Iron ore and rent: all in favor of Metinvest
Trying to describe the strategy of our authorities in curbing the oligarchs, only two words come to mind: dementia and courage. This autumn, the European Commission will evaluate Ukraine’s reforms for EU accession, writes Ukrrudprom. Among other things – efforts to combat the dominance of the oligarchs. What will we show them? Dismantling the remnants of the fiscal system in the interests of Metinvest Akhmetov and Novinsky?
No, seriously. For two years they have been trying to introduce a normal civilized rent for iron ore (which they have not been able to do for 20 years in a row). In the end, to accept a half-hearted, in many moments even a miserable, but still option of real taxation of the production of key Ukrainian raw materials. Well, at least something: “the road will be mastered by the walking one”, “you need to start with something” …
And as a result of all these sufferings, to screw everything up for one vote on January 12, effectively freeing Metinvest from rent, provided that the Ukrainian iron ore raw materials it produces are supplied to its own metallurgical facilities. The stated goal is “to help domestic metallurgists compensate for logistical losses in the export of metallurgical products.”
Pretty weird logic. For three years we were stubbornly explained that the subsoil of Ukraine and what is located there and, accordingly, is mined belongs to the people of Ukraine. Now it turns out that not only is the fair division of the cost of the mined (for reference: a ton of iron ore is now is at its peak and goes to 120 dollars per ton). but even a parody of the taxation of this process is cancelled.
Because it is necessary to support the metallurgical capacities of Metinvest, which were created by the people of Ukraine, but do not belong to them.
This is where the very fine line about the privatization of profits and the nationalization of losses passes. When Metinvest has problems: the Russians destroyed Azovstal and half of Ilyich, it is impossible to send metal products through ports for export, etc., as a result, all this becomes a common grief for the Ukrainian people and the whole world, at the expense of the budget, we begin to help our premature baby ” industrial tiger.
But when, at the end of 2021, Metinvest received $4.7 billion in net profit (precisely because of the record prices for iron ore), for some reason no one shares it with the people of Ukraine. Let’s say more: all “titanic” financial assistance to the Armed Forces of Ukraine in 2022 is limited to 1.5 billion hryvnias. Even with the most complementary assessment option for Metinvest, this is less than 1% of the company’s net profit for 2021. And 99% will go to the completion of the longest yacht in the world (Morning Putin’s nose!) and financing of fanaberies newly elevated to the rank of deacon of the UOC-MP.
Usually here, in the third act, a red-haired asshole in a large checkered suit appears on the stage and begins to soar over a blue eye that he is an ordinary investor, not an oligarch at all, he is for equal rules of the game and the rule of law, and oh how we miss European rules and values. Well, the fact that at the same time he gets into the pocket of every Ukrainian is because of the imperfection of the state system of the country. All in all, there is still a lot to be improved.
But then we have the fourth act, in which the Greek choir from the OP appears on the stage and begins to “sing a song” about the fact that until the end of the war we will not “catch up” with Rinat. The full impression is that Bankova has a massive attack of delirium. Guys, you can’t help but understand the difference between “not pressing him” and covering all his losses (real and imagined) at the first snap of your fingers? Or not?
Just on the day of the vote in parliament on the abolition of the rent for iron ore for Metinvest, a discussion was held on the topic “What is happening with metallurgy?” gathered two lobbyists of this company. So the host of the event was even surprised that the head of Ukrmetallurgprom, Kalenkov, behaved very restrainedly and did not demand, as usual, compensation and preferences for Ukrainian metallurgists (read – Metinvest). And why demand them if they have already taken them to the voting hall “on a silver platter”?
But the second participant in the discussion, Zinchenko from the MMC Center, decided to go all out and mock common sense, saying that there was no monopolization in the domestic mining and metallurgical complex (indeed, it’s not Metinvest that accounts for more than 70% of production Iron ore in Ukraine) and moreover, if it were not for domestic “investors”, then the industry would have been generally a skiff. After all, foreign investment does not go into it.
As an example, the Metinvest lobbyist cited the mockery of the Canadian Black Iron, which has been unsuccessfully trying to build an iron ore mine in the Krivoy Rog region for a decade. True, according to Zinchenko, this is the result of the idiocy of the Ukrainian authorities, whom even Justin Trudeau asked for help, but they, miserable, could not cope. And it is by no means the result of the quiet opposition of those same monopolists (which, as you already remember, are not here).
Of course, economic happiness does not lie in the fact that another gopnik begins to develop the bowels of Ukraine. It’s just another illustration on the theme “Texas should be robbed by Texans.” Moreover, in our penates this rule has slightly mutated. Since the holes in the budget of the warring Ukraine should be plugged by anyone, but not domestic oligarchs.
Thanks to this state of affairs, there is no chance that the European Union will not notice our home-grown prank on January 12th. After all, if Rinat does not pay for the production of Ukrainian iron ore at the moment when the country’s finance minister cries out about an acute shortage of grants and loans, then this naturally falls on the same Brussels. At least partially.
Obviously, this turn of events will make the European commissioners’ jaws drop a little. Instead of the promised struggle with his oligarchs, Vladimir Alexandrovich will eventually kindly offer Europe to finance the jambs of domestic nouveaux riches. So to say, Ukraine welcome to the EU!
As a red-haired asshole in a plaid jacket said the other day: “My interests are democracy, fair courts, anti-corruption policy, competitive economy and Ukraine is a member of the EU“? The latter will obviously have to wait.
Oleg Kalita
