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.

Author: Anna Ershova

I am a rising senior at Yale who is originally from Russia/Ukraine. I was mostly educated in Hong Kong and Germany, and now attend Yale University in the U.S. I blog on and off about things that interest me: Russia, China, politics, and law.

7 thoughts on “Will Ukraine’s Economy Collapse?”

  1. Alex, I have read your post you are linking to. I feel that at this point the financial meltdown is a much more serious concern than the Euro-2012 fans coming in contact with the TB patients. If Ukraine does in fact manage to have completed building all the infrastructure etc by 2012, the poor sanitary situation is not going to hinder the fans from coming over. After all, there are millions of people, myself included, from developed countries who visit Southeast Asia every year, and most of them are not hindered by the disease scare. They just stick to bottled water. Ukraine should, too — and fix that government already.

  2. It’s interesting what you write Anna from Ukrainia. It’s possible that this rumor come from Russia. Russia is interesting that the next ukrainian government is steered by Komunist who are near from Russia.

    I saw on the TV an emission, there was an interview of the Russian ambassador of Paris, and he said Ukraine is a part of Russia, what amazed all the participants and the presenter.

    But what I hear from Ukrainia in France in the news is that all go bad. There are the constant fighting between President Yushchenko and premier Timoshenko. The ukrainian state have financial difficult, the Russia is hard with ukrainia (give a lot of russian passport in Crimea for perhaps a day annex this district, crisis of gaz, there is a lot of this terrible disease sida… Can we be optimist for futur of Ukrainia ?

    I have to travel in Ukrainia in 2002, from all country where I travel Spain, Germany, Polen, Austria, Georgia it was the country that I have prefer for his nice people. I wish the best for Ukrainia and I hope that this country will enter in Europa. For my familly, friend and colleague, Ukrainia is in Europa.

  3. Sebastian, I don’t really think that it’s a rumor promoted by Russia. Ukraine is facing severe economic difficulties at the moment, and all Ukrainian politicians, whether pro- or anti-Russian, admit that. The Russian mass media are of course happy to discuss the pitiful state of Ukrainian economy.

    As a Ukrainian myself, I would be very happy to be optimistic for Ukraine’s future, but it’s looking pretty bleak.

    I think that Ukraine is fairly European, and I would be very happy for it to join the EU, but it is not happening in the next five years — at least. Perhaps is it gets the new leadership, and the EU likes it, then Ukraine might get more foreign aid and expert advise on how to address its numerous problems. But for now, it’s getting worse, not better.

  4. Anna, it does seem govt as well private sectors in Ukraine have not taken thier positions seriously. I am not going to judge, though all religious matters aside, those in higher places take on the greater scrutiny for thier actions!

    It is my personel opionin that Ukraine’s place in eurpoe, regardless of what the EU decides, has much to offer, because of it’s people amd land. The westernized cultures are forgetting the true gifts that still are in force(mainly heart and soul). Again this I sense is where your people still can be in a place to rally from!! To much has been taken away from there, from all nations, because of greed and callousness… shame, it seems no one looks clearly in the mirror anymore!

    I am most troubled with my own nations(USA) brutality, and think in Ukraine still is land and people where a light may shine, if citizens just looking within and care for each other. Quit looking to belong to others(outside), focus on living close to the earth, make the changes for health and healing!

    There is a rally for peace later this year around the globe. Let it start now at home, and perhaps then particpate in the same! Look, poor economies are not the problem, just the result greed and hatred, there is the real challenge! I support Ukraine in prayer and hope, not to mention, a place to live by choice. We are to bold to suggest /advise on the future as it can all change by our actions!

    It has been said, that “my people, who are called by my name, should lift up thier voice and repent(change), I will hear thier request and heal thier land” It’s not a matter of whether you believe this! You write articles and publish to the people, so let them hear and decide what they will do? Who will care for the children, the broken hearted, will you also turn aside from this call? You decide!

  5. Anna,

    Do you have any recent update or info on Ukraine’s current economic state? I have heard that Russia will be issuing a “report” in October which is expected to bring very bad news for that county. Does the Ukrainian government have a similar plan or report other than what you note here? Any other websites you can suggest for my edification and keeping current on what’s happening in Ukraine?

    Thanks for a good article!

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