IMF Loans to Ukraine: Deadly “Economic Medicine” Aimed at Total Destabilization
Global Research, February 17, 2015
Url of this article:
http://www.globalresearch.ca/imf-loans-to-ukraine-deadly-economic-medicine-aimed-at-total-destabilization/5431677
http://www.globalresearch.ca/imf-loans-to-ukraine-deadly-economic-medicine-aimed-at-total-destabilization/5431677
On
February 12, Christine Lagarde, Managing Director of the International
Monetary Fund, announced that the IMF had reached an agreement with the
Ukrainian government on a new economic reform program. Ms Lagarde’s
statement, made in Brussels, came only minutes after peace negotiations
between the heads of the German, French, Russian und Ukrainian
governments in Minsk, Belarus, had ended. The timing was no coincidence.
Washington had been left out of the negotiations and now reacted by
sending its most powerful financial organization to the forefront in
order to deliver a clear message to the world: that the US will not
loosen its grip on the Ukraine, if not by sending weapons, then at least
economically and financially.
Mme
Lagarde’s assertions that the program would support immediate economic
stabilization“ and spell a turning point for the Ukraine“ are as far
removed from reality as the main stream media’s depiction of the IMF as
an aid organization helping a drowning country to survive in times of
trouble. Not a single cent of the loans will go to the Ukrainian working
people. Instead, the money will be used to prop up the Yatseniuk
government which is totally subservient to US interests, and enable it
to service the debts incurred by its predecessors in the aftermath of
the financial crisis of 2008, to pay off most of its military expenses
of around $ 250 million per month for the continuation of a war against
its own population and to fill at least some holes in the state budget
which are due to the country’s ongoing economic deterioration.
The
loans will be based on the terms of an economic program for Ukraine for
2015 2020, passed by the Kiev parliament in December 2014, and are
tied to harsh conditions laid down in a letter of intent, signed by
prime minister Yatseniuk and president Poroshenko in August 2014. Some
of the measures have already been implemented, others will follow. Among
those already in force is the flexible exchange rate regime which has
not only led to a 67% devaluation of the hrivna, lowering the average
monthly wage of Ukrainian workers to less than $ 60, but has also opened
the doors for international currency speculators who have already made
millions by indebting themselves in hrivnia and repaying their debts in
euros and dollars.
The
rate of inflation, running at 25 % in 2014 and expected to rise even
higher in 2015, and a hike in gas prices by 50 % in May 2014 made
survival almost impossible for the weakest 20 % of the population who
already lived below the poverty line in 2013. Among the measures still
to come are the layoff of 10 % of the country’s public employees and the
partial privatization of health care and education. The retirement age
for women is to be raised by 10 years, that for men by 5 years, most
benefits for old age pensioners are to be abolished, the pharmaceuticals
market is to be deregulated. Retirement pensions will be frozen, and
there will be no more free lunches for school children and patients in
hospitals. Benefits for victims of the 1986 nuclear disaster in
Chernobyl are to be cut, and the boundaries of the officially designated
radioactive hazard zone will be revised. The country’s monthly minimum
wage is to remain at 1,218.00 hrivna ($ 46 at the current rate of
exchange) until at least November 2015.
None
of these measures will serve to improve the living standards for the
Ukrainian people“, as cynically predicted by Ms Lagarde. Nor will they
restore robust growth“ in an economy which is teetering on the verge of
collapse, with a central bank left with only $ 6 billion in currency
reserves and incapable of raising new fundi
ng
in foreign exchange auctions. However, they will contribute to an
intensification of the suffering of the Ukrainian people, deepen the
social divide of a country already torn apart by a bloody civil war and
lead to its complete disintegration, nurturing separatist movements and
thus creating perfect conditions for a future of violence and despair.
In
pursuing this strategy, the IMF is totally in line with the
geopolitical policies pursued by Wall Street and the government in
Washington. Both are in deep trouble, with the US torn apart by
ever-increasing social inequality threatening to explode in massive
social unrest, while its rulers are drowning in debt and losing control
over the world financial system. Having dominated global markets for
seven decades, the United States’ economic decline and a shift in global
power are ringing in the end of the US dollar as the world’s reserve
currency and thereby heralding the end of the US’s status as the world’s
super power.
In
a reckless attempt to stop this unstoppable process, Wall Street and
the White House are waging an extremely aggressive campaign against
Russia and China who have dared to complete an energy deal outside the
petro-dollar and whom the US fear to be preparing a new, possibly
gold-backed, currency that might replace the US dollar as the world’s
reserve currency. To prevent this from happening and to gain control of
the vast natural riches of Russia which promise enormous profits, Wall
Street and the White House are pursuing a strategy of regime change in
Moscow, undertaking everything possible to replace the Russian
government by one that is as subservient to US interests as that of
Ukrainian premier Yatseniuk and his investment banker cronies in
Kiev.One of the means to this end is the integration of Ukraine into
NATO in order to step up the military threat against Russia. However, as
the EU and Germany in particular do not seem to be willing to join
forces in an all-out war against Russia (not out of humanitarian
considerations, but because of their dependency on Russian gas and oil
and their anticipation of a new monetary world order no longer dominated
by the US) and as the majority of Americans, despite a massive media
campaign demonizing Vladimir Putin, are unwilling to support a war that
would cost more money and more lives than any war in the past and could
end up in a nuclear catastrophe, the US government’s and the IMF’s main
purpose in Ukraine is to deepen and widen the already existing economic,
social and ethnic conflicts. By doing so, they hope to force Vladimir
Putin into a long-lasting and costly war that will weaken his position
at home and eventually pave the way for the installation of new rulers
in Moscow.
Looking
at Ukraine as a part of the present geopolitical struggle, one can see
that the IMF’s new loans to Ukraine, announced by Christine Lagarde, are
anything but a turning point“ signalling the country’s stabilization.
They will lead to unspeakable human suffering and contribute to the
trail of blood which Ms Lagarde and the IMF are so used to leaving
behind after intervening under the pretext of helping“ countries in
times of trouble.
Ernst Wolff
is a freelance journalist and the author of the book “Pillaging the
World. The History and Politics of the IMF”, published by Tectum Verlag,
Germany.
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