Ukraine's prospects for future

[deisik]

Ukraine is running out of money. There is not enough money to pay salary to its soldiers and police, still less to pay doctors and teachers (let alone pay out debts). Many would wonder how this is ever possible, couldn't they just print more? Yes, they probably would since any truly independent state in the case of war begins printing money. This serves for the purpose of redistributing resources for military ends through inflation. But since Ukrainian economy is now being controlled by the IMF, they can't just do that. If they would, this would derail the hryvnia exchange rate, the stability of which is one of the IMF's clauses for helping Ukraine (somewhere in the distant future) . So they are stuck between the upper and the nether millstone...

And the IMF nolens volens helps end the war!

[Balthazar]

Waiting for Alex077 with his "It's all Putin's fault" response.

[deisik]

Waiting for Alex077 with his "It's all Putin's fault" response.

Fault?! I would rather say it is his genius!

[Nemo1024]

My prognosis is that Ukraine will eventually split up and default. I cannot see the state surviving as one, especially given the history of the last century (see http://stanislavs.org/the-wild-wild-west/), and I cannot see it getting more money from Russia. The time of subsidised gas and grants is over. They are also consequently shooting themselves in the foot by severing the trading connections with the only countries that really traded with them.

[Balthazar]

Return to pre-1654 borders?

[Paya]

I am afraid that the future of Ukraine looks pretty grim. It's a deeply divided country with ruined economy and shit ton of problems wherever you look. Separatist uprise on the East might not even be the most serious threat.

[lihuajkl]

Need bailout from the IMF or EU

[deisik]

Need bailout from the IMF or EU

I strongly doubt that the IMF, the EU or whoever else for that matter are going to bailout a belligerent country (though some parts of Ukraine might eventually end up being sold out)...

[bryant.coleman]

Need bailout from the IMF or EU

They will get the bailout from EU / IMF. But at a huge cost. The IMF will ask them to reduce pensions by 80%, to fire 50% of the government employees and to make a haircut from all the savings bank accounts (just like what happened in Cyprus).

[deisik]

Return to pre-1654 borders?

Ukraine prior 1654 (shown in dull red color)...

[bitsmichel]

Need bailout from the IMF or EU

They will get the bailout from EU / IMF. But at a huge cost. The IMF will ask them to reduce pensions by 80%, to fire 50% of the government employees and to make a haircut from all the savings bank accounts (just like what happened in Cyprus).

I think this will happen, they will go like the path of Cyprus. In the end, the Ukrainian people are worse of - no matter what side they support - than before this war.

[deisik]

Need bailout from the IMF or EU

They will get the bailout from EU / IMF. But at a huge cost. The IMF will ask them to reduce pensions by 80%, to fire 50% of the government employees and to make a haircut from all the savings bank accounts (just like what happened in Cyprus).

I think this will happen, they will go like the path of Cyprus. In the end, the Ukrainian people are worse of - no matter what side they support - than before this war.

Is it really possible that the IMF (or the EU for that matter) would provide loans to a country that is in a state of civil war? I think the money will be stolen as soon as it touches the Ukrainian account...

[bryant.coleman]

I think this will happen, they will go like the path of Cyprus. In the end, the Ukrainian people are worse of - no matter what side they support - than before this war.

The people are not fully realizing the effects of the civil war. Already the war has cost tens of billions of USD, much more than the annual tax revenue of Ukraine. Sooner or later, the government will be forced to take "austerity" measures.

[tee-rex]

Need bailout from the IMF or EU

They will get the bailout from EU / IMF. But at a huge cost. The IMF will ask them to reduce pensions by 80%, to fire 50% of the government employees and to make a haircut from all the savings bank accounts (just like what happened in Cyprus).

I think this will happen, they will go like the path of Cyprus. In the end, the Ukrainian people are worse of - no matter what side they support - than before this war.

I've heard rumors that people in Ukraine have begun buying bitcoins, since dollars could be expropriated whether they are in the bank (which would be stupid to hold them there for obvious reasons) or under the mattress. During the Civil war of 1918 in the former Russian empire, widespread looting had set in, and was most outrageous in Ukraine.

[Daniel91]

Need bailout from the IMF or EU

They will get the bailout from EU / IMF. But at a huge cost. The IMF will ask them to reduce pensions by 80%, to fire 50% of the government employees and to make a haircut from all the savings bank accounts (just like what happened in Cyprus).

I think this will happen, they will go like the path of Cyprus. In the end, the Ukrainian people are worse of - no matter what side they support - than before this war.

Yes, I agree with this.
It looks that there is no win scenario for Ukraine people in this war, they are fighting with stronger military power (Russia), have no money and EU giving them just declarative support and empty promises.
Any way, their politicians will have to make some very difficult decisions soon and probably will have to solve their situation in direct negotiation with Russia.
I'm not sure if they can avoid financial collapse, and in this war I don't think they can win or get everything they want.

[tee-rex]

Need bailout from the IMF or EU

They will get the bailout from EU / IMF. But at a huge cost. The IMF will ask them to reduce pensions by 80%, to fire 50% of the government employees and to make a haircut from all the savings bank accounts (just like what happened in Cyprus).

I think this will happen, they will go like the path of Cyprus. In the end, the Ukrainian people are worse of - no matter what side they support - than before this war.

Yes, I agree with this.
It looks that there is no win scenario for Ukraine people in this war, they are fighting with stronger military power (Russia), have no money and EU giving them just declarative support and empty promises.
Any way, their politicians will have to make some very difficult decisions soon and probably will have to solve their situation in direct negotiation with Russia.
I'm not sure if they can avoid financial collapse, and in this war I don't think they can win or get everything they want.

The war significantly contributes to the future collapse of the Ukrainian economy, but even if there were no war, Ukraine would still face the same problems. Russia has been subsidizing the Ukrainian economy for many years (partly because of Crimea and the Russian naval base there), and now these times apparently came to an end.

[galbros]

Ukraine is in a tough spot no doubt.  Between the last ten years of truly horrible governance and a dependance on a marginally hostile neighbor for most of their energy not to mention a weakening but still serious separatist threat, it looks bleak.

However, I have to think that Europe and even the US will not leave Ukraine out to dry.  So if Ukraine manages to secure their border (something even the US has problems with) I think the financial aid will come through.  Long term is more problematic, but maybe they will manage it.  I figure they are still way better off than Iraq.

[michaelwang33]

Need bailout from the IMF or EU

They will get the bailout from EU / IMF. But at a huge cost. The IMF will ask them to reduce pensions by 80%, to fire 50% of the government employees and to make a haircut from all the savings bank accounts (just like what happened in Cyprus).

I think this will happen, they will go like the path of Cyprus. In the end, the Ukrainian people are worse of - no matter what side they support - than before this war.

Yes, I agree with this.
It looks that there is no win scenario for Ukraine people in this war, they are fighting with stronger military power (Russia), have no money and EU giving them just declarative support and empty promises.
Any way, their politicians will have to make some very difficult decisions soon and probably will have to solve their situation in direct negotiation with Russia.
I'm not sure if they can avoid financial collapse, and in this war I don't think they can win or get everything they want.

The war significantly contributes to the future collapse of the Ukrainian economy, but even if there were no war, Ukraine would still face the same problems. Russia has been subsidizing the Ukrainian economy for many years (partly because of Crimea and the Russian naval base there), and now these times apparently came to an end.

I wouldn't say that russia is subsidizing the ukraine economy, but that they are a major trading partner.

[tee-rex]

Need bailout from the IMF or EU

They will get the bailout from EU / IMF. But at a huge cost. The IMF will ask them to reduce pensions by 80%, to fire 50% of the government employees and to make a haircut from all the savings bank accounts (just like what happened in Cyprus).

I think this will happen, they will go like the path of Cyprus. In the end, the Ukrainian people are worse of - no matter what side they support - than before this war.

Yes, I agree with this.
It looks that there is no win scenario for Ukraine people in this war, they are fighting with stronger military power (Russia), have no money and EU giving them just declarative support and empty promises.
Any way, their politicians will have to make some very difficult decisions soon and probably will have to solve their situation in direct negotiation with Russia.
I'm not sure if they can avoid financial collapse, and in this war I don't think they can win or get everything they want.

The war significantly contributes to the future collapse of the Ukrainian economy, but even if there were no war, Ukraine would still face the same problems. Russia has been subsidizing the Ukrainian economy for many years (partly because of Crimea and the Russian naval base there), and now these times apparently came to an end.

I wouldn't say that russia is subsidizing the ukraine economy, but that they are a major trading partner.

They are not right now of course (after Russia has taken Crimea), but they were since there is a Russian naval base in Sevastopol (Crimea), and Gazprom had been giving Ukraine a significant discount from the gas price (around $100). Also, Russia was the major trading partner of Ukraine, so by providing lower prices for gas and oil (not sure about the latter), they helped their own producers that imported parts from Ukraine.

[Nemo1024]

If anyone wants to leant how gas subsidising worked over the years, and how Ukraine all the times asked for more, read the following article:
http://stanislavs.org/the-third-gas-war-eu-and-us-must-pay-for-their-successes-in-ukraine/

In a way, Ukraine reminds me of the old woman from Pushkin's fairy tale "Fisherman and the Golden Fish":
http://fairytales.biz/alexander-pushkin/fisherman-and-the-golden-fish.html