According to Viktor Pynzenyk, it is useless to look for the reasons of the current crisis in Russian and Ukrainian economies. The present authorities live day to day, real economic reforms have not yet been launched, and government actions only temporarily postpone the agony of the economy.
According to Pynzenyk, the current situation has inner reasons and was programmed back in 1995. After refraining from emission, the government found a new source to cover the state budget deficit, foreign loans. This would have been fine, if they had used the loans to lay the basis for a domestic market economy. But they simply ate them. According to Pynzenyk, this year Ukraine spent Hr 1.19 billion for debt service, because interest rose from 22% to 70%. And the attempts to find reserves within the country ended up in freezing the bank accounts of enterprises. Being aware of this, foreign investors are unlikely to come.
This is why the Russian collapse only enhances the financial crisis in Ukraine. According to Pynzenyk, the NBU used up 60% of its currency reserves by August 1998 and devaluation was 30%. The only thing that the authorities can do now is to try to calm down the population. If there is panic and a run on bank deposits, the Ukrainian banking system will simply collapse.