Page 12 - UKRRptMar19

Tymoshenko as president, when he has been president – it seems unlikely.
And what exactly would Zelenskiy demand for his support in a second round vote, if he came third? Hard to say – some deal around banking, to satisfy his oligarchic backers, but which would derail cooperation with the IMF?
Note though that if Tymoshenko or Zelenskiy are elected president, they would have little legislative room to manoeuvre, given they would not control a majority in parliament, could note change the structure of the [Ukrainian Prime Minister Volodymyr] Groysman government much before those elections (sway only over the ministers of foreign affairs and head of the national security council).
Q? What about the economy, and economic policy?
Answer: Poroshenko is banging the line that only he can be trusted with the economy, and macro stability and investment are only safe in his hands, while denigrating Tymoshenko et al for populism.
I think here it is important to focus on Poroshenko’s achievements on the economy front, and I think it is fair to say that Ukraine is in a much stronger position today than in 2014, with macro-stability –the resumption of real GDP growth at over 3%, inflation back in single digits, the UAH stable and reserves back to around USD20bn, with much reduced fiscal and current account deficits (around 3% of GDP each). Contrast that with the recession, devaluation and default in the period 2014-2015.
And there have been some landmark reforms, including NBU reform, banking sector reform, energy sector reform, fiscal consolidation, pro-Zorro, pension reform et al. But many of these reforms were due to the reform zeal of the Yatsenyuk administration and due to the ‘blood and tears’ of key reformers such as [former Finance Minister Natalle] Jaresko, [former NBU governor Tatiyana] Gontareva, [current NBU governor Yakiv] Smolii, Kobylev, [former Ukraine Finance Minister Oleksandr] Danylyuk, [Economics Minister Max] Nefyodov, [head of UrkInvest Daniel] Bilak, et al – they might argue fighting against opposition elsewhere in the Poroshenko administration. These are all heroes in my mind.
But I think it is also fair to recognise that reform slowed under the Groysman premiership, and as reflected in the fact that the IMF [programme] was off track for 18 months until late last year with its revamp to a much smaller Stand by agreement (SBA).
Why? The answer is that there seemed to be vested interests at play to prevent key structural reforms such as the anti-corruption effort, land reform, and backtracking again around energy sector reform. And Poroshenko just did not do enough to fight those battles on key structural reforms. On that he failed.
Poroshenko’s legacy is hence mixed – he did some great things, but failed in other areas, such as the fight against corruption. True the anti-corruption court should be up and running soon, but let’s see how successful it is, and whether it will be allowed to function and not “captured” as seems to be a big risk. But the failure to address corruption, and push on with land reform, which should have been two slam-dunks and great positives about Ukraine to sell to the
12 UKRAINE Country Report March 2019 www.intellinews.com