A new video dedicated to the situation in the Ukrainian and world economy at the beginning of 2023 has been published on the YouTube channel of the “Club of Experts” analytical center. The official data concerning the main macroeconomic indicators was presented in the program as well as the forecasts of the leading world analytics for the years 2023-2024 were consolidated.
According to the analysts, the indicators of Ukrainian economy are stable on the whole. Thus to support it in the conditions of war in 2023 the increase of volumes of macrofinancial help from partners will be required. Thus, the founder of the Club of Experts, candidate of economic sciences Maxim Urakin referred to the IMF assessment, according to which Ukraine’s needs for external financing in the current year will be not less than 39.5 billion dollars and can reach 57 billion.
“This forecast is an expression of a high degree of uncertainty on the part of the world’s leading financial institutions with regard to the situation in the Ukrainian economy, and also demonstrates the increasing pressure on it from expenditures,” the expert stressed.
As for the global indicators, the same IMF forecasts that more than a third of the global economy in 2023 will arrive in recession. In turn, Bloomberg notes a record fall in global stock and bond markets in the last months of 2022. At the same time, investors are more optimistic about this year’s prospects.
“The end of the cycle of interest rate hikes, the recovery of the Chinese economy and the end of the war in Ukraine followed by the recovery of our economy could significantly improve the situation both in our country and in the world,” said Maxim Urakin.
For more details on the situation in Ukraine and the world economy, please watch the video on the “Club of Experts” channel by clicking here:
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The negative balance of Ukraine’s foreign trade in goods in January-October 2022 increased 2.6 times compared to the same period in 2021 – to $7.050 billion from $2.691 billion, said the State Statistics Service. According to them, exports of goods from Ukraine during the reporting period compared to January-October 2021 decreased by 32.3% to $36.859 billion, imports – by 23.2% to $43.909 billion.
Ukraine’s state budget deficit in November rose to a record 170 billion UAH from 143.4 billion UAH a month earlier, including the general fund to 163.3 billion UAH from 147.1 billion UAH, the Ministry of Finance said on its website.
Total national debt of Ukraine in November 2022 increased by 4.2%: in dollar terms – by $4.34 billion, to $107.46 billion, in UAH – by 158.7 billion, to 3.930 trillion UAH, according to the Ministry of Finance website.
According to them, direct public debt last month increased by 4.5% to $97.69 billion, or 3.572 trillion UAH, mainly due to a loan from the European Union ($2.95 billion) and placement of government bonds ($0.56 billion, or 20.44 billion UAH).
International reserves of Ukraine as of December 1, 2022, according to preliminary data, amounted to $27 billion 422.2 million (in equivalent), which is 10.7% more than at the beginning of November ($25 billion 244.2 million), according to the National Bank of Ukraine.
One third (34%) of Ukrainian refugees in Germany want to stay in this country until the end of hostilities at home, while a quarter (26%) are planning to stay in Germany permanently, Deutsche Welle wrote on Thursday with reference to the results of a representative study conducted by three German sociological institutions together with the Federal Office for Migration and Refugees (BAMF).
Russian attacks on the energy infrastructure increased the rate of decline in Ukraine’s economy this November to roughly 41 percent last November, First Deputy Economy Minister Denis Kudin said. “Our expectation for November is minus 41%. That’s significantly deeper than what we forecasted before,” he said during a discussion at the Center for Economic Strategy (CES).
A month earlier, First Deputy Prime Minister and Economy Minister Yulia Sviridenko said at a meeting with U.S. media that Russia’s October energy slump increased the drop in GDP to 39% by October 2021, which is worse than the September-August figure of 35%.
Kudin also pointed out that for this year as a whole, the GDP decline forecast has been worsened to 33.2% from 32%.
Ukraine since the beginning of 2022/2023 marketing year (MY, July-June) and exported 19.66 million tons of crops, including 10.76 million tons of corn (54.7% of total supplies), 7.29 million tons of wheat (37%) and 1.53 million tons of barley (7.8%).
The total area of residential buildings with permits for construction work (new construction) in January-September 2022 halved compared to the same period in 2021 to 5.2 million square meters, said the State Statistics Service.
Commercial real estate operations and construction lead the list of sectors with the highest share of bad loans (NPLs) – 70.2% and 68%, respectively, according to the National Bank in the Report on Financial Stability on the analysis of the largest corporate borrowers on December 1, which accounted for 60% of the net loan portfolio of banks.
According to the document, the total share of NPL in the real estate sector is 62.8%, followed by mechanical engineering – 62.5%, while in the sectors of energy and utilities, as well as metallurgy, the figures are much lower – 46.8% and 45%, respectively (42.7% in the green energy sector).
Head of the project “Economic Monitoring” candidate of economic sciences Maksim Urakin
Port of Reni for the first time since the independence of Ukraine has attracted a new cargo flow – citrus fruits from Egypt, which in peacetime went through the larger ports of “Big Odessa”, the Administration of Sea Ports of Ukraine (AMPU) reported on Facebook.
“Last week a refrigerated vessel “ZEINAB”, equipped with enhanced ventilation and refrigeration units for the transportation of perishable goods, arrived at the port of Reni,” AMPU said in a statement.
In particular, 519.9 tons of fruit were delivered from Egypt: 150.3 tons of oranges, 169.4 tons of pomegranates, 31.05 tons of lemons and 169 tons of tangerines.
AMPU specified that citrus fruits were traditionally transshipped by Chornomorsk and Odessa ports.
The leader among them was the port “Chernomorsk”, which transshipped 253 thousand tons of citrus in the last five years: in 2018 – 83.6 thousand tons, in 2019 – 74.1 thousand tons, in 2020 – 43 thousand tons, in 2021 – 35.5 thousand tons and in 2022 – 16.8 thousand tons.
Port “Odessa” during the same period transshipped 134.2 thousand tons of citrus: in 2018 – 45.4 thousand tons, in 2019 – 40.4 thousand tons, in 2020 – 26.5 thousand tons, in 2021 – 14.3 thousand tons and in 2022 – 7.6 thousand tons.
AMPU reminded that now the ports of Greater Odessa work only within the framework of the “grain initiative”, so the cargo owners are forced to seek other ways to deliver citrus to consumers.
Earlier analytical project “Club of Experts” analyzed in detail the trade and economic cooperation between Ukraine and Egypt, see in detail in the video:
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In the next video YouTube-channel of the analytical center “Club of experts” the prospects of trade and economic relations between Ukraine and Egypt were considered.
As the founder of the Club of Experts Maxim Urakin emphasized, before the war Egypt was the most favorable trade partner for Ukraine, the trade surplus with which amounted to almost 2 billion U.S. dollars. Grain and metallurgical products were the main Ukrainian goods at the Egyptian market.
At the same time, in the first months of the war, the Russian blockade of maritime communications in the Black Sea limited Ukrainian exports to Africa and, above all, to Egypt. The grain agreement improved the situation, but only with regard to agricultural exports. In order not to lose the Egyptian market, the Ukrainian companies have to adapt to the current situation now in order not to make additional efforts after the war.
According to the President of the Ukrainian Exporters Club Eugenia Litvinova, the Ukrainian producers should pay attention to the Egyptian market of dairy products in the first place. In this case, it is necessary to take into account the separation of Egyptian groups of goods for wholesale and retail trade while creating favorable conditions for imports. Also, according to her, the demand in Egypt is for canned and dried fruits, confectionery, chocolate, oils, fats, mineral water, as well as crockery, various cutlery, baths, showers, sinks, building materials and other goods for the retail trade.
“I want to draw attention to the fact that all Ukrainian exporters who want to trade with Egypt, must be registered in the general administration to control exports and imports. After that it is possible to establish logistics through rail and road ways, taking into account the temporary inaccessibility of the port of Odessa”, – she explained.
Besides, Yevgeniya Litvinova noticed that since March of the last year, Egypt obliged Ukraine to use the letter of credit for many groups of goods that leads to rise in price of transactions from 0,2 to 0,5%. This factor, according to the expert, will also directly affect trade and its final results.
“If we talk about advice to our small and medium-sized businesses when entering the Egyptian market, first you need to understand what exports are, if you have not previously been involved in this process. Then you should analyze in which cases it is profitable to open a Ukrainian enterprise in Egypt to work, and in which cases you do not always need to do it and not always profitable. Finally, the third tip – go through the registration. At least look at how to pass authorization, registration through a single window in Egypt. I draw your attention to the fact that your brand should be registered at least in Ukraine before you start to pass this registration in Egypt, “- summed up Eugenia.
In turn, the head of the Egyptian diaspora in Ukraine, Dr. Atia Walid noticed that in recent years Egyptian-Ukrainian trade relations have been intensively developed and our country has been invited to participate in major infrastructure projects, which are now being implemented by the Egyptian authorities.
“Back in 2021 Egypt discussed with the Ukrainian government investment in the special economic zone of the Suez Canal. That is, the Egyptian economic policy is primarily aimed at encouraging investment in the country’s economy. Egypt, of course, is interested in cooperation with Ukrainian companies from the point of view of opening joint ventures on its territory, which can well be realized today, despite the war. I think it is quite realistic for Ukrainian companies to open branches there, if they are interested in the sales market. Egypt is ready to facilitate this,” stressed the representative of Egypt.
In his opinion, our suppliers should work more actively both with the Egyptian embassy in Kiev and the Ukrainian embassy in Cairo. This will facilitate the passage of bureaucratic procedures and reduce the likelihood of becoming victims of fraud.
“Ukrainian businessmen should check with the Egyptian embassy or the Chamber of Commerce the authenticity of the documents of those organizations with which they cooperate. And only after that, conclude a contract according to all international rules. You should not believe the promises and pretty eyes, and do not forget the basics of doing business in the field of export-import. I wish all businessmen in Egypt and in Ukraine only success,” said Dr. Atia Walid.
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Russian attacks on critical infrastructure facilities in October accelerated the fall in GDP to 39% from October 2021, which is worse than in September-August – 35%, said First Deputy Prime Minister – Minister of Economy of Ukraine Yulia Svyrydenko at a meeting with representatives of the American media.
The fall in Ukraine’s GDP in 2022 could be 33-35%, Finance Minister Serhiy Marchenko said at a briefing in Kyiv.
Massive Russian missile strikes on the Ukrainian energy infrastructure, which began in October, stopped the trend of slowing down the decline in the Ukrainian economy, its forecast for the year has been worsened from 32% to 35%, the ICU investment group reports in an updated macroeconomic forecast.
Dragon Capital investment company, one of the leaders in the Ukrainian market, worsened its forecast for a decline in real GDP this year by 2 percentage points, to 32% and retained its forecast for a decline in 2023 by another 5%, despite the improvement in the key assumption about the course of the war.
Exports of goods from Ukraine in October fell by 8.2% compared to September, to $3.805 billion, while imports rose by 2.6%, to $4.615 billion, Deputy Economy Minister and Trade Representative Taras Kachka said.
The deficit of Ukraine’s foreign trade in goods in January-September 2022 increased 2.4 times compared to the same period in 2021, to $5.419 billion from $2.264 billion.
The growth of consumer prices in Ukraine in October 2022 accelerated to 2.5% from 1.9% in September, 1.1% in August and 0.7% in July.
The money supply in Ukraine (M3), after growing by 0.8% in September, added another 2.3% in October, or UAH 52.6 billion, to UAH 2.330 trillion, the National Bank of Ukraine (NBU) said.
Ukraine, which has achieved a deferral of repayment and payment of a significant part of external obligations to private creditors and the Paris Club, may enter into negotiations on the final terms of restructuring for the state debt closer to the end of the war, Deputy Head of the President’s Office Rostyslav Shurma has said.
Economic Monitoring’s Project Manager – PhD in Economics, Maksim Urakin
During the last two months a series of scientific and practical seminars-tastings of vintage drinks of 20-80 years old were held on the basis of Analytical center “Club of experts” with the assistance of a public association “Ukrsadvindindprom” and Charity fund “Reconstruction and development of Ukraine”. Representatives of Ukrainian wine industry, retail, mass media and other experts took part in these seminars.
All in all, participants of the workshops got acquainted with more than 40 kinds of vintage alcohol, produced in Ukraine and European countries in the second half of the last century. The total age of the drinks exceeds 3000 years.
In particular, such famous Ukrainian collection brands, as “Massandra sherry” from the 1980s and “Black Doctor” from 2007 were presented at the conferences. Among the European alcoholic brands the participants distinguished a rare sherry brandy “Hispano” 1870 (!), another Spanish drink “Ponche Rives” 1978, vermouth “Marsala” 1950-ies and other drinks. All in all 15 different vintage drinks were evaluated by the participants.
According to the words of the expert-collector of vintage alcoholic drinks Igor Magalas, the cost of the majority of samples which were presented at the seminars does not exceed the prices of similar drinks on supermarket shelves. At the same time, the taste and eco-friendliness of vintage drinks are an order of magnitude superior to many modern brands.
“The thing is that the automation of alcohol production lines, which became widespread at the end of the last century, led to a natural decline in quality for the sake of quantity. More than once I faced situations when at closed tastings sommelier experts preferred lower class vintage alcohol produced in the 1960s-1970s to modern expensive brands bottled in the 2000s-2010s,” Magalyas noted.
According to the expert, the reason for this is not the number of years the drink has been in the bottle, but the technological process of production at the initial stages, which largely affects the bouquet and taste of any alcohol.
Maxim Urakin, the organizer of the series of seminars, in turn, expressed hope for the further development of the vintage drinks market in Ukraine and for promotion of the culture of their consumption in the new year 2023.
“We will continue the promotion of vintage alcohol in the Ukrainian market. In Europe this product has a wide consumer audience for a long time, while in our country it is still considered “elite” and unavailable, although in my opinion it is a delusion. Therefore, the main purpose of our seminars, to make vintage alcohol more accessible to Ukrainians” – he stressed.
Vintage (molesim) in wine-making means the year of ripening of a certain grape variety which is used to produce wine, brandy, cognac or other vintage-based drinks. This indicator is important in determining the characteristics of the drink because weather and climatic conditions change every season, which may affect both positive and negative effects on the organoleptic characteristics of beverages of the same brand.
The Club of Experts is Kiev analytical center, which is engaged in researches in the field of economics, sociology and other scientific disciplines. In particular, with the assistance of the Club of experts during the last year there were held several events for the promotion of the national winemaking products.
Public Union “Ukrsadvindindprom” was a partner of the seminar and tasting. “Ukrsadvindwinprom” unites about 200 producers of fruits, berries, nuts and grapes, enterprises that process fruits and berries and produce wine, as well as scientific institutions for implementation of new scientific approaches in production.
The “Reconstruction and Development of Ukraine” Charitable Foundation has been providing extensive volunteer support to the army and civilians since the war began. In particular, with the support of KNUSA Rector Petr Kulikov, the foundation donated a modern mobile hospital for the needs of the military.
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