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Saturday, 27 April
economy

Not only the war: the expert explained what slows down the development of Ukraine's economy

Financial expert Oleksandr Lymar assessed the impact of the war on the economic development of Ukraine and talked about another restraining factor that prevents the country from achieving sustainable development.

He wrote about it on his Facebook page.

"War is an obvious obstacle standing in the way of economic development because more than 50% of the country's budget is aimed at ensuring defense needs. The question is: can they be reduced? Hardly, but such a forced "distortion" leads to the fact that underfunded expenditure items today become unrealized income items in the future. Therefore, we are talking not only about direct losses from the war but also about potential opportunities that will not be realized as a result", - explains Oleksandr Lymar.

Another important restraining factor, the expert calls "personnel hunger" - and, according to him, this factor existed not only before the start of a full-scale war but even before the term of office of Volodymyr Zelenskyi.

"Ukraine has always lacked experts in economics who could systematically and consistently implement changes in management positions. Reforms, which should last a decade or more, cannot be carried out in a year, two, or three - as long as a person is in office until the government changes. At the same time, conditional "new faces" coming in her place usually have their vision, their ideas, and guidelines. As a result, there is no practice of a kind of "inheritance" of reforms," the expert emphasizes.

The situation may change after the end of the war - provided that the State Apparatus of Ukraine finds enough specialists who can not so much reform the economy to ensure its functioning following the norms of the current legislation and compliance with its norms by all businesses.

"Currently, it is not about development, but about maintaining what is there. However, the situation will change after the victory of Ukraine - investments will begin to flow in, and it will be important for investors that the rules are the same for everyone. We can already ensure this by organizing stricter control over the implementation of current legislation - even without introducing reforms. But for reform, it will be necessary to attract experts, including from the digital economy, because Ukraine has a chance to "open the door" for digital money and, in particular, cryptocurrencies, which can and should become a support for the real sector of the economy," Oleksandr Lymar concluded.