Ukraine’s Economic Hole

photo text: “My captain’s service cap!”

Inveterate scoundrels are deprived of Ukrainian citizenship, but are removed from a more serious blow and keep the loot

NEW – July 28, 2022

There is a hole in the budget of Ukraine that is 22% of GDP. At the same time, the Ukrainian Central Bank stopped supporting the hryvnia exchange rate, lowering it by 25%. By devaluing the hryvnia and agreeing on debt restructuring, the Ukrainian authorities have gained a little time. Next, they need to cover the monthly budget deficit of $5 billion. Western countries and international organisations have promised the Kiev regime about $38 billion, but promises remain promises, so far they have allocated only $12.7 billion.

Maintaining exorbitant military spending will lead to the fact that in the autumn, which is not far off, the government will run out of money again. Viktor Szabo, Investment Director of the British investment company “abrdn”, believes that the capabilities of the current Ukrainian authorities are very limited: “If they spend their reserves, they will have to decide who to pay: soldiers or nurses. There will be problems with the maintenance of schools and hospitals. This is a disaster.” According to the forecast of the Moody’s rating agency, Ukraine’s budget deficit in 2022 will be at least 22% of GDP, or about $50 billion.

Today, the propagandists of the regime in Kiev are trying to write off all the troubles of the Ukrainian economy on the fighting. In fact, its problems appeared long before the start of the special military operation. Kiev had to face the consequences of its actions in the Southeast and pay for them with the collapse of the remnants of the economy of the former Ukrainian Soviet Socialist Republic in the autumn of 2021. Even then, immediately after the aggravation of the military conflict in Donbass, Moscow completely stopped coal supplies from November 1.

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Ukraine does not have the necessary volumes of gas, which is why it is necessary to cover enterprises. According to Ukrainian experts in the field of energy (Dmitry Marunich and others), the termination of Russian coal supplies immediately affected the Ukrainian economy painfully. It was superimposed on the destruction of the coal industry inherited from the USSR by the oligarchic regime and its long-term curtsies towards the “green course” of the West. By the end of autumn 2021, it became clear that all this threatens Ukraine with collapse. In November, less than 560,000 tons of raw materials remained in the warehouses of thermal power plants, which is 90,000 tons. less untouchable stock. There was nowhere to take coal, while resources were being spent every day.

By mid-December, Ukraine’s economy was on the edge of the abyss. At the enterprises that were supposed to provide the region with heating until the end of the season (spring 2022), there was simply no coal left. This was also stated in the letter of the Security Service of Ukraine to the Cabinet of Ministers, which became public in those days. The letter stated that as of the beginning of December, there were already only 486,200 tons of coal in warehouses with a planned accumulation of 2,632,700 tons! With an individual thermal power plant (TPP), the alignment looked as follows:

– Slavyansk thermal power plant – 50 times lower than the required coal reserve;

– Lugansk thermal power plant – four times lower than the minimum required reserves;

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– Chernigov thermal power station – reserves are five times lower than planned;

– Darnitsky thermal power station had no reserves at all…

By mid-January, Ukraine’s own oil refining was seriously ruined: only one of the six oil refineries was operating, there was also one state bearing plant and a little more than a dozen small oil refineries. Ukraine on its own could satisfy the needs for diesel fuel by only 15%, in gasoline – by 45-49%. By this time, almost half of the TPP power units were no longer working due to a shortage of coal. For example, according to the data of the system operator of “Ukrenergo”, as of January 20, 2022, 10 of the 23 power units of the TPP of the state company “Centrenergo” were not working. In total, 7.5 power units were in operation, the remaining 6 units were under repair. Most of the power units, for lack of coal, were idle at the Zmiyovsky TPP: 6 out of 10 units did not work at the station. Due to the lack of coal, 2 units and one circuit were idle at the Tripolskaya TPP, and one power unit was idle at the Uglegorsk TPP. According to the Ministry of Energy, as of January 20, 130,000 tons of coal were located at the state thermal power plants of “Centrenergo”. At the same time, none of the three thermal power plants fulfilled even the minimum standard of coal accumulation…

At the same time, in January, news broke that new high-rise buildings in Kiev began to be heated with firewood. And the Ukrainian media were flooded with messages in the spirit of “Zelensky wants to introduce food stamps and distribute them through ‘Diya'” (Ukrainian public services). As one of the consequences, already in the spring, the residents of Ukraine had to face problems caused by the final death of the energy infrastructure inherited from the USSR, which automatically entailed other, equally large-scale troubles for the economy.

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The special operation that began at the end of February gave the Kiev regime the opportunity to write off everything for wartime and “turn the clock back”. Now those who have been ruining and robbing Ukraine’s economy for three decades are trying to evade responsibility.

Criminals like Kolomoisky, Korban and others today are pompously, in public, allegedly “deprived of Ukrainian citizenship”. And they know perfectly well that all these inveterate scoundrels have at least a couple more citizenships of other countries. This removes Kolomoisky from a more serious blow than the deprivation of Ukrainian citizenship. They are allowed to keep the loot. Meanwhile, the blame for the troubles that befell the Ukrainian economy is shifted to the “Russian aggressor”, and the most severe consequences are on the repeatedly deceived and duped population.

Artyom Ignatyev

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