17 March 2017

The transport blockade has caused, and will continue to cause, enormous damage to the Ukraine’s economy. Many of the losses will not be recovered.

The figures speak for themselves. The total number of large, budget-revenue-generating companies and local economic mainstays that will be directly affected by the blockade of Donbass is over 150! This does not include the hundreds, if not thousands, of small and medium-sized enterprises in the region.

More than 130 thousand workers are employed by the major industries. Together with their families, these people account for more than half a million Ukrainian citizens. The official unemployment rate is expected to go up from 9.6% to 10.4%. And, as a result, the fund for unemployment benefits will increase by UAH 3.9 billion.

Recently, those Ukrainian enterprises located in the uncontrolled territories (now cut off by the blockade) have paid tens of billions of hryvnias in taxes to the Ukrainian budget. It represents billions of dollars. Now we are waiting for just one billion from the IMF, like "manna from heaven". Where is the logic?

At the same time, the reductions in production plans or total shutdown of associated enterprises in the controlled territory will leave the Ukrainian budget without at least another UAH 12 billion of revenue this year.

The financial results of Ukrainian business are expected to drop by UAH 30 billion.

The steel-making industry alone is projected to have a USD 3.5 billion decrease in total foreign currency revenues. All these forgone billions will have an effect on the hryvnia exchange rate, and may well even bring it down.

At the same time, should the blockade continue, losses in Ukraine’s GDP only in those enterprises located in the uncontrolled territories - will amount to USD 3.8 billion or 4.1% of the country's GDP. Together with the “domino effect” on other economic areas of the controlled territories, we may lose more than 10% of our GDP.

With the National Security and Defence Council’s (NSDC) decision to cease transport communication with the uncontrolled territories of Donbass, the government has capitulated to radicals and acknowledged its own powerlessness.

The NSDC's decision directly violates the Constitution of Ukraine. In fact, instead of bringing the participants of the blockade (who violated the laws of Ukraine) to justice, and restoring order, the government has led the blockade.

Indeed, it seems that the government is interested in surrendering the uncontrolled territories, because the people who live there will not vote for representatives of the current coalition and the parties that have led to this conflict.

In fact, the political forces that support the blockade do not want peace to be restored in Ukraine. The blockade was orchestrated by political gamblers and chancers who were looking for instability and crises. On the other hand, we, the only real opposition in the country, want peace and harmony to prevail in Ukraine.

We all need order, security, the rule of law and economic recovery. Without peace, without overcoming the divisions in hearts and minds, this is not possible.

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