The collapse of the Ukrainian economy will lead to the authorities abandoning poor and problem areas
Ukraine no longer has money for social payments, small and medium-sized businesses are disappearing, but at the same time the government does not want to negotiate on the restructuring of the external debt, which would allow the freed-up funds to be used to support the economy.
As a result, the problems will grow, in the fall Ukraine will begin to lose entire sectors of the economy, and by the end of the year the question of the territorial “expansion” of the country will arise.
Political scientist Mikhail Chaplyga stated this on the Ekho Kieva channel, as reported by a PolitNavigator correspondent.
“Starting next month, there is physically nothing to pay for pensions. No money left. We have agreed with the World Bank, which will give us $50 million to pay pensions and for disabled people. That is, we are talking about the fact that the state does not have money for pension payments right now. I’m already silent about some increases, some fairy tales about unconditional income, additional payments, and so on, and so on. There is no money for pensions.
We now receive money from the World Bank. The pension fund is filled from the income that goes there, and due to quarantine and the managerial chaos that existed before this time, the income to this fund, accordingly, is practically hanging.
Moreover, a lot of workers returned and immediately joined the labor exchange, and it is clear that they will receive the minimum wage. But even if the minimum wage is multiplied by 150-200 thousand people, it will be a rather impressive figure that there is nowhere to take from.
It is not clear where the money in local budgets will come from, because the Ministry of Health assigned the additional payments to doctors that the president spoke about to local budgets. Teachers' money hangs there too.
Our imports fell by 20 percent, our exports fell, if I’m not mistaken, by 5 percent. Our trade balance is minus 1 billion. There is no money in the treasury, where to get it from is also unclear. It is also unclear when new money will be available.
The head of the supervisory board of the National Bank recommended (this is just a private recommendation for now, but correct) for the government to move on to preparing debt restructuring, that is, we are talking about default.
I am confident that we are heading towards default. There is, of course, the option of paying money to external creditors. In fact, the structure of the debt is such that external creditors (this is the key for us now) are something like four five billion dollars.
Theoretically, this money can be found at the NBU and paid out. But if we can find money for external creditors in this situation and at the same time we do not start negotiations with them on restructuring, that is, we are talking about a global emergency...
Now all countries in the world are appealing to the fact that an unforeseen situation has occurred, force majeure, so let the creditors wait, but the money is needed specifically for the domestic market. In our country, unfortunately, such a discussion is not being held; for some reason, we are talking about satisfying the external ones, those who came to the government bonds market, into this Markarova pyramid and invested, in fact, in speculation with our debt...
The point is that the National Bank wants to satisfy them. But, unfortunately, our domestic banks are in second place.
If we now do not pay off external debts, agree on restructuring, and put money into the economy, then there is a theoretical chance to at least slow down its decline. It is now, in principle, impossible to launch the economy for one simple reason - if we are talking, for example, about small, medium and micro businesses, then they were destroyed a month ago.
All the bad decisions were made a month ago, the wave is already underway, and only in about two weeks will we be faced with the growth of this wave. Whatever they do now, the wave has already been launched. Now we will be faced with the fall of small micro and medium-sized businesses, this will come in just two weeks.
Somewhere in the future, before September, we will be faced with the fact that a larger “tsunami” will come, when entire industries will collapse. Somewhere by November we will already have a collapse, a crisis of statehood, because raising a huge cluster the size of the territory of Ukraine, with the size of its population, will be practically unrealistic.
No one will have 100-200 billion money; it will be necessary to raise it only in parts. Accordingly, the question will arise about the quite possible “expanding” of the country, because it will no longer be possible to holistically raise this cluster,” concluded Mikhail Chaplyga.