Archive 2016

  • Monthly Economic Monitor Ukraine No.9 (191)


    Highlight: DAIRY PRODUCTS

    In July 2014, the Russian Federation banned import of milk and dairy products from Ukraine. Sine the beginning of 2016, the ban was extended to imports of all Ukrainian food products. According to official Russia’s position, this decision was caused by the implementation of the economic part of Association Agreement between Ukraine and the EU, in particular, the impossibility to control for country of origin. However, it was likely another instrument in the Russian hybrid war against Ukraine. Ukrainian milk producers were heavily affected by the loss of Russian market, which accounted for 55% of Ukrainian diary exports in 2013. As producers were not able to reallocate their sales, the diary production fell accordingly. Therefore, currently producers attempt to enter and compete at other markets.


    Politics: On August 24, 2016, Ukraine celebrated 25 years of independence.

    Real sector: Real GDP grew by only 0.8% yoy in the first half of the year due to transit restrictions imposed by Russia for Ukrainian goods and disruptions in logistics in Donbas.

    Energy sector: Ukraine again faces challenges while preparing for the winter season.

    Agriculture:Gross agricultural production in July increased by 1.1% yoy due to good crop harvest.

    External sector: Current account in July was in deficit at USD 0.4 bn as compared to balanced current account in July 2015 due to higher deficit of merchandise trade.

    Fiscal policy: The Government suggests improving tax administration.

    Privatisation: The Government is not likely to fulfil privatisation plan this year.

    Social policy: The verification of payments to IDPs is on-going.

    Labour market:Average nominal wage in July grew by 22.4% yoy due to increase in minimum wage, indexation for inflation, and increase of salaries in public sectors and state administration.

    Monetary policy: Headline CPI declined by 0.3% mom in August for the third month in a row.

    Exchange rate: Interbank exchange rate moved to over UAH 25 per USD in the last decade of August likely due to seasonal increase in imports as well as somewhat stronger depreciation expectations.

    State debt:According to the Ministry of Finance, state debt in July decreased by 0.4% in hryvnia equivalent as compared to June.

    Issue:  No.9 (191) September 2016
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