Richmond, Va.
Sunday, Nov. 23, 2014

Professor participates in reform advisory group in Ukraine days before prime minister resigns

Thursday, July 24, 2014

Oleg Korenok, Ph.D., is no stranger to the turmoil in Ukraine, having recently helped create a proposal for a National Council for Reforms in his native country during a government-sponsored retreat in the capital city Kyiv held July 19-21.

Korenok, associate professor of economics in the VCU School of Business, was among the public policy experts, Ukrainian government officials, international experts and think-tank representatives who took part in the three-day event, which was titled “Ukraine: A Strategy for Reforms.” The event took place just days before Prime Minister Arseniy Yatsenyuk and his cabinet announced their resignation on July 24.

“By law, the prime minister had to resign,” Korenok said. “He is also frustrated that unpopular — but necessary — laws were not passed by the parliament that is thinking about reelection instead of the good of the country.”But, Korenok said, the prime minister’s resignation may not negatively affect the work and proposals put forth during this weekend’s reform retreat.

“I think there is a good chance that National Reform Council will survive,” he said. “It was mainly driven by presidential administration which is staying. Also, after parliamentary elections there is going to be a new government. Finally, I think there is a good chance that prime minister will remain in his role until parliament reelection.”

Korenok, who says he is increasingly interested in reaching out beyond academia, attended the reform retreat to help his native country.

“There is a war in Ukraine,” he said. “I am not a [member of the] military by training so I can't help much there. I wanted to help at least with something.”

“Dr. Korenok's appointment to the advisory group is an honor that reflects the quality of his intellect and his scholarship,” said Carol Scotese, Ph.D., chair of the VCU Department of Economics. “He has considerable expertise in macroeconomic issues broadly and inflation in particular. His economic expertise combined with his native knowledge of the Ukrainian situation makes him ideally suited to help formulate pertinent reforms."

Organizers hoped the retreat would help the nation reach a comprehensive reform program based on principles, vision, priorities and methodology collectively agreed upon. Attendees participated in both general panel discussions and breakout round-table discussions.

“Ukraine needs a lot of changes,” Korenok said. “If there are many options it is always good to have some priorities and to see how different reforms connect to each other.”

Korenok participated in the monetary and fiscal policy group, which proposed:

°  Abandoning effective fixed exchange rate policy.
°  Slowing transition to inflation targeting.
°  Emphasizing the importance of administrative reform by cutting number of government employees and increasing their pay roughly in line with private wages.
°  Emphasizing the importance of transparency and availability of key economic statistics so that civil society and experts would be able to control the government.
°  Simplifying taxes possibly all the way to one flat tax rate, improving administration of taxes, emphasizing taxes that government withholds..

While the long-term outcome of the retreat has yet to be determined, on Wednesday, Ukraine President Petro Poroshenko issued a decree creating the National Council for Reforms.

“We discussed creation of such a council during the retreat but I had no idea it would be that fast,” Korenok said.

 

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Oleg Korenok, Ph.D.