Coal Industry Restructuring in Ukraine : The Politics of Coal Mining and Budget Crises
Restructuring Ukraine's coal industry has been even more difficult and politicized than reforming its electricity and gas industries. Coal reform has divided Parliament and the government into two camps - one supporting populist policies and the other supporting fiscal realism - and the balance of power between these camps has changed frequently. Despite mounting financial losses, coal miners and managers have blocked attempts to rationalize production and employment practices. The government has, however, managed to close several highly uneconomic mines. Speeding up mine closures seems to be the only way to arrest the accumulation of payment arrears - nearly US$4billion (including wages) by mid-1998 -- and of payments due for coal supplies - more than US$1.5billion by mid-1998.
Summary: | Restructuring Ukraine's coal
industry has been even more difficult and politicized than
reforming its electricity and gas industries. Coal reform
has divided Parliament and the government into two camps -
one supporting populist policies and the other supporting
fiscal realism - and the balance of power between these
camps has changed frequently. Despite mounting financial
losses, coal miners and managers have blocked attempts to
rationalize production and employment practices. The
government has, however, managed to close several highly
uneconomic mines. Speeding up mine closures seems to be the
only way to arrest the accumulation of payment arrears -
nearly US$4billion (including wages) by mid-1998 -- and of
payments due for coal supplies - more than US$1.5billion by mid-1998. |
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