“One-and-a-half mistakes“

Valeriy LYTVYTSKY, head of a group of advisers to the National Bank governor:

“I welcome the reappointment of Viktor Pynzenyk as minister of finance. His work was full of initiatives that had a positive effect on the national economy, like implementing the budget. Naturally, there were some things that could characterize him somewhat negatively, but this appointment is of very great importance for the entire economy. I, personally, not to mention the National Bank, can assume that Mr. Pynzenyk will pursue financial policies in the same direction as before, preserve a reasonable range of inflation rates, and guarantee a stable exchange rate. What is very important now for us, i.e., the National Bank, is cooperation with the cabinet ministers in charge of finance and economy. I also welcome the new ministers’ aspiration to take the advice of key economists in order to assess shortcomings and work out a new economic policy, which should be based on the intention to stabilize the economy. There have been a lot of property-related problems this year. After all, strictly speaking, reprivatization will not be over until the Kryvorizhstal story comes to its logical end.

“Above all, investors should understand that threats that were made periodically were not aimed at all of them. I hope the new cabinet will really launch a new dialogue with business.

“As a matter of fact, we hope that the exchange rate will stabilize by the end of the year and we will reach a good understanding with the ministers of finance and economics. Both of them are professionals, and I hope we will be able to avert abrupt exchange rate fluctuations.”

Viktor LYSYTSKY, ex-cabinet advisor in the Yushchenko government:

“Undoubtedly, this cabinet is going to be far more efficient than its predecessor. Mr. Yekhanurov is a practical politician in contrast to all kinds of political disc jockeys, actors, and playwrights who dabble in politics. He knows very well how to put good ideas into practice, so it is a very good thing that he was appointed. I should also mention Stashevsky’s appointment. He is a person with good hands-on experience in the higher echelons of power. His appointment is a good signal for those who are really concerned with job creation. As for Pynzenyk and Yatseniuk, I can say that this is Yekhanurov’s ‘one-and- a-half mistakes.’ The problem with Yatseniuk is not that he is young (young people are well disposed toward new approaches) but that he has a vague idea of a market economy. During last fall’s crisis he worked the way we did back in 1992-1993.

“Those principles proved to be totally ineffective, so his decision to revert to them means that either he does not know any other methods or he is politically weak-willed.

“Pynzenyk and Teriokhin were the main ideologues of the 2005 problem-ridden budget. For the time being, we have managed somewhat to alleviate the results of their decisions that brought about the reduction in economic growth rates. But I am afraid Yekhanurov will constantly have to offset the consequences of what the Pynzenyk-Yatseniuk duo will be doing.”

Oleksiy PLOTNYKOV, Professor, Institute of Global Economics and International Relations, National Academy of Sciences of Ukraine:

“The appointment of the ministers of economics and finance are of secondary importance. What is really important for the economy is the appointment of the new prime minister. Yekhanurov’s promise to stop reprivatization is undoubtedly a positive signal to businessmen, who have been discouraged by the never-ending talks about it. The promises to improve relations with Russia, with which many of our industries are tied up, are also a hopeful sign. It remains to be seen, however, which of these intentions will be put into practice.”

Oleksandr PASKHAVER, president, Center for Economic Development:

“The economy will receive the signals of calmness and evolutionism. This is the position of Yekhanurov, who will in fact create governmental policies. The rest will work precisely the way the prime minister wants them to. For example, Pynzenyk obediently followed the instructions of Tymoshenko in the previous cabinet. Likewise, he will be following the new premier’s instructions in the new government.

“As for Yatseniuk, I must say that during the crisis in the last quarter of last year he behaved as befits a highly-placed official: he never panicked and did his utmost to make the banking system go through the revolution.”

Mykola HOLEV, postdoctoral fellow at the Ternopil Academy of National Economics:

“This will not bring any new investments to our country, even though the prime minister said reprivatization was over. Everyone will be waiting for the elections. The processes that the new cabinet has launched will not result in any radical changes. What they really have to do now is smoothly finish what was begun earlier. As for the dollar, I must say this: the ministry of economy is now headed by a wise individual, who will never allow what happened to the exchange rate earlier this year to reoccur — of course, if he is free to work like this.”

Oleksandr RIABCHENKO, director, International Institute of Privatization, Property Management and Investments:

“The appointment of the new prime minister will signal the world public that you can cooperate with Ukraine and that our country will open its doors to a normal market economy. In my view, Yatseniuk’s appointment is also quite a positive thing. He is a highly-skilled expert and I am sure he will be able figure his way in things. Pynzenyk’s reappointment means that the president is satisfied with the previous fiscal policy and is not going to make any radical changes. On the whole, it is good. The minister of finance is a conservative office, especially considering that it will be very difficult to implement the 2005 and 2006 draft budgets. Even if a new person came, nothing would change radically. Moreover, I doubt that this cabinet is going to reform anything, especially in the budgetary sphere.”