Onisсhenko: sound economic policy can lead Ukraine out of crisis

10 july 2014

First Deputy Director General of the Analytical Center Vladislav Onischenko took part in a roundtable titled "Economy of Ukraine: association with the EU and industrial decline", which was held at the Press-center of IIA "Russia Today".

Experts discussed what sectors of industry had to suffer the most because of military actions, what are the economic prospects of Ukraine's association with the European Union, what threatens the economic and trade relations between Ukraine and CIS countries and why Ukraine is reducing science funding in order to increase weapons production.

Vladislav Onischenko suggested ignoring the politics that, of course, dominate the situation in Ukraine. "Sharp depreciation of the national currency, decline in industrial production and unemployment is not a new situation for the world" - said the expert, and reminded that at the beginning of the century, major Latin American countries - Argentina and Brazil were in the same situation. "Today, we see that these countries are not in such a bad shape as is has been predicted at the time of acute crisis", - said Mr. Onischenko. According to him, the key to a successful recovery from crisis can become the sound economic policies implemented by the government.

He sees certain advantages for the economy of Ukraine. "Regardless of how you approach the fall of hryvnia, objectively speaking, the depreciation of the national currency on the background of the opening of markets for Ukraine, is advantageous if the customs duties on European markets will decrease, as it will facilitate the growth of exports in the medium-term", - said the expert. He reminded that before all these events happened, Ukraine has had a good trade balance. The expert suggested that if the economic policy will be sufficiently balanced and reasonable, we can hope for an investments increase, especially at the level of small and medium-sized businesses which doesn’t require political guarantees.

As for the threats to our nation's economy, Mr. Onischenko believes that Russia needs to solve the issues related to the gas transmission system, and to seek a compromise, because there isn’t yet an alternative for Russia to export gas at full capacity if it bypasses Ukraine. Another important factor influencing the state of the Russian economy - relatively cheap labor force from Ukraine, a quick replacement of which is unlikely. Also, according to experts, we must not forget about the relatively large volume of Russian investments in the Ukrainian economy, which must be preserved.

Video of the event is located on the website of the Press-Center IIA "Russia Today".