If existing laws and mechanisms of their execution reflect the whole aggregate of interests, they would result in the constant increase of and improvement of its efficiency.
Our situation in the production sphere gives us grounds to state that the sum of contradictory Ukrainian interests reflected in law has negative characteristics and leads to economic disintegration. Its turn towards creation is exceptionally connected with privatization, which, according to the architects of reform, is sufficient. But how do we explain the registered dependence during the last seven years between the reduction of economic indexes in general and the growing number of privatized enterprises? The optimists from the executive authority state that we have passed or almost passed the decrease peak and the rise is about to begin. To feed the belief in this magic they use old, time-tested measures, like changing primeministers and taking senior executives as hostages.
How many more years should pass, before recovery begins? The forecast experts predicted a rise would begin in 1994 basing their accounts on the dynamics of macroeconomic indexes' changes in the pass. In the fifth year of such predictions, Harvard scientists lost patience and openly declared their failure to understand the processes taking place in Ukraine. A memorable announcement displaying that the actual reasons for the economic crisis is hidden within it is called interests.
No one would argue with the fact that under conditions of private property private interests are a powerful force. If they are aimed at production growth, and it will develop. But until recently only the financial, banking, and commercial spheres developed in Ukraine. However, they do not produce national profit, which objectively assisted the disintegration of domestic manufacturing.
Collective (stock) property, privatized with privatization certificates, is in Ukraine usually in essence analogous to state property, because it is placed under the actual control of the enterprise's manager, who is interested in appropriating it. The mechanism of fulfilling this interest is already textbook. The property redistribution within an enterprise will last long enough, which means the crisis has long lasting perspectives and wide horizons: the overwhelming majority of enterprises in Ukraine are joint stock companies.
Without deep legislative reforms and mechanisms of executing them is no way to solve the crisis. We should achieve a wise combination of the interests of all participants in the manufacturing process.
In this light the present transition to fiscal privatization does not appear effective and, for enterprises in basic industries will be put on sale first. Of the first fifty most attractive enterprises for sale, basic one constitute 90.5%, 54.6% of the second fifty, 53% of the third, and only 1% of the fourth. In all of 200 enterprises 83.7% are basic. Consequently fiscal privatization will not have any positive influence on the manufacturing of final products. But negative changes such as price increases in raw materials and energy will not await long. Also importantly, by owning basic enterprises you can influence the rest of production. Since foreign investors are the most probable purchasers of the fifty most expensive enterprises, they will definitely gain control over them. After that the basic branches production will be oriented on export due to economic interest in speedy and maximum profits. The threat of becoming a raw materials appendix to the developed countries will become an unchangeable reality.
Based on these observations, many economists including author consider that fiscal privatization of processing enterprises of basic branches should be carried out first hand. Starting a new stage of economy reform, we should place the interests of majority first.






