Paul Gregory is a research fellow at the Hoover Institution. He is Cullen Professor Emeritus in the Department of Economics at the University of Houston, a research fellow at the German Institute for Economic Research in Berlin, and emeritus chair of the International Advisory Board of the Kiev School of Economics. Gregory has held visiting teaching appointments at Moscow State University and the Free University of Berlin.
1. Ukraine has had all prerequisites for economic growth (e.g., people’s capital, abundant natural resources, strong science research base) and was ahead of many Eastern European nations after the collapse of the Soviet Union in 1991. Why our political elites have failed so badly to transform our country into a prosperous one in almost three decades?
Ukraine’s grow from 1990 to 2004 was typical for an FSU (Former Soviet Union) country. There was negative growth in the 1990s, which was followed by more robust growth in 2000-2008. Then it was also struck by the world’s financial crisis in 2008 and underwent a period of gradual recovery up to 2014-2015 when the Donbas War unfolded in Ukraine. Since that time, Ukraine has been slowly recovering. Currently, Russian incursion is a significant factor affecting the Ukrainian economy. Also, Ukraine has to deal with the rule of law, corruption, and other matters before it can grow at higher rates, such as 10 percent per annum.
2. What is your opinion on the newly elected President Zelensky and his team? Is there a possibility for effective reforms implementation with the newly formed government in Ukraine, and what obstacles can prevent it from doing so?
There is some optimism because of a new team. However, it is going to be very hard to beat corruption because corrupt people have the means to buy off reformers.
How can Ukrainians make politicians and the bureaucracy more accountable? Do you think there has been any substantial progress in this direction since 2014?
Ukraine has been under a lot of international pressure, but vested interests are hard to beat. Also, it is hard to tell who is corrupt and who is not.
Is the Detente between Ukraine and Russia possible or there is a long way to go before a stable peace Ukraine can be reached? What do you think about the recent developments regarding the Donbas region?
I am pessimistic about it, and there is still a long way to go. Russia will not allow an independent DPR and LPR. It is aiming to give DPR and LPR veto rights upon their return to Ukraine. Such a situation would mean Ukraine under Russian domination. Europe, I fear, is not sensitive to this danger.
What do you think about the current official country’s stance on Crimea? What be additional steps taken to ensure its gradual return to Ukraine?
The most important thing is to keep Europe and the UN finding that Crimea is an occupied territory. Ukraine has to fight constant battles such as maps showing Crimea as a part of Russia. Also, Ukraine has potent human rights arguments. I predict Crimea will not return to Ukraine. Maybe Ukraine should negotiate its return for a large payment.
What risks to Ukraine statehood do see right now? Do you think Ukraine is successfully combating Russia’s hybrid war techniques? What can our country still improve to combat that?
I think Ukraine is becoming pretty good at combating hybrid warfare. Ukraine pulled off a minor miracle in its presidential and parliamentary elections. Ukraine should join regional alliances (like with Poland and the Baltic States) to fight Russian hybrid warfare.