#Official Commentary of Elena Melnik on agreement of Ukrainian budget in IMF
Last week, the budget approval process was launched in Ukraine. On September 21, 2016, the government submitted to the Verkhovna Rada the draft state budget for 2017.
By the way, today Ukraine has reached such a level of ‘independence,’ at which the President Petro Poroshenko is literally praying for receipt of another currency credit, and the government does not hide the fact that the adoption of decisions determining the development strategy for the entire state is entirely dependent on the West.
Thus, from the statement of the Minister of Finance of Ukraine Alexander Danyluk it became known that the draft state budget for 2017 is aimed at agreement in the IMF (International Monetary Fund – Ed.). This is due to the signing by Ukraine of a new memorandum of cooperation with the IMF, in which on September 16, 2016, the country was granted another currency credit in the amount of $1 billion.
I want to remind you that this is the third tranche for Ukraine within the credit agreement, which the country has signed with the IMF in 2014. Drafts of Ukrainian state budgets in 2015 and 2016 were also agreed with the IMF. However, at that time this fact wasn’t particularly advertised. In the same year, the issue of the budget agreement with the IMF was one of the most covered in all the Ukrainian media. And, in my opinion, the matter is far from publicity: it is an attempt of Ukrainian rulers to shift responsibility on their Western partners for anti-social policy and economic genocide against their own people! Ukrainian rulers, while trying to stay in power in any way, with help of their decision on the new loan signed under the terms of the IMF, namely:
- carrying out so-called pension reform, which includes the extension of the retirement age, the abolition of the special pensions, stricter conditions for the minimum pension;
- quarterly increase in tariffs for electricity, gas and heating;
- lifting the moratorium for sale of agricultural land;
- continuation under the name ‘privatisation’ of the sale of enterprises under state ownership.
And this is only a small part of the requirements, which have become known, because the Ukrainian government has not yet published the text of a memorandum of cooperation with the IMF.
By signing under the requirement mentioned above, the official Kiev has driven the country into a debt trap and devoted the Ukrainian people to the total impoverishment. And most importantly, the Ukrainian government is trying to legalise all this through the draft state budget for 2017, which is fully adjusted to the terms of a memorandum of cooperation with the IMF. Now, in the event of any civil protests over the regular tariff increases or cuts in social benefits, Ukrainian officials will boldly point at signatures of representatives of the IMF. Agree, this is an interesting scheme of robbery of Ukrainians under the guise of ‘European values.’
Discussions about the main estimates for the country for the coming year do not cease. The headlines of Ukrainian media are full of statements of leading politicians, experts and analysts in the field of economics: “Budget of poverty and hunger,” “Budget of ‘frozen’ poverty,” “Devastating budget,” etc. It is difficult not to agree with this, because the increase of social standards and economic development is not provided in the new budget. The Cabinet of Ministers of Ukraine to fill the state budget plans to increase excise taxes on alcohol, tobacco, petrol and diesel. It is also planned to strengthen the tax burden by raising the single social contribution for all categories of natural persons-entrepreneurs and simultaneous cancellation of benefits for its payment for enterprises and organisations. But the most striking is that the government in the budget for the next year is laying means, which in fact do not exist yet, and it is unknown whether there will be any! Matter concerns the so-called special confiscations – the billions Viktor Yanukovych’s family that Ukraine has been looking for in vain for more than a year. Also the government lays in the budget for 2017 the increase in external debt to 14% at the expense of obtaining new loans, and this is happening taking into account maintenance costs of previously taken loans.
Against this background, the statements of the Prime Minister of Ukraine Vladimir Groisman on budget honesty for 2017 and that it is based on actual earnings look very cynical.
The IMF is not a charitable organisation, which gives billions to those in need. First of all, it is a creditor organisation. Hopefully, even those Ukrainians who are not particularly versed in the economy understand that any creditor provides the money on their own terms at certain interest. But the decision of whether to submit or not to these conditions always takes the borrower – hence, they are responsible for the consequences of the decision.
I am sure that very soon the economy will prevail over politics, and the Ukrainian authorities will face punishment for all their military, political and economic crimes against their own people.
Elena Melnik, the DPR People’s Council deputy