Spotlight: Ukraine still faces ambiguous future after year-long crisis
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E-mail Xinhua, February 22, 2015
The future of Ukraine remains uncertain one year after a dramatic shift in power triggered the country's worst crisis in two decades, in spite of a brokered ceasefire between Ukrainian forces and independence-seeking insurgents.
The Ukrainian government is expected to hold a commemoration Sunday to mark the first anniversary of the overthrow of then president Viktor Yanukovych, who fled the country after massive protests in Kiev's Independence Square, widely known as Maidan.
Yanukovych's toppling triggered a series of tumultuous events, including Russia's annexation of Crimea and a war between government forces and rebels in eastern Ukraine.
Meanwhile, Russia's relationship with the West descended to its lowest point since the end of the Cold War, with the two sides trading accusations and sanctions on each other for the prolonged crisis.
ECONOMIC CRISIS REGARDED AS MOST CRITICAL CHALLENGE
Ukraine's national currency, the hryvnya, has lost nearly half of its value against the U.S. dollar since the beginning of the crisis, curbing consumers' spending and putting pressure on businesses.
Natalia Komasa, a 26-year-old participant of the anti-government protests, said the past year was the worst in her life, especially in terms of economic well-being.
"The hryvnya's slump has sharply increased the costs of all commodities, but our salaries remain the same. Many people have dollar-based mortgages and are unable to repay them," said Komasa, who works as a sales manager in a Kiev-based private company.
"If I knew that the Maidan protests would result in such enormous losses, I would not have gone there," she said. "The freedom that we got is not worth the lives of thousands of people and economic devastation."
Oleg Kharchenko, a 35-year-old businessman from Kiev, said the sales revenue declined as people saved their expenses. In addition, it became pointless to import goods from abroad because of the unstable exchange rates. "Some companies, especially importers, are forced to operate at a loss, just to stay on the market without losing customers," he said.
According to Kharchenko, business environment in Ukraine still leaves much to be desired despite high expectations for its improvement.
"Everything remains as it was -- the taxes are still high and regulatory authorities continue their pressure on businessmen," he said, adding that he expects no positive development in 2015 if the government would not change its policy regarding business regulation.
NATIONAL DIALOGUE, REFORMS NEEDED TO DE-ESCALATE CRISIS
One year after Yanukovych's overthrow on Feb. 22, 2014 following three months of anti-government protests against his rule, local experts summed up the lessons learned from the turmoil and offered their suggestion for improving Ukraine's situation.
Well-known local political analysts agreed that nation-wide dialogues, economic reforms and constitutional changes that will serve the interests of people from all Ukrainian regions, are the key to resolving the crisis.
Ruslan Bortnik, a political analyst at the Ukrainian Institute of Political Management, told Xinhua that the government's failure to engage in dialogue with all regions, lack of political and constitutional changes and slow progress of implementation of required economic policies are the key factors behind the ongoing crisis.
"Many have expected positive changes in the country, but the situation took turn for the worse. Over the past year, the economic crisis has greatly exacerbated. Thousands of people died and millions have become refugees," Bortnik said, referring to the conflict in eastern regions that has killed over 5,300 people and displaced about 1.5 million others.
Given the rapidly deteriorating situation of Ukraine's economy with gross domestic product (GDP) plunging 7 percent last year, inflation at 24.9 percent and foreign exchange reserves below 6 billion dollars, Ukrainian authorities should take urgent steps to avoid financial collapse, the expert said.
"To fix the economy, the government should act immediately to root out corruption in administrative sector and trim the shadow economy, which is estimated to account for over a half of the GDP," Bortnik said.
To restore economy to health, the Ukrainian authorities should develop economic relations with its eastern and western partners, instead of relying only on deepening trade with the European Union (EU), the expert believes.
"Although Ukraine has managed to sign an association agreement with the EU, which was one of the main requirements of last year's protests, it brought no significant positive impact on the economy," he said.
In addition to economic challenges, consolidation of the society remains the focal task for the government to address in the nearest future.
In order to return peace and stability, Bortnik said, it is vital to launch an inclusive dialogue within the country.
He suggested that the strengthening of communications and mutual trust between different political forces, which represent all regions of Ukraine, will help de-escalate the crisis in the country.
"All political forces, including the opposition, must sit at the negotiating table and adopt a mutual solution to the crisis. Probably, it is necessary to adopt a new constitution built on new principles, which would ensure the freedoms of all people and their rights to chose language and cultural preferences," Bortnik said.
UNCERTAIN FUTURE AHEAD
The prolonged economic, political and social crisis sparked unprecedented uncertainty in the country.
Vadim Karasev, director of the Institute of Global Strategies, said Ukraine will face new political turbulence in the coming months.
"The poor shape of economy, political instability, balancing on the brink of war and peace, external threats, lack of reforms and corruption may raise the question of reshuffle of the cabinet or new parliamentary elections," Karasev said.
According to him, new parliamentary elections in Ukraine may take place at the end of the year or in the beginning of 2016.
The expert was also optimistic about a short-term outlook for developments in Ukraine, saying the fresh Minsk agreement on the Ukraine crisis by leaders from Russia, Germany, France and Ukraine will help ease the turmoil.
"The so-called Minsk-2 agreement gives Ukraine a hope for peace. Although it is not the final peace deal, it would give some time for the authorities to focus on economic development, financial situation, and social stability," Karasev said.
In the near future, the situation in Ukraine will "move towards peace," Karasev added, emphasizing that diplomatic efforts are the only instrument to resolve the conflict.
Another Ukrainian expert, Olesya Yahno, a chief analyst at the Kiev-based Institute of National Strategy, said the Minsk agreement was the first, yet very important step that could bring sustainable peace and stability to Ukraine.
Under the deal, the insurgents released 139 servicemen in return for 52 militia fighters on Saturday evening. Both sides reportedly have also been preparing for further swaps of captured soldiers in the near future.
"The Minsk deal will not lead to a fundamental solution to the conflict, but will remove certain important issues from the agenda," Yahno said. Endi
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