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The industrial community demands that the government and parliament toughen technology-based anti-crisis measures that are in line with economic development laws. They will have to minimize the devastating impact of the social and economic crisis and give the economy an opportunity to boost its competitiveness, move to the stage of growth. This opinion was aired by President of the Ukrainian League of Industrialists and Entrepreneurs Anatoliy Kinakh in an interview with one of Ukraine's mass media.
"The depth of the current crisis is due not only to the tragic events in the country's east, the annexation of Crimea and the loss of traditional eastern markets, it is the result of degradation of the public administration system, the absence of intention and the ability to form long-term economic, industrial development strategy. All the developed world powers came out of the crisis because of the priority given to the industry, a powerful lobby of domestic producers. Ukraine has lost its industrial policy, there are programs either at general, regional or sectoral level," Anatoliy Kinakh said.
In his view, one should start with joint efforts by the National Bank, the government and the parliament to develop programs for lending to the real sector at affordable rates. The domestic producer is unable to work with an NBU discount rate set at 22% per annum (a few months ago it was 30%), inaccessibility to credit resources, even with the current credit rates. It is worth mentioning that the European Central Bank's rate is currently 0.25% per annum, Anatoliy Kinakh said.
The investment climate should be improved as soon as possible, efforts should be made to safeguards the rights of investors and owners. One of the conditions for sustainable economic development are measures to increase the solvency of the domestic market for the economy as a whole and for its citizens. Only with demand for goods, the economy has incentives to boost their production, solving problems of quality and competitiveness.
One of the most powerful anti-crisis principles is export expansion, the ULIE President said. It is extremely important to Ukraine, as in 2014 the country lost a billion euros, which had previously come from the eastern markets. Instead, exports to the EU, which has given us unprecedented preferences, grew by a mere 2.6%, or 115 million euros.
"The conclusion that one can draw is that any preferences from foreign partners — no matter how well they treat us — do not give the desired results without systematic, highly professional internal work to modernize the economy, improve the quality and competitiveness of products. Ukraine has to clearly do its "homework" on the adaptation of its economic complex to EU standards, improve investment, credit policies, otherwise, on January 1, 2016, when a free trade area with the EU starts work, globalization will amplify the risks of Ukrainian producers," Anatoliy Kinakh said.
He particularly warned against de-industrialization, when not only separate factories but the entire industries stop working. In his words, a decline in the aerospace industry, automotive, transport engineering sectors has recently exceeded 80%. Tough and systematic measures are needed to revive these industries, government programs should be elaborated to let them get out of crisis and start developing gradually.