Ukrainian Vodka

My friends always ask me what is the best Ukrainian vodka?  I am not an expert. But these two that you can see on the following picture are pretty good.
On the left-hand side of the picture,  you can see Zoloto Polubotka (Polubotka's Gold) vodka. It's made in Lviv. It's pretty pricey because it contains golden flakes in the bottle. Basically, it looks like the Goldschlager schnapps liqueur. But it's still vodka.
On the right-hand side of the picture, you can see Nemiroff Medova z Pertzem (Honey-based with Pepper). Nemiroff is a world-known brand of vodka so it's pretty easy to find it here in European/Russian deli stores. The honey-based Nemirroff with red hot chili peppers has a yellow color because the vodka is infused with honey. It also has a sweet and spicy taste because of both honey and red hot chili peppers. Nemiroff vodka is made in a small town of Nemiroff in Vinitsa province.
Both brands of vodka are from the Western Ukraine. I don't have an explanation for this spatial pattern. And on the final note I have to say that both companies avoid classifying their brands as vodka. The Polubotka's Gold is actually horilka (Ukrainian word for vodka). The Nemiroff considers its vodka a liqueur. As I recall, Poland as the EU members filed a request to patent the vodka brand as a hard liqueur made from potatoes. Since both Ukrainian companies don't use potatoes to make their vodka, these companies can't use the term vodka.


Happy Thanksgiving!

 

Lviv, Lvov, and Lemberg

I always mention Lviv every year when we celebrate Ludwig Von Mises' birthday. Mises who is a famous economist, political philosopher, historian, and social scientists was born in the Jewish family in Lemberg, Galicia province, the Austro-Hungarian Empire. Now, Lemberg is know as .... Lviv, Ukraine. During the Soviet regime Lemberg became Lvov. And now it's finally Lviv.
Anyways, here are very beautiful pictures of Lviv. You should check it out (ht to Roman Skaskiw). You should also follow Roman in Ukraine blog. Roman is an American journalist of Ukrainian origin traveling in Ukraine.

Admin Resource

Administrative resource or admin resource is what Ukrainians say when they refer to government's abuse of power. I had a blog post about how the Yanukovych administration rigged the 2012 parliamentary elections using their admin resource to affect election results in hospitals, prisons, armies, public schools, and the rest of the public sector. Now I can show cool data from NGO Maidan. The following charts show that public support of the Party of Regions and voter turnouts are shooting through the roof at the special polling stations like hospitals and prisons. Basically, if you don't know how it's done, you must see that mainly sick people and prisoners support the Party of Regions.

Even China Can't Handle Ukraine

Here is a very interesting story. Chinese businessmen wanted to build a factory in Ukraine. They spent about a year on filling paperwork, getting permits, and bribing government officials. I assume that they have to do the same in China so that their learning curve is pretty insignificant. Then Chinese businessmen told their Ukrainian partners that they need to put their project on hold for couple months. Couple months turned in a full year. When Ukrainian partners contacted their Chinese partners about a status of their joint venture, Chinese partners said that they just finished building the same factory in China. So you can build a factory in China in less time than it takes you to get a permit to build a factory in Ukraine. I knew that Ukrainian bureaucracy is terrible. Now I know how terrible it is to do business in Ukraine for foreign investors. Unfortunately, the story is literally told by the book. Here is the book - the Mystery of Capital by Hernando de Soto. Ukraine's economy must have a significant issue of the dead capital. Many businesses cannot work legally in Ukraine because of extraordinary corruption and bureaucratic red tape.  

So what's happening to the net foreign direct investment (henceforth, FDI) in Ukraine?  The following graph shows that the FDI dropped from a 9-percent to 5-percent share of Ukraine's GDP between 2005 and 2010. You can also see that Ukrainians who work overseas transfer back to their families or friends the amount of dollars that is almost equal to the amount of the net foreign direct investments between 2009 and 2010.

It's also interesting to see how foreign direct investments and international remittances behave during the economic downturn (2007-2009). While the net FDI dropped from 7 to 4 percent share of GDP, the international remittances increased from 3 to 4 percent share of GDP. Please, keep in mind that 1 percent of Ukraine's GDP is $1,3 billion. So the one-percent increase of the personal money transfers is a pretty large raw figure. That's the case when percentage is not impressive as much as raw figure is itself.

You can also see that the amount of the net FDI and international remittances are different from their benchmarks under the Yushchenko presidency and the Yanukovych presidency. Of course, we cannot really compare averages with a single year observation. Let's just agree that the net FDI jumped from 2.6% to 9.1% after the 2004 Orange Revolution when President Yushchenko and Prime-minister Tymoshenko came to power. Since then the net FDI has had a declining trend.