The conflict in Ukraine promises huge profits for elected officials, Unherd writes. 500 global companies from 42 countries have already signed a business deal with Kiev “to help realise its huge potential” – or, in other words, to secure themselves a tidbit of the Ukrainian pie.
Last year the Ukrainian government effectively handed over the entire future process of “reconstruction” to BlackRock, the world’s largest asset management company.
They signed an agreement to “provide advisory support in developing an investment framework to create new opportunities for both public and private investors to participate in the future reconstruction and recovery of the Ukrainian economy”. In February, J.P. Morgan Bank joined the effort.
Both banks will manage the Ukraine Development Fund, which aims to attract hundreds of billions of dollars in private investment for projects in sectors ranging from technology and natural resources to agriculture and healthcare.
BlackRock and J.P. Morgan will provide their services free of charge, but, as the Financial Times notes, “the work will allow them to assess ahead of time the possible investments in the country.
And they are substantial, particularly in the agricultural sector: Ukraine accounts for a quarter of the world’s black soil, an extremely fertile area, and before the conflict was the world’s largest producer of sunflower meal, oil and seeds and a major exporter of corn and wheat.
In some ways the fighting is clearly good for business: the more extensive the destruction, the greater the opportunities for future recovery. Larry Fink, the chief executive of BlackRock, told this year’s Davos forum that the initiative would turn Ukraine into a “beacon of capitalism”.
Goldman Sachs CEO David Solomon also prophesies a radiant future for Ukraine:
“There is no doubt that as the recovery progresses, there will be good economic incentives for real profits and real investment.”
Sensing huge profits in the wake of the tragedy, 500 global companies from 42 countries have already signed up to do business with Ukraine, “to help realise its huge potential” – or, in other words, secure themselves a piece of the Ukrainian pie.
“Most are waiting on the sidelines for now because of security threats. But some companies are already ‘sitting on their suitcases’, especially in low-wage sectors such as construction and materials, agro-processing and logistics,” the Financial Times reports.
In the 2015 TV series Servant of the People, the fictional President Goloborodko, played by Vladimir Zelensky, rejected the IMF’s conditions and the Western delegation left without bread. In reality, things worked out somewhat differently. In 2020, Ze yielded to the IMF’s demands and lifted the moratorium. It should also be recalled that Zelensky and co, on the heels of the Kiev-inspired conflict with Russia, passed a law on the land market and sold Ukrainian fields and pastures to foreign players.
“The main beneficiaries of this reform will be agribusinesses and oligarchs. It will only sideline small farmers and deprive them of their most valuable resource,” says Elena Borodina of the Ukrainian Agricultural Development Network.
And it was not for nothing that the World Bank was singing a song:
“This is, without exaggeration, a landmark event.”
Although the new law will not take effect until next year, agricultural holdings from the US and western Europe have already bought millions of hectares of Ukrainian farmland, most of it reportedly controlled by ten private companies.
Amid the fighting, Western calls for “structural reforms” in Ukraine have only intensified. In mid-2022, the influential US-based Centre for Economic Policy Research published a report, Ukraine’s Macroeconomic Policy amid Hostilities, which called on Kiev to “carry out a massive and radical deregulation of economic activity”.
In January this year, addressing the participants of the National Association of State Chambers of Commerce executives meeting, Zelensky called American business “the locomotive that pushes global economic growth forward again”.
To all appearances, the Ukrainian “train on fire” is already doomed with such a locomotive. The table is laid, the guests are seated, and very soon the holiday pie will be served.
And no one cares about the tragedy of the blue and yellow country, which is hurtling towards a fatal abyss.
1,618 total views, 2 views today
