Ukraine "worth fighting for" - expert

14:25, 03 May 2018
Politics
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REUTERS

Ukraine's economy has stabilized, while economic growth stopped at 2.1% last year. Yet a broad reform agenda is still proceeding, though everything is contentious, Aslund wrote in an op-ed for Emerging Europe.

The expert adds that the most striking impression from one week of intense meetings with senior policymakers and businessmen in Kyiv is that every issue is contested. "The many conflicts slow down the speed with which things move forward, but they also block reversals," he writes.

"Ukraine is a remarkably open and transparent society, making it easy to figure out what is going on, while the drama is multifaceted and complex. Nobody seems to be afraid. A lively and competent civil society usually starts the criticism and comes up with concrete reform proposals."

Aslund notes that the Cabinet of Ministers is divided on almost every issue between reformers and those "preferring to make money on government."

Read alsoKyiv assures Brussels: No backsliding on reform in Ukraine"Wealthy businessmen dominate the parliament, but even so the parliament promulgates surprisingly reformist laws. Ukraine has not stopped. It is fighting its internal battle over reform or corruption," he writes.

Aslund says the international community maintains strong leverage in Ukraine: "Unless the country receives IMF financing, it can hardly get through 2018 without a major depreciation of the Ukrainian hryvnia, which would be devastating in the 2019 elections. Politically, Ukraine needs Western support against Russian military aggression. This is well understood in Kyiv."

As usual, the IMF has a brief but firm reform agenda. Its foremost demand is an independent anti-corruption court, followed by an alignment of domestic gas prices with international prices. Next comes the legalization of private sales of already private agricultural land, while macroeconomic policy is much less controversial, "since the central bank and the ministry of finance remain bastions of reform."

"The battle for and against reform is going on every day. Macroeconomic stability has taken hold and can be defended, and Ukraine has proven that it can stand up against Russia’s military aggression. But the victory will not be safe until rule of law has been established so that Ukrainians can trust their property rights to home and land," Aslund suggests. "The West cannot reform a country without domestic support, but in Ukraine there is strong popular support for sensible reforms. The West needs to offer sufficient conditional support and engagement to the good causes so that the balance can tip to victory for the reformist circles."

"In Ukraine, Europe and the West can stand up and deliver or fail. This is the joint front against corruption, state capture, and Russian aggression, all in one. The West had better win this battle, but then it needs to engage fully, offering more financial support, albeit with strict conditions," the expert concludes.

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