Three TV channels (5 channel, TVi, TRK “Chornomorska”) ceased to broadcast for 1 hour (19:00-20:00 Kyiv time) in defense of freedom of speech. It was warning strike, if the government continues to violate freedom of speech, they’ll continue strike.

Public movement “Stop Censorship!” is ready to call on a nationwide journalists strike.

Dear readers, visitors of my blog, today it was reported that the International Monetary Fund (IMF) has given to Ukraine a new stand-by credit line in the amount of SDR 10 billion (about $ 15.15 billions), which is administrated for 29 months. SDR 1.25 billion ($1.89 billion) will be available today. I don’t want to analyze the consequences of how it will affect Ukraine, but I’d say one thing, money will not be administrated for the needs of state.

Link for the IMF web-site: http://www.imf.org/external/np/sec/pr/2010/pr10305.htm

European Bank for Reconstruction and Development maintained its forecast of gross domestic product (GDP) of Ukraine this year at 4% and improved it in 2011 from 4% to 4.1%.

According to the update of the regional macro-forecast released on Thursday by the bank, as a result of the fourth quarter of 2010 the GDP growth will be 6% comparing to the same period of 2009, and according to the balance sheet of fourth quarter of 2011 will decrease to zero.

According to estimates made by Bank, the GDP growth in first quarter of this year was 4.9%, while in second quarter it slowed to 2.3%, in third quarter – it will increase to 2.9%.

The EBRD said that, in the fourth quarter of 2009 the decline of GDP was at 7%, a year earlier – 8%.

July 14, 2010, Kyiv hosted an international conference of the Collective Security Treaty Organization (CSTO), where was announced the need for large-scale propagation of CSTO among the Ukrainians for “brain washing”.
In the pro-Russian government that was established in Ukraine after the victory of Yanukovych in the presidential elections last winter, most politicians want the further cooperation with Russia, to reach an economic, political and military integration.
So, what about the economic integration it’s already too late for openly pro-Russian politicians as the President of Ukraine Mr. Yanukovych is, because Ukraine is part of the World Trade Organization ( WTO) since 2008. And as Russia, Kazakhstan and Belarus are not parts of this international organization, Ukraine can not join the Russian project of customs union. It’s a good news for Ukraine. We must say thank you to Yushchenko that Ukraine joined the WTO and he has saved our economic independence.
Concerning the political integration, Ukraine is not a part of the European Union (EU) nor the Commonwealth of Independent States (CIS). As the EU shows no political will on the Ukrainian question about possible Ukraine joining the EU, gives every opportunity to Russia for maneuvering to put Ukraine in its sphere of interest (CIS and other projects). Rejecting Ukraine, the EU can have a volatile area near its eastern borders. Otherwise, the EU could show its true face to the people of the EU on double standards concerning a European country as Ukraine. Like this, it will reduce the image of the EU in the eyes of people around the world as an organization/country struggling for democracy and freedoms of people.
Regarding military integration, Ukraine is still a neutral country, but that may change. In 2008 NATO Summit in Bucharest, Romania, under pressure from Russia, France and Germany, NATO has rejected the application of Ukraine to grant the Membership Action Plan (MAP). So, the population of Ukraine is frustrated, the people of Ukraine were expecting the backing of the expected the granting of MAP, but NATO member-countries refused it. After the complete failure feels forgotten by the West and does not believe in the values announced by the EU. What it gives to the EU and NATO? Above all, NATO risks to lose Ukraine as an active partner (Ukraine takes part in all operations of the NATO from “Active Endeavour” to Afghanistan). Because it is not in the interest of Ukraine to cooperate so deep with NATO without membership. So, the new pro-Russian president of Ukraine Victor Yanukovych pushes Ukraine into the hands of Russia. That is to say, he and his team will promote the CSTO and therefore, as the military bloc is opposed to NATO and the West, in my opinion it is a bad sign/message for European and American politicians. Otherwise, in the future Ukraine may join the CSTO and become a rival to NATO.
Instead of conclusion. The EU and the U.S. must put themselves a question “do they want Ukraine as a stable and predictable partner or they want to have a zone of instability and Ukraine who plays like Russia?”.

In late 2009, Ukraine signed a contract with Iraq to supply weapons of the total amount of $ 2.4 billion. It is the largest contract for the supply of weapons in the history of Ukraine.

The United States helped Ukraine to get such contract. According to the U.S. Congress, Ukraine is among the ten largest exporters of weapons. This agreement will put Ukraine on 5th or 6th place in the world arms trade. This contract will provide with work 80 Ukrainian enterprises.

Ukraine will supply to Iraq armored vehicles, tanks, small arms and aircrafts.

I want to remind, that this month Ukraine signed a contract with India to upgrade 105 AN-32 aircrafts.

Note. AN-32 (NATO codification: Cline) – Ukrainian military transport multipurpose aircraft. Can operate in different climatic conditions, including conditions of hot climate (50 °C) and high airfields (up to 4500 m). The main purpose of the aircraft – cargo lines of small and medium-haul. You can use it to transport people, parachute landing people and cargo platforms, as well as sanitary option for transporting the wounded.

Today let’s speak about the economic freedom. There is no universally accepted term of “economic freedom”. By definition of “Wikipedia” the Economic freedom is a breadth of economic behavior of economic entities in the choice of ownership and the scope of their abilities, knowledge, capabilities, skills, methods of income distribution, consumption of material goods; is realized on the basis of state laws; the economic responsibility of citizens.

The one indicator among other which indicates that Ukraine is not an economically free country is the fact, that holders of bank cards cannot receive money through the payment system as “Paypal”. Of course, we can buy something, but we can’t receive money nor withdraw it. And all this is just because of Ukrainian law “On foreign economic activity” and general policy of the Ukrainian government to prevent implementation of any elementary operations with money in Ukraine.

Let me show you a fact, according to the “2010 Index of Economic Freedom“, which is a foundation of “The Heritage Foundation“, Ukraine got the 162^nd place among 179^th. According to the same foundation, our economic freedom is at the “repressed” level. ”Neighbors” of Ukraine were Togo (161^st place) and Liberia (163^rd place). North Korea was last and took 179^th place.

Let’s look at others former USSR countries. Turkmenistan (171^st place) is the sole country which slipped below Ukraine. Also, there are Belarus (150^th palce) and Uzbekistan (158^th place) in the rank of “repressed economic freedoms”. Russia (143^rd place) and Moldova (125^th place) are in the rank of “mostly economically unfree”. For example, Georgia (26^th place) is in the rank of “mostly economically free”.

Let’s make conclusions!

PS. You can find all data here

Everyone knows that Ukraine is one of the most affected by the global financial crisis among the European states. Despite the fact that this year the proposition of $ and € exceeded the demand. And some other positive moments in macroeconomic system of Ukraine, the problem remains.

Today I decided to share my opinions about the development prospects and pension system reforms in Ukraine. I hope it’ll be interesting for you, if somebody’s still reading me.

The urgent issue for Ukrainian economy in overcoming the crisis is to balance the state budget by reducing spending. So, ideally, it would be nice to bring the deficit in Ukrainian budget to 2% of GDP. But most likely it’s impossible because of number of economic, but primarily, because of political reasons. Let’s speak about it a bit later.

Inadequate fiscal policy pushes away the potential investors from the Ukrainian market. Ukraine has to create a fair business environment through the elimination of tax exemptions that exist in business operations with Cyprus.

In the pension sector, the situation is developing in such scenario that soon the government won’t fulfill its obligations to pensioners. However, there is a way out. In Ukraine there is a problem of a big difference between pensions. There are people who get about 3125$ as pension, and there are a lot of people who earn just some 125$ per month as a pension. By reducing the large pensions we can redirect that money to increase a low pensions or their financing.

As about political reasons, which make it impossible to conduct an adequate fiscal policy, there are:
1. President’s and its team populist’s electoral promises
2. Unwillingness to realize the complexity of Ukraine’s economic situation
3. Lack of political will to carry out unpopular reforms and restoration of cooperation with the IMF and the World Bank Group

I hope for the rationality of the new president of Ukraine and the government.

PS. Maybe someone has some thoughts about it? If so, please leave them in the comments.

In XVIII century sons of hetman Pavlo Polubotok (1660 – 1724) put a huge amount of money to the British East India Company (also known as B.E.I.C.) with an interest of 4% per year. There are two conditions under which we can get the money back are:
1. being a direct descendant of hetman
2. when Ukraine gains its independence
It’s known that during the Ukrainian People’s Republic (1917 – 1920) there was a case when a man came from Argentina to Vienna in the embassy of the Ukrainian People’s Republic in Austria, and said that he’s a direct descendant of hetman Polubotok. Then the ambassador of the Ukrainian People’s Republic in Austria demanded a meeting with a representative of the B.E.I.C., but such a company ceased to exist in 1858 and the entire capital and the deposit liabilities moved to the Bank of England. So it was the representative of the Bank of England who came. Further, there is no precise information what happened then. But we also know that no money has ever been sent to Ukraine.

According to the estimations the amount of money which the Bank of England has to pay to Ukraine is about £1 trillion. Of course, if we put out such an amount from the fiscal system of the Great Britain, it’ll be a big problem. But I think Ukraine would agree on repayment via tranches. However, the UK doesn’t think about repayment, because the Ukrainian government does eventually nothing to get repayment.

Generally, we can’t say for sure whether it’s a fiction or a legend, or this event took place. But I’d like to mention one interesting thing to justify that this story is true. Time of the economic prosperity of the United Kingdom and the time of putting the money on deposit account by hetman’s sons match the XVIII century. Maybe in the same way England has earned a lot of money, and this case concerns not only Ukraine but also a lot of other states.