To do list for Ukrainian president

Today FT publishes an article Daunting task ahead of poll winner which briefly highlights the tasks ahead of the new Ukraine's president. As the election day comes closer the thoughts of the public get directed into the "checklists" for the new head of state.

Here is the list according to FT (with minor comments from UR):

1) Renew IMF aid package for Ukraine, which means undertaking two unpopular tasks - cutting budget and increasing gas price. As of now both candidates are uneasy saying what they going to do if elected.

2)  Paying monthly gas bill to Russia.

3) Investment climate improvement. Ukraines business climate is notoriously bad and improving it is a first priority. At least stabilizing politics will greatly help.

4) Reforming pension system.

5) Seek new growth sources to overcome economy's high dependence on export-oriented sectors, such as steel and chemical industries.

6) Improving public services and infrastructure.

7) Fighting corruption.

There is no point in arguing with this list - it is all true. As it was just 5 years ago (take away the IMF program and the gas bill). The trick in Ukraine is not the lack of knowledge of what needs to be done - most of things are well explained in numerous reports - but the ability to implement the necessary actions. To do that the new president will have to work on the foremost issue - making the state machine able to get things done, preferably according to a mid-term plan.

Ukrainian Railways - another struggling state giant

Prime Minister Julia Tymoshenko promises increasing railway tariffs for passengers to help struggling Ukrainian Railways (UR). Tymoshenko also said that there will be no privatization of railways. Strategic plans to reform UR have long been on the table, but once cross-subsidization of passanger traffic by industrial tariffs was working nobody cared. Currently, industry is no able to cover the rift in tariffs and cost for passenger transportation and UR is struggling on the brink and starts to miss on external debt payments, just as it did with USD 110 mln that it had but failed to transfer to Barclays earlier this year. It is forecasted that with UAH 38 bn of income there will be UAH 9 bn losses for the UR in 2009.

Cabinet of Ministers adopted 16 decisions on reforming Ukrainian railways by 2011. Quality of this reform should be further evaluated, but it is expected that there will be no speedy improvement in the UR situation. The program of reforms does not require corporatization of UR as the first step - a step long ago requested by donors and creditors of UR. It is likely that UR is on the road of becoming another Naftogaz in the portfolio of state assets.

Civil society prays for reforms in Ukraine

For a number of years international organizations present in Ukraine and civil society organizations work on publishing lists of systemic reforms that Ukraine needs. There are a number of documents that has been published already, e.g. coalition agreement drafts, Blue Ribbon Commission reports etc.

Coming presidential elections just as previous rounds of elections spur the activity of the independent think-tanks in reform writing exercises. Another report called Modernization of Ukraine has come out authored by a coalition of think-tanks under George Soros Foundation (IRF) in Ukraine. Quality of the report leaves a lot to be desired with some parts better than the others.

The report just repeats numerous previously issued lists of reforms. Authorities in Ukraine pay little attention to these voluminous documents, provided the issues raised come out just before elections and are never persistently kept up on the agenda afterwards.

EU and US grow tired of Ukraine

Ukraine fatigue spreads among Ukraine's Western partners in Europe and in the US. Economist publishes an article basically saying that US will not endanger its "reload" of relations with Russia, which basically means Ukraine will not be in the Washington's eye that much anymore.

EU in its turn, as the article in Telegraph says, is losing patience with Ukraine. For some strange reason European officials don't like that Ukrain doesn't move with reforms and finances with electoral promises with international money.

Ukraine is a difficult partner to deal with lately, especially with elections coming up. Hopefully things will change after the president is elected and local and national parliamentary elections are done.