(Business New Europe – bne.eu – bne IntelliNews – June 10, 2015) The International Monetary Fund (IMF) says it will continue lending to Ukraine, even if the country fails to make payments to private creditors. “We have a policy of lending into arrears which allows us to continue lending to a member state when it has arrears with private creditors, […]
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(Bloomberg – bloomberg.com – Leonid Bershidsky – June 10, 2015) A top International Monetary Fund official is offering Ukraine a generous gift: continued loans, even if it stops paying private creditors. It is, however, a trap of sorts. Accepting the deal risks undermining Ukraine’s ability to borrow on the open market and strengthening its dependency on the IMF. “If at […]
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KYIV. June 11 (Interfax) – Hopefully, the Ukrainian economy will resume growth in 2016 if reforms continue in the country, Prime Minister Arseniy Yatsenyuk has said. “Any simple recipes or quick solutions do not exist. But, hopefully, if everything goes according to our plan, 2016 should become the first year of economic growth,” Yatsenyuk was quoted as saying by the […]
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(Business New Europe – bne.eu – KYIV BLOG: Ben Aris in Moscow – June 8, 2015) It’s not exactly blue-sky news, but after a little over a year in office, Ukrainian President Petro Poroshenko had a few things to boast about in his recent annual speech before the Rada lower chamber of Parliament. Reforms have started and the first green […]
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Russian trade turnover with Ukraine fell by around 60 percent in the first four months of this year compared to the same period last year, according to a recent study by researchers at the World Trade Center Moscow, news agency RBC reported Wednesday. Russian exports to Ukraine fell 63.5 percent, from $8.1 billion to $2.9 billion, while imports of Ukrainian goods fell 60 percent from $4 billion to 1.6 billion between January and April […]
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(Business New Europe – bne.eu – Ben Aris in Moscow – May 26, 2015) Will Ukraine’s private bondholders force the country to default on its debt on purpose by refusing to negotiate on the restructuring, or “haircut”, that Kyiv is demanding on $10bn worth of debt? It’s not such a crazy question, because it has happened before. In 2009, Morgan […]
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(Moscow Times – themoscowtimes.com – May 28, 2015) Russian trade turnover with Ukraine fell by around 60 percent in the first four months of this year compared to the same period last year, according to a recent study by researchers at the World Trade Center Moscow, news agency RBC reported Wednesday. Russian exports to Ukraine fell 63.5 percent, from $8.1 […]
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(Bloomberg – bloomberg.com – Natasha Doff – May 28, 2015) Ukraine’s creditors including Franklin Templeton put forward a restructuring proposal that includes maturity extensions of up to 10 years and reductions in interest payments of about $500 million. The offer, submitted on May 9 by a group owning about $8.9 billion of Ukraine’s debt, involves amortizing the bonds over a […]
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KYIV. May 19 (Interfax) – The Petro Poroshenko faction in the Ukrainian parliament predict that the government will not make use of the right to declare a moratorium on the repayment of the external debt to commercial companies. “The law on the Cabinet’s right to impose a moratorium on the repayment of the external debt is putting additional pressure on […]
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Foreign creditors must agree to the “legitimate” deal offered by Ukraine in talks on restructuring around $23 billion worth of its debt, Prime Minister Arseny Yatseniuk said on Friday.
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(Business New Europe – bne.eu – Ben Aris in Tbilisi – May 15, 2015) The conflict between Russia and Ukraine has overshadowed the European Bank for Reconstruction and Development’s (EBRD) annual general meeting in Tbilisi this week, with Russian Deputy Finance Minister Sergei Storchak accusing the bank of a “political motivated” decision to suspend lending to Russia. The development bank’s […]
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(Bloomberg – bloomberg.com – Leonid Bershidsky – May 13, 2015) With Greece missing one deadline after another to reach agreement with its creditors, it’s easy to forget that a day of reckoning is also nearing for Ukraine. The government is supposed to reach a debt restructuring deal with private bondholders by June, but is no closer than when talks began […]
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(Business New Europe – bne.eu – bne IntelliNews – May 14, 2015) Ukraine’s finance ministry and holders of its sovereign Eurobonds have taken their dispute over debt restructuring public, as a mid-June deadline set by the International Monetary Fund (IMF) requiring final agreement on terms draws close. The ministry criticised the level of secrecy over the identities of the mainly […]
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Post-Maidan Ukraine is at war. Not only against Russian invaders, but more generally against sovietism. This war has a military front in the East, but as important is the political, economic, social frontline in the rest of the country. Resisting the invaders and reforming the nation are two fronts of a same fight: the struggle for the emergence of a […]
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(Bloomberg – bloomberg.com – Kateryna Choursina, Volodymyr Verbyany and Alex Sazonov -May 7, 2015) At the November 2013 World Economic Forum in Kiev’s Intercontinental Hotel, billionaire Petro Poroshenko predicted a European Union trade pact would kick-start Ukraine’s economy and enrich his Roshen Confectionery Corp. by dramatically increasing EU-bound chocolate exports. Eighteen months later, Poroshenko — now Ukraine’s president — has […]
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(Oilprice.com – Robert Bensh – May 6, 2015) Each country blessed with oil and gas discoveries initially tries to create a tax regime that maintains the balance between generating tax revenues from the extraction of these hydrocarbons while also encouraging investment. If the country gets too greedy and imposes an excessive tax burden, the inverse effect occurs – investors abandon […]
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Despite decisive measures in 2014 to stabilize the economy and jumpstart growth, Ukraine’s economic woes worsened mainly due to the conflict in the east. In its new Ukraine Macroeconomic Update, the World Bank projects real GDP to fall by 7.5 percent in 2015, down from 6.8 percent in 2014. This lower forecast is mainly driven by the ongoing conflict that […]
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Ukraine is in a worse state economically than previously thought, the World Bank assumes. It drastically lowered its forecast for the country for 2015, saying the military conflict with separatists was a huge burden.
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(RFE/RL – rferl.org – Katya Gorchinskaya – KYIV, April 21, 2015) Yulia Tymoshenko didn’t have much of an income in 2014. The former Ukrainian prime minister spent part of the year in prison, part of it rehabilitating in the hospital, and much of it in back-to-back campaigns for president and parliament. But nevertheless, she managed to buy a luxury car, […]
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KYIV. April 22 (Interfax) – Over a thousand miners who approached the Presidential Administration edifice on Wednesday morning to deliver their demands have broken through security cordons on Bankova Street in downtown Kyiv and came close to the building. The protesters are pounding their helmets against the ground and shouting. They have not expressed their demands but their behavior is […]
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(Business New Europe – bne.eu – bne IntelliNews – April 20, 2015) Ukraine is ready to play hard ball in its bid to restructure $15.3bn in foreign debt, was the signal sent by Finance Minister Natalie Jaresko to corporate bondholders in Washington on April 17. The government wants to secure a $40bn bailout package assembled with the International Monetary Fund […]
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(Business New Europe – bne.eu – Graham Stack in Kyiv, Mari Bastashevski in Donetsk – April 15, 2015) The Russian ruble is gaining ground against the hryvnia across rebel-held parts of East Ukraine’s Donbas region, 19 years after Kyiv introduced the national currency to end the country’s membership of the ruble zone. As Eastern Ukraine heads towards becoming a frozen […]
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… With most of its scarce resources focused on fighting Russia’s proxies in the east, Ukraine’s leaders have watched their economy fall off a cliff, surviving only by the grace of massive loans from Western institutions like the International Monetary Fund, which approved another $17.5 billion last month to be disbursed over the next four years. But that assistance has […]
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Writing for Chatham House in the aftermath of Igor Kolomoisky’s dismissal as regional governor, Orysia Lutsevych considers the impact of Ukrainian oligarchs and efforts to address their role. The grip the oligarchs have on Ukraine’s economy could further undermine the country’s integrity. Attacking their vested interests is dangerous but preserving the current state of affairs is even riskier. According to […]
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(Paul Goble – Window on Eurasia – Staunton, April 13, 2015) As long as Russian aggression against Ukraine continues, patriotism is likely to trump concerns about domestic difficulties, according to Ella Libanova, a reflection of the fact that “the Maidan and Russian aggression has pushed Ukrainians toward more responsible attitudes toward both their country and their own fate.” In a commentary […]
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(Business New Europe – bne.eu – bne IntelliNews – April 13, 2015) Ratings agency Standard & Poor’s has downgraded Ukraine’s sovereign credit rating from ‘CCC-‘ to ‘CC’, three levels above default, with a negative outlook. S&P said it views a Ukrainian default as “virtually inevitable”, with Ukraine’s sovereign debt to reach 93% of GDP in 2015. “The negative outlook reflects […]
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On Friday, Standard & Poor’s cut Ukraine’s long term foreign debt rating to CC from CCC-. The rating of CC is one notch above C, which is used when a debtor is in the process of filing for bankruptcy protection. Standard & Poor’s kept Ukraine’s short-term foreign credit rating at C with a negative outlook. http://www.forbes.com/sites/kenrapoza/2015/04/10/ukraine-debt-rating-now-super-duper-junk/
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The Minsk II accord is not a peace deal. It is a cease-fire agreement, and a fragile one at that. Beyond suspending large-scale hostilities, pulling back heavy weapons and exchanging prisoners of war, Minsk can hardly be implemented. http://nationalinterest.org/feature/europes-nightmare-ukraines-massive-meltdown-12597
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(Bloomberg – bloomberg.com – Yulia Surkova – April 7, 2015) Deep behind rebel lines in eastern Ukraine, cash machines on garbage-covered streets have long run out of bills and residents are turning to fixers to survive. A pro-Russian insurgency that erupted a year ago has killed more than 6,000 people, with economic desperation permeating what was once Ukraine’s industrial heartland. Residents of […]
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Ukraine’s judicial authorities launched actions on Tuesday challenging tenders that gave big businessmen control over key power companies under ousted president Viktor Yanukovich in a new move by the government to curb the influence of the so-called oligarchs. Reuters: Ukraine challenges oligarchs’ grip on energy companies
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While the IMF Spring Meetings are just around the corner, we are not here to talk about the global economy. Rather, our focus today is Ukraine. Going into the meetings, many will want to have a clear picture of the situation in that country as they seek to understand the risks facing the world, and Europe in particular. IMF: […]
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For people in rebel-held territory, the destruction of infrastructure and a cut-off of government support along with the legal limbo created by the separatist takeover have left once-flourishing cities in dire straits. http://news.yahoo.com/russia-steps-job-losses-closures-ravage-east-ukraine-043432796.html
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(Business New Europe – bne.eu – Ben Aris in Moscow – March 27, 2015) A confusing argument has broken out over the crucial question of whether Ukraine’s $3bn worth of bonds held by Russia and due in December are “official” debt or not. The answer is important because if the bonds are “official” and Ukraine doesn’t pay them, the International […]
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(Business New Europe – bne.eu – bne IntelliNews – March 26, 2015) Support for Ukraine’s pro-Western government is plummeting, with nearly 70% of Ukrainians believing the country is going in the wrong direction, one year after the change of regime in Kyiv. The plunge in confidence mirrors the economic collapse in the wake of the conflict in East Ukraine and rising tensions with […]
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(Business New Europe – bne.eu – Ben Aris in Moscow – March 19, 2015) March will be a tense month as Russia has decided to poke its finger in Nato’s eye again. Russia’s Armed Forces are holding for the first time Arctic military exercises, which kicked off on March 16 and will last through March 21. The exercises are massive. The […]
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(Bloomberg – bloomberg.com – Lyubov Pronina, Krystof Chamonikolas – March 17, 2015) The jockeying has begun in Ukraine’s debt restructuring talks. The government’s notes slid below 42 cents on the dollar on Tuesday as Russia said it wouldn’t budge on being paid back a $3 billion loan in full on time and the Financial Times reported Franklin Templeton won’t accept a […]
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Ukraine’s fight to control its destiny is underway not only on its eastern battlefields but also in the halls of its parliament and in those of global financial institutions. The struggle to keep the former Soviet state afloat economically has been daunting, as the nation’s parliament has fallen into disarray and failed to enact major economic reforms. … http://www.rand.org/blog/2015/03/for-ukraine-the-battle-to-bolster-a-crashing-economy.html
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(Moscow Times – themoscowtimes.com – March 14, 2015) With the first billions of dollars foreign aid in its pocket, Ukraine’s government can now stay afloat long enough to embark on its radical reform drive, but the hard part is only just beginning. Ukraine received the first $5 billion on Friday of $17.5 billion in aid promised by the International Monetary […]
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[“Ukraine Finance Minister Seeks More Bailout Financing; Natalie Jaresko says security, political risks could push up debt-restructuring needs” – Wall Street Journal – Ian Talley – March 16, 2015] The Wall Street Journal covers Ukraine’s efforts to gain more financing to spur growth and development. Ukraine needs more bailout financing than currently promised to help jump-start the embattled nation’s economy, Finance Minister […]
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(Business New Europe – bne.eu – Kateryna Killyashenko in Kyiv and Nick Allen in Berlin – March 13, 2015) After the International Monetary Fund’s (IMF) approval on March 11 of its $17.5bn loan package to Ukraine, with $5bn due to flow immediately to bolster Kyiv’s dwindling coffers, the population could be forgiven for thinking the material hardships of recent months […]
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A little more than a year ago, the Ukrainian people chose a path of fundamental change. Citizens took a stand in Kyiv’s Maidan Square for the right to live in a free, independent and prosperous European country and to put an end to endemic corruption and mismanagement. More than 100 people gave their lives during the Revolution of Dignity. Since […]
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(RFE/RL – rferl.org – Mark Baker – March 13, 2015) From higher home heating costs to lower pensions, Ukrainians are about to feel the pinch from austerity measures attached to a newly approved International Monetary Fund (IMF) loan package. The long-awaited $17.5 billion credit announced this week holds out hope of an eventual economic recovery for the country. But that […]
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(Business New Europe – bne.eu – Mark Adomanis in Philadelphia) Writing and thinking about Russia can often have a rather surreal quality to it. Something about the place seems to short-circuit peoples’ critical thinking skills. Serious pundits write things (“Russia life expectancy is collapsing!”) that are flatly contradicted by recent academic research and that don’t withstand even the most cursory […]
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(Business New Europe – bne.eu – bne IntelliNews – March 11, 2015) The International Monetary Fund is ready to disburse to Ukraine the first tranche of an agreed extended funding facility (EFF), confirming on its website that the sole subject of discussion at an IMF board meeting on March 11 will be the loan. At the same time, Ukrainian President […]
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(Bloomberg – bloomberg.com – Leonid Bershidsky – March 6, 2015) [Chart here bloombergview.com/articles/2015-03-06/ukraine-s-economy-is-worse-than-it-looks] The world’s worst-performing currency this year, the Ukrainian hryvnia, has bounced back 47 percent since last week’s precipitous plunge. It’s tempting to conclude Ukraine has pulled back from the brink of financial disaster. In reality, the Ukrainian central bank and government are just sweeping their problems under […]
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Efforts to restore financial stability in Ukraine face “exceptionally high” risks from further conflict and disgruntled creditors, the International Monetary Fund said on Thursday. … http://uk.reuters.com/article/2015/03/12/uk-imf-ukraine-idUKKBN0M81OX20150312
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(Business New Europe – bne.eu – bne IntelliNews – March 9, 2015) Ukraine’s bankers stole UAH58bn from their banks in 2014-2015, state refunds to depositors of bankrupt banks were equivalent to 10% of total budget revenues, while total losses from bank insolvencies comprised 9% of GDP. These are just some of the disastrous figures Valery Gontareva, head of the National […]
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MOSCOW. March 4 (Interfax) – Ukraine is already in a default, and the country’s financial sector cannot exist without foreign financing, VTB (MOEX: VTBR) CEO Andrei Kostin told reporters on Wednesday. “Ukraine’s financial and banking sector is in an extremely difficult state. Ukraine is actually already a bankrupt nation and in a default, and without foreign aid and external [financing] […]
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ROSTOV-ON-DON. Feb 26 (Interfax) – The self-proclaimed Donetsk People’s Republic (DPR) has accused Kyiv of increasing the economic blockade on the region in defiance of the latest peace accords. “In defiance of the Minsk agreements, Ukraine is intensifying the economic blockade on the DPR. Humanitarian aid is the only opportunity for people to get food today,” DPR envoy Denis Pushilin […]
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(Business New Europe – bne.eu – Kateryna Illyashenko in Kyiv – February 12, 2015) The International Monetary Fund (IMF) has tentatively agreed a $17.5bn extended fund facility with Ukraine, part of an overall $40bn funding package for the country over the next four years, the fund’s managing director, Christine Lagarde, said on February 12. The package will go some way […]
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