'West wants to cut Ukraine’s historical ties with Russia quickly & cheaply, but that’s impossible'
On Monday Kiev hosts the first formal EU-Ukraine summit after an association deal was agreed last year. However the EU's foreign policy chief, Federica Mogherini, is not coming to the summit. She said she won't be able to be in Kiev today, because she has to see the UN Secretary General. This comes amid reports that Europe is losing faith in Ukraine's commitment to make political and economic reforms.
RT:Kiev got another €267 million in low interest loans from the EU to “stabilize the economy and ensure consistent growth.” Will this latest cash injection make a difference, considering how much Ukraine has already received?
Richard Wolff: I believe it will give Ukraine a little bit more time but it is nowhere near adequate to deal with the economic distress in Ukraine, with the social and economic costs of the continued tension with Russia. And in the event that Ukraine becomes a fully independent economic unit, it’s not enough to enable it to survive even the problems, the debts and so on that it has.
RT:And why aren’t there signs of sustainable growth and stability in the Ukrainian economy by now, considering the amount of bailout help Kiev got?
RW: There are many reasons for this. Probably the most important is the fact that for a very long time, many decades, the Ukrainian economy was integrated mostly with Eastern Europe, the Soviet Union, and then Russia and so on. You cannot have an economic history over that long a period of time that doesn’t involve a very complicated set of interdependencies. That cannot be changed quickly and that cannot be changed cheaply. That is an enormous transformation. It’s clear that the European Commission with the support of the US is eager to pull Ukraine away from its historical relationship with Russia and Eastern Europe. But what they want is they want it to happen quickly and cheaply and neither of those is possible.
RT:GDP is contracting, prices are going up, and cuts have been introduced. When will the Ukrainian people start to see the real benefits from all this EU money?
RW: Not for quite a long time and that’s the problem. The internal conditions of Ukraine - they have serious problems with their own economy, with inexperienced political leadership, with internal corruption... Anyone of those is more than enough to delay many of the benefits. What they are really trying to do is to convince large numbers of Ukrainians to have hope, faith, that in some sort of long-run they will be able to prosper as part of Europe in a way that either cannot or wouldn’t happen if they didn’t go in this direction. And this is really only a matter of hope because it’s not at all clear that Europe next year or ten years from now will be able or willing to provide the level of support and the level of resources that this hope would require if it were ever to be realized.
RT:Borrowing money is one thing, what happens when it’s payback time in Ukraine?
RW: Yes that’s when the problems will happen, that’s when the economic difficulties that now beset the world, capitalist system in general and the European capitalist system in particular, when those difficulties impact Ukraine they will have more not less requirement of help from the Europeans. But the problem is they are not alone: Spain, Italy, Portugal, Ireland and Greece. You can see what’s going on simply watching the Greek example that its demands on Europe far exceed what the Europeans seem able or willing to provide. And those other countries I mentioned will likely take precedents over Ukraine in the listing of priorities for the Europeans. So I think Ukrainians, if they are counting on massive long-lasting support from Europe which they would need to get their economy in shape, they are counting on something that is highly problematical.
The statements, views and opinions expressed in this column are solely those of the author and do not necessarily represent those of RT.