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May 1, 2014, “IMF warns Ukraine on bailout if it loses east," CNBC, Catherine Boyle
“Ukraine,
struggling with a stuttering economy as well as [what the war crowd
hopes is] an escalating crisis with neighboring Russia, has had its $17 billion International Monetary Fund bailout signed off. But international lenders are already warning of threats to its funding. Christine Lagarde, IMF managing director, warned “further escalation of tensions with Russia and unrest in the east of the country pose a substantial risk to the economic outlook.”
In a staff report on the aid program, published Thursday, the IMF added that a change to eastern Ukraine’s borders could force it to adjust its bailout.
“The unfolding developments in the east and tense relations with Russia could severely disrupt bilateral trade and depress investment confidence for a considerable period of time, thus worsening the economic outlook,” it said.
“Should the central government lose effective control over the east, the program will need to be re-designed.”
The detention of Russia’s military attaché to Kiev by Ukrainian police on Thursday morning highlighted concerns that the tensions gripping the country are unlikely to go away.
The IMF predicts Ukraine’s economy to shrink by 5 percentat least this year. The country has been hidebound by corruption in business and politics. New anti-corruption laws are expected, but their effectiveness remains to be seen.
“This is something of a leap of faith for the IMF and is politically driven by key IMF shareholders to support the ([US-selected] interim prime minister Arseniy) Yatseniuk “kamikaze” administration in its [supposed] reform efforts,” according to Tim Ash, head of emerging markets research at Standard Bank.
Ukraine will get $3.2 billion straight away to help stabilize its economy, which was already in trouble before recent unrest in Crimea and Eastern Ukraine. The ratio of public sector debt to gross domestic product, a key measure of how heavily the government is indebted, will rise from 41 percent at the end of 2013 to 57 percent at the end of 2014 following the deal. This may trigger a repayment of debt to Russia, which was incurred as part of an earlier planned bailout, interrupted by the ousting of former Ukrainian president Viktor Yanukovych.
Ironically, Ukraine is still heavily dependent on trade with Russia, which is at risk both from the conflict and any sanctions imposed by the West against Moscow.”
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Added: 2014 IMF bailout required Ukraine to impose +56% increase in gas tax and +40% increase in heating fuel tax. If anyone in Ukraine believed US oligarchs would do anything but rob them blind, they deserve what they got.
5/1/2014, “Ukraine bailout of $17bn approved by IMF who warns reforms are at risk,” UK Guardian, Angela Monaghan “The policies agreed by Kiev include a strategy of gradually increasing retail gas and heating tariffs, by 56% and 40% in 2014, respectively, and by 20-40% in 2015-17.
The IMF said it was a necessary shift after authorities disregarded rising import prices, keeping domestic retail gas and heating prices fixed at the lowest levels in Europe. The IMF said the proportion of household budgets spent on gas and heating spending in Ukraine would rise from 3-7% to 5-11% – “moderate by the standards in the neighbouring countries”.
To help bring the deficit down, the government has agreed to restrain the public sector wage bill growth by cancelling discretionary wage increases planned for July and October this year. It will also impose a hiring freeze to reduce employment through “attrition and staff optimisation”, while a VAT rate reduction has been reversed.” (end of article)
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Added: “Obama-era” elites “backed the wrong man in Ukraine.”…Never, ever listen to advice from US oligarchs:
12/5/2017, “The West Backed the Wrong Man in Ukraine,” Bloomberg View, by Leonid Bershidsky
[Image: Pres. Poroshenko, the “immediate protege” of US oligarch and convicted felon, George Soros, Luxembourg Herald] “It’s become increasingly clear that Obama-era US politicians backed the wrong people in Ukraine. President Petro Poroshenko’s moves to consolidate his power now include sidelining the anti-corruption institutions he was forced to set up by Ukraine’s Western [ie, US] allies….
At this point, even the most vocal Western supporters of the post-revolutionary Ukrainian government have realized that something is wrong with Poroshenko. “President Poroshenko appears to have abandoned the fight against corruption, any ambition for economic growth, EU or IMF funding, ” economist Anders Aslund, who has long been optimistic about Ukrainian reforms, tweeted recently.”…
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Added: Ukraine, August 2005, Obama and Lugar in Ukraine to remove its weapons.....Ukraine’s biggest problem is that it’s a puppet of the Washington DC war machine.
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Added: US elites viewed Russia as a joke, a servile weakling, “ours to lose:”
“In July 1997, NATO formally invited three former Soviet satellites—Poland, Hungary, and the Czech Republic—to join the [NATO] alliance; and
in March 1999, less than two weeks after their membership became
effective, NATO [ie, the US] began to bomb Serbia, Russia’s ally, in an effort to end its military operations in Kosovo.”…“Bill Clinton, Boris Yeltsin, and U.S.-Russian Relations,” history.state.gov 3/20/2008, “Why the West loved Yeltsin and hates Putin,“ thehindu.com, Vladimir Radyuhi
“One reason why Yeltsin was the West’s darling—while Mr. Putin is the target of virulent attacks–was that his policies perfectly suited the Western agenda for Russia, a superpower-turned economic and military weakling, a subservient client state and a source of cheap energy and minerals. By contrast, Russia’s resurgence under Mr. Putin is seen as upsetting the global balance of power and threatening the U.S. unipolar model….[Link, Yeltsin Time cover, “Yanks to the Rescue,” 7/15/1996]
In Russia, Yeltsin is associated with plunging the country into chaos, reducing a majority of Russians to abject poverty and awarding the country’s oil, gas and other mineral riches to a handful of rapacious oligarchs, who plundered Russia and played Kremlin powerbrokers. The West lauded him as the “father of Russian democracy” who buried communism. Yeltsin remained “Friend Boris” to the West even after he sent tanks to blast his political opponents from Parliament in 1993. In Russia, he faced impeachment charges for this and other “crimes against the nation.”… Mr. Putin’s “controlled democracy” involves centralisation of power, government control over most electronic and some printed media, and Kremlin-supervised grooming of political parties. This policy helped to curb the chaos of the 1990s and bring about political stability that has underpinned economic growth.”…
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