Archive 2013

  • Monthly Economic Monitor Ukraine No.9 (155)


    Highlight: Recycling tax - RECYCLING TAX: CHANGES NEEDED

    Politics: Russia imposed trade barriers on imports from Ukraine likely to discourage Ukraine from signing the Association Agreement (AA) with the EU.

    Real Sector: Real GDP declined by 1.3% yoy in the second quarter of 2013 due to drop in investments. Real private final consumption and net exports made positive contribution to economic growth.

    Energy sector: Ukraine managed to decrease gas consumption by 8.6% yoy due to decline in industrial output as well as somewhat higher energy efficiency of industry.

    Agriculture: Record grain harvest is expected this year. However, profitability of producers is likely to be poor due to extremely low prices both at the domestic and international markets.

    External sector: Financial and capital account returned to surplus of USD 1.1 bn as surprisingly FDI inflows reached USD 0.9 bn and portfolio inflows in equity jumped to USD 0.35 bn.

    Fiscal policy: Lower than planned fiscal revenues and state borrowings resulted in low execution of central fiscal expenditures. As a result, the Government might be forced to sequester the budget in autumn.

    Privatisation. The State Property Fund of Ukraine is not likely to ensure execution of planned privatization receipts in 2013.

    Social policy: Number of applications for housing and utility subsidies declined by 3.0% yoy in the first seven months of 2013.

    Labour market: Weak economic state of manufacturing was reflected in changed labour patterns at manufacturing companies.

    Monetary policy: Fundamentals such as slower wage growth, stable global commodity prices and slowdown in demand contributed to low inflation in August. Headline consumer inflation fell to -0.4% yoy.

    Financial markets: Demand for cash foreign currency increased only slightly in August with net demand of USD 0.14 bn.

    Issue:  No.9 (155) September 2013
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