Ukraine's economic descent began last September. According to George Soros the country had come"close to default.". The hryvnia collapsed, a bank crisis ensued, and the real estate boom in Kyiv ended. There was also the gas shut off by Russia and a horrendous gas agreement that ended it. The IMF arrived and bailed out Ukraine, but the country is facing a difficult economic recovery.
This year's nominal GDP in Ukraine will amount to UAH 956.4 billion, according to the materials circulated at a press conference by First Deputy Head of the Presidential Secretariat Oleksandr Shlapak on Wednesday.The secretariat also expects 16.5% inflation and a $2.2 billion deficit in foreign trade in Ukraine.
The presidential secretariat forecasts that GDP will contract by 12.9% in 2009 (IMF estimate a bit higher for GDP). While Yushchenko said on Bloomberg that the Ukrainian economy would take two years to recover from the economic crisis. One bank is already calling a bottom and believes the economy will start to recover in 2010. However, the World Bank thinks that the high budget deficit will hurt economic growth .Meanwhile, the WSJ writes on the intense political infighting that has paralyzed the Rada and (also) threatens economic recovery.
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