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    July 18, 2016

    Magic Numbers: The Main Trade Partner of Ukraine Is... Russia

    Translated by Ollie Richardson for Fort Russ
    19th June, 2016

    Press Secretary of the President of Petro Poroshenko Svyatoslav Tsegolko presented on Twitter optimistic, from his point of view, numbers of trade turnover of Ukraine. According to him, Russia's share in it declined from 32% to 8.5%. The share of the EU on the contrary has grown to 41%. Is this good or bad?

    The Press Secretary considers everything to be fine and that the data is encouraging. But besides the 2 indicators, there isn't any accompanying data, such as: during which period the comparison was made, to what extent the contribution of the European Union increased, if the increased overall Ukrainian turnover increased or decreased and how is the ratio of exports and imports in Ukrainian foreign trade. And it is difficult to understand, how today's Ukrainian economic reality looks like.

    Kiev cannot boast major successes in trade with the EU. The Ukrainian authorities have worked solidly, breaking economic relations with Moscow, but Russia remains the main economic partner of Ukraine, despite the fact that both exports and imports with Russia declined significantly after the Maidan.

    We should not forget that the EU is 28 countries. And Russia is one state. Comparative analysis carried out in this situation is incorrect. In addition, the economic ties between Ukraine and Russia are still strong.

    Ukraine (according to Ukrainian state statistics) exports to Russia more than any other country. Despite all the efforts of the current government and progress on the destruction of trade relations with Russia, it has remained the main buyer of Ukrainian goods.

    In general, the volume of Ukrainian foreign trade after Maidan show a steady decline. Both exports and imports have dropped significantly. For the first four months of 2016 and 2015: export from Ukraine to the CIS fell by 35%. The fall of Ukrainian exports to Russia for the same period was 13%.

    The relative growth of trade with the EU cannot compensate for such a drop in trade with once the main Ukrainian partner. In addition, in the foreign trade of Ukraine with the European Union there is a negative balance of payments — and this caused a serious blow to the Ukrainian economy.

    "Exports to the EU increased by 0.7%, while imports from the EU grew by 2.1%. In general, foreign trade formed a very large negative balance, more than 800 million US dollars. That is importing 800 million dollars more than exports," said Ukrainian economist Aleksandr Okhrimenko.

    It is a pity for the Ukrainian authorities that Russia still strongly wins first place in the list of the Ukrainian importers, even despite all the political disagreements. In second place is China, and only then followed by Germany, mainly selling Ukrainians cars. Fourth — Belarus, fifth — Poland, which is due to the fact that Kiev buys allegedly "Polish", but in fact Russian gas. Then comes the US (coal), France — medication. Then Slovakia, who achieved incredible success in the resale to Ukraine of imported goods, primarily Russian gas.

    "The current helm is pursuing a policy of genocide against the Ukrainian people," said People's Deputy of Ukraine of three convocations, co-founder of Committee of Rescue of Ukraine Vladimir Oleinik – because of their incompetent activities meat and dairy production and engineering stopped, and agriculture makes losses. Even the Europeans say that the Ukrainian economy can develop only at the expense of the Russian market as Europe, as our products are not needed. But the "patriots" continue to mercilessly burn bridges with Russia.

    The main patriot of Ukraine Petro Poroshenko does not hesitate to sell his cakes in Crimea and Donetsk, as well as to profit from the work of a confectionery factory in Russian Lipetsk.

    We need to change the power in Ukraine and conduct a pragmatic policy in the national interest. As Poroshenko is concerned about every personal kopeck, he as President it seems he should do the same about the economy of the country entrusted to him. It is time to stop the anti-Russian hysteria. The trade war isn't necessary for anybody and, first of all, it isn't necessary for Ukraine.

    However, the current government's policy of maximizing the distance from the North-Eastern neighbor and partner will eventually lead to the complete economic collapse of Ukraine. There is only one way out: to stop the destructive course of the country, which is possible only simultaneously with the change of the current Ukrainian authorities with the power of realists and professionals.

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