The Ukrainian economy is in coma

A coma is a state in which the economy does not respond to external stimuli (losses, price shocks, paralysis of the old capital structure). Vital institutions and mechanisms are disrupted, and sources of income are paralyzed.

CAUSES OF THE COMA OF UKRAINE’S ECONOMY:

1) агресія нацистської Росії. Це зовнішній фактор. Росія перетворила всю Україну на зони дуже високих ризиків для ведення економічної діяльності, зокрема інвестиційної та виробничої.

2) inadequate economic policy of the government of Ukraine itself. When a full-scale war began, it was urgently necessary to change radically: 1) the decision-making system, 2) monetary policy, 3) regulatory policy, and 4) social policy. The return of the pre-war regime is a gross mistake because there is no old pre-war economy, no old labor market. You cannot control what is not, regulate what is not there and expect success.

THE CONTRIBUTION OF THE GOVERNMENT ITSELF “INTO A COMA” IS:

• preservation of the old system of economic management,
• manual price adjustment,
• bringing the hryvnia to multiple exchange rates,
• preservation of strict currency regulation,
• restoration of the pre-war tax system,
• restoration of the pre-war regulatory system,
• restoration of the pre-war customs policy,
• the threat of introducing a 10 percent currency exchange tax,
• low-quality management of inflationary and devaluation expectations,
• preservation of pre-war social policy and social benefits.

The state must respond adequately to an external economic shock. If you only have $2 billion, you can’t spend $7 billion. That’s a direct path to economic collapse. Attempts to cover government expenses through a generous money issue are a gross mistake, adding fuel to the fire. Therefore, those who did not make the necessary budget sequestration contributed to the collapse of the Ukrainian economy.

The second person in charge is the one who made the devastating decision to restore the pre-war tax system. The country’s economy during the war cannot generate income from such tax bases as “added value,” “profit,” “salary,” “real estate,” or “land.”

The third person in charge is the one who decided to restore pre-war regulations (licenses, permits, certificates, regulations, quotas, labor, environmental, etc. requirements).

The fourth person in charge is the one who preserved the old customs regime. This is sabotage, a blow by armed force in the back.

The fifth person in charge is the one who did not dare to cut social benefits because there is nothing to pay.

The sixth person in charge is the one who disagreed with foreign partners on the specific amount of aid necessary for the conduct of the war and the country’s life support. Instead, we saw the Lugano show with claims for $750 billion.

“We, not only Ukraine but also the whole world, must do everything today so that our economy starts breathing,” said V. Zelenskiy. It will begin to breathe and even move energetically if the heavy, suffocating tax package is removed from it, the ropes of crazy regulation are untangled, and the ballast of hundreds of thousands of other people’s managers is released.

When we do this within the country when we show our partners clear, understandable solutions, explain the necessary amounts, fully entrust the production of goods and services to private entrepreneurs without any restrictions, then the possibility of the world’s help in financing public expenditures will certainly come.