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Bridges in the desert

The article on page 9 of the Sept. 18 Post that describes Ukrainian treasury bills as a pyramid scheme was right on the mark. Foreign investors, having lost hundreds of millions of dollars in the Ukrainian T-bill and equities markets, have finally come to the realization that there are better places to put their money. Foreign capital has been leaving the country in droves.

So why now is the World Bank and International Monetary Fund willing to pour more money into a place that has proven to be a corrupt, bottomless pit? Apparently no one has taught them the error of throwing good money in after bad.

Perhaps they think that this time reform will actually take place. Or perhaps some miracle will occur, Ukraine will begin to manufacture something, its gross domestic product will grow astronomically, and the government, instead of depositing the new revenues into off-shore bank accounts, will allocate some of the money to pay back its debts. But if anyone considers the history and the reality of this situation, they know that the only thing that the World Bank and IMF will accomplish is an increase to a debt that is beyond their control. It's kind of like putting out a fire with gasoline.

Meanwhile, the U.S. Agency for International Development, a donor organization that has never been known for quickly adapting to a changing environment, has just created a new multimillion dollar project to enhance the infrastructure for the comatose capital markets. The thinking here must be that lack of infrastructure has caused the capital flight and a new depository with better regulations will bring the investors flocking back.

My analogy to this convoluted thinking would be to build a bridge in the middle of a barren desert, because a river once flowed there. 'Build it and they will come' is a fantasy better left to Hollywood movies. In the end, USAID will spend millions to build this bridge in the desert and they will go back to Congress flaunting their success. Who knows, maybe they'll even be able to hold up as examples to Congress some confused Ukrainian souls who spend the better part of their days fishing from the bridge. Who do they really think they're kidding, besides the U.S. taxpayer?
Jack Horowitz
Kyiv

(From September 1995 to March 1997, Jack Horowitz worked as project manager and in other capacities on the Barents Group's Ukrainian Capital Markets Development Project, the USAID-sponsored project that created the PFTS over-the-counter securities trading system. ) Time to get our noses bloody

The ignominious collapse of the Ukrainian currency has proved what was clear from the beginning – working in the Soviet style and enjoying the benefits of stability just do not go together.

At an international company where I am employed, there is a particular person whose job it is to make sure no superfluous documentation is issued, that no any unnecessary paperwork is being filled out by company personnel.

Alas, what we witness at Ukrainian state offices drives me to desperation. To make the smallest transaction, various documents have to be filled in and signed and countersigned and sealed, until the documents resemble ancient religious scripts. And all of the officials who have to sign them, believe me, are never located in one building. Any unfortunate businessman who nonetheless persists in trying to register his business has to wait, walk, beg and wait again for so much time that the business itself ceases to be fun anymore. All this could be funny if it were not so tragic.

Instead of creating an economy that works like a good Swiss watch, officials continue to waste everybody's time constructing mountains of paperwork. While the whole civilized world is working hard from morning till night, in Ukraine officials are busying themselves with bureaucratic buffoonery.

It's high time we recognized that this idiocy has got to stop. The time has come for Ukraine to become competitive, for it to compete hard, compete using all means possible, compete, figuratively, 'with a bloody nose' in the world economy.

We can't draw an iron curtain over the outside world anymore – the technological revolution in communications has taken care of that. The only way forward is to revive the economy by breaking the bureaucratic shackles that still bind it.
Alexey Muzalyov
Odessa