Ukraine deserves more financial help from the West, but it shouldn’t expect it, speakers at an economic panel told the Yalta European Strategy forum on Sept. 11.
“The rest of the world can never
want economic reform in any country more than the people who live there and the
government of that country,” said former U.S. Treasury Secretary Lawrence
Summers. “Ultimately Ukraine’s future is going to be determined by Ukraine’s
economic policy more than the rest of the world…I am not sure there’s much
Ukraine can do to influence what happens in the United States or in Europe. For
those interested in what the Ukrainian government thinks, they are strong
supporters of doing more in Ukraine. Those who want don’t want to spend more
money on foreign anything don’t care what Ukrainians think.”
The best approach, Summers said, is
to try to persuade the West that greater financial aid to Ukraine “is not
charity, this is a security investment.”
However, many other global crises are commanding attention and resources, forcing Ukraine to compete harder for any assistance it receives.
Dominique Strauss-Kahn, the former
managing director of the International Monetary Fund, said that economic and
other forces will be pushing nations to “be looking inward” in coming years,
making it even more difficult for Ukraine to become a priority for Western donors.
Ronnie C. Chan, chairman of Hang
Lung Properties Ltd., also said that Ukraine should get is own house in order
to have a better chance at attracting private investments, who are
pragmatically interested in how to make money.
“Instead of depending on others,
depend on yourselves,” Chan said.
Phillip Bennett, the first vice president
and chief operating officer of the European Bank for Reconstruction and
Development, said that – as Ukraine’s largest investor in the last 24 years –
the agency knows how bad the investment climate is in Ukraine.
Ukraine seems to have moved from
economic crisis to stability, but needs now to improve the investment climate
in order to make progress, several speakers said.
Natalie Jaresko, the finance
minister of Ukraine, was the crowd’s favorite on the panel, getting high marks
for striking a deal to cut Ukraine’s debt and stabilize its finances.
But Jaresko even said that Ukraine’s
government needs to do more “to keep walking the walk and walk faster than we
have in the past.”
Arthur Laffer, founder and chairman
of Laffer Associates and Laffer Investments, praised proposed tax changes in
Ukraine that would lower rates and apply taxes broadly and simply.
“Government doesn’t create
prosperity,” Laffer said. “Let the private sector take over.”
