Highlight: “Doing Business” - DOING BUSINESS IN UKRAINE: RAPID INCREASE IN RATINGS BUT LITTLE SYSTEMIC CHANGES
Politics: In October Ukrainian authorities did little to ensure signing of the Association Agreement with the EU as well as to make new IMF program possible.
Real Sector: Real GDP dropped by 1.5% yoy in the third quarter of 2013, which is the fifth quarter in a row of declining real GDP.
Energy sector: The Verkhovna Rada has finally adopted the law “On Operating Principles of Electricity Market of Ukraine” that changes the electricity market model of Ukraine.
Agriculture: ‘Agricultural Sector Development Strategy of Ukraine till 2020’ is directed at ensuring increase in gross agricultural output by 1.3 times by 2020 and growth of exports at 3-4% annually.
External sector: Current account deficit ballooned to USD 2.0 bn in September and according to preliminary estimates it came within breathing distance to largest value since 2009.
Fiscal policy: Funds at the Single Treasury Account declined to UAH 0.4 bn as of November 1, which is the lowest level for last ten years.
Social policy: The Pension Fund is increasingly financed at the expense of central fiscal transfer.
Labour market: Labour market situation remains weak with reduced number of staff employed and rapid deceleration of wage growth.
Monetary policy: Headline consumer inflation remained negative at 0.1% yoy in October as Ukrstat reported increase in prices for a number of raw food products.
Financial markets: International reserves dropped to USD 20.6 bn by the end of October as the NBU made payments to IMF and conducted limited interventions on foreign exchange markets.
