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Ukraine could disappear from economic map of the world

Author : Oleksiy Kushch

Economically we simply do not exist. How this could have happened to a 40-million country on the border of "classical" Europe, which has the largest industrial, scientific and educational potential, remains a mystery. And the Davos forum will not reveal it.
23:15, 23 January 2019

112 Agency

In past times, the World Economic Forum in Davos pleased visiting journalists with delicious oligarchic breakfasts. But if Ukrainian oligarchs surprised guests with gourmet breakfasts, then Ukrainian officials regaled our distinguished guests with empty promises, flavored with salty tears asking to “provide for food” some billion loans. This year, you can also expect something enchanting in the Ukrainian section, including flags, anthem and a battery of “Dom Perignon” bottles at a price like ten average Ukrainian pensions for one. But if earlier oligarchic participation at least minimally supported the interest of Western investors in our country, now Ukraine’s participation in the Davos forum can be compared with the participation of “independent Mongolia” at the winter Olympics. Independent in the sense that nothing depends on it.

In order for your presence or absence to have any effect anywhere, it is first necessary to return your subjectivity. Especially when it comes to international politics. “Object countries” are of no interest to anyone in the global world, because everyone is well aware that negotiating with them is a waste of time. It is better to directly contact the "owner".

In this regard, the presence of Ukraine on the forum will be perceived the same as our absence. No one will pay attention to this fact and, perhaps, it will not even be reflected in the official reports "from the fields". In order to change the situation, our country must first show the world that the daily routine of the whole country is written not in the memorandum with the IMF, but in the internal intellectual environment. Only then the investors will accept the fact that the fate of Ukraine needs to be discussed with Ukrainians, since we still have an intellectual elite capable of developing new economic meanings.

The request for subjectivity exists both within the country and in the external environment. Global capital has still not understood how the 40-millionth country in the east of the richest world economic conglomerate - the EU - could disappear from the investor radar.

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The current Davos forum will be remembered for the fact that key world politicians, such as US President Donald Trump, French President Emmanuel Macron and British Prime Minister Theresa May, will not attend it. Ukrainian officials, of course, would be interested to listen to the South Korean president and ask him a couple of questions, for example, on how to successfully complete the program of cooperation with the IMF for several years, become the most dynamic creative economy of the new type, take first place in terms of innovation and how to implement complex systemic reforms to get a vote of confidence of their own people. But the President of the Country of the morning freshness will not come either. He did not even give the reason, he simply refused and that was all.

Ukrainian "elites" have always had somewhat inhibited trigger mechanisms: in 1917, the leaders of the Central Rada dreamed that Ukraine would become a member of the Entente, right before the collapse of this bloc. Similarly, attempts are now being made to “jump” literally into all transnational blocs, many of which are experiencing a growth crisis.

The current Davos has shown that the globalism that irritated the left gradually transforms into a new multicellular organism. In the east, these are China and India, and each of these subglobal economies has its own pool of satellite countries. In the west - the traditional US and the EU, which economic roads diverge further and further, dragging along the complicated tangle of ambiguous political and military goals. In Latin America we can see Brazil and Argentina. And then there is a whole group of countries that are in ambush, waiting for their chance for an industrial leap.

The world is entering the stage of defragmented globalism, when there appear not only new regional discussion platforms replacing Davos, but also regional financial centers that will replace the IMF: the Asian Monetary Fund and the Bank of Infrastructure Investments in Asia, the European Monetary Fund, initiated by Germany, system of swap agreements between the BRICS countries.

But if the global world is being defragmented, where will Ukraine be?

British financier, James O’Neal, who worked in Goldman Sachs, proposed several important classifications of countries that will participate in the future defragmentation of the global world. He introduced the concept of the BRIC countries (Brazil, Russia, India and China), to which South Africa was later added and the group became BRICS.

By analogy with the above cluster, the concept of MINT was introduced: Mexico, Indonesia, Nigeria, Turkey.

But I find more interesting another typification of economies proposed by O’Neil - this is the so-called group of 11 countries or N-11 (Next Eleven). The following countries were included: Mexico, Nigeria, Egypt, Turkey, Iran, Pakistan, Bangladesh, Indonesia, Vietnam, South Korea, Philippines.

According to the analyst, these countries are very likely to become the new locomotives of the world economy and change the relief of the distribution of productive forces in the 21st century, even pressing the BRICS group.

The future economic regionalization of the global economy will not develop according to the principle of raw materials or agricultural potential. And not according to the factor of innovation. All that matters is a possibility to pursue a new industrial policy. The fact is that innovations are derived from an effective industrial core of the economy, which allows for a sufficient level to finance science, education, medicine. In addition, the industrial core creates demand for innovations and an environment for their successful transfer to the real sector.

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The new industrial countries (NIC) now include South Korea and Mexico. In the first wave of the NIS we saw "Asian tigers" - Taiwan, Singapore, Hong Kong, as well as Argentina and Brazil.

Then come the "newest industrial countries": the Philippines, Turkey and Indonesia. Before that, the group included Malaysia, Thailand, Chile.

Egypt, Iran, Nigeria, Pakistan, Vietnam belong to the group of "promising industrial countries". To "possibly industrialized countries" belongs Bangladesh.

For investors, the marker of an “industrially developing country” is a sign of where in the next 20-30 years a new part of the added value will be formed and where global technological chains will form. That is where it is profitable to invest long-term funds. And there really is no Ukraine on this “radar”.

But we have been reassuring ourselves for decades with photos from garbage dumps in Bangladesh or from shipyards in India, self-satisfiedly saying: "well, we are better than that." As if this excuses the fact that these countries win our battle for investors. The fact is that, unlike these countries, our “colonial past” in the form of nuclear power plants and a colossal industrial complex allows us to depreciate the inherited economic potential for years. So our landfills and ship graveyards are still ahead, while India creates a new industrial core of the economy.

In this context, analyzing the groups of "new industrialized countries" in the form of 11 actively growing economies, it can be stated that we simply do not exist. How this could have happened to a 40-million country on the border of "classical" Europe, which has the largest industrial, scientific and educational potential, remains a mystery. And the Davos forum will not reveal it.

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