The position of official representatives of Europe concerning the imprisonment of Ukrainian oppositionists has forced the leadership of Ukraine to postpone the Summit of  Central European States. The session of Ukraine-EU Cooperation Council  will pass amid sharp statements of European ministers concerning impossibility of signing and ratification of the Association Agreement. On the whole the strengthening of criticism on the side of European leaders concerning actions of the Ukrainian authorities becomes a tendency. Massive ignoring of the Euro-2012 by the European political establishment becomes the following stage. Sport becomes a player of big politics.

Meanwhile, the Ukrainian authorities obstinately ignore the official EU position. They are occupied with providing their own inviolability in Ukraine. With the Euro-2012 coming closer, the trust to actions of authorities is incessantly falling. Numerous inquiries of journalists about bribery during the preparation for this event, an imperfect infrastructure, cosmic prices for hotels and a spoiled international image — have become an integral part of the Euro-2012. The authorities, on the contrary, are happy due to the development of the multi-billion budget, and therefore sure that the football championship will pass at a “high” European level.    

The authorities have proved that they know how to shift all responsibility to their own people. Therefore, unfortunately possible losses from the political isolation of Ukraine will be felt, first of all, by ordinary citizens. Investments put up into the Euro-2012 have every chance to become not the improvement of well-being, but to turn into the growth of tax pressure upon Ukrainians.  

If all forecasts concerning the ignoring of Ukraine’s leadership during the football championship get realized by Europe, then the following logical stage of political isolation will become the non-recognition of results of the parliamentary elections in Ukraine. 

Obviously, preparatory actions of the Ukrainian authorities concerning the continuation of their powers will turn for them into the acknowledgement of their own illegitimacy. And the first among these measures are legislative initiatives of the authorities concerning complication of a procedure of organization and conduction of peaceful actions, the right to shutdown Ukrainian Internet sites without court decisions and, consequentially, transition of their activity to offshores due to actions of law-enforcement bodies. Protest moods of citizens and general discontent by actions of authorities will only grow in Ukraine.

Governmental circles of Russia discuss now the draft bill “About development of Siberia and the Far East”. At the beginning of the year a political decision was made that a special structure should work on the development of Siberia and the Far East. The main priority is the construction of infrastructural objects at the specified territories. The idea was supported by V.Putin. At the beginning of February the future president declared that means of the Reserve Fund and Fund of the National Wellbeing can be used for the financing of state corporations on Siberia and the Far East. According to the Ministry of Finance of the Russian Federation, as of March 1, 2012, a total volume of the Reserve Fund makes up 62,4 billion dollars., and that of the Fund of the National Wellbeing – 89,84 billion dollars. The volume of means is amazing.

Already at the end of March Russian mass-media disseminated information that an independent noncommercial organization can be engaged in the development of Siberia and the Far East. However, actually it means the creation of the state corporation which will be directly submitted to the president of Russia, and the list of investment objects will be confirmed by the government.

On a whole the specified initiative provides for the introduction of a number of positive innovations by the government. Among the main ones are the exemption from taxes on profits, on mineral extraction, granting of privileges to concrete projects within the limits of activities of the corporation, and what’s most important, inhabitants of Siberia and the Far East will be provided with privileges on accommodation and studies. In the framework of the whole project it is planned to create 5 million workplaces. By the way, among the primary steps of development of Russia, voiced by Putin during the report on work of the government in the State Duma, is the creation of 25 million qualitative workplaces in economy in the nearest years. Moreover, variants of simplification of procedures of receiving citizenship by foreigners who will settle in the specified territories are discussed.

Along with positive moments, there are negative ones as always. There exist not unreasonable fears that the creation of the state corporation on the contrary will slow down the development of the specified territories. After all, any private investor who has a desire to work there will have the state corporation with special preferences as a competitor. Hence, nobody is talking about competition here. An accurately limited system of governmental admission to participation in the development of Siberia and the Far East will operate.

Realization of the specified project is also connected with geopolitical questions. The basic problems lie in the plane of cooperation of Russia with the countries of Asian-Pacific region. Especially this has to do with China. In one of his program articles, V.Putin already urged to more actively build communication with China on the basis of cooperation of technological and industrial potentials of both countries. Meanwhile, this cooperation is demonstrated by the saturation of the Russian market with poor-quality goods and cheap work force. Nobody hurries to share technologies. Also the realization of plans of the Russian leadership is connected with the creation and effectiveness of new international associations, such as the Eurasian economic union for example. In the realization of the development of considerable territories of Siberia and the Far East Russia can face the main problem – shortage of human resources. Unfortunately, the demographic crisis in Russia only deepens this problem. The way-out can be found in the historical experience of attraction of human potential of the countries of the former Soviet Union to the development of Siberia and the Far East. However today, these countries have their own social and economic and demographic problems. Hence, China can have all the advantages.

Strategically, the decision on the development of the infrastructure of Siberia and the Far East fits into the foreign policy concept of development of Russia, voiced by V.Putin. However, in case of the creation of the state corporation, it will be necessary to prove the efficiency of realization of the project of development of the specified territories. The experience of Russian state companies is an example here. Everything can end up right after budgets disbursement. In 2011 there was already created a financial structure – the Far East Development Fund. Despite the pumping of the Fund with means, there is no project realized by it today, although the creation of many workplaces was planned. However, the advantage in favor of the state corporation is the Russian reality now. It is paradoxical, but rigid state control at the highest level gives a chance to control corrupt practices at the level of top-management and regional power. At the same time, it will increase competition between foreign service and financial companies for participation in this mega-project.

Considering the importance and scale of the new mega-project, the creation of a new structure of development of Siberia and the Far East has every chance to be realized right after V.Putin’s inauguration. Anyways, the choice of the head of this project will show seriousness of intentions concerning the development and exploration of the major resource region of Russia.

Information concerning possible signing of the gas agreement between Naftogaz of Ukraine and German RWE recently appeared in Ukrainian mass-media.  What’s meant is the delivery of spot gas bought in Europe to Ukraine through pipelines of Slovakia.

Even in case the short-term contract between Naftogaz and RWE is signed, it won’t reduce dependence of Ukraine upon Gazprom.  Annual volumes declared by the new contract can make up about 1 billion cubic meters.  Whereas Ukraine consumes about 70 billion cubic meters of gas per year, out of which at least 40 billion cubic meters under the current contract.

Germany buys about 30 billion cubic meters of Russian gas annually.  In winter  theses volumes grow.  At the beginning of March RWE declared its intentions to reconsider conditions of its own long-term contracts with gas suppliers already in 2013. Priorities will be given to negotiations with the greatest gas suppliers.  Gazprom has a leading place among them.  36 % of purchases of RWE go to Russian gas according to long-term contracts.

Also mass-media have been actively discussing information concerning Ukraine having conducted talks with Turkey and Bulgaria about the delivery of liquefied natural gas from Turkish storage facilities through the Bulgarian gas transportation system.  It is possible already now to ascertain considerable problems of a possible future cooperation. Since both countries are involved in the realization of  “the South stream” project.  And hardly anyone will spoil relations with Russia by means of gas contracts with Ukraine.

Besides, such scheme of gas delivery to Ukraine foresees the attraction of Romania as well. It is impossible to directly deliver gas to Ukraine by means of Bulgarian gas-transport system. Hence, Ukraine can face the aggravation of relations with Romania which already aren’t simple.  As for today the issue of borders with this country continues to be open, especially for the latter.

During the winter period European countries constantly fall short of volumes of gas, especially of the Russian one.  This winter Gazprom was simply compelled to limit gas deliveries to Europe, concentrating fuel resources on covering Russian consumers’ demand.  No additional volumes of gas were within reach.  And nobody in Russia was going to sacrifice the heating of its own population on the eve of presidential elections.

Unlike previous years, Europe starts to cautiously treat the constant accusations addressed to Ukraine of taking gas meant for Europeans.  The fact that Ukraine managed to fill up the lack of gas for Europeans with the help of its own forces out of its own storage facilities is established, as well as the fact that Gazprom lacks financing for the development of new deposits and building of gas pipelines.

In this sense the statements of the Russian leadership concerning the acceleration of building of “the South stream” sound too optimistic.  The situation around the reduction of volumes of Russian gas supply to Europe is a bright confirmation here.

Firstly, this has placed the very participation of European companies in the project of “South stream” construction in doubt.

Secondly, a traditional charge of Ukraine’s unauthorized gas takeoff already didn’t surprised anybody.  The only thing that it testified was a lack of imagination in terms of creation of information provocations.

Gazprom has been constantly denying the reduction of deliveries to Europe.  However, accusations were voiced by the European countries, and by no means by Ukraine. Austria, Slovakia and Poland, which suffered from frosts most of all, declared that deliveries were reduced.  Germany, Hungary, Bulgaria, Romania, Greece and Italy also demanded that deliveries were increased.

Already in the middle of February Gazprom reduced the gas price for the European consumers by 10 % on average.  Whereas Ukraine is unsuccessfully trying to get a discount for the Russian gas.  Previous negotiations were unsuccessful.  Signing of an additional agreement to the current gas contracts again remains only possible.

As for today preparation for parliamentary elections becomes more topical in Ukraine.  The Ukrainian leadership won’t afford itself such luxury as the surrender of the Ukrainian gas-transport system to Russia on the eve of conduction of elections.  Gazprom is interested in the creation of a bilateral consortium on possession of the Ukrainian gas-transport system. And this is the condition for a discount of the gas price. Ukraine insists on the participation of Europe. Hence,  there is no sense to expect the revision of gas contracts of 2009.

Moreover, the price of oil is high and will grow in the nearest future which will accordingly influence the formation of the gas price.  And these are the additional means for the Russia’s budget.  The situation is deteriorated for Ukraine also by the fact that Gazprom goes through financial difficulties it terms of development of new gas deposits and construction of new gas pipelines. Therefore, Russia’s absence of desire to reconsider contracts unprofitable for Ukraine is completely clear. Gazprom has occupied an advantageous position of an observer and recipient of additional profits. Whereas everything what has been left to Ukraine is to disseminate the information about an active search of alternative energy-carriers deliveries in mass-media.

Results of the national will expression on March 4 are a predicted victory of the needs of Russians in the stability of the state. V.Putin has turned out to be capable of becoming the spokesman of representation of an average Russian citizen in far-off regions. The reality of the present times is that the Russian civil society has started to get formed. However, the future of Russia is not in the satisfaction of interests of the capital and stability of the “middle” class. Protests of the bourgeoises have been opposed to the will of the majority.

Absence of a singular leader of opposition is not a victory of the new-old president. It is a paradox of conservatism. They like a strong leader.

The policy of “Russia of the future” will be certainly formed in the Center. However, the role of regions will grow. This is an objective reality of the present times and a pledge of a full term of V.Putin’s presidency.

Budget-forming branches work thanks to average citizens. Their expectations and choice of unifying statist guarantees of V.Putin were realized in their choice.

Unfortunately, opposition has appeared to be ready only to state claims concerning the formation of strategy of development of Russia, and it has really turned out to be incapable of offering alternative to the majority of Russians.

Difficult political and economic relations between Ukraine and Russia have become even more complicated with the beginning of this year due to another trade war.  This time — a cheese one.  Out of 15 Ukrainian companies which deliver cheese to Russia, import of production has been banned to three of them starting from February 7 of this year.  This list can be extended.  This is when the Russian market makes up 85-90% of sales for Ukrainian cheese makers, and annual losses of a considerable share of the Russian cheese market for Ukraine can exceed 300 million dollars.

Yet again experts reasonably criticize the authorities for an excessively high economic dependence which Ukraine has in relations with Russia.  However, is the Ukrainian economy able to survive without Russia in present world conditions?

If we take a look at the Ukraine’s state statistical data, we will observe that in 2011 38% of all goods were exported to the CIS countries, and  27% – to the EU countries.  And in terms of import, in 2011 45% of all goods were imported from the CIS countries, and 31% – from the EU states.  In addition, Russia continues to be the greatest trading partner of Ukraine holding 29% of export and 36% of import.

Despite problematic issues in economic relations between Ukraine and Russia, like different trade “wars”, an annual goods turnover between the countries continues to grow and has already exceeded an indicator of 50 billion dollars.  Hence, it is possible to say that a positive dynamics is observed in the development of economic interrelations, although this is in no small measure due to the rise of Russian gas and oil prices.

Consequently, in present world conditions, with a narrowed access to foreign capital and growth of protectionism, Ukraine can’t reject a close economic cooperation with Russia.  The question is not only in energy resources.  The thing is that the curtailment of economic cooperation with the greatest trading partner will by all means lead to the state bankruptcy of Ukraine with all corresponding consequences.  Especially in the social sphere.

But what then?  The launching of the Russian project of the Customs Union led to the destruction of an old concept of economic and political relations between Ukraine and Russia.  The old economic model will no more work between the states.  This has been brightly demonstrated by “dairy, meat, sugar, caramel and pipe wars” which were arising serially after the launching of the Customs Union in the middle of 2011.

Hence, Russia is vividly demonstrating what sort of model of bilateral economic relations Ukraine will get in case it abstains from joining the Customs Union and the Eurasian Economic Community (EAEC), which has formally started working since January 1, 2012.  And the free trade area agreement with the CIS, which was signed by Ukraine in autumn, 2011, won’t allow Kyiv to protect its own trade with Russia due to numerous exceptions in the agreement which, first of all, have to do with the agricultural goods. Securing itself against risks of the decreased economic interaction with Ukraine, Russia already now has begun an intensive development of its own enterprises, which can replace Ukrainian import.

Which other way do the Ukrainian authorities have?  Joining the Customs Union and the EAEC will mean a gradual handover of control over the Ukrainian economy to the Russian capital.  Big Ukrainian business will be the greatest opponent of such scenario.  Apart from this, the Russian capital will worry less about the maintenance of the social sphere of Ukraine and its infrastructure as well.  In addition, Ukrainians can negatively estimate the loss of the Ukrainian economic sovereignty at the following parliamentary and presidential elections.

Hence, the Ukrainian authorities are compelled to make a strategic choice of a model of economic relations with Russia, while not forgetting about the consequences of such a step.

Anyways, the Ukrainian government should be ready to implement real reforms aimed at the optimization of economy of Ukraine by means of changing the structure of import and export, raising competitiveness of goods production technologies and a considerable reduction of possibilities at foreign markets.

However, Russia also shouldn’t forget that a bankrupt Ukraine isn’t profitable for it.  Who else then in Europe will annually buy 40 billion cubic metres of Russian gas at the highest prices?  The loss of the Ukrainian gas market can annually cost about 10 billion dollars to “Gazprom”.

Weird.  Is the bankrupt Ukraine indeed favourable to Europe?  After all, this is a consumer market which amounts to 46 million citizens.

It is clear that Russia is interested in inviolability of the gas contracts of 2009. And the longer the negotiating process with Ukraine is protracted, the greater profits “Gazprom” gets. Official representatives of the Ukrainian and Russian authorities constantly declare that the negotiating process is going on. However, Ukraine will hardly get the gas price discount in the near future. “Gazprom” insists on obtaining control over the Ukrainian gas-transport system in exchange for the gas price discount.

         In January it became known that “Gazprom” has reduced prices for 5 EU companies. The discount was received, in particular, by such companies as Wingas, GdF Suez, SPP, Econgas and Sinergie Italiane. According to the Austrian periodical “Die Presse” the discount may make up from 45 to 50 dollars per thousand cubic metres of gas.

         The above listed consumers buy together about 35 billion cubic metres of gas from Russia annually which makes up almost a quarter of all export of the Russian gas to the Western Europe. The specified volumes of gas are almost comparable to volumes which Ukraine received from Russia in 2011, – about 40 billion cubic metres of gas. This almost corresponds with the minimum volume (41 billion cubic metres of gas) which “Naftogaz of Ukraine” was supposed to buy in 2011, according to conditions of the contract of 2009. However, Ukrainian governmental officials have informed that they want to reduce volumes of the Russian gas purchases to 27 billion cubic metres this year. “Gazprom” however insists on 52 billion cubic metres.

         In addition, there appeared information in mass-media, that on January 18 in Moscow “Gazprom’s” daughter company “Gazprom International” and NAK “Naftogaz of Ukraine” have activated cooperation with the aim of creation of a joint venture for the field development on the Black sea shelf.

         That is, despite the delay in negotiations concerning the reduction of gas price, a normal working process continues between gas monopolists of Russia and Ukraine. Arrangements are reached, plans are made, new companies are involved. Then, what is covered by the delay in the negotiating process? What arrangements are reached and actually take place now between the leadership of Russia and Ukraine?

         It is necessary to understand that the existing groups of influence around the president of Ukraine are far from being united. And, first of all, this has to do with economic interests. Representatives of gas and oil traders, and also the owners of municipal services are interested in keeping the gas contracts of 2009. Since, high gas prices allow them to jack up tariffs for the population and industry. And this is the growth of their profits. And business which controls the metallurgical and chemical industry is on the contrary interested in low gas prices.

         Recently Minister of Energy Y.Boyko has informed that Ukraine can extract 70 billion cubic metres of shale gas a year and is going to involve American experts. This statement is at least amazing. Despite the necessity of the mentioned investments amounting to 10 billion dollars a year, the government of Ukraine ignores the warnings of international experts concerning ecological consequences of such projects. Thus, governments of France and Bulgaria have already forbidden the development of the shale gas.

         As a whole, the current leadership of Ukraine in every possible way avoids the question of existing and potential environmental problems and threats in the country. And last statements of the government about the plans to transfer all thermal power stations from gas to coal confirm it.

         In such a way the government plans to save up to 6 billion cubic metres of Russian gas a year. The initiative is supposed to be not bad and even noble. Ukraine is reducing its gas dependence upon Russia. However, this project is too expensive and threatens with ecological problems.

         It is possible to understand the logic of the officials-initiators if we take into consideration those who control coal mining in Ukraine and in which regions it is concentrated. The government prefers not to think of the catastrophic ecological situation in Donetsk and Lugansk regions. The development of means for thermal power stations re-equipment is in the first place. And the practice of “modernization in Ukrainian” testifies: money is invested only after receiving guarantees on the privatization of objects. Accordingly, the statement of the Ministry of Energy of Ukraine looks completely logical: “as soon as the law is adopted, we will direct thermal power stations to concession or for privatization”.

         The current authorities are blindly convinced that all their initiatives will be accepted by the Ukrainian people. However, the population of Ukraine has no immunity to the consequences of ecological disasters and the authorities will not be able to create it. Nobody has forgotten the Chernobyl yet…

In conditions of growth of economic risks for the world and Ukraine, the question of attraction of investments acquires a special topicality.

World media and international organizations publicly point to challenges and risks linked with investment possibilities of Ukraine in 2012.  For example, according to 2011 Forbes rating Ukraine has ended up 105-th among 134 countries, going down by 7 positions in comparison with 2010.  This is according to such basic criteria as property rights, innovations, taxes, development of technologies, level of corruption, bureaucracy and protection of investors.

At the same time, according to the “Doing Business-2012” rating, prepared by the World bank and International Finance Corporation, in 2011 Ukraine has fallen from 149 to 152 position out of 183 countries.  At the end of 2011 the level of Ukraine’s attractiveness for foreign investors has fallen to a record-breaking low level – even in the crisis year of 2009 this indicator was higher.  Pressure from the Ukrainian authorities, corruption, a new Tax Code and non-transparency of legislation are among the main reasons of this downfall.  This is a reaction of the world business commonwealth to actions of the Ukrainian authorities concerning the maintenance of an investment climate in the state.

An indicative fact is that Cyprus continues to remain the greatest investor of Ukraine.  The Ukrainian authorities obstinately continue to refrain from including Cyprus into the list of offshores through which the capital escapes Ukraine.  Only according to official figures of the State Statistics Committee, in 2010 Ukrainian companies invested into Cyprus a sum of 6,5 billion dollars.  Simultaneously, in 2010 Cyprian companies invested 9,5 billion dollars into the Ukrainian economy, which made up 22 % out of a total amount of direct foreign investments into Ukraine this year.

These and other figures show that even a big Ukrainian business doesn’t trust its government.

Ukraine became the last European country, in which the elite prefers to launder the capital rather than to form its own successful state.

It doesn’t understand all the hopelessness of this path.  At the same time, this adds optimism to people — this won’t last long.

Social responsibility of the big business before its own state, especially in times of the present crisis, is now topical in the West.  Maybe, it’s time for the biggest Ukrainian businessmen to follow the example of big American and French businessmen (W.Buffett, B.Gates, 16 top-managers and billionaires of France and others) who are voluntary ready to pay higher taxes to their states during crisis?  Or we still should expect the time when the Ukrainian people will be compelled to take back a part of Ukrainian funds from the offshores and other “islands” by means of a protest for the maintenance of their own survival?  This will lead to the hunt for the capitals.

Many questions remain open.  Hence, Ukrainian investors still have possibilities left to change the situation for the better.  I am sure that following the example of the Ukrainian business, foreign investors will also increase the level of financial confidence in the Ukrainian state.

This will be a game where all parties win.  Or there will come the wind of change.

If we take into consideration the fact that the Ukraine-EU Summit has taken place on December, 19, it is a success for Ukraine.  Two months ago the conduction of the summit was being doubted.  Ukrainian officials even discussed a possibility of V.Yanukovych’s participation in the session of the Council of the Eurasian Economic Community in Moscow that same day.

If we take into consideration the essential content of the Ukraine-EU Summit, then it has ended up in vain.  Not a single important decision has been signed.  Ukraine expected to launch the Free Trade Area Agreement with the EU.  Also Ukrainian governmental officials announced a possible signing of the Association Agreement. Expectations of Ukraine haven’t been realized.

According to Herman Van Rompuy, the President of the Council of Europe, the uncertainty concerning Y.Tymoshenko’s case is among the main reasons of such results of the summit. European officials are concerned with the existing restraints on free meetings of people in Ukraine. They expect that the situation improves during parliamentary elections in 2012. A requirement towards Ukraine has been laid down again.  Till the situation with democracy isn’t improved, the EU won’t sign and ratify the Association Agreement with Ukraine.

The secrecy of the Ukraine-EU Summit arouses certain concerns.  The information concerning the adopted decisions and the course of the session itself is practically absent.  If this is the initiative of the Ukrainian authorities, why then official EU representatives adhere to the same line of behaviour?  After all, freedom of speech, transparency and access to information are the main democratic principles.  The EU espouses them and demands that Ukraine sticks to them.

Introduction of democratic values by Ukraine upon demand of the EU is a long-term process. And the necessity of forming and filling the budget of Ukraine for 2012 is the reality of the present time.  The effect is intensified also by the conduction of the parliamentary elections that same year.  In this context, the necessity of revising gas contracts with Russia becomes actual as never before.

On November 24, V.Yanukovych declared that Ukraine and Russia will agree upon the price of gas before the end of 2011.  However, on December 12, the chairman of “Gazprom” O.Miller announced that his company and “Naftogaz” won’t sign the agreement before the end of December.  Therefore, the order of M.Azarov, voiced on as far back as December 7, to prepare a tough variant of the state budget for 2012 with no less than $400/thousand cubic metres gas price looks not that groundless.

Taking this into account, it is hard to escape a conclusion that the results of the Ukraine-EU  summit are directly connected with Ukraine-Russia negotiations on the price of gas.  In this context the example of Belarus is revealing. Recently, “Gazprom” paid $2,5 billion for another 50 % of “Beltransgaz” and became the owner of the whole stock of shares of this company.  That is, today Russia controls the whole Belarusian gas transport system in exchange for 20 % gas discount.  This was preceded by Russia’s purposeful assistance to Belarus in accumulating considerable debts.  And in the critical moment of their accumulation Russia became the owner of the gas transport system.

The situation completely repeats itself with Ukraine.  The price which Ukraine pays for gas now is certainly high.  And a financial load of “Naftogaz” in terms of payments for Russian gas grows every month.  The Ukrainian company constantly has to take credits for payments.  A possibility of paying in roubles and switching to credits of Russian banks complicates the situation even more.  Each time the question of a discount for gas is touched upon, Russia demands something in return.  Now, the Ukrainian gas transport system is the subject of talks.

On the eve of the Ukraine-EU Summit information on the project of a new interstate Ukrainian-Russian gas agreement appeared in the Ukrainian mass-media.  It foresees the creation of two joint ventures (JV) with “Gazprom” on the basis of the Ukrainian gas transport system.  The first JV, a gas-transport one, should include directly main gas pipelines and underground gas storage facilities of Ukraine.  The second JV, a gas distribution one, is planned to be created with “Gazprom” on the basis of internal networks of Ukraine.  It is foreseen that European energy companies will join the gas-transport JV.  But already after it begins to work.  Formally the project provides for an equal share participation of all JV parties (33 % – “Gazprom”, 33 % -  eurocompanies and 34 % – “Naftogaz”).  There is no information on the mentioned eurocompanies yet.  However, already now the majority of Ukrainian experts focus attention on the close relation or affinity of these companies with “Gazprom”.

Today, Ukraine became the hostage to the two international integration projects.  The first one – joining the European commonwealth is again postponed for a long-term prospect.  The second one – the Eurasian Economic Community is gradually being materialized.  In the realization of both projects pragmatic economic calculations and arrangements between the EU and Russia come to the fore.  Ukraine has nothing left but to continue the declarative course on foreign policy maneuvering at the international arena.

Ukrainians need to put questions for themselves today. 20 years of independence, 20 years the nation is paying taxes to state and salaries to state’s servicemen. If the result of their work is well known in whole Europe then what should be done during the next parliamentary elections?

Nowadays, the level of competition is considerably growing in the world.  The lack of qualified personnel is now a first and foremost problem in many spheres.  We can speak about demand for both qualified employees and elite itself.  For example, in Ukraine, according to official statistics, in the first two quarters of 2011 processing industry, trade and civil service felt the greatest lack of personnel — at the level of 90 thousand people, which is 14% more than last year.  And this is when an informal level of unemployment is more than 10%.

There exists a couple of ways of solving a personnel “hunger”.  The Chinese way, for example, consists in a constant rising of the professional level of workers and a careful selection of officials.  Selection criteria for executive positions in China foresee moral qualities, success of candidates at their previous job places and demonstration of possibilities of providing the level of economic growth.  The government stimulates rotation of personnel which restrains the growth of corruption.

The Russian experience of rotation of elites is less successful, but also has some achievements.  In particular, a personnel “presidential thousand” was formed, out of which the most worthy candidates for the state positions are to be selected.

Ukraine now has no system answer to the personnel challenge of time and this is one of the reasons of growth of social and political tension in the society.  The country has no system of national selection of talented personnel for the state administration at different levels.  Instead,  we have a formed clan-corporate rotation, when positions of parents-officials are occupied by their children.  A dynastic principle of rotation of elites in Ukraine only gathers pace, but very soon it can lead to a social explosion in the 46-million country where 90% of youth is deprived of chances of legitimate political self-realisation.

Last sociological researches show that the level of support of the present political elite in Ukraine amounts to no more than 10%.  More than a half of population supports neither the ruling, nor the oppositional elite.  An insufficient professional level of the ruling elite leads to the fact that attempts of reforming end up unsuccessfully.

One of the ways out of this situation is a wider attraction of the intellectual elite to the state management and participation in political processes.  It is extremely important to hold possibilities of self-realisation open for the talented youth which will go to work to civil service for the sake of creation of successful and competitive Ukraine.

The European Union can join the process of formation of the new political and public elite which will ground upon morals and high professional skills.  For example, by promoting the formation of understanding of democracy advantages and their interrelation with social security of each citizen among Ukrainians.

Jointly bringing up the generation of future leaders of Ukraine, Europe will also invest into its own future!

Tension which we observe in the Ukraine-EU relations is caused by objective economic reasons. Besides, Ukrainian authorities consider that it is possible to cooperate with Europe without changing post-Soviet standards in the internal life of the country.

The EU is persistently concentrated on solving its internal problems. A number of countries negatively treat plans of the EU expansion. The main reason is connected with fears of Europeans related to the financial load increase because of a possible appearance of new members.

Deterioration of relations between Ukraine and the EU became a push for closer relations with Russia. Moscow has successfully conducted a number of international and external economic initiatives.

Recently, Ukraine resigned a free trade area agreement within the CIS states. This won’t have serious contradictions with the creation of a similar area with the EU. However, energy carriers, metals and sugar are excluded from the free trade area with Russia, and these are the goods which form a basic turnover between Russia, Ukraine and other CIS states. And those goods which Russia cannot replace with its analogues remain within the framework of free trade between Russia and Ukraine.

At the end of October prime-ministers of Ukraine and the RF came to an agreement about a possibility of utilizing Russian rubles for payments for gas supplied to Ukraine. It obviously was one of the requirements of Russia for the negotiations on gas prices reduction to start. “Naftogaz of Ukraine” will have to resort to banking establishments due to the shortage of means for the Russian gas payments. Additional volumes of ruble supply will have to be attracted. Russian banks will be happy to give credits.

Gazprom has no practice of carrying out calculations for the exported gas in Russian rubles. Binding to dollar in calculations will continue to stay. As a whole, if Ukraine switches to ruble in calculations for gas, this will strengthen a Russian financial system and considerably expand a zone of use of a Russian monetary unit.

Last initiatives in gas and currency spheres testify to the beginning of realization of next ambitious foreign policy plans of Russian leaders. The present state of the Russian-Ukrainian economic relations signifies the necessity of creation of new effective interstate formations. Russian leaders plan that this consolidation will become another world influence centre and will compete equally with the EU, USA and China.

Inconsistent actions of the Ukrainian authorities concerning the European prospects have led to advantages of Russia in economic cooperation. Ukraine has to make considerable efforts in order to achieve equality in this process.

Meanwhile, a considerable part of the Ukrainian society continues to expect clear signals from the EU regarding its desire to see Ukraine as an equal member of the European family. Concentration of the EU on its own internal political and economic problems is perceived by the Ukrainian authorities as a signal to search for new economically sound partners who would not ostensibly demand changes in the internal policy of Kyiv.