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> On Mar 29, 2014, at 2:03 AM, "Michael Karadjis" <mkarad...@gmail.com> wrote: > > -----Original Message----- From: Glenn Kissack > > That is, that the West, particularly the greedy and desperate EU, wanted to > get its hands on the tremendous natural resources of the Ukraine, on its > heavy industry and cheap but highly-educated work force. They offered a deal. > A very bad deal, under which, European companies would be allowed to plunder > the country, but Ukrainian people would not be even allowed to enter the EU, > let alone seek employment there. > > Has anyone seen a copy of the proposed EU deal? The full text of the EU agreement with the Ukraine, together with accompanying guides to the various sections, is here. http://eeas.europa.eu/ukraine/assoagreement/assoagreement-2013_en.htm On a quick skim, the documents contain the usual boilerplate about bringing Ukrainian trade and investment laws into line with EU treaties. But there are few specifics which could inflame public opinion. As you know, the deregulation and privatization of industries and infrastructure as well as the "reforms" aimed at trade union rights and working class standards by signatory governments proceed in piecemeal fashion within the general framework of free trade agreements. It is only later that their impact is registered on an unwary public. Here are are a couple of articles from Counterpunch and Consortium News and an interview from Real News Network attempting to identify the objectives of Western capitalism in the Ukraine which the IMF, EU, and US aid packages and agreements are designed to realize. I don't know whether any or all of the contributors are on Louis' Index Librorum Prohibitorum, but I hardly need add that in itself would not be sufficiently persuasive to invalidate the facts and interpretations which are presented. "Who In Ukraine Will Benefit From An IMF Bailout?" http://therealnews.com/t2/index.php?option=com_content&task=view&id=31&Itemid=74&jumival=11614 "Who Benefits From Ukraine’s Economic Crisis?" http://www.counterpunch.org/2014/03/17/who-benefits-from-ukraines-economic-crisis/?utm_source=rss&utm_medium=rss&utm_campaign=who-benefits-from-ukraines-economic-crisis "Corporate interests behind the Ukraine putsch" http://consortiumnews.com/2014/03/16/corporate-interests-behind-ukraine-putsch/ Finally, an informative article from the Wall Street Journal earlier this week on the IMF aid package: "IMF Reaches Deal to Provide Up to $18 Billion to Ukraine", March 27, 2014 http://online.wsj.com/news/articles/SB10001424052702304418404579464712032792176?KEYWORDS=Ukraine&mg=reno64-wsj KIEV, Ukraine—Momentum gathered in the West to censure Russia and shore up Ukraine's moribund economy, as the International Monetary Fund readied as much as $18 billion in rescue loans to help avert a financial collapse. The IMF agreement—which calls for what Ukrainian officials described as painful budget cuts and other measures that will strain the country's fragile economy—will unlock additional aid from other donors. IMF official Nikolay Gueorguiev told a news conference at Ukraine's central bank in Kiev on Thursday. In total, Ukraine is expected to receive a total of $27 billion over the next two years. The IMF said that its executive board would review the deal in April and that the precise amount of the IMF loan would depend on the level of support given by other lenders, including the U.S. and European Union. A senior EU official said on Thursday that the European Commission planned to disburse some €850 million ($1.17 billion) in loans and grants to Ukraine by June if the country completes the IMF accord next month. The bailout comes as Ukraine grapples with the biggest crisis in its post-Soviet history. Mass protests in recent months led to the ouster of former President Viktor Yanukovych and the establishment of a new government. Russia, disturbed by what it perceives as the new government's pro-Western leanings, swiftly seized control and then annexed the Ukrainian peninsula of Crimea, transforming the crisis into the most charged East-West confrontation since the Cold War. Russia came under renewed fire on Thursday for the incursion, as the United Nations General Assembly approved a nonbinding resolution calling the Crimean referendum to rejoin Russia invalid and urged nations not to recognize it. Though it carries no legal consequences, the vote illustrated a lack of public international support for Russia over the Ukrainian crisis. Only 10 other nations—including Syria, North Korea, Nicaragua, Venezuela and Cuba—agreed with Russia to reject the resolution. Russian President Vladimir Putin took steps Thursday to brace against sanctions from the West, backing plans for Russia to create its own national payment system. The move is aimed at protecting its economy against the kind of disruption caused when Visa and MasterCard cut ties last week with Russian banks hit by U.S. sanctions over the annexation of Crimea. Ukraine's new government had been seeking around $30 billion in emergency loans to avoid an economic collapse amid its standoff with Russia. The country faces dwindling foreign-exchange reserves, a deepening budget deficit and substantial debts to Russia's state-run gas giant OAO Gazprom OGZPY -1.08% and foreign bondholders. The EU welcomed the loan agreement and said its own pledge of over €11 billion in aid to Ukraine, unveiled earlier in the month, would carry the same conditions as the IMF deal. In the U.S., Congress approved $1 billion in loan guarantees for Ukraine. In the U.S., the White House urged Ukraine to pass the measures needed to win approval from the IMF's board and said it was working with Congress "to quickly provide a $1 billion loan guarantee" for Ukraine. Ukraine is set to hold presidential elections at the end of May, making this a difficult time to impose tough changes on the population. Among the actions Ukraine must complete before the IMF's board will approve a loan in the range of $14 billion to $18 billion are maintaining a flexible exchange rate and overhauling the energy sector. In parliament, Prime Minister Arseniy Yatsenyuk outlined a package of tax increases and spending cuts he said were needed to secure the IMF loan and prevent financial catastrophe. These included a 10% cut in the number of state officials, a decrease in pensions for judges and prosecutors, and higher taxes on alcohol and tobacco products. Mr. Yatsenyuk warned that without the measures, the country would go bankrupt and suffer a contraction in economic output of 10% this year. The reforms and foreign loans would limit the decline to 3%, he said. "There's no other way out," he said, blaming the administration of Mr. Yanukovych for leaving the country's coffers empty through what he characterized as economic mismanagement and theft. Late Thursday, legislators passed one key piece of legislation required by the IMF. Ukraine's government bonds rallied in response to the IMF deal, which investors saw as providing Ukraine with enough funds to pay bondholders. The yield on a Ukrainian dollar-denominated bond maturing in 2023 fell 0.36 percentage point from Wednesday's close to 8.94%, according to Tradeweb. Yields fall as prices rise. In return for the IMF financing, Ukraine needs to make a major dent in its budget deficit by cutting spending and raising taxes, the IMF said. It also needs to raise natural-gas prices for consumers, the IMF said. Ukraine's two previous loan deals with the IMF have failed in part because the nation has refused to cut generous state subsidies for household gas and heating that have left the country heavily in debt. On Wednesday, an official with state gas monopoly Naftogaz said Ukraine would raise gas tariffs for consumers by about 50% starting May 1. Ukraine's currency, the hryvnia, has fallen sharply since the country began floating its exchange rate in February. The IMF said Thursday that the hryvnia was previously overvalued and that Ukraine would need to preserve a flexible exchange rate to help the country boost exports and economic growth and rebuild its foreign-exchange reserves. The IMF is also requiring Ukraine to adopt regulations to ensure its banks are sound and well capitalized and laws to improve the business climate and fight corruption. Ukrainian central bank chief Stepan Kubiv told the news briefing Thursday that the overhauls would be painful. But he said the government must shift "from populism to more pragmatic work." "We are aware such a pragmatic approach might not be welcome," said Mr. Kubiv, a former commercial banker who became chairman of the National Bank of Ukraine last month, after helping coordinate mass street protests that led to the ouster of the previous government. Some opposition to the IMF's requirements began surfacing Thursday. Sergei Taruta, governor of Ukraine's industrial Donetsk region, called the planned gas-price increases unjustified, saying the country should first stop what he called rampant corruption at Naftogaz. By raising prices without fighting corruption, officials would essentially be saying, "We'll keep stealing just as we have been stealing, and simply crawl into the pockets of the people" instead, Mr. Taruta said in remarks reported by the Interfax news agency. IMF officials said they were requiring Ukraine to boost audits of Naftogaz as part of the loan agreement. The European Commission welcomed the loan agreement Thursday and said that its own pledge of over €11 billion in aid to Ukraine, unveiled earlier this month, would carry the same conditions as the IMF deal. In the U.S., the White House urged Ukraine to pass the measures needed to win approval from the IMF's board and said it was working with Congress "to quickly provide a $1 billion loan guarantee" for Ukraine. The European Bank for Reconstruction and Development said it would supplement the IMF program by boosting its investment in Ukraine to up to €1 billion a year over the next few years, from its earlier plans of €550 to €750 million a year. ________________________________________________ Send list submissions to: Marxism@greenhouse.economics.utah.edu Set your options at: http://greenhouse.economics.utah.edu/mailman/options/marxism/archive%40mail-archive.com
