George Soros on Ukraine’s financial strategy for an economic win

Ukraine has been experiencing a difficult financial turmoil with regard to debts. To date, the country has been seeking for financial support from different institutions such as the International Monetary Fund on wsj.com. The IMF has however demanded that the country should enter into negotiations with creditors so that it get assistance. Ukraine has a foreign debt that totals to $19 billion. The amount has become unsustainable after the recent Russian aggression that deal a lot of damage to the country’s economy. George Soros has written several publications to find solutions for Ukraine. He regrets that Ukraine has not yet had its remedy to bankruptcy. The country has no sovereign borrower policy to cool down fights between lenders and borrowers. Additionally, the country doesn’t have enough powers to decide the types of debts it wants reconsidered.

Soros has argued that Ukraine’s solutions lies in creating a default unless it is successfully guaranteed a debt relief. According to George, bondholders ought to be willing to warn Ukraine regarding of defaults. No investor is going to be interested in investing in the country in future. Such sovereign debts have their long term effects. It becomes even more pronounced when these lenders put themselves out of the battle. The effect is that all possible lenders pull out financial aid and the country experience a financial crisis as that experienced in Greek. George agrees that when lenders can get to a speedy deal, the country will get back to its position within a year. He adds that a default never locks out a country from financial markets. It is however economic problems arising from the default that lock the country outside financial markets.

Read more: Ukraine Deserves Debt Relief

George Soros is a wise investor and clearly understands how the economy plays out. He knows that Ukraine can repay all its financial aid once its economy is stabilized. He knows that the current problems experienced by the country are nothing but temporary. He adds that what has happened in Ukraine is nothing but a historical lesson. The European Union too may be faced by a resurgent Russia which may soon turn from being a partner to becoming a rival. Apart from getting financial aid, the European Union also ought to provide technical assistance to Ukraine. The reforms are going to be radical if this happens.

George Soros has made billions of cash as a simple financial market speculator. The 86-year old has amassed tons of wealth and has financed liberal causes. He has hugely supported millions of migrants that are flowing into Europe. Soros himself was born in Hungary to a Jewish family and later had his education in Britain. He moved to the United States at a very young age where he founded his hedge fund. Throughout the years, he has proven to be a leading investor in the world. George has since been passionate about reforms in the EU and Ukraine. In 2015, he formulated a strategy that should guide Ukraine on its reformation procession. The strategy was title the Ukraine Win Strategy.