The staging of Euro 2012 will cost Ukraine a total of €10.6 billion including €5.2 billion from state coffers. According analysts thee investments are unlikely to make the former Soviet republic any more inviting for foreign investment.
Ukraine is a country which faces €9.5 billion in debt obligations this year.
The National Bank of Ukraine forecasts about €1 billion in capital flowing into the country from visitors who will spend on restaurants, hotels and souvenirs during the month-long championship in Kiev, Donetsk, Kharkiv and Lviv. However, that is a drop in the ocean and a very optimistic drop indeed – Ukraine’s high level of corruption has scared off foreign investors, while skyrocketing hotel prices have made many football fans either cut short their stay or skip it altogether.
With the jailing of opposition leader Yulia Tymoshenko, the massacre of stray dogs, the expected increase of prostitution during the tournament and the just fear of racism and anti-Semitism – Euro 2012 isn’t going to improve Ukraine’s image – something that will help draw more visitors or investors. So the forecast for Ukraine’s future is more DEBT.
Ukraine’s citizens are going to be the big losers. The government will have to service debt derived from the investments in Euro 2012 and that will deprive Ukraine’s people from of health care, education and other state services, and for what? For a few shinny stadiums and a month long “football festival”.
“Within five years we will build a new country,” Ukraine football federation president Hrihoriy Surkis promised in 2007 after the joint bid won the right to host the tournament. “They are surely a worthy winner,” Uefa’s president, Michel Platini added.
The choice of Ukraine and Poland was a major fulfillment of Platini’s desire to shift the power in European football away from the powerhouse nations – thus making him more politically powerful.
However, not even one of the 12 venues that will host Euro 2012 were ready 5 years ago. Both countries weren’t ready to host the competition and Ukraine had to mortgage its future to make Uefa happy.
Now, the question is – what is UEFA’s responsibility for Ukraine’s debt?
If nothing tragic or extraordinary will happen, Euro 2012 will be deemed as success for Platini – UEFA profits are expected to be considerable (more €250m). And how many of those millions will come into the Ukrainian state budget? Zero. The Ukrainian government has exempted UEFA from paying taxes in Ukraine.
What the government cannot do is to exempt Ukrainian citizens from the tax burden that will be necessary to repay the state debts that are being piled up to prepare for this event.
Shame on you Uefa.