Ukraine is expected to become the second-fastest growing economy among emerging markets in 2011, trailing oil-rich Kazakhstan, according to Dragon Capital investment bank in Kiev. Experts say Ukraine is growing faster than others simply because it was one of the worst affected by the global financial crisis and the growth is fueled mostly by rising prices for metals, its main export.
"The Ukrainian economy is highly exposed to global commodity cycles," said Olena Bilan, chief economist at Dragon Capital, a leading investment company in Ukraine. It "contracted sharply and now is recovering faster than regional peers."
From an AP
story, the economy is expected to grow 4.3% next year. However, it looks like it will be several years before it returns to the pre-crash level. Also as this Interfax-Ukraine
article notes, a large part of the economy is still in the shadows. We see why the Ukrainian government is eager to pass a new tax code, it needs to close the budget deficit by finding new sources of revenue. Below is an excerpt from the article quoting Sergiy Tigipko, vice premier.
"Concrete reforms are needed, and [the document] you passed yesterday is a compromise that has to be taken… The adoption of the Tax Code is a large step. We've not taken a whole step forward, but we've moved three quarters [of a step] forward. It's important that the code was endorsed, and in the future we'll propose such reforms," he said.
He said that after the reform is conducted, including during next year, "we'll be able to totally balance the budget."
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