Doctor of Economics Oleksiy Plotnykov comments on the government’s anti-crisis measures aimed at financial stabilization:
“The so-called anti-crisis program is not anti-crisis in nature. It is rather a hodgepodge of the most random and outrageous measures, some of which reek of lobbying — for example, the proposed exemption of cowhides from export duties and indicative prices. But the Ukrainian economy is not based on cowhides, and an increase of their export volume will not rescue Ukraine from crisis. Nor will Item 22 providing a list of imported consumer goods subject to mandatory certification.
“The program contains a lot of meaningless declarations, slogans, and simple well-wishing, for instance, ‘to determine optimal parameters for hryvnia-dollar exchange rate fluctuation, taking into account the balance of payments and pressure on the state budget’ — here we have an utterly unfathomable mechanism.
“There is grave doubt that the measures directly affecting the financial sector will help manage the crisis. The planned mandatory sale of 75% of currency revenues from export operations will again open the possibility for manipulation, especially given the galloping exchange rate. Item 2, stipulating introduction of a procedure to process payments for imported goods in the national currency, makes no sense either. Who now needs our faltering hryvnia on the international market? The proposed additional customs duty on imported light oil products will increase fuel costs, which in turn will trigger a chain reaction of price increases for various consumer goods. When implemented, these measures will actually boost further inflation.
“Paradoxically, as far as the strategic interest of the program’s authors are concerned, they did everything they could for the crisis to boomerang back and strike with double force. They have actually postponed imminent economic collapse for some time. If it occurred now, then in a year or so the situation would stabilize, giving impetus to an economic boom just before the presidential elections. But, given the current situation, a collapse should be expected around New Year’s, and the people will not have time to forget those responsible for it before next year’s elections. In other words, implementation of the proposed ‘anti-crisis’ program will inevitably result in a change of the country’s political leadership.”







