People’s Deputy, the Party of Regions parliamentary faction member, Minister of Economy of the Opposition government Iryna Akimova, making a speech at the tribune of Verkhovna Rada of Ukraine today, said the following:

- The global financial crisis reached Europe two days ago. Several large mortgage and credit institutions in Germany, Holland, Iceland experience serious financial distress. Now it is not only the American phenomenon, but the European as well.

Meanwhile, the Ukrainian government woke up and found out that financial risks do approach Ukraine. At the same time it showed entirely inadequate reaction. Last Friday prime minister Tymoshenko said that financial crisis would not take place in Ukraine, and if such crisis does occur, the government is not to blame. On Monday Tymoshenko initiated an urgent meeting of the National Security and Defense Council of Ukraine (SNBOU) in order to decide how to cope with financial risks in Ukraine.

The question is: what is all this panic about and why is this panic raised? The answer is quite simple. Firstly, during a few months the Ukrainian government did not see because of its economic incompetence that Ukraine has already lived on the verge of financial risks. And now the government’s only task is to find an enemy – in this case it can be the National Bank of Ukraine or the President of Ukraine – in order to shift the blame onto them.

I think that it is not a state’s approach. For the time being we establish the fact that the Ukrainian government does not make any effort to mitigate financial risks facing our country and to prepare Ukraine for a wave of financial crisis coming from the European side.

So far we see that the government keeps on pursuing a populist policy which triggers inflation and entails accumulation of macroeconomic risks. Recently Fitch Ratings international agency has lowered Ukraine’s rating to negative, and it means that debt funds for our state will be scarce and expensive.

In addition, there is a lack of any basic coordination of the government and National Bank work. Recently, the Ministry of Finance suggested an odd scheme of refunding problem commercial banks. The National Bank rejected this scheme at once. And is it called coordination?!

What should be done for the time being? Firstly, we should demand from the government and the National Bank to scrutinize the situation, define bottle-necks in our financial system, draw up a program of anti-crisis measures and introduce it before Verkhovna Rada.

Secondly, it is necessary to carry out a reasonable budget policy and set down in the budgetary spending the means for financing the stabilization fund. The latter should be formed in Ukraine immediately out of the 2008 State budget windfalls. Now we should be engaged in enhancing independence of the National Bank of Ukraine and enabling it, if necessary, to refund problem financial institutions.

And, finally, explicit coordination of actions of the National Bank and government should be attained. The government should not raise panic. Today Ukraine can cope with financial risks if it is prepared for them. Now it is time not for panic but for pragmatic, real actions.

The Party of Regions Press Service