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2.0 Politics
2.1 Ukraine’s recovery plan
Ukraine's government started working on a new economic recovery plan at the start of May. The Ukrainian Parliament Committee on Economic Development supports Ukraine's economic recovery plan. Here are the nine main principles of the plan:
· Full access to the EU and G7 markets. This will help manufacturers integrate into global retail chains and increase exports.
· Obtaining candidate status and then full membership in the EU.
· Building an economy on the principles of deregulation and
liberalization.
· Establishment of logistics routes in the Western direction.
· The transition from the export of raw materials to processing.
· Development of the domestic military-industrial complex.
· Self-sufficiency in energy, which will increase domestic gas
production and develop nuclear power.
· Climate modernization. The creation of new facilities in various
industries must consider the principles of a "green economy”.
· Utilization of domestic companies not less than 60% of the total
expenditure, ensuring that Ukrainian companies and producers will be involved in the reconstruction of Ukraine.
The IMF has set up a $170bn reconstruction fund amongst other promises of funding for the rebuilding of Ukraine.
2.2 Gas flows via Ukraine disrupted for the first time
Part of Russian natural gas transit flows to Europe via Ukraine were halted due to the war on May 11, sending European gas prices spiking.
Gas entering Ukraine via the Sokhranivka gas metering station were halted at 7am local time, reports Bloomberg, after the territory that the station stands on fell under Russian military control. The Gas Transmission System Operator of Ukraine (GTSOU) said late on May 10 that it would turn the station off, as it no longer controls the station.
As bne IntelliNews reported, despite the war raging in the country, the gas transit business has continued unabated and indeed Gazprom has been exporting the maximum allowed volumes via Ukraine – and paying Kyiv its transit fees under the terms of the deal signed in December 2019 – as Europe races to refill its storage tanks ahead of the coming winter. Russia has taken control of some of the territory where pumping stations are located, but has been careful not to destroy the pipelines or interfere in the transit business.
7 UKRAINE Country Report XXXX 2018 www.intellinews.com