Teaming up with oligarchs for sake of reforms: Why is this dangerous?

Author : Serhiy Fursa

Source : 112 Ukraine

What is one of the main problems of Ukraine? The oligarchs. This is recognized by both ordinary people and experts of international organizations
23:15, 24 September 2019

Ukrainian oligarch Ihor Kolomoysky

Talks of Zelensky’s possible compromise with Kolomoisky have brought an interesting thesis to the light. "We must not fight with each other, we must unite to make reforms." And this is very dangerous and false idea.

Because it is impossible to unite for the sake of reforms with those against whom the reforms should be directed. This is the same thing as saying that we must unite with Putin in our desire to win the independence of Ukraine.

What is one of the main problems of Ukraine? The oligarchs. This is recognized by both ordinary people and experts of international organizations. The oligarchs are a problem that makes us poorer. Not specific people. Namely, the oligarchs as a phenomenon. And any reform will be directed against them.

The key things to be done in Ukraine are the establishment of the rule of law, demonopolization, deregulation. And all this will be directed against the oligarchs. After all, the oligarchs became so rich just because the rule of law is absent in the country.

And when it appears, they will turn into ordinary people. Indeed, oligarchs earn superprofits precisely because they create a monopoly and destroy competition.

Therefore, any honest real reformer in Ukraine is doomed to fight them. To be in conflict with them. This is a natural process. One should not expect that the most influential caste of people in Ukraine will silently contemplate how you destroy their influence and wealth.

And any reforms will harm them. During the cooperation with the IMF, the ratio to GDP of the Forbs top ten from Ukraine decreased from 18% to 11%. And they definitely don't like this process. And that is why they dislike the IMF so much.

There is still an illusion that reforms are beneficial for oligarchs, because if they are implemented, the economy of Ukraine will increase significantly - the capitalization of Ukrainian business will increase significantly, as well as the capitalization of oligarchs.

Related: President’s Office: No transcript or video from Kolomoysky-Zelensky meeting

Theoretically, yes. But practically not. After all, it is necessary to create equal rules of the game for the reforms, and the oligarchs themselves do not believe in this. They do not believe in the rules, but believe that if they do not control something, their opponent will control it.

This theory suggests that oligarchs are interested in capitalization. But look at Kolomoisky’s latest interview. He directly says that they are not interested. They are not about that. They are about cash flow, not capitalization.

That is why the oligarchs will fight against any real reforms. This is natural for them. They are against honest and transparent rules, because became rich in the 90s, when there were no rules at all.

And they do not want changes, because they are not competitive in such conditions. Oligarchs are against a transparent land market. Because then not only they will be able to buy land. And this will increase the value of land, which means that the oligarch will not receive superprofits. Ukrainian tycoons stand against transparent privatization.

Because they didn’t buy a single plant like that. Because oligarchs never buy from the state for the real price. This way they will not get superprofits. And the formation of the oligarchy is connected precisely with the non-transparent privatization of the early 90s.

The oligarchs are against the rule of law, because they can defend their rights in London, and earn profits due to the lack of law in Ukraine.

Therefore, we don’t need to convince ourselves that we need oligarchs. It is not true. We need a big business. As well as we need both small and medium-sized businesses. But we don’t need the oligarchs.

Any compromise with the oligarch has no excuse. Because this is an act against reform. And you cannot fight the devil by selling the soul to him.

Related: French media concerned regarding oligarch Kolomoisky's influence on president Zelensky

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