[ad_1]
The author is a colleague at the American Enterprise Institute, tank-tank
Russia moved about 100,000 troops to its border with Ukraine, a major concern for the Ukrainian people and the Nato members in particular. The threat of invasion is the biggest concern, but Russia should not send troops to destroy its southwestern neighbors. The presence of the military is already destroying foreign investors – and it has become a very cruel weapon that Kyiv can do nothing to prevent.
In March 2014, just as Russia had recently invaded Crimea, people in many lands worried that Moscow would launch an all-out attack against neighboring countries. Investors were also anxious, and stock markets plummeted. Now, the financial markets are the same. Since the Russian military became known last month, the Ukrainian hryvnia has depreciated, the value of the Ukrainian dollar bonds has plummeted, and the value of Ukraine’s defense has increased.
In terms of finances, Ukraine is a well-known fact: because of its corrupt history and oligarchic power, it is especially attractive to private investors with high risk risks. Last year, foreign direct investment in Ukraine was bad, while neighboring Poland received all FDI funding more than € 10bn.
For a weak economy like Ukraine’s, the war crisis is a serious problem. Yes, Russian stocks are declining due to fears of war – but Russia’s economy has grown tenfold and could continue to thrive. And while the government of President Volodymyr Zelensky will work to curb corruption and the spread of the oligarchs, it will do nothing to push Russian troops to the border. Neither Nato was able to help the downfall, although allied members are strong in supporting Kyiv.
Sending essential troops to the neighboring border is Russia’s clever strategy, because it is a dangerous trade-off, Russia could also wreak havoc on a country whose economy needs a steady income and foreign exchange. Instead, in order to inflict pain on Ukraine, Russia needs to do more than just keep the troops at bay as they seek to prolong uncertainty, and intensify the simultaneous military action near the border. Russia’s actions are a well-known example of the brutality of the greyzone – a global phenomenon between peaceful relations and conflict.
If Russia wants to weaken Ukraine again there is a lot it can do in economic matters. So why not ask a few Russian oligarchs to think against the hryvnia? Or tossing large sums of money into the pockets of fraudulent officials, thus thwarting Zelensky’s efforts to convince the country that Ukraine is cleaning up its reputation? For a short time, it could spread false rumors that an attack was about to begin. Greyzone critics just have their opinions.
Moscow has a history of greyzone successes against Ukraine. In June 2017, Russia NotPetya Cyber attack hit hospitals, electronics companies, two airports, twelve banks, card payment systems and the government. The ensuing turmoil caused public concern and loss of trust among investors around the world.
Obviously, economic freedom fighters in Ukraine and beyond can turn to Moscow, shorten the shares of Russian companies or bet heavily against the ruble.
Currently, Kyiv is at risk for investors and shareholders who have no national responsibility. If they want to seize their money from the world, or think against its finances, or think it will not change, they can. And the more Ukraine’s economy deteriorates, the greater its chances of becoming a EU member remain. Russian President Vladimir Putin could not have expected such a positive outcome. Who said the soldiers needed to cross the border?
[ad_2]
Source link
