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  • Monthly Economic Monitor Ukraine No.12 (170)

    12.12.2014
    Free

    Highlight: Reform agenda - FISCAL CONSOLIDATION AS A BASE FOR SUSTAINABLE ECONOMIC DEVELOPMENT

    Politics: On November 27, a new Verkhovna Rada was inaugurated. The five pro-European parties, which won the October elections, established a coalition that included a constitutional majority of the members of the Parliament.

    Real Sector:Real GDP in the third quarter of 2014 declined by 5.3% yoy due to drop in domestic demand.

    Energy sector:At the beginning of December, Ukraine experienced severe power shortages due to a number of factors: shortage of Type A coal at thermal power stations, low water level at hydro power stations and repairs at the Zaporizhzhya nuclear power plant.

    Agriculture:The harvested grain volumes are likely to be somewhat higher than last year at near 64 m t.

    External sector: Financial and capital account was in deficit at USD 2.8 bn, which was primarily attributed to the repayment on Eurobonds by the Naftogaz at USD 1.6 bn.

    Fiscal policy: The Government is unlikely to execute optimistic fiscal revenues plan this year, which envisages increase in revenues by 11%.

    Social policy: The Government decided to cease all payments to occupied territories including wages, pensions and social payments to people that live there.

    Labour market:Average wage in October dropped by 11.2% yoy in real terms due to financial constraints of companies and high fiscal pressure against the background of accelerated inflation.

    Monetary policy: In November, consumer inflation crossed 20% yoy threshold for the first time since February 2009.

    Exchange rate: In November, the NBU ceased attempts to keep hryvnia at UAH 13 per USD and as a result hryvnia weakened to UAH 16 per USD.

    State debt:In mid-November and early December, the Government received next two tranches in the framework of two EU programs of macro-financial assistance.

    Issue:  No.12 (170) December 2014
    Attached file  (266.7 kb)
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