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The Ukrainian Economy:

The Ukrainian Economy:. Overview. Current Situation. Poor political environment Outset of a severe economic downturn High Inflation Sharply falling incomes Currency losing value Rising unemployment. The Economy at a Glimpse…. Before the Crisis Began…. Importance of FDI.

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The Ukrainian Economy:

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  1. The Ukrainian Economy: Overview

  2. Current Situation • Poor political environment • Outset of a severe economic downturn • High Inflation • Sharply falling incomes • Currency losing value • Rising unemployment

  3. The Economy at a Glimpse…

  4. Before the Crisis Began…

  5. Importance of FDI

  6. The Role of FDI in Ukraine • Drives Economic Growth; • 2006: $5 billions; • 2007: $10.7 billions; • 2008: $6.9 billions; • EU – the source of the greatest amount; • Major affected sectors: banking and financial services, insurance, consumer goods, telecoms

  7. When the Economic Crisis Began… • Higher rates for the Ukrainian dollar debt; • $105 billion total external borrowing; • Rising doubts for default; • Lower prices of the country’s top exports – steel and chemicals; • Overall contraction in world trade;

  8. Monetary and Fiscal Policy • Central Bank of Ukraine: responsible for monetary policy; • No Currency Board; • M2 grew 50% YoY basis by December 2008; • Central Bank raised interest rates in an attempt to curb inflation; • Fiscal Tightening through reining in social expenditures;

  9. Troubles on the way… • 6% Forecast Contraction in Growth; • A Deep Recession in 2009; • Weaker Currency: Slump in Steel Prices and Restricted External Financing; • Higher Gas Prices; • Reduced Inflows of FDI; • Gradual recovery expected in the future…

  10. Sources: • http://www.bank.gov.ua/ENGL/default.htm • http://www.dallasfed.org/research/eclett/2007/el0701.html • www.rgemonitor.com • http://www.delukr.ec.europa.eu/page32099.html • http://www.economist.com/COUNTRIES/Ukraine/profile.cfm?folder=Profile-Economic Data • http://www.alacrastore.com/country-snapshot/Ukraine • http://globaleconomydoesmatter.blogspot.com/2008/10/ukraine-wobbles-as-financial-ground.html

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