"So the last will be rst, and the rst will be last. Ma6hew 20:16
Ukraine Kyiv
March 2014 Kakha Bendukidze
0
5000
10000
15000
20000
25000
30000
1990 1994 2012
Uzbekistan
Kyrgyztan
Armenia
Tajikistan
Moldova
Azerbaijan
Georgia
Turkmenistan
Belarus
Kazakhstan
Ukraine
Latvia
Estonia
Russia
Post Soviet Countries 1990, 1994 and 2012
5th 7th
9th
2012
Tajikistan
Kyrgyztan
Moldova
Uzbekistan
Georgia
Armenia
Ukraine
Azerbaijan
Turkmenistan
Kazakhstan
Belarus
Russia
Latvia
Estonia 0
5000
10000
15000
20000
25000
30000
1990 1994
Post Soviet Countries 1990, 1994 and 2012
5th 7th 9th
Lagging Behind GDP Growth Rates (1994-2012)
0%
2%
4%
6%
8%
10%
12%
0
5000
10000
15000
20000
25000
1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012
USD
, GDP
per cap
ita, P
PP
Ukraine
Poland
How Poland Outperform Ukraine
3
Night Light Test Warsaw Kyiv
0
5000
10000
15000
20000
25000
1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012
USD
, GDP
per cap
ita, P
PP
Ukraine
Bulgaria
How Bulgaria Outperform Ukraine
2.2
0
5000
10000
15000
20000
25000
1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012
USD
GDP
per cap
ita, P
PP
Ukraine
Romania
How Romania Outperform Ukraine
2.3
0
5000
10000
15000
20000
25000
30000
1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012
GDP per capita (PPP)
Ukraine Grown as Poland Grown as Kazakhstan
Grown as Lithuania 8% GDP Growth Rate
What would happen if Ukraine grew as
Romania
Slovak Republic
Estonia
Russia
Big Governments Weapons of Wealth Destruccon
Excessive taxa=on
Populism
Energy subsidies
Corrup=on Unbalanced social policy
Red tape
Adverse poli=cal selec=on
Wealth destruc=on
Bureaucracy
Government Expenditures as Share of GDP 2013 (IMF)
0%
10%
20%
30%
40%
50%
60%
70% 2008 2013
Budget Decit to GDP 1.1% 9% Public Debt to GDP 12.3% 45%
Spending
Pensions - 17 % of GDP Educacon 6.2 % of GDP Healthcare 3.7% of GDP Subsidies for energy: Pre-tax: more than 5% of GDP (equal to 12% of government revenues )
Post-tax: more than 11% of GDP (equal to 27% of government revenues )
Energy Intensity Electricity, Gas and Oil Consumpcon per Dollar of GDP
(Joules in millions)
0
2
4
6
8
10
12
14
16
18
(PPP)
Natural Gas Consumpcon Germany vs Ukraine
Germany Ukraine
Total consumpcon, bln m3 79 53 Total produccon, bln m3 12 20 GDP (PPP), bln USD 3 378 333 Populacon, mln 81 45 Gas to create $1 GDP, m3 0.02 0.16 Household consumpcon, bln m3 24 16 Transformacon/industry, bln m3 47 32 Gas to create $1 of GDP, m3, without households
0.01 0.1
Hospital Beds by Country 1999-2012 (per 1,000 people)
0 2 4 6 8 10 12 14
New Zealand Georgia
USA Canada Israel
Australia Latvia
Estonia Moldova Romania Bulgaria Lithuania Ukraine Russia Belarus
1999
2012
Reduccon of Hospital Beds (Percent) 1999-2012
0% 10% 20% 30% 40% 50% 60% 70%
Ukraine Russia Belarus Bulgaria Romania
USA Canada
Moldova Estonia
Lithuania Latvia Israel
Georgia Australia
New Zealand
Ukraine in Internaconal Rankings
Corrupcon Percepcon Index 144 Doing Business 112 Easiness of Paying Taxes 164 Press Freedom 131 Global Compeccon Index 84 Index of Economic Freedom - 155
Bureaucracy Level: Ukraine VS Georgia
Ukraine Georgia Documents to export: 6 4 Time to export (days): 29 9 Documents to import: 8 4 Time to import (days): 28 10 To start a business (days): 21 2 To register property (days): 45 2
Ministry of Economic Development, Georgia 2004
Before Restucturing
21 departments 26 agencies 2492 employees
ARer Restructuring
12 departments 12 agencies 600 employees
50% of the government agencies was closed 15-fold increase of the average salaries Complete turnaround of the police forces
Which Is Export-Oriented Country? China:
GDP (nominal) - $8 227 billion GDP (PPP) - $12 610 billion Total export - $2 210 billion Export share in GDP (nominal) - 26% Export share in GDP (PPP) - 18%
Ukraine: GDP (nominal) $176 billion GDP (PPP) - $335 billion Total export - $70 billion Export share in GDP (nominal) - 40% Export share in GDP (PPP) - 21%
Ukraine vs China in Europe China:
Chinas export to EU is 16% of total export Urban employment 371 million people Industry output 46% of GDP 27 million people is engaged in export to EU From Shanghai to Berlin 8400 km
Ukraine Urban employment - 18 million people Ukraine needs 13.5 million people to be engaged in export to
subsctute half of Chinas export to EU From Kiev to Berlin 1200 km
To Do List
Thieves in jail Cut bureaucracy Cut red tape Reduce taxes Kill subsidies Put Maastricht criteria in the Consctucon Create Currency Board Privacze
!
March 2014