George Soros Views on the New Ukraine

A new, modern Ukraine that is democratic minded has been born following pro-European protest of 2014. An analysis written by George Soros and Bernard Levi in the New York Times in January 2015 reveals that the push to create a stronger and independent Ukraine is what inspired thousands of protesters to gather at Kiev’s Independence Square. Besides pushing President Viktor Yanukovich from power, Ukrainians wanted a country that was European focused and devoid of corruption. In this new Ukraine according to George Soros, most government and parliamentary workers are volunteers who have surrendered well-paying jobs to serve the nation.

Case in point, the country’s new Finance minster Natalie Jaresko is a former investment banker currently taking home a few hundred dollars a month. Volunteers are also involved in philanthropic efforts Like George Soros Ukraine, where they have been instrumental in helping the government take care of over 1 million internally displaced persons. The challenges, the new Ukraine is facing from the old Ukraine include fighting the deeply entrenched state bureaucracy and hostility towards President Vladimir Putin of Russia, following Crimea annexation. The effort to free the country from the cusp of state control is facing opposition from the known business oligarch’s.

In the latter case, the hostility towards President Putin is drawn by his desire to destabilize Ukraine. It is instructive to note that Putin is doing this by putting a lot of pressure on the country’s finances and stepping up its military by supporting the separatists. Although Russia itself is in a deep financial crisis, the country’s president is bent on destroying the new Ukraine before in order to escape the wrath of his populace. Russia’s dwindling economic fortunes come in the wake of unstable oil prices and weakening exports. Ukraine’s new president has, however, reiterated that his country will defend itself from Russia in spite of a serious financial shortfall.

The other issue the government and reformers have to deal with is implementing a far reaching reforms blue print and fighting corruption in the police force and other sectors. It is not uncommon for police to ask for bribes in Ukraine, when one wants to obtain a driver’s license. This is unlike in the Georgia of 2004 that ushered a revolutionary and transformative President, Mikheil Saakashvili. During his first year in office, President Saakashvili quickly replaced the corrupt traffic police and eliminated the roadblocks that were used by the country’s corrupt police to extort money from members of the public.

According to Soros and Levi, one major point of difference between Ukraine and Georgia, is that Ukraine is a participatory democracy while in Georgia, the monolithic leadership still pervades. To help Ukraine overcome the challenges it is facing today and in future, Soros urges the EU to support the country financially in order to strengthen its finances and guarantee a more prosperous Ukraine. Billionaire and philanthropist George Soros is a renowned supporter of freedom of expression and justice and donor to the Democratic Party. Bernard Levi, on the other hand, is a well-known public intellectual.

Learn more about George Soros and Ukraine at Bloomberg
Read more of George Soros’s opinions about the Ukraine on Project Syndicate

George Soros and His Position On Ukrainian Debt Relief

With Ukraine having lived in the backdrop of Russia for so many years, with one foot inside Europe and the other under the iron grip, debt has inevitably followed. As George Soros points out, Ukraine may very well deserve debt relief as they attempt to shake off the hands that have bound them and enjoy a more economically free existence. It is noted that the aggression Ukraine has endured at the hands of Russia has amounted to more than $19 billion in foreign debt. This debt is simply unsustainable, so the talks surrounding this very issue that are currently underway in San Francisco are well timed and necessary.

Soros warns, and rightly so, that the only true alternative to debt relief available to Ukraine is outright default. This would benefit none of the parties involved. Were that to happen, little to no investment would pour into Ukraine for the foreseeable future, which would be an extreme liability to a unified Europe. Furthermore, it would simply strengthen Russia’s revolve and grip over the region in the end.

Soros further notes that defaults entered into by any sovereign nation are almost always costly on an international scale. This is exacerbated when lenders wrangle over any available dollars, as they would be certain in the case of Ukraine. One only has to go back to the numerous defaults that occurred in Latin America some four decades ago, or continues to take place in Greece today. By following a policy of debt relief, however, Ukraine would be able to work with each individual lender to come up with a suitable solution to their financing woes.

Read more:
The Greatest Investors: George Soros

George Soros | Open Society Foundations (OSF)

Ukraine is now fighting for a type of structural financial reform that is similar to the Brady Plan of 1989. Such a plan, Soros notes, will serve to stamp out corruption and begin to process towards a complete reformation of the judicial system. These steps would be necessary to push Ukraine in a forward direction and lessen Russia’s grip over it. The plan would also call for Ukraine to become less reliant on gas from Russia, and it would push the nation to integrate its economy to come more in line with the European Union. In the end, this will strengthen that agriculture industry within Ukraine, provide more regulated banking opportunities and services, and be great for the country in the long run.

As the chairman of Soros Fund Management LLC and the Open Society Foundations, Mr. George Soros is well qualified to speak on issues of national debt relief and default. Understanding the consequences of the latter helps the reader to understand the necessity of the former, and that is the basis of the recommendation made by George Soros.

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