Ukraine Presidential Candidate Says Economy Is “Falling Apart”
Policy + Politics

Ukraine Presidential Candidate Says Economy Is “Falling Apart”

REUTERS/Jonathan Ernst

Ukraine is “basically bordering on default” and “the structure of the Ukrainian economy is falling apart,” Dr. Valery Konovalyuk, a former member of the Ukraine National Parliament who is running for president in the troubled country’s election scheduled for later this month said in an interview Monday.

Konovalyuk, speaking through an interpreter, painted a dire picture of the economic future of Ukraine, where separatists in favor of what amounts to a Russian takeover of large parts of the country have assumed control of public facilities in many cities and towns.

Related: U.S Watches While Ukraine Burns

Two months ago, Russian forces occupied Ukraine’s Crimean peninsula, and not long afterward, the population of that region voted to be annexed by the Russian Federation. Since then, pro-Russian separatists have been actively agitating for the eastern part of Ukraine to align with Russia as well.

Russia has massed tens of thousands of troops on its border with Ukraine, and Russian President Vladimir Putin has made multiple public statements suggesting that Russian military intervention is Ukraine is a real possibility.

Konovalyuk, an economist by training with degrees from the Moscow Military Academy of Higher Command and the German Finance Academy, said that his country is on the brink of economic disaster. He is one of about 21 candidates for the presidency, a pack led by billionaire businessman Petro Poroshenko and former president Yulia Tymoshenko. 

He said current sanctions on Russia have not been enough to deter it from taking further action in Ukraine and that additional sanctions run the risk of creating another global economic crisis. 

Related: If Russia goes Over the Economic Cliff, It Won’t Go Alone 

“There is an enormous budget deficit. Not only are social services being cut back, we are also at risk of losing funding for very important domestic projects,” Konovalyuk said. “Investors are abandoning Ukraine and the economic crisis is only making things worse.” He warned that as unemployment increases, it is likely to lead to even more social unrest. 

He said that a proposed International Monetary Fund aid package, totaling about $17 billion dollars was “not going to be enough.” The majority of the money, he said, would simply be used “to service Ukraine’s enormous foreign debt.” 

Konovalyuk’s strategy is to present himself as the man who can unite the eastern and western parts of Ukraine. Born in the eastern city of Donetsk, where separatists have been particularly active, he has also served three terms as a member of parliament in the capital of Kiev in the west. 

In discussion about the current strife in Ukraine, he took pains to paint the United States and Russia as equally at fault. 

Related: Does Russia Have the Ukraine Crisis Under Control? 

“The U.S. and Russia have provoked the conflict,” he said, which threatens to worsen. 

“The US and Russia need to take an equal number of steps back,” he added, and allow Ukraine to solve its own problems. Russia, he said, should remove its troops from the Ukraine border, and the U.S. should draw down recent troop increases in Poland and the Baltic states. 

There is an element of false equivalence here. There is a significant difference between tens of thousands of Russian troops poised on the border of a country, part of which they have already invaded, and the U.S. putting a few hundred troops in countries it is obligated by treaty to help defend. Additionally, unlike Russia, the United States has not recently occupied and annexed any Ukrainian territory, nor has it suggested that it might need to take military action because of events occurring within Ukrainian borders.

Understandably, Konovalyuk appears to be trying to strike a balance between forces in his country that want to align with the West, and those that want to retain historic ties to Russia. He said he envisions an “unaligned” Ukraine, with obligations to neither the West or to Russia.

Related: The Kerry Quote That Really Matters Isn’t About Israel

That said, he is also willing to take a stand that defies Russia with regard to the Crimean peninsula. 

During the interview, he also called for an international effort to improve the effectiveness of the enforcement of the Budapest memorandum – a deal in which Ukraine agreed to surrender its nuclear arsenal, left over from its years as a Soviet Socialist Republic in exchange for assurance from the U.S., Russia, and others that its territorial integrity would be respected. 

Asked if that included the Crimean peninsula, he said, “including Crimea.” 

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