Ukraine and Georgia in 2020
05 February, 2015
Ukraine and Georgia in 2020
In 2009-2010 Irakli Gogava acted as a chief political consultant and field operations manager of Ukrainian leader, Viktor Yushchenko. Before 2014, he presided over the American Committee for Open Democracy Program, and later he returned to Georgia. Well versed in both Ukrainian and Georgian politics, Mr. Gogava offers a short comparative analysis between two strategic development plans - Georgia 2020 and Ukraine 2020.

The strategic plan “Ukraine 2020” seems to be more ambitious than its Georgian counterpart. In order to
carry it out, Ukraine will require an unprecedented mobilization, especially considering the ongoing Donbas conflict. In 2020, Ukraine plans to achieve a $16,000 PPP (purchasing power parity), which would automatically make it a suitable EU candidate. However, many other things factor into making this dream a reality, such as overcoming corruption, optimizing bureaucracy, improving the business environment and implementing tax and judicial reforms—as well as introducing new, democratic institutions. They have up to 60 basic reforms to implement, which, in turn, will create the need for dozens of others.
Ukraine’s assets include well-developed human capital, a powerful technocratic elite, a high level of the country’s urbanization, governmental possession of almost 100 percent of the country’s arable land, a developed and mechanized agricultural sphere, powerful industry, technological capacity for both scientific and practical research, lots of nationalized property, a $45 million internal market and a positive import/export balance.
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Ukraine’s problems include an armed conflict with Russia, almost total corruption in all fields, prevalence of smuggling, a population used to social subsidies, a centralized government, the immense influence of oligarchs on its economy, its government and its parliament, an unattractive business environment, a collapsing national currency and an ineffective healthcare system.
First and foremost, the necessity for any Ukrainian success is the cessation of warfare, which means freezing the conflict, losing 10 percent of the coal and mining industry and allocating a lot of resources into the country’s defense capabilities. The group of self-proclaimed reformers is quite suspicious: Poroshenko is an oligarch, Saakashvili is wanted by his own government, Aleksandre Kvitashvili was unsuccessful with healthcare reforms in his own country, Eka Zghuladze created a machine of political repressions under the shining façade of patrol police, and Arseniy Yatsenyuk was involved in several smuggling and corruption-related scandals. By most estimates, this group will not be able to complete the mission they have set for themselves and will end up creating a so-called “Georgian model,” where corruption among the elite was nearly absolute. However, it is also possible that this system will eventually pave the way for cleaner, patriotic politicians such as Nalivaichenko, Sadov or Klitchko.
The main problems outlined in the “Georgia 2020” strategy include a lack of economic competition and a lack of government oversight, a low level of human capital and a lack of financial resources. The government’s goal for 2020 involves attaining a PPP of 13,000 GEL. Romania, the “poorest” country in the EU, has a $12,000 USD PPP, and this is what Georgia should aim for by 2020. In general, the strategy describes wishes rather than concrete ways of economic development.
Many important issues, such as industrialization, urbanization, demography and scientific development are not mentioned at all. Some of the figures mentioned by the strategy are downright catastrophic – the amount of self-employed and unemployed persons comprises 70 percent. Most of the self-employed people work in the agricultural field, growing their own food. The strategy plans to reduce the current 15 percent unemployment to at least 12 percent. The problem is that this unemployment strategy doesn’t offer anything to the self-employed, who comprise more than half of the country’s population. The country needs these people; they represent the main resource and impetus for the Georgian economy.

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PHOTO OF THE DAY
GEL Exchange Rate
Convertor
16.09.2019
17.09.2019
USD
1
USD
2.9607
2.9608
EUR
1
EUR
3.2855
3.2699
GBP
1
GBP
3.6878
3.6874
RUB
100
RUB
4.6066
4.6206
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GEL Exchange
USD
1
USD
2.9608
EUR
1
EUR
3.2699
GBP
1
GBP
3.6874
RUB
100
RUB
4.6206
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