Ukraine's economy unable to rise without Russia’s help, says Steinmeier

25 April 2015 - 10:46pm The Ukrainian economy cannot rise without Russia’s help, says Steinmeier

Foreign Minister Frank-Walter Shtaymayer believes that the EU should
reduce Russian’s fears about the free trade zone between Ukraine and the
EU. He made such a call in his official letter of the 2d of April to
Jean-Claude Juncker, President of the European Commission, which fell at
the disposal of Radio Free Europe.The
Minister says in the letter that it is necessary to resume interrupted
tripartite negotiations among the UN, Ukraine and Russia which can help
to find the right solution to the problem.Besides,
Steinmeier recommends the European Commission to show flexibility as it
possible in the context of the agreement. He warns that « it’s
impossible to achieve economic stability in Ukraine without the
participation of Russia," that is why it is necessaryto create a
"pragmatic, political approach, without preconditions," RIA News

(My opinion on that:
It´s a little complicated, if you declare the only guy who could help you from starvation to the evil enemy.)

How poor they really are:


The political economy of civil war: How the Ukraine became as impoverished as Tajikistan in only one year

April 11, 2015
By Ivan Lisan

Translated from the Russian by Robin

Tajikistan has long been considered the poorest of the former Soviet
republics. For example, in 2013 its GDP per capita based on purchasing
power parity was $2,536, whereas for the Ukraine it was $8,652. It would
seem that to compare impoverished Tajikistan, which went through the
crucible of civil war, with the until recently prosperous Ukraine was in
bad taste.
But it’s not that simple. The start of the civil war and the
disintegration of the Ukraine have rendered ​​such a comparison possible
and appropriate, because to understand the extent of the Ukraine’s
impoverishment in only one year it is fitting to compare some of its
economic indicators with those of Tajikistan.
All civil wars resemble one another

Although the people of the Ukraine began to fight one another in
their 23th year of independence, war broke out in Tajikistan only five
months after it declared its independence on September 9, 1991. And it
was not until June 27, 1997, at the ninth meeting between
representatives of the Tajikistan government and the united opposition
at the Kremlin that a final peace agreement was signed.
In 1992-1993 alone, about 60,000 people were killed in Tajikistan,
and the number of refugees in 1994 alone was estimated at one million to
1.5 million. According to various estimates, the economic damage
amounted to $7 billion to $10 billion. About 150,000 houses were burned
down and another 15,000 were looted. In the Qurghonteppa Oblast
in the south, about 80% of the industrial capacity was destroyed. By
1997, Tajikistan’s industrial production had fallen by 72%.
The Ukraine has just started its journey down this bloody path, but
even before the Debaltsevo Cauldron the war had claimed more than 50,000
victims according to German intelligence. At the end of the fourth
quarter, the Ukraine’s real GDP was down 15.2%, not including that of
Crimea and the Luhansk and Donetsk people’s republics, which together
accounted for about 20% of the country’s GDP. By February 20, as a
result of fighting in the DPR, 90% of its industrial capacity had been
destroyed or idled. The destruction of houses and infrastructure is
incalculable. And, even though this is just the beginning, the people of
the Ukraine have already fallen to Tajikistan’s level of
Basic pensions and salaries

The basic pension in the Ukraine is 979 hryvnia, and the minimum wage
is 1,218 hryvnia. The basic pension and minimum wage in Tajikistan are
both 250 somoni.
At the official exchange rate, one U.S. dollar was worth 21 to 22
hryvnia on March 14, but the actual rate was 26. The number of solomi to
the dollar was 5.53.
So, if we convert the pensions and salaries in the Ukraine and Tajikistan into U.S. dollars, we find the following:

– The basic pension in the Ukraine at the official rate is about $44
(at the real exchange rate it is $37.60), and the basic pension in
Tajikistan is $45.20; and
– The minimum wage in the Ukraine at the official rate is about $55
(actually $46.80), and the minimum wage in Tajikistan is $45.20.
For comparison purposes, a year ago, when one dollar was equivalent
to eight hryvnia, the basic pension in the Ukraine was $118, and the
minimum wage was equivalent to $152.
In September Tajikistan’s president Emomali Rahmon promised to raise
the minimum wage by 50%, to 400 somoni. Stipends for students will be
increased by an average of 30%. Six billion somoni will be allocated for
this purpose.
In the Ukraine, the next increase in the basic pension and the
minimum wage is to take effect on December 1 of this year. The Kiev
cabinet has promised to raise the basic pension to 1,074 hryvnia, and
the minimum wage to 1,378 hryvnia, but only if it is not obliged to cut
spending on social programs. Given the IMF’s imposition of austerity
measures, an increase in pensions and salaries seems about as likely as
landing astronauts on the nebulous surface of Uranus. Even if
Emomali Rahmon does not fulfill his promise, in terms of minimum wage
and basic pension Tajiks already live a little better than Ukrainians
Migrant workers

According to figures provided by Konstantin Romodanovsky, director of
Russia’s Federal Migration Service, in 2013 about three million
Ukrainian migrant workers earned $27 billion in Russia. At the beginning
of 2015, there were more than 1,300,000 Ukrainian men of military age
in Russia. Over all, five million to seven million Ukrainians have left
the country to seek work and in 2014 they remitted $9 billion to the Ukraine.
The number of Tajik migrant workers in Russia is estimated at one
million to 1.2 million, and they account for more than 90% of all
migrants from Tajikistan. Together, they sent their families $1.7
billion in the first half of 2014.
The population of Tajikistan in 2014 was 8.2 million people, and the
proportion of the working-age population was about 60%, or 4,920,000.
The population of the Ukraine was 45,490,000 in 2013. Since 2014,
when the Euromaidan protests started the process of disintegration,
Crimea (with about two million people) has officially left the Ukraine,
and the Luhansk and Donetsk people’s republics (the LPR with 1.2 million
and the DPR with 1.8 million) have for all practical purposes also
left. Thus, according to rough estimates, the population of the Ukraine
has fallen to 40.5 million. The proportion of the working population in
the Ukraine in 2013 was about 48%. Consequently, in 2014 the number of
able-bodied citizens was only 19.4 million (if the LPR and the DPR are
included, 21.2 million).
If we do a rough calculation of the share of working-age citizens who
have left the country in search of work (because this writer does not
have data on the number of migrant workers from Crimea and the two
people’s republics), it turns out that a quarter to a third of the Ukraine’s working population has left. In comparison, in Tajikistan this number is also about 25%.
Thus, about a quarter of the population has left both Tajikistan and the Ukraine in search of work.
Only God knows how long the civil war will last, how many victims it
will claim and how many cities it will demolish, but one year after the
war began the Ukraine has already reached the level of destruction
wrought by Tajikistan’s civil war.
The Ukraine has not yet defaulted on its debt, but its minimum wage
and basic pension have fallen to the levels of Tajikistan’s, although a
year earlier such a steep decline, which was then only starting, seemed
inconceivable. Moreover, in Russia migrant workers from the Ukraine are
gradually displacing people from Central Asia.
And this is only the beginning. Now Ukrainians and Tajiks have more
than one thing in common. Not only were they both part of the Soviet
Union, but they also share a similar fate: with their lives in ruins,
they are wandering the world in search of work.
Qurghonteppa Oblast was an administrative subdivision of Tajikistan
until 1992, when it was merged with Kulob Oblast to create Khatlon