Nearly a year and a half after the Euromaidan protests ushered a new government into power in Kiev, Ukraine is still in trouble. Some 6,200 people have been killed, more than 15,000 wounded, and 1.2 million internally displaced in a civil war that had by mid-March, according to the new president, Petro Poroshenko, destroyed “around 25 percent of the country’s industrial potential.”
The country’s economy is out of control: Trending downward since the end of 2013, Ukraine’s gross domestic product is declining at a massive, accelerating rate. The World Bank predicts GDP will contract by as much as 7.5 percent during 2015. During 2014, the amount of money brought in on exports dropped by 40 percent, and between the beginning of 2014 and spring of this year, the goods and services available in the country became nearly 50 percent more expensive as the currency used to pay for them lost two-thirds of its value.
Ukrainians need rescuing. The question is: Can the policies favored by the new government save them?
After endorsing the anti-government protesters that filled the streets of Kiev in November, 2013, the United States gave its blessing to a change of government in the following February, one year ahead of Ukraine’s scheduled democratic elections. The government that rules from Kiev today is therefore distinguished from its predecessors by its distinct amenability to US interests—and dramatic coolness to Russian concerns.
In a sign of this shift, on June 27 of last year, this government, led by Poroshenko and Prime Minister Arseniy Yatsenyuk, signed the Ukraine-European Union Agreement—the rejection of which by the previous government had precipitated the protests. The EU agreement reorients Ukraine’s political, economic, and military activities toward those of Europe (and by association, the United States) and has become one of the chief instruments of Western influence in Ukrainian affairs.
The other instrument is an agreement with the International Monetary fund to receive $17.5 billion in bailout loans in exchange for key changes to Ukraine’s economic policy. By accepting this deal, Ukraine effectively forfeited its sovereignty, handing over to foreign governments the power to write its own laws. These loans are attractive to Ukraine because at the beginning of 2015 it lacked the money it needed to make payments due during the year on existing foreign debts. If Ukraine defaulted on those payments, it would risk losing the ability to borrow the money it needs to support its national budget—money which for a variety of reasons it is unable to generate itself.
So Ukraine is hard up, unable to help itself and in no position to make demands. This development, say many scholars and experts, means that this crisis has become an especially attractive opportunity for foreign interests looking to expand their wealth, property holdings and geopolitical influence. Writing and speaking from the margins of the discussion, these experts say that the policy solutions proposed by the West through the economic agreement and the IMF loans threaten only to deepen Ukraine’s troubles—and with nuclear powers struggling on either side, they risk a world war.