IMF loans impoverish Ukraine’s population, do little to address widespread government corruption

By Vladimir V. Sytin
The Ukrainian Times

According to Natalia Korolevskaya of the Opposition Bloc, the rate of inflation accounts for 74% in Ukraine today. The parliamentary opposition insists on a moratorium on an increase in the prices of utilities.

As parliamentary opposition leader Yuri Boiko put it, impoverishment of the population and social plundering of pensioners continue in this country while unemployment is going through the roof. He maintains that the IMF shock therapy mafia is destroying the real sector of the economy, small and mid-sized businesses.

Many analysts agree that IMF loans and a recent agreement on 20% restructuring of Ukraine’s debt with a consortium of bond holders led by Franklin Templeton will do little to address either the oligarchic nature of the Ukrainian economy or widespread government corruption.

In fact, this year Nikolai Gordienko, former head of the State Financial Inspection Board, has presented the facts of violations committed by the companies, which were financed at the expense of the Ukrainian state budget. According to him, the U.S.-backed puppet government of Ukraine received kickbacks from dummy firms through close associates of the so-called prime minister, Arseniy Yatsenyuk.

At the meeting of a parliamentary committee on counteraction against corruption Mr. Gordienko stated that damage done by the corrupt entourage of Yatsenyuk had amounted to 3.5 billion grivnas in the second half of last year alone. For instance, the violations exposed at the state rail transportation administration UkrZaliznitsa are estimated at 300 million grn. “According to my estimates, the damage done by the corrupt government will amount to dozens of billions if you conduct a planned audit to the full,” he concluded.

Western observers think the neo-Nazi regime in Kiev will continue to wallow in corruption. Greece, with only eight million citizens, ought to serve as a warning to the European Union of the consequences of pushing an incompatible economy into integration with states that maintain a stricter fiscal policy and lack widespread corruption. Ukraine, with 42 million people, is poorer and would bring more problems to the EU at a time when the latter simply cannot afford it nor cope with it politically.

It is small wonder that Transparency International’s Global Corruption Index ranks Ukraine 142nd out of 175 states. After the neo-Nazi coup in Kiev last year, this country has a worse record than after the ‘orange’ coup in 2004.

Practically all sectors of Ukraine’s government, business and civic life are affected by widespread corruption. Bribery and extortion are particularly common in the Ukrainian public health system.