Economics, Politics & Business

Poverty is widespread, we are told.  Ukraine is one of the poorest countries in Europe.  Yet, it is not at all obvious.  Many people dress well; generally they dress like anywhere else in Europe or America.  In the cities, even those with little to spare seem to take great pride in their appearance.  The drabness of life here really jumps out though when one sees inside a typical apartment in one of the Soviet-style buildings that most people live in.  One typical apartment we see has perhaps 400 square feet in total, consisting of a bedroom, living room, kitchen and a minute bathroom.  The appointments are dirt-cheap. The kitchen sink doubles as a bathroom basin.  The living room has a simple couch, one easy chair and a table that seats 3-4.  

For a hard currency tourist, prices are spectacularly low – a beer costs $0.20, an excellent meal in a top restaurant for two costs $30.  A business acquaintance told us he pays $20 per month for his apartment in downtown Kiev.  However, for the hard-pressed Ukrainians, many of whom are unemployed or even those lucky enough to have jobs with unbelievably low salaries, life is hard indeed.  The country is an economic basket case – being the third largest recipient of US aid.  Sadly, we encounter many beggars, mainly old women, who beg for kopeks or spend time searching through garbage cans.

Business loans are available to small businesses at 65% interest, hardly an incentive to jump start entrepreneurs out of the formerly state-owned businesses.  Bureaucracy and corruption is endemic and business people cannot rely on the rule of law for protection.  Consequently there is minimal interest on the part of foreign investors.  Our taxi driver points out the police chief of one city driving a large Mercedes one Sunday.  The new American-trained prime minister offers some hope for the future although the president is still of the old communist school.  One foreign company that appears ubiquitous and successful is McDonalds.  Sometimes the juxtaposition of old and new is ironic - see picture at left - Also, Gillette is active in the country.

There is a monumental shortage of energy, caused by lack of foreign exchange to pay for oil.  We see dozens of idle airplanes at the airports and outside of a few downtown streets, people walk around in pitch blackness after dark.  It’s very strange and not a little scary, although I suspect there is far more danger of falling into one of the gigantic pavement potholes than of being mugged.  The telecommunications infrastructure is dreadful beyond belief as people steal the cables to sell recycled copper. 

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