Touring Ukraine’s Economy – Day 1 Kharkiv

In Kyiv it’s obvious the global economic and financial crisis has hit Ukraine. But what’s happening out there in other Ukrainian cities? It’s been six months since my last business trips to our regional dealers, and even those were short, flight in the morning, meeting, flight back in the evening type trips. This time I travel by car starting with Kharkiv, then Donetsk, Dnipropetrovsk, and Odesa staying one night in each city. I estimate 2000 km in total. My goal is to get a top-level, quick feel for how these Oblast centers are faring.

My borrowed navigation system (thanks ROK), insists on calling Kharkiv Charcow. The female voice calmly instructs me: “Continue straight 466 km and turn right, in Char Cow”.



There are noticeably less trucks on the road than I remember from prior road trips. Less consumption, less manufacturing, less shipping, less cargo on the roads of Ukraine. Exiting the city of Borispil, I find myself surrounded by empty billboards on both sides of the road. This goes on for a couple of kilometers. Sporadically, amid the looming grey boards are new Party of Regions billboards: “Enough noise (halas?)…let’s get to work” and other such doosies along with one aged independence day greeting from President Yushchenko, the kind with his signature scrawled across it.

Dozens of small towns (selos) appear and disappear. Yellow gas lines thread their way across the otherwise picturesque snow covered cottages. A bundled up babushka sits on a stool by the side of the road in front of a bucket of potatoes and bucket of carrots. Same as during boom times. These villages have many problems, sub-prime loans are not among them.

Poltava. I become melancholy on the approach to Poltava. I wonder what it was like in these fields in the Summer of 1709. The masses of Swedish and Russian infantry, cavalry, and artillery advancing in long lines to gruesome deaths. Nine thousand soldiers lost their lives in these fields now traversed by the Kyiv-Kharkiv road. The Swedish dead were buried where they fell, the Russians buried their dead in a mohyla – which, oddly, today bears the name “Swedish Mohyla”. I imagine the Zaporizhian Cossack contingent joining ranks with the Swedes with the dream of ridding their land of the Russian yoke only to find themselves up against Cossacks of other orders fighting for the other side. I contemplate this as I walk into Poltava McDonald’s for a coffee. 300 years of progress and we’ve made it from muskets to McNuggets.

Scenes from Poltava McDonald's:




The recently built McDonald’s was done in that new McD’s style like the one I saw in Berlin. Poltava has the coolest McDonald’s I’ve ever seen. Try it. Regarding the economy? The parking lot was full and there were lines at the cash register.

In Kharkiv there is no construction work being done on any of the construction sites I pass. Cranes and back hoes are motionless. Car dealerships are open, but visitor parking lots are empty and there are no people in the showrooms. Shopping mall lots are full.

I meet our dealer and embark on an eight hour marathon of second-hand smoke inhalation and increasingly belligerent Russian language and spirited laughter. The restaurant is empty except for us. I witness him work his two phones continuously, at times simultaneously, with one on each ear, cigarette dangling from his mouth working deals, negotiating.

“Are you nuts? For that kind of money I can buy half of Kharkiv right now. Call me when you are ready to talk.”

Laughter. The general topic of conversation is how everyone has stopped spending money and is waiting for something to change. There is no credit money. Banks are failing. Then on to a conversation about the Tax inspectors, corrupt local politicians and so on. I felt like I had traveled back in time to 1995 Ukraine.

The night ends outside the hotel. He leaps out of the car to say goodnight, lights another Marlboro. I look up and see a clear, star filled winter sky. I am happy to be breathing fresh air. After a pause, he becomes melancholy and issues a final lament about the Hryvnia:

“If only they devalued it once. Let it devalue as much as it has to, but do it once. Then at least we can start from there. These sporadic devaluations keep us in a continuous feeling of anarchy. What will we do Petro? What will we do?”

Then he erupts into laughter, hugs me violently, and zooms off into the distance in his 140k EUR imported car.