'Marshall Plan' for Ukraine: Illusions of Economic Recovery
The authorship of the document belongs to the three Lithuanian politicians: two former Prime Ministers – Andrius Kubilius and Gediminas Kirkilas and former head of the Ministry of Foreign Affairs Petras Vaitiekunas.
Earlier this year, the "Marshall Plan for Ukraine" was officially approved by the Lithuanian Seimas (the country's unicameral parliament). In March, the Congress of the European People’s Party (EPP) included it in its final resolution.
"The EPP recognizes that in the current environment in the coming decade, it is difficult to expect Ukraine’s accession to the EU. However, the EPP should be aimed at strengthening its Eastern partnership. The successful transformation of Ukraine is an important element for strengthening civil society in other post-Communist countries, particularly in Russia.
To save the motivation of Ukrainians to pursue difficult reforms, the EPP encourages the establishment of a broad investment package (Marshall Plan for Ukraine),” the Congress of the EPP stated in its final resolution.
Kirill Yakovenko, an analyst at Alor Broker, however thinks that under the "Marshall Plan", Volodymyr Groysman envisages a slightly different scenario of financial aid being provided to Ukraine than his Western partners.
He further noted that there were several plans to aid Ukraine under the same very name, the "Marshall Plan," and it is hard to suggest which one that Volodymyr Groysman supports. It might be the one earlier proposed by Ukrainian oligarch Firtash, which sees aid been given to Ukraine through the country's businesses.
Yakovenko therefore says that Kiev urgently needs a new plan. Until the end of the year, the country should pay off debts worth $1.4 billion. In addition, it needs to redeem $2 billion more of interest from earlier debt obligations. This is not taking into account the $3 billion that Ukraine owes to Russia.
However these are all trifles, he says, taking into account future payments. So far, Ukraine starts paying off the debts it accumulated during the first years of the Poroshenko administration. At that point, the foreign debt of Ukraine was $22 billion, which already was an overwhelming burden for its budget.
The search for alternative sources of financing seems to be a priority for the government. Eurointegration and the visa-free regime might be very positive achievements but they become meaningless when there is simply no money in the country, he said.