Industrial output in December contracted by 17.9% yoy due to military conflict in Donbas (according to official statistics companies that stopped reporting to Ukrstat (e.g. in the conflict zone) are assumed to have stopped working).
Highlight: State debt - STAT DEBT: CAN THE GOVERNMENT AVOID DEFAULT?
Fiscal vulnerability in Ukraine was growing over recent years. The Government pursued unsustainable increases in social standards, and maintained fixed prices for gas, electricity and heating leading increasingly large energy subsidies. This resulted in high recurrent expenditures, which are difficult to cut during economic recession. The Government also raised short-term funding and had to refinance large part of the debt each year. As a result, during recession the Government faces low revenues against growing expenditures and large refinancing needs.
View the contents of the new issue of MEMU No.2 (172)
