If the West is so eager to lend or give Ukraine money, maybe they should just do it — and dispense with the charade that they are conditioning the assistance on meaningful and lasting reforms.
Let’s start with the International Monetary Fund, the global lender whose credibility will remain tarnished as long as Kristalina Georgieva remains its managing director. There’s plenty of convincing evidence to show that she boosted China’s rating in the World Bank’s Doing Business index when she worked for that financial institution.
This year, the IMF gave Ukraine $2.7 billion in “special drawing rights” for which Kyiv had to do nothing. It was part of a global gift to help nations recover from the damaging economic effects of the coronavirus. Now the IMF is poised to lend Ukraine more money, a $700 million installment, on a $5 billion credit line that was frozen in June 2020 because of non-compliance with reform requirements.
So far, Ukraine has received only $2.1 billion under the program. But on top of restarting the loan, the IMF is set to extend the deadline to June 2022 for a program that was to expire by year’s end.
What did Ukraine do to deserve the renewed lending? Almost nothing.
It passed legislation reinforcing the independence of the National Bank of Ukraine and the National Anti-Corruption Bureau of Ukraine, which it shouldn’t have had to do anyway. Both were supposed to be independent.
The failure to fight corruption, reform the courts, establish rule of law, punish bank fraud, fill the vacancy of the special anti-corruption prosecutor, set market prices for energy, or respect corporate governance principles? None of this is needed to get IMF credit.
Combined with another recently released 600 million euros in European Union assistance, Kyiv’s leaders will unjustifiably brag that the resumed lending is a vote of confidence in them. Nonsense. All signs are that corruption is flourishing unabated, and why shouldn’t it? There’s nobody to stop it or punish it.
Ukraine, for the record, still hasn’t convicted anybody of serious corruption. It’s not an accident. It’s by design.
But with Western ambassadors and international institution heads rotating in and out every three years or so, and Western leadership in general in decay, nobody can break their bubbles of delusional thinking.
And then, in the same category of complicity or apathy, there’s the deafening silence by business associations, embassies and many others in not calling out the State Property Fund for the sham Oct. 27 privatization of the 35-hectare Bilshovyk property in Kyiv. Five workshops were illegally privatized on the plot several years ago. Investors said this made development highly litigious and unlikely, so they pulled out.
Experts said the shady circumstances favored tycoon Vasyl Khmelnytsky. And, indeed, he and his partners bid barely above the $51 million minimum to win. They won the uncompetitive auction for less than half of the market price, according to some valuations. It was not a victory for open and competitive privatization, as touted, and should have been condemned by the West.
But this is the same West that lends Ukraine money for little in return
