Alternative scenarios for Ukraine

Abstract

Major trends and driving forces are analysed in four areas, i.e. polity, economy, society and international environment of Ukraine, as well as their inter-linkages, in order to define overall dynamics of Ukrainian society. It leads to three basic scenarios for the medium term: a pan-Slavic state centred scenario (example Belarus), a feudalisation/mercantilist scenario (example Pakistan) and a liberalisation scenario (example Mexico). It is argued that the rent seeking state and the rent seeking economy are deeply rooted in a society that can be characterised as patrimonial. Although having some distinctive features, such as high level of human capital and an over-powerful state, Ukraine faces problems that are characteristic for many stagnating Third World countries. A predatory and patrimonial state could develop due to the weakness of civil society. As Aristotle has said, we can learn the nature of anything when it has reached and past its maturity. Since the abolishment of communism and the proclamation of independence, in 1991, Ukraine is experiencing a turbulent transition to a new social, political and economic system. The most tangible change was the transition from an industrialised country, where people were assured of a decent living standard, to a country where industrial production declined by 75 per cent and where the overwhelming majority of the population has been pushed into poverty. The scale and speed of deprivation was unheard of as was the social peace that accompanied this destructive movement. Leonid Kuchma, who played a major role in Ukraine for most of the 1990s as President and as Prime Minister, was re-elected by the Ukrainian population with a big margin (56 per cent) in November 1999, when faced with the choice between Kuchma and Symonenko, the latter being an orthodox communist. It showed, to a certain extent, the break with the communist past although Ukraine has not developed yet into a participatory democracy. But Ukraine has consolidated its status as an independent nation in the heart of Europe. However, the overall impression is that of disintegration, hierarchical breakdown and decline. Ukraine has been the only transition economy not to have known at least one year of economic growth during the 1990s. Only in 2000 the Ukrainian economy started to grow. Here, an analysis is made of defining features and major trends in the political sphere, the economy, society and the international environment in order to identify overall dynamics. This exercise allows the formulation of relevant questions about the interrelationships of the various sub-systems in society as well as the major challenges that Ukraine may face in the medium term.