The budget of Ukraine: no money for people, all is spent on state authorities

On this photo – Kyiv city clinical hospital №10. The Department of palliative care, which provide assistance to the disabled persons, war veterans, elderly patients and patients with incurable diseases.

The picture was made yesterday, on 19 January 2018, on the Orthodox St Nickolas Day.

There is no money in the budget of Ukraine for this old people.

But the same time government has decided this month to buy brand new lux Mercedeses 750 000 dollars each for the President Administration which already has about a hundred luxury cars. (check the tender documentation - in Ukrainian)

The same time they raise expenditures on the Government and Presidential offices.

The same time the top officials don’t travel by regular transportation, using only the governmental luxury Airbus spending thousands of dollars just for their comfort.

Have a nice day.

The Guesstimation. Who (and when) will be the next President of Ukraine? And what comes next?

It is my first post here after the first round of presidential election in Ukraine. Obviously, the result was predictable. But nevertheless every Ukrainian needed time to think over in order to understand, what happened. After January, 19, at least one simple thing is clear: there will be no miracle for Ukraine. And no hope for a big change. We’ve got a choice without choice – between two well-known faces.

The results of the first round of Presidential vote in Ukraine demonstrated a confident priority of leader of the opposition Party of Regions, anti-hero of times of the 2004 Orange revolution Viktor Yanukovych, who received a support of 35,32 percent of voters.

The Prime Minister of Ukraine Yulia Tymoshenko has got only 25,05 percent (a gap between two leaders is 10,27 %, which is a big challenge for the PM).

The 7th of February will be a day of a totally hopeless choice for Ukraine. President Viktor Yushchenko had mentioned recently that both candidates are almost equal. Yes, I must confess that there is not much difference between Tymoshenko and Yanukovych. First of all, they’ve got very similar programmes, mostly based on social promises and well-written slogans (it reflects a wider problem of absence of big ideological parties in Ukraine – all the main political forces differ by names of their leaders and oligarchic sponsors). Secondly, they have almost the same origin – East of Ukraine. It is very popular these days to say that Viktor Yanukovych represents Eastern and ‘pro-Russian’ (I don’t agree with that formulation) Donetsk region, and that he has a lot of difficulties with communication in Ukrainian language (though he’s not a good speaker at all). But lot of experts prefer to forget that only a decade ago Yulia Tymoshenko had a nickname “ a gas princess from Dnipropetsovsk”, and that she learned Ukrainian only at the beginnign of 2000th.

The choice between Viktor Yushchenko (who did represent Ukrainian mentality and traditions) and Viktor Yanukovych in 2004 was really a choice between values – Western and Eastern. But the current choice is totally different. It may be said that it is a choice between importers and exporters (as there are more representatives of the biggest export-oriented enterprises are accumulated around Viktor Yanukovych, and Yulia Tymoshenko’s biggest supporters are making their profits on import operations). but it’s not a clear statement at all. I would say, it is just a fight for power between two politicians and their establishments – it is naïve to expect the revolutionary breakthrough from any of them.

Who will win?

Most probably, Yanukovych.

Is it for better, of for worse? I don’t know what to say. No comments for this moment.

Let’s count. (It will be just a ‘guesstimation’ as the percentage strongly depends on the voters’ turnout. Besides, the less turnout we will have in the second round, the better it will be for Mr. Yanukovych, as he proved to have a very stable electorate).

Starting position:
YANUKOVYCH – 35,32 %
TYMOSHENKO – 25,05 %

Both the pretenders are fighting now for votes of supporters of other political heavyweighters.

First of all, it is Sergiy Tigipko who (with a help of a French political technologist Jacques Segela) showed the third result – 13,05 percent. Here I would like to mention that I don’t agree with experts who call Mr. Tigipko a kingmaker. Yes, he may become very and very influential, but only after the parliamentary election. As for now, Mr. Tigipko may hardly influence his electorate to vote for this or that candidate – it’s a specifity of Ukrainian voter, and especially of a well-educated urban voter, than he makes his own decisions, some times unpredictable.

Most of Ukrainians who voted in favor of Tigipko didn’t actually support him as a politician, but were hoping for change and the renovation of Ukrainian politics. On 7th of February a big part of them will stay at home, some will vote against all, and others will divide between Yanukovych and Tymoshenko. I would suppose that at least half of supporters of Tigipko will vote for Yanukovych as they represent Eastern, Central and Southern part of Ukraine.

So, we are adding 6,5% to Yanukovych – subtotal result 41,82 percent. Let’s also give around 4% to Tymoshenko – subtototally 29,05 percent.

Arseniy Yatseniuk with a very unsuccessful advertising campaign, mostly created by Russian team of PR-professionals, has gained only 6,95 percent. Some of his voters will also demonstrate the absenteeism, but the active part will surely vote for Yulia Tymoshenko. Let’s say it will be 5%. (YANUKOVYCH – 41,82 %, TYMOSHENKO – 34,05 %.)

The voters of the President of Ukraine Viktor Yushchenko (5,45 %) are also rather unpredictable. Taking to the account the rough fight between PM and President during last months, we may predict that part of them will not show up at the polling places. But I hope Yulia Tymoshenko may count on additional 4,5 percent. (YANUKOVYCH – 41,82 %, TYMOSHENKO – 38,55 %.)

It is for sure that the electorate of a Communist party leader Petro Symonenko (3,54%) will vote for Yanukovych. At least, 3 percent. (Subtotal result: YANUKOVYCH – 44,82 %, TYMOSHENKO – 38,55 %.)

In favor of Prime Minister may be also around 4 percent of voters, who supported other candidates – like Speaker of the Parliament of Ukraine Volodymyr Lytvyn (total 2,35%), radical right politician Oleh Tyahnybok (1,43%), and ex-Minister of Defense Anatoliy Hrytsenko (1,2%).

So, the forecasting figures look like YANUKOVYCH – 44,82 %, TYMOSHENKO – 42,55 %. (The gap is 2,27 percent).

But taking to the account the probable growth of the level of absenteeism, my own style of the vote-count, very favorable to the Prime Minister, and also the fact that Ms. Tymoshenko represents the acting power, I would predict that in reality the gap may be not 2, but 3-4 percent or even more.

Anyway, both candidates are preparing to challenge the result of election in courts. And here comes the next important question:

Is there any chance to have an inauguration in March?

According to the Law on Election of the President of Ukraine, the official results of second round should be declared not later than 17 February. But the court proceedings (which will be long and difficult in case of 1-2-3-percent gap between candidates, or in case of a high level of ‘against all’ votes) may postpone this date even for a month.

The inauguration shall be held in frames of 30 days after the declaration of official results, and some influential off-going forces may try to postpone this date. The elected President shall take the oath during the special parliamentary sitting, which may also be wrecked.

So, there is a chance that the inauguration of nobody-knows-who will be held in March 2010, but as I am informed the headquarters of both candidates has received the instructions to be ready to work till the summer. Maybe, to prepare for the early parliamentary elections, who knows.

Early parliamentary election: to be or not to be?

Analyzing the current alignment of political forces in Ukraine, I am 99 percent sure there will be no early parliamentary election on 30 of May 2010, despite of all the ‘promises’ of the top-politicians.

(The day of 30 of May is widely discussed as a possible date for early parliamentary vote as is an officially established day for the local elections).

The argumentation is simple: there is no parliamentary party in Ukraine, which would be really very interested in early election in 2010. Though, it is very possible that the early parliamentary poll will take place in 2011, even in January 2011, – about one year before the scheduled time.

Why the current composition of Parliament seems to be very livable? First of all, because two biggest factions wouldn’t run the risk of losing the precious parliamentary seats.

The party of Regions is again in the most confident position. In comparison to the results of last parliamentary election of September 2007, Viktor Yanukovych slightly strengthened the ranks of his supporters – on 1 percent (from 34,37%). But it is not clear, how Ukraine will vote for the ‘Regions’ in half of the year, especially if Yanukovych win the presidential position (Ukrainians are predisposed to give less support to the ruling authorities).

Yulia Tymoshenko, to the contrary, has lost more than 5 percent – in 2007 she had 30,71% of votes. And 5 percent is about 20-27 seats in Parliament (it depends on the quantity of parties, which will overcome a 3% threshold).

All the other political parties, presented in Parliament now, including the members of so-called ruling coalition, have very illusive chances to enter the Parliament after the early vote. The block of Viktor Yushchenko Our Ukraine – People’s Self-Defense has already been falling into pieces, and ex-and-current-pro-presidential MPs are seriously thinking about their political future and risk not to become MPs again in case of the early election. Communist Party understands that it will never win 27 seats in Parliament which they have now. The block of Volodymyr Lytvyn (currently having 20 seats) seems as totally not able to pass the 3% threshold, so, the Speaker would surely form a coalition with a winner of Presidential fight, whoever it will be.

Does a new coalition already exist?

The vote in favor of dismissal of the Interior Minister of Ukraine Yuriy Lutsenko on Thursday, 28 January, has showed that a new coalition (pro-Yanukovych one) already exists in Ukrainian Parliament.

Who voted in favor? Here is the list, ahich may be considered as a draft of a 'new coalition':

The Party of Regions faction – 171 vote (out of 172 members of the faction)

The Block of Yulia Tymoshenko faction – 1 vote (out of 153 members of the faction)

Our Ukraine – People’s Self-Defense faction – 11 votes (out of 71).
I have to add that part of these MPs represent ex-Head of Presidential Secretariat Viktor Baloha. A brother of Viktor Yushchenko Petro and a godmother of President’s child Oksana Bilozir also voted in favor of Minister’s dismissal.

The Communist Party of Ukraine – 27 (out of 27).

The Block of Lytvyn – 19 (out of 20 – as the Speaker decided not to vote).

Independent MPs – 2 (out of 6).

As the proverb says, we shall see how the cat jumps.

All Flags at Half-Mast. One more quotation from the President of Ukraine.

“If Yulia Tymoshenko is getting into the second round, it will be the time to go to Maidan and dip the national flag”, the President of Ukraine Viktor Yushchenko said during one famous TV-show on 15 January 2010.

Flu epidemic has reached its peak, the Health Ministry of Ukraine informs. Meanwhile the opposition accused Yulia Tymoshenko in making money on panic.

The flu and ARVI epidemic in Ukraine has already reached its peak, Deputy Minister of Health of Ukraine Vasyl Lazoryshynets informed at the press-briefing today. According to Deputy Minister, 54% of people who were hospitalized since 29 October have already recovered from sickness.

Talking about the swine flu, Mr. Lazoryshynets said that there were 166 documented cases of swine flu (A/H1N1) in Ukraine, and 15 of them were fatal.

Though, it is well known that very limited number of Ukrainians had an opportunity to be examined, whether they have a swine flu or not. I asked my district doctor today (while she was filling in my sick-leave certificate), how many recommendations for a swine-flu examination had she signed in our district. The answer was ‘none at all’.

‘Some private clinics are practicing such an examination’, the nurse added. According to witnesses, one of the well-known Kyiv private medical centers performed a kind of PR-action in one of the shopping plazas in Kyiv: everyone passing-by was proposed to have a free swine-flu test.

The Health Ministry of Ukraine, and Vasyl Lazoryshynets in particular, also gave an interesting peace of indormation today. To receive any kind of swine-flu diagnostics an average Ukrainian should be either severely ill (hospitalized) or/and pregnant, or dead.

Meanwhile the opposition Party of Regions started to blame the Government and Prime Minister Yulia Tymoshenko in provoking total panic around the A/H1N1 epidemic, and even in making money on that. The MP from the Party of Regions Hanna Herman, Head of the Parliamentary Committee on Freedom of Speech and Information, has stated today during the popular TV-show that the epidemic is a way for the Block of Yulia Tymoshenko to earn money on selling drugs via affiliated and ‘friendly’ companies.

‘Yulia Tymoshenko made money on drugs during the epidemic’, Hanna Herman declared.
Now the Government says the epidemic has finished. And even more – Government is supporting the Junior Eurovision Song Contest to be held this Saturday in Kyiv. That suggests the flu epidemic panic was fake, MP assumed.

871 thousand of Ukrainians are sick with flu, ARVI or pneumonia - Health Ministry of Ukraine

Official information of the Ministry of Health of Ukraine as of 6 November 2009: 871037 Ukrainians are sick with flu, ARVI or pneumonia. 135 died, 25 of them - has died today.

Deputy Head of Kyiv City Administration Irena Kilchytska has just informed at the TV-show I'm watching now that there are 7 proved A/H1N1 cases in the capital of Ukraine, and 2 women died.

Credit History. Ukraine will receive the second bailout of the IMF credit, but it is not enough to support the economy.

I was not blogging here for a long time due to some personal reasons, but also because it was rather difficult to write about the messy situation we’ve got here in Ukraine. Every day we receive a portion of new information on what’s wrong in the country. And the picture really frightens. Ukrainian economy is getting worse, national currency is falling down (starting from the last week, the price of one dollar is more that 9 hryvnias, it’s twice more than five months ago).

To save the economy Ukraine is in need of the external financing. Here is also the problem: the International Monetary Fund (IMF) refused to issue to Ukraine the second bailout of its $16,4 billion dollars (Kyiv was supposed to receive $1,864 billion on 15 February), because Ukrainian authorities failed to comply with the requirements of the Arrangement with the IMF.

As a result, all the main world rating agencies have cut Ukraine’s credit rating. Fitch Ratings cut the rating to B, the fifth-highest non-investment grade, and kept the outlook “negative”. Standard & Poor's Ratings Services cut Ukraine's foreign currency sovereign credit ratings by two notches, to CCC+/C from B/B. S&P left Ukraine's outlook negative, indicating it may reduce the ratings further. I have to remind, that the next letter after C is D, which means ‘default’. The new S&P rating for Ukraine is the lowest in Europe – one of the ‘rating colleagues’ of Ukraine is Pakistan.

Experts said that Ukraine has no chance to attract investments and receive new loans, until its relations with the IMF will not be ‘repaired’. The only country that is ready to give money to Ukrainian economy is Russia, but the interest of Moscow is the geopolitical influence and the control on some of the strategic centers of the economy – for example, the gas transport system of Ukraine, which is a key to Ukrainian and all the European energy security. Besides, there is an evidence of upcoming problems in gas area. The 7 of March is a deadline date for a new payment of Naftogaz Ukraine to Russian Gazprom. Gazprom has already warned it may cut off gas supply to Ukraine on March 8.

Coming back to the troubles of Ukrainian economy, I have to add that people who were making such a sad prognosis on the destiny of the IMF loan didn’t take to the account the fact that the IMF as an Organization is not interested in loosing of such a big borrower as Ukraine is (actually a biggest one for the current moment). The break-up of the cooperation with Ukraine would also mean for the IMF the failure of the IMF policy, which may question the appropriateness of all the system of anti-crisis measures, worked out my the IMF experts.

As a result, the IMF decided to change the tone of a dialogue with Ukraine: if the country cannot accomplish its obligations and commitments, one of the ways out is to change the rules. Ukrainian authorities were asked to write a new Letter of Intent to the IMF, listing a new set of measures, more appropriate for the today’s economy state. I wrote about this issue for one Ukrainian newspaper, and here and here are the links to my recent articles (in Russian language).

So, next week (or a bit later) the Mission of the IMF will be back to Kyiv. Ukraine may receive the second tranche of the loan in March 2009. But it will not resolve the whole problem. To deal with the essential budget deficit, Ukraine has to ask for extra-loans (back to question of Russian ambitions), or to monetize it (back to the question of a severe inflation). Let’s see, which evil will be chosen by Ukrainian authorities?