A Second Chance for Abandoned Construction in Ukraine

February 17, 2009

A Second Chance for Abandoned Construction in Ukraine

Kyiv has a long history of abandoned construction, with some objects dating back as far as the beginning of 20th century. However, most of it has accumulated in the city (and throughout the country) within the two last decades. We can find at least several groups here:

1. Unfinished construction from perestroika times – mostly huge administrative buildings that were started in the eighties and abandoned just before or soon after the collapse of the Soviet Union, when public spending on construction was cut off;
2. Buildings that were started after 1995, with the rise of private building companies – mostly apartment blocks – and dropped at different stages of construction for several reasons. The builder may have gone bankrupt or due to frauds with funds collected from individual investors;
3. Construction frozen as a consequence of the current financial crisis and lack of liquidity. This last group includes both residential and commercial real estate.

Fortunately, the Ukrainian language has a word for this phenomenon: dovgobud. Some of these are lucky and eventually get finished; others are forgotten, and in some very rare cases ruined. Dovgobudy in the third category, however, may be getting a second chance. Overall, as for apartment blocks, around 75-80 percent of objects have been put on hold, and as for commercial real estate – it’s close to 30-40 percent. Just before the end of 2008 the Ukrainian Parliament adopted a special law aimed at mitigating the influence of the financial crisis on building construction. The Government will now allocate UAH 3 billion (roughly USD 375 million) to help finish the objects built by at least 70 percent in 2009. Those built by 50-70 percent will be covered by the program in 2010.

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Posted by Nadiya Pustovoytova on February 17, 2009 in Eastern Europe | Permalink
February 13, 2009
World Crisis Index

Intrade, one of the most popular prediction markets out there, has put together a world crisis index that aggregates markets that indicate the probability of recessions, unemployment, falls in the stock market, and the like. The index opened at 50.0 on January 27. Unfortunately, Intrade hasn't published a graph to track the index over time, but as of 2pm GMT today, the index had creeped up to 51.0, meaning that propsects for 2009 have gotten just a little bit worse over the last two weeks.
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Posted by Ryan Hahn on February 13, 2009 in Recession | Permalink
Enforcing Transparency

The financial crisis gave new impetus to demands for more transparency and more accountability. “The global financial crisis [is caused] in part by greed and corruption,” was the announcement last December by the United Nations Secretary General Ban Ki-moon. How to enforce transparency?

There might be a few good ideas to learn from the American experience of setting up a transparency watchdog. These ideas were presented by Walter M. Shaub of the US Office of Government Ethics (OGE), the main speaker at a brown bag lunch at the World Bank last week.

The work of the OGE is focused on prevention. Assets and interests disclosure is the main tool to identify conflicts of interest among government officials. If a conflict of interest is apparent from the declaration, the agency works with the official on resolving such conflict before it creates prejudice. Increasingly complex conflict-of-interest legislation increases the probability of inadvertent violations. The right advice is important - independent from law enforcement bodies and tax authorities, the ethics agency is conscientious of the trust that its clients place in it.

Promoting transparency comes before fighting corruption. It is generally true that a psychological stance of promotion creates acceptance while struggle against something incites resistance. Transparency might be just like healthy food and a healthy lifestyle – it requires steady effort to build up the right habits.


Posted by Larisa Smirnova on February 13, 2009 in Corruption, International organizations | Permalink