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The Next Economic Crisis in the West Will Mean the End of the Ukraine

The country lives mostly off of subsidies from the US and the EU. If they decrease, the Ukraine is toast.

This post first appeared on Russia Insider

Since the “glorious revolution” on Maidan in 2014 it has been possible to trace the precipitous decline of Ukraine step by step both politically and economically. Here is a succession of facts leading to one unmistakable conclusion: the collapse of Ukraine.

The “dramatic shift towards an independent and truly democratic government” was mere pretense. In four years, a collection of oligarchs has managed to gain control over almost every aspect of Ukrainian life. These robber barons – Akhmetov, Firtash, Kolomoisky, Pinchuk, Poroshenko and Pasternak – control the government and just about every sector of the Ukrainian economy.

Boxed in

In order to end its dependence on Russian subsidies (over 200 billion dollars since 1991) Ukraine has allowed itself to be taken over by biotech interests handing over massive agricultural areas to Monsanto and other corporate carpetbaggers. This was necessary – along with assurances to reform shady business practices - in order to secure a 17 billion dollar loan from the IMF ( most of which magically disappeared). Rather than becoming more transparent and efficient due to its alliance with Europe, Ukraine consistently loses $8.6 billion a year to corruption and mismanagement.

The construction of the Nord Stream and South Stream pipelines bypassing Ukraine will deprive it of  at least $2 billion annually in transit fees. On a related topic, the cost of heating one’s home is bound to rise to levels unacceptable to average citizens. In fact, many struggling Ukrainians are already falling behind on their payments and residents in Kiev spent all of last summer with no hot water.  

Before the CIA inspired coup in 2014, the GDP of Ukraine was 183 billion dollars. In 2017 it was already down to 112 billion. If that trend continues the country will be bankrupt by 2020. If this is not bad enough, Ukrainian Foreign Minister Pavel Klimkin has said that nearly a million Ukrainians are leaving the country every year. The current situation is expected to worsen in the years to come, according to Ukrainian Deputy Minister of Social Policy Olga Krentovska.

As Rostislav Ishchenko has shown, Ukrainian high-tech enterprises have lost foreign market share over the past few years and even Ukraine’s agricultural products are being displaced. It is estimated that two out of three dollars of Ukraine’s state budget has been from the West or Russia since 2014. With the next economic recession expected to hit the world in less than three years, Ukraine will be lucky to receive even half of that assistance. America and the EU countries will simply not be able to afford any substantial help to Kiev. In other words, the country is doomed. There is no other way to put it.

The warm fuzzy feelings that proud nationalism has given so many Ukrainians will not be enough to heat their homes next winter or the one after that. Will the citizens of Ukraine continue to suffer in order to “stick it to the Russians”? Or will they rise up against the oligarchs who have plundered the wealth of Ukraine? One thing is for sure…instead of worrying about attempting to sail a ship through the Kerch strait, the authorities in Kiev should be focusing on how to prevent the Ukrainian Titanic from smashing into the financial iceberg it is heading towards at breakneck speed.

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