The European Party of Ukraine, April 8th, 2016 Kyiv
The Revolution of Dignity had a number of reasons: lack of public confidence in the development program of the country because of corruption in the government and army of thousands of bureaucrats; lack of economic freedoms for business, corruption and criminal essence of the judicial system; government regulation and approval procedures of tax policy. Unfortunately, the power that came in the wake of the Ukrainian Revolution continues to use the old methods and corruption in the robbery of the Ukrainian economy.
The macroeconomic situation in Ukraine in 2015 showed that the forecasts of the government at the beginning of the year were false. Instead of the expected inflation to 13.1%, in fact it will rise to 42.3% till the end of the year. As a result, price growth was about 45%. The main thing – the fall of the GDP is expected to reach 12%, instead of 4.3%. This is one of the highest percentages in recent years. The level of the shadow economy, according to official figures is 52%, but unofficially it reaches 65-70%. The situation is shameful. Ukrainians require fair and transparent relations between the state and business.
For the previous year the number of working places in Ukraine has decreased by more than 500 thousand. Investors are turning their backs on Ukraine. Growth of tariffs and depreciation of hryvnia squeezes the population below the poverty line and abroad.
Taking into consideration:
• A significant drop in living standards, without any positive trends to changes in the socio-economic situation;
• The economic crisis that could lead to final loss of Ukraine’s competitiveness on world markets and the complete impoverishment of the population;
• Risks to the national security associated with increasing budget deficits, public debt, which ultimately can lead to complete loss of Ukraine’s economic independence and that is a real threat to national sovereignty;
• Illiterate pseudo-state rate in all sectors of the economy that substantially worsen the level of economic freedom and the conditions for investment attraction;
• A complete lack of effective compromise and close cooperation between citizens, government, businesses, civic organizations for the benefit of Ukraine and in the name of sustained quality development in all spheres.
The European Party of Ukraine considers necessary:
1. To provide a real fiscal decentralization to transfer funds to local communities to reduce government expenditure;
2. To provide professional work of the National Bank of Ukraine to establish the financial and exchange rate stability of the currency;
3. To enter a limit on fiscal deficit of 3% of the gross domestic product of Ukraine;
4. To introduce limits on public debt of the gross domestic product of Ukraine to the international standards;
5. To provide an annual review of the consumer basket, forming a living wage, minimal wage and pensions, taking into account the forecast rate of CPI for the following year;
6. To ensure competitive conditions in the market of public services to reduce utility rates for the population;
7. To set the maximum marginal rate of unemployment at the end of the year under 6%.
In order to create working places and competitive Ukrainian economy, we apply for:
• A state support of investment attractiveness of Ukraine;
• Reducing the fiscal pressure on all productive sectors of the economy to an acceptable level for countries that have to develop and grow, and on the wages of workers to reduce the shadow economy and increase the purchasing power of citizens;
• Adoption of the Tax Code of Mykola Katerynchuk;
• Simplifying tax administration and reducing the number of taxes;
• Reducing the number of regulations on setting up and doing business;
• Creating favorable conditions for crediting of small and medium enterprises using rates adopted in the European Union; to decrease the NBU discount rate;
• Introduction of tax incentives for strategic investors, innovative companies and long-term infrastructure projects, incentives for businesses that actually create new working places;
• Currency liberalization, removal of restrictions on the free movement of capital;
• Public investment in infrastructure, transport, roads, replacement of fixed assets;
• Creation of favorable conditions to encourage the development of small and medium businesses as the basis for the economic stability of the state;
• A launch of a state program of innovation and IT-market with mandatory state funding, the transition from a resource economy to a large percentage of added values;
• Adoption of the law on compulsory involvement in implementation of infrastructure projects of national experts and companies;
• Development of available government program to stimulate domestic agriculture and livestock;
• Development of state programs to improve labor costs as a prerequisite for more working places and purchasing power;
• Providing liberal environment for the development of industries producing consumer goods for more working places;
• Introduction of programs to encourage businesses through tax mechanisms payroll for young graduates of universities as a necessary condition to minimize the outflow of skilled labor abroad.
As a result, such liberal economic reforms will fundamentally change the structure of the GDP. The share of gross investment in the GDP will increase within 2-3 years from the current 11-14% to 30%. Investment in the economy multiplicatively leads to the GDP growth, creation of new working places, new industries. Ukrainian economy will be transformed into innovative.
Press service of the European Party of Ukraine