Fighting Shadows: Cabinet Sets Direction of Attack
The over two weeks after the election race Ukraine is still packed with political emotion. The cabinet is no exception as its first meeting after the elections had a noticeable political emphasis.
Premier Anatoly Kinakh stressed that the election turnout should serve to enhance political stability and provide adequate conditions for constructive cooperation among the president, parliament, and government. He compared the first quarter to an examination in politics which Ukrainian society had to take, saying “Whether some like the results or not, we must all respect it as an expression of the electorate’s will.” Mr. Kinakh further declared he wished a viable and capable majority were formed in Verkhovna Rada, willing to work for the good of society and the state.
As was to be expected, he referred to improving the tax structure as the first priority. After that, probably by force of election campaign habit, he mentioned pensions, saying that “we are getting very late with the pension reform, compared also to neighboring states.” But then the priorities were aligned in keeping with economic logic. Mr. Kinakh recalled that the cabinet must submit next year’s budget resolution to parliament before June 16. As instructed by the president, a package of legislative initiatives must be in the parliament before May 15, aimed at “enhancing the results of economic development and being thus top priorities.” In addition, the government plans to recall and revise all bills the previous parliament had no time to deliberate and submit. The final versions are to be submitted before that date as well.
The premier emphasized that combating the shadow economy remains one of the most important tasks of the cabinet. He believes that vast material and financial resources are out of the state budget’s and transparent economy’s reach, so that the shadow has to be dispersed. However, in his words, this must be done not by using law enforcement, fiscal, or administrative means, but primarily by providing favorable conditions for the development of business, effectively improving the investment climate, enhancing legal protection of the investor and proprietor rights. We have no time to postpone these issues, Mr. Kinakh declared, summing up the shadow theme. Indeed, a considerable retail commodity turnover increment (18.7%) is expected in the first quarter. Mr. Kinakh said it is graphic evidence that an economy of market demand – in other words, a domestic consumer market – is gradually taking shape in Ukraine. Naturally, if the government allows the shadow operators to get it under control, the Ukrainian economy will be knocked out again. It is important to hold the next round of this shadow boxing in keeping with the rules, involving all political forces, but without certain law enforcement officials showing too much zeal.
