The growth of Ukraine’s economy in the fourth quarter of 2019 slowed down to 2.2% and will again exceed 3% in the first quarter of 2020, Dmytro Sologub, the Deputy Governor of the National Bank of Ukraine (NBU), has stated. “According to our estimates, behind the growth figure [GDP] of 3.3% in 2019 is the fourth quarter growth of 2.2% … Regarding the first quarter, we currently have an estimate of GDP growth above 3%,” he said at a briefing in Kyiv.
As reported, the NBU worsened the forecast for GDP growth in 2019 to 3.3% from 3.5% and kept it at 3.5% in 2020 and 4% in 2021.
The Wuhan coronavirus will have a minimum effect on the economy of Ukraine due to low international tourist inflow in the country, Economic Development, Trade and Agriculture Minister of Ukraine Tymofiy Mylovanov has said.
“Usually it may directly affect tourism – tourism slows down. Unfortunately, or in this case fortunately, international tourism inflow is low in Ukraine – a mere 2% of GDP,” he said at a press briefing following the government’s meeting on Wednesday, adding that transporters and tour operators, who are working on foreign markets, including China, might suffer some expenses on the evacuation of people, however, in general, the effect will be minimal.
“We are not forecasting a negative effect [of the coronavirus] on goods turnover. Actually, using the opportunity, we have eliminated several trade barriers for export to China, but this is not related to the coronavirus,” the minister said.
Ukrainian President Volodymyr Zelensky met with Prime Minister of Sweden Stefan Löfven on the sidelines of the 74th session of the UN General Assembly, and the sides discussed prospects of negotiations on Donbas and Swedish investment in the Ukrainian economy.
The press service of the president of Ukraine reported on the president’s website on Wednesday, Zelensky thanked the prime minister for comprehensive support of Kyiv, in particular, the support of Ukraine’s sovereignty and territorial integrity. The parties discussed the prospects of the negotiations on Donbas.
“We are not ready to wait five more years for the negotiations in Minsk to yield results,” Zelensky said.
The head of state also noted the importance of Sweden as a partner for Ukraine, in particular in the trade sphere.
Zelensky urged Löfven to facilitate the increase of Swedish investments in Ukraine’s economy, including the spheres of energy efficiency and recycling.
The share of IT industry of the Ukrainian economy is 4% of GDP, First Deputy Prime Minister, Minister of Economic Development and Trade Stepan Kubiv has said.
“Today, the IT sector is 4% of GDP, 150,000 employees with high wages, who form the middle class. In a year and a half they will already be 200,000,” he said at a government meeting on Wednesday.
Kubiv also said that the government intends to support investments in innovations in such areas as the agricultural and industrial complex, the IT industry, aircraft manufacturing, tourism, infrastructure and other sectors.
“Together with the National Bank, we must form the best prerequisites for creating financial projects that will create new high-paying jobs,” Kubiv said.
The members of the American Chamber of Commerce in Ukraine expect the continuation of growth of the Ukrainian economy and the increase of profits in 2019 despite the elections, the co-founder and executive director of Horizon Capital, Lenna Koszarny, has said at a press conference of the organizing committee of Ukraine House Davos.
“We asked the members of our chamber, investors who invested huge money in Ukraine, what they expect in 2019. Some 74% answered growth and profits. That is, they will continue to invest, and these are the investors who understand what is happening in the country, that there will be elections,” she said.
She also noted about raising $200 million to the Horizon Capital investment fund – Emerging Europe Growth Fund III, L.P.
“This is a signal for the market that investors are interested in Ukraine. The investors who entered the fund are $350 billion of total capital,” she said.
Alexa Chopivsky, the Executive Director of Ukraine House Davos, also noted the success of the campaign at the economic forum in Davos.
“Three main conclusions can be drawn from our experience in Davos. First, Ukraine House Davos has created a powerful investment brand. Second, we have opened a window for foreigners and sponsors. Third, we have shown a positive image of Ukraine as a country of creativity, innovations and great opportunities,” the expert said.
Batkivschyna Party Leader Yulia Tymoshenko believes that Ukraine should switch from the crony economy to the social market economy, transform the economic model based on raw materials into the economy of innovative development. “This is a global trend, which was adopted as the basis and the main strategic line, including by the European People’s Party, which member Batkivschyna has been for more than ten years. A harmonious combination of free entrepreneurship with the interests of society is necessary. Today it is obvious that the market cannot be absolutely self-regulating and work in the interests of the public. It has weaknesses in the form of monopolism, ignoring the interests of the development of society, the paradigm that the strongest survives any way,” Tymoshenko said on Friday, September 21, during the presentation of the New Economic Course of Ukraine.
She said that the state should create equal rules for all. “Say “no” to monopolies. They eat any economic system, like any monopoly in any sphere of society’s life. It will be dismantled. We will finish the story with monopolies, including clans,” the leader of Batkivschyna Party said.
Tymoshenko said that the goal for this should be the accelerated economic growth with an annual rate of at least 7%, and the main driving force for all economic changes in the country should be a creative intellectual entrepreneurial class.
The leader of Batkivschyna Party said that the tasks of the monetary policy should be stabilization of the hryvnia, a reduction in inflation, the development of small banks, the introduction of long-term low-interest loans for business, and the control of the National Bank by society.
“And the speculative adventures that have been and are being conducted at the National Bank will be the subject of separate criminal investigations after the change of power: about $13 billion in four and a half years was deduced from the budget of Ukraine, from the banking system of Ukraine on the basis of speculative operations. We got almost as much, a little less, from the IMF [International Monetary Fund]. We need to remove the criminals from the National Bank who killed our currency, destroyed our economy and continue to make money on our grief,” Tymoshenko said.
