Prime Minister Leonid Kuchma, newly emerged from a month-long power struggle, has proposed emergency measures to save Ukraine's economy from collapse 18 months after independence from Moscow.
His main adviser, Viktor Pynzenyk, first deputy prime minister, said the government had no money to satisfy all the concessions made to coal miners to end their 12-day strike.Mr. Kuchma, in an address to Parliament on Wednesday, proposed tougher restrictions on money supply, faster privatization, tax advantages for industry and incentives to attract foreign investors.
Mr. Kuchma has been embroiled for the past month in a battle with President Leonid Kravchuk for control of the government, and has twice threatened to resign.
He proposed strict controls on issuing money, closure of loss-making factories, a negotiated moratorium with Russia on fuel prices and a campaign to secure foreign credits for energy purchases.
Mr. Pynzenyk told Parliament recent price and wage increases, including concessions made to miners, had caused a threefold jump in money supply in the last quarter.
Some simply could not be implemented, including indexing of wages and increased subsidies, he said. "If we continue to print money at this rate, we shall have to charter a special aircraft to bring in the bank notes," he said.
The concessions were made by government officials who persuaded east Ukraine miners to end a strike that threatened to shut down Ukraine's heavy industry. About 40 mines in the area were still on strike pending implementation of the agreement.
Two conservative ministers appointed to end the strike have since called for greater state subsidy to industry and big increases in the monthly minimum wage.
Mr. Kuchma was appointed last October to introduce market reforms after a year of inaction following the collapse of the Soviet Union.
His success in reining in a huge budget deficit and bringing down monthly inflation of 50 percent has been limited and he has met consistent resistance in the Parliament.
Mr. Kuchma's plan was submitted to parliamentary commissions for study but even radical and liberal deputies were skeptical about implementing it.
"Kuchma's team has been demoralized by the power struggle and this Parliament will not allow them to do anything," Liberal leader Volodymyr Filenko told Reuters.