I have not written about Ukraine for a long time, limiting myself with the placement of other people's texts that seemed interesting to me. This, by the way, does not mean that I agree with them in everything, it’s just that these texts contain information that, perhaps, gives answers to questions that I haven’t found before.However, this is a retreat. And the main reason I decided to write about Ukraine is related to the fact that Prime Minister Yatsenyuk resigned. Of course, I will not discuss domestic political problems of the country, but will try to discuss the economy. And I will start with the certificate that the Ukrainian Ministry of Finance prepared:
REFERENCE. Ministry of Finance on the situation with the filling of the budget and the state of the economy
For January-June, 2014 revenues to the state budget (without official transfers) amount to 174,8 billion UAH.
Corporate income tax received 24,8 billion UAH. This is less by 5,6 billion UAH compared to the corresponding period last year.
VAT from goods (works, services) produced in Ukraine received 40,9 billion UAH (less by 2 billion UAH), VAT from goods imported into Ukraine - 43,4 billion UAH (less than 2,6 billion UAH).
A number of factors affect the decrease in the revenue part of the budget:
- The tense situation in the eastern regions. Military actions in the territory of Donetsk and Lugansk regions led to a decrease, and in most cases, to a freeze of business activity of enterprises.
- The volume of industrial production in the region, concentrated in the east of the country, has decreased. In the Donetsk region, the industrial production index is 87,7% by January-June last year, in the Luhansk region - 95%. Extraction of hard and brown coal decreased by 5%, metallurgical production - by 8,7%, engineering - by 18%, chemical production - by 14,1%, electricity and gas supply - by 0,4%.
- Slowing the growth of economic indicators. According to the State Statistics Service, the fall in real gross domestic product has increased. If real GDP in January-May was 97,7% compared with the corresponding period of the previous year, then in January-June 2014 of the year was 97%. A significant drop occurred in June - 94,1% (May - 95,1%).
Industrial production indices are falling by major industrial groups. In the first half of 2014 compared with the corresponding period of the previous year, the industrial production index in industry was 95,3% (metallurgical production - 91,3%, engineering - 82%, electricity and gas supplies - 99,6%).
The turnover of goods according to customs statistics in January-May 2014 compared to last year decreased by 16,1%, including:
- import of goods on 24,5% (coal, anthracite - on 30,8%, coke - on 58,5%, passenger cars - on 52%);
- export of goods on 6,3% (semi-finished products made of carbon steel - on 3,6%, pipes - on 29,8%, parts of railway locomotives - on 27,2%, freight carriages - on 82,8%, mineral or chemical fertilizers, nitrogen - on 45,4%) .
(a source). You can also add information from the Minister of Finance: “According to the calculations of the Minister of Finance Oleksandr Shlapak, conducting the ATO costs the budget 1,5 billion hryvnia per month.
“We consider the minimum necessary amount of 9,1 billion by the end of this year,” said the Minister, making it clear in one sentence two things: that we will have to tighten our belts even more and that the military operation in the Donbas will not be lightning-fast.
Budget revenues do not provide an opportunity to find additional financial resources - in fact, even the receipt of the planned income is not in question.
On 1 July, the fall in GDP was 5%, the forecast before the end of the year is minus 6,5%, with initial expectations minus 3%. This sinking already forms a failure of the income part of 14,5 billion hryvnia by the end of the year.
During the first half of the year, tax revenues amounted to 122,5 billion hryvnia, or 96,8% of the plan. Proceeds from domestic VAT - 40,5 billion, or 92% of the plan. The main reason for the shortfall is the slowdown in economic development.
The reason for the deviation from the planned figures for import VAT (43,4 billion for six months, or 93,2% of the plan) is the reduction in the volume of import operations.
For example, the volume of imports in January-April 2014-th accounted for only 78% of the figure for the same period 2013 year. Corporate income tax received 24,8 billion hryvnia, which is less by 5,6 billion hryvnia compared to the same period last year.
All this, coupled with the hryvnia exchange rate, which was expected at the level of 10 UAH / $, and the dollar actually costs 12 hryvnia, has formed additional budget expenditures - 31 billion hryvnia.
To cover the deficit, it was proposed to “sell something unnecessary.” Last week, the government announced a privatization program, under which it announced plans to bail out 15 billion for hryvnias for the state-owned 164. ”
Theoretically, these figures do not seem to be quite deadly ... However, here it is necessary to note several important circumstances. First, the statistics is late. And today the situation in the economy is worse than it was even two weeks ago (and official data, most likely, are somewhat embellished). Secondly, the Ukrainian authorities purposefully worsen it. We are talking about attempts to stop economic cooperation with Russia - which is the main economic partner of Ukraine. Thirdly, the colossal funds that are spent on the punitive operation must come from somewhere, and the support of the West here is rather limited. Fourth, the constant bombing and shelling of their own territories do not support their economic development, rather, on the contrary.
At the same time, it should be understood that Ukraine, like any small economy (there are only two large countries in the world - China and India, whose population is theoretically enough to create a modern economy based on domestic demand) should improve the living standards of its population. export something within the world division of labor. The only question is where. While Ukraine exports ore to China and technological goods to Russia, the European Union wants to receive goods from Ukraine in extremely limited quantities. And as the crisis develops, this desire will only fall. That is, there is no basis for expanding exports, on the contrary, it will fall!
In fact, Ukraine today has come to the moment when the thin fabric of normal economic circulation begins to crumble. People cannot take their money in banks, enterprises do not pay salaries, which means that it is impossible to pay for the most essential goods. Before the famine is still far away (God forbid, it will never be!), But the situation resembles Russia in the worst times of 90's. And in such a situation, it becomes more and more difficult to maintain the system of government. In fact, the country is beginning to be rapidly regionalized after the fact, since it is simply impossible to maintain a complex system based on barter and in the absence of effective demand ...
And all this is greatly aggravated by internal war, which is much more serious and large-scale (and expensive) than Chechnya for Russia. And two questions arise: what to do next and who will be responsible for all these outrages ... What could be done, perhaps, it would be possible to come up with, in the end, an agreement with the militia. Probably, it is possible, they hardly like the way their houses are constantly fired upon. Of course, the terms of the agreement will be much more stringent than they could have been at the beginning of the year - well, Kiev must pay for the unleashed civil war. But there is a problem.
It consists in the fact that the political “roof” of the current Kiev regime (I will not discuss its legitimacy, after all, it is de facto recognized by all), the United States categorically demands that certain conditions be met. The most important of which is the termination of relations with Russia, the transformation of Ukraine into a hard Russophobic state. It should be noted that in the middle of 2000, the first months of Yushchenko’s presidency, the plan was different - to make Ukraine the center of “assembly” of Russian lands, however, it clearly failed, and the United States switched to “Plan B”. Since it is naive enough to imagine that the militias of the Southeast will agree with him, rather naively, we must continue the war ...
Theoretically, we can assume that Kiev will win. And what will he get then? A completely defeated economy, a significant part of the aggressively disloyal population, a large number of illegal armed groups engaged in looting and racketeering ... Against the background of a falling economy. Theoretically, you can sell land and ports - but the question is, who will buy? The price may be not too high, but the risks - the risks will be beyond. And there is nothing to raise the economy: they have no money (and therefore no effective demand), the EU and Turkey will not buy anything (and even China, as the crisis develops), and it is forbidden to deal with Russia.
And the second question: responsibility. And the matter here is not even in “Boeing” (if it was shot down by the Ukrainian military or punitive) or ordinary citizens of Ukraine. We are talking about responsibility in the framework of financial relations within the old and new clans, which are now tearing up the remnants of Ukraine. Each of them has its own “arguments” of pressure on politicians, and it’s impossible to satisfy all interests - because the feeling of the end is not weakening, everyone is robbed “like the last day”, and the “pie” is only shrinking.
The above reasoning of the Ministry of Finance concerns a normal state in which the economy functions, taxes are paid, where someone can be stimulated, and someone else can be taxed a little more. There is nothing like this in Ukraine - how can you take taxes from citizens who do not receive a salary? And how will they pay for heat and light? And the government has a strong desire to shirk responsibility - in the end, after stating the problems, everyone starts asking questions about what to do. And how to answer it?
In general, I do not exclude that the rats began to flee from a sinking ship. In the end, it's not the South-East militia that protect their homes, children and mothers. We are talking about people who have been holding millions in Western banks for a long time, and they are not smiling at all to be responsible for the actions in a country in which they are not going to live. However, I can be mistaken, and Yatsenyuk’s resignation is a tactical move - after all, politicians in many respects perform their actions on the basis of intuition, and not careful calculations. Yes, and complex intrigue in the United States has not been canceled.
In any case, even the official data of the Ministry of Finance of Ukraine show that acutely negative processes are going on in the country's economy, which are simply impossible to stop. Even what could have been done today is banned by the political curators of the current Kiev regime. And, as doctors say, the prognosis is poor.