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How long Ukraine will stay so poor?

Author : Olexandr Honcharov

13:21, 29 November 2017
How long Ukraine will stay so poor?

Author : Olexandr Honcharov

According to official statistics, by the end of 2017, Ukraine's GDP will grow only to 1.8%, and inflation will reach 12.8%

13:21, 29 November 2017

Read the original text at 112.ua.

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Do we, citizens of Ukraine, have a reason to be happy from the economic successes of the Cabinet of Groysman? Only according to official statistics, by the end of 2017, Ukraine's GDP will grow only to 1.8%, and inflation will reach 12.8%! In this case, the national debt to GDP in 2017 will reach 86.2%.

Related: Economic forecast for Ukraine: Hryvnia weakening, high inflation and tarrifs

I do not learn about this from TV news or television talk shows, but directly from interviews with entrepreneurs. Maybe Groisman is just joking about some kind of investment growth and the real sector of the economy? But who will finally tell the truth in the government? For the sake of justice, I note that it is not the ministers, but the experts have already started talking frankly about the sore point. For example, recently Svitlana Kovalyvska, deputy director of the Institute for Social and Economic Research, bitterly noted in her article that the volume of direct foreign investment in Ukraine in the first half of 2017, compared to the same period last year, was reduced 4-fold and amounted to only 711.2 million dollars (in the equivalent of 18.9 billion UAH at the rate of 26.5 UAH / USD).

Related: Four years after Maidan: What happened to the Ukrainian economy

And this is because the national investment structure preserves the investment prospects of enterprises and indicates an ineffective state policy. In turn, investors and other players in the financial market do not have real incentives and tools to accumulate and invest in the fixed assets of Ukrainian joint-stock companies. Moreover, a number of other experts began to characterize our economy as a pole of trouble. Why? Because Ukrainians called inflation, declining incomes and self-restraint the main manifestations of this economic crisis.

Unfortunately, today Ukraine among the poorest countries. Modestly. But with a national identity. And all who receive foreign grants, experiment with the Ukrainian economy. One of them hopes for the European Union, and someone for the actions of Donald Trump to tighten sanctions against Russia. Well, where are our political and economic leaders with at least one really feasible national economic strategy?!

Related: Economic revolution is inevitable in Ukraine

By the way, then the American president confidently bet on the intellect, rightly believing that it is time to listen not to the rich, but to the smart ones. Most likely, Roosevelt's example is now being followed in Armenia. Judge for yourself. During the V summit of the Eastern Partnership in Brussels, the Armenian delegation managed to achieve its goal, and as a result, Armenia signed the Association Agreement with the European Union. At the same time, Armenia remained a member of the Eurasian (Customs) Union, a member of the CSTO and is a military and political ally of the Russian Federation in the Caucasus.

Related: Paradoxes of Ukrainian economy's growth

Armenians have shown that the EU and Russia can pursue a single and non-confrontational policy towards the countries of the "Eastern Partnership". And what did our delegation achieve at this summit? For example, the European Commissioner for European Neighborhood Policy and Extension Johannes Khan again dismissed the idea of an investment assistance program for Kyiv "The European Plan for Ukraine," advising his Ukrainian counterparts to spend more money on reforms.

Related: How could Ukraine get out of crisis: Declare default and attract Chinese investors

Although there is still a hope that our top officials and people's deputies will take into account the hard-hitting remarks of EU colleagues, they will draw the appropriate conclusions, and, perhaps, in 2018 a new program of macro-financial assistance of the European Union, the volume of which can reach 1.8 billion euros, would be launched. In this regard, Poroshenko stressed that this new program will include a list of certain conditions that Ukraine must necessarily fulfill, but did not list these conditions.

I do not expect that any economic leaders will soon appear from the "bottom". I think that there should still be people in the country's leadership who will have a sense of self-preservation, and they will correct the strategy for the development of the Ukrainian economy in the correct direction and finally formulate the national idea of a comprehensive reform of Ukrainian markets.

Related: Third gas crisis: Chronicles of new Gazprom war against Ukraine

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