it sounds likely to be true.

As a Ukrainian, I am very upset about Ukraine’s future.

As a political scientist, at least I get to benefit from studying how “dirty” political technologies are used to undermine an opponent in the game of politics.

Although I hope that the report above and all the rumors are not true, it is quite certain that Yale’s poli sci department is probably the safest place to observe Ukraine’s government failures.