Archive 2013

  • Macroeconomic Forecast Ukraine monthly issue


    Executive summary

    In the first quarter of 2013 real GDP declined by 1.3% yoy due to drop in industrial production, construction and transport. The economic activity is likely to somewhat recover in the second half of 2013. Real GDP is expected to grow by 1.4% in 2013. However, there are substantial downside risks to this forecast.

    Improved access to external financing enabled the Government conduct two successful Eurobonds placements. One the one hand, this enables the Government to serve debt in full and in time, but, on another hand, it weakens bargaining position of the IMF in negotiations with Ukrainian government.

    Successful introduction of the new program with the IMF is among our most important forecast assumptions. Recent talks between the Government and the IMF did not lead to new Stand-by agreement. In particular, the Government postpones again important structural reforms, measures in the framework of fiscal consolidation and shift towards more flexible exchange rate regime. This, in turn, may harm Ukraine’s economy in the longer run.

    Under pessimistic scenario GDP may fall by 2-3%. It would be likely scenario if Ukraine postpones further structural reforms, holds on to fixed exchange rate and, thus, does not sign new SBA.

    Issue:  No.4 (68) April 2013

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