Business news from Ukraine

MACRO SUMMARY OF UKRAINIAN ECONOMY IN NOV-DEC 2020

Oxford Economics has improved its forecast for Ukraine’s GDP fall in 2020 to 4.6% compared to 4.9% of GDP in the November forecast, according to the December forecast.
The fall of the Ukrainian economy in 2020 may amount to 5.5% of GDP with a further recovery of growth by 3.5-4% in the next two years, analysts at Deutsche Bank expect.
The Kyiv School of Economics (KSE) expects the economy to fall by 5.1% of GDP in 2020, according to the KSE economic activity review for the fourth quarter of this year.
The National Bank of Ukraine (NBU) preliminarily estimates the loss of Ukraine’s GDP from the enhanced quarantine in January 2021 at 0.2%, Deputy NBU Governor Dmytro Sologub has said.
The fall in the gross domestic product (GDP) of Ukraine in July-September 2020 amounted to 3.5% compared to the same period in 2019, the State Statistics Service confirmed its preliminary assessment, published in mid-November.
The deficit of Ukraine’s foreign trade in goods in January-October 2020 decreased by 71.4% compared to January-October 2019, to $3.354 billion from $8.496 billion, the State Statistics Service reported on Tuesday.
The growth of consumer prices in Ukraine in November 2020 accelerated to 1.3% from 1% in October and 0.5% in September after falling by 0.2% in August and 0.6% in July, reported the State Statistics Service on Wednesday.
The 2021 national budget provides for a deficit of 5.5% of GDP, or UAH 246.6 billion, according to the text of the law released on the website of the Finance Ministry on Monday.
Most members of the Monetary Policy Committee of the National Bank of Ukraine (NBU) expect the key policy rate to rise to 6.5-7.5% in 2021 due to the predicted rise in inflationary pressures, the regulator’s website said on Monday.
The total public debt of Ukraine in November 2020 increased by 1.16% in U.S. dollars, to $ 84.24 billion and by 1.27% in hryvnias, to UAH 2.398 trillion, according to data on the website of the Ministry of Finance.
The prices of industrial producers in Ukraine in November 2020 increased by 2%, while in October by 3.8%, in September by 1.7%, in August by 2.3%, in July by 0.4%, and in June and May their decline was recorded by 2% and 0.6%, respectively, the State Statistics Service has said.
Industrial production in Ukraine in November 2020 compared to November 2019 decreased by 0.3%, while in October by 5%, in September by 4.4%, in August 5.3%, in July 4.2%, June 5.6%, May 12.2% and April 16.2%, the State Statistics Service has reported.
Since the beginning of the new 2020/2021 marketing year (MY, July-June) and as of December 11, Ukraine has exported 22.89 million tonnes of grains and legumes, which is 3.8 million tonnes less than year-over-year.
The transport companies of Ukraine in January-November 2020 reduced transportation of goods by 11.6% compared to the same period in 2019, to 546.6 million tonnes, the State Statistics Service has reported.
Ukrainian transport companies carried 2.345 billion passengers in January-November 2020, which is 39.9% less than in the same period in 2019, the State Statistics Service has reported.
Retail trade turnover in Ukraine in November 2020 increased by 12.1% compared to the same month in 2019 in comparable prices, while in the previous month the growth was 15.2%, the State Statistics Service has said.

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DEUTSCHE BANK EXPECTS UKRAINE’S ECONOMY TO FALL BY 5.5% OF GDP IN 2020

The fall of the Ukrainian economy in 2020 may amount to 5.5% of GDP with a further recovery of growth by 3.5-4% in the next two years, analysts at Deutsche Bank expect.
According to the materials of Emerging Markets Outlook 2021, experts admit that the next tranche of the International Monetary Fund (IMF) will be allocated to Ukraine in early 2021, which will pave the way for obtaining funding from other international partners.
At the same time, the central bank will leave the discount rate at 6% per annum, according to the review.

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MACRO SUMMARY OF UKRAINIAN ECONOMY IN SEPT-OCT

Ukraine has entered the crisis in better macroeconomic condition than in previous crises due to prudent macroeconomic management over the past several years, and activity in Ukraine, the largest economy in the subregion, is projected to shrink in 2020, by 5.5%, the World Bank has said.
The decline in GDP in January-August 2020 will amount to 5.8%, the Ministry of Economic Development, Trade and Agriculture of Ukraine expects in the review of economic activity in August.
The International Monetary Fund (IMF) has improved its assessment of the decline of Ukraine’s GDP in 2020 to 7.2% from 8.2% in the June forecast.
The National Bank of Ukraine (NBU) has said that the GDP forecast for 2020 has remained unchanged at 6% and the expectations regarding its growth next year were improved from 4% (in July forecast) to 4.2%, the NBU said on its website on Thursday.
The National Bank of Ukraine (NBU) has improved the assessment of the decline in the gross domestic product of Ukraine (GDP) to 6.2% in July-September 2020 from 7.4% (in July’s forecast), according to an inflation report posted on the regulator’s website on Thursday night.
The National Bank of Ukraine (NBU) predicts a deficit of the public administration sector in 2020 at 6.5%, in 2021 at 4% of GDP and in 2022 at 3% of GDP, according to the central bank’s inflation report posted on its website on Thursday night.
The Board of the National Bank of Ukraine (NBU) has decided to leave its key policy rate unchanged at 6%, according to a posting on the website of the central bank on Thursday.
The National Bank of Ukraine (NBU) has improved its inflation forecast for 2020 from 4.7% (in the July forecast) to 4.1%, while worsened it for the next year from 5.5% to 6.5%.
The volume of exports of goods in September amounted to $4.19 billion, which is 2.87% higher than in September 2019, but 0.77% less than in August, the State Customs Service has reported.
The deficit of Ukraine’s foreign trade in goods in January-August 2020 decreased 59.4% compared to January-August 2019, to $2.399 billion from $5.915 billion, the State Statistics Service reported on Thursday.
Consumer prices in Ukraine in September 2020 increased 0.5% after a decrease of 0.2% in August and 0.6% in July and an increase of 0.2% in June, 0.3% in May and 0.8% in April and March, the State Statistics Service reported on Friday.
The National Bank of Ukraine (NBU) has improved its inflation forecast for 2020 from 4.7% (in the July forecast) to 4.1%, while worsened it for the next year from 5.5% to 6.5%.
State budget revenues in September 2020 amounted to UAH 76 billion, which is 15.3% more than the planned figure and 11.5% more than last year’s level, according to the data of the State Treasury Service.
The total public debt of Ukraine in September 2020 decreased 2.6% in U.S. dollars, to $82.89 billion and increased by 0.32% in hryvnias, to UAH 2.345 trillion, according to data on the website of the Ministry of Finance.
The prices of industrial producers in Ukraine in September 2020 increased 1.7%, while in August the increase was 2.3%, in July 0.4%, and in June and May they decreased 2% and 0.6%, the State Statistics Service reported on Monday.

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YULIA TYMOSHENKO: DRAFT NATIONAL BUDGET THREATENS WELL-BEING OF PEOPLE AND UKRAINIAN ECONOMY

Leader of the Batkivschyna party Yulia Tymoshenko believes that the draft national budget for 2019 submitted by the authorities is a budget for the destruction of the economy, since it envisages raising tariffs and freezing minimum wages and pensions, which will lead to the total impoverishment of the population and the destruction of the middle class, according to the official website of the party.
“For the first time in the history of Ukraine, wages and pensions are equal to 43% of the subsistence level. This is the budget of total poverty, saving the tariff policy that is crushing for Ukrainian families – they are increasing by 23%. This is a corrupt and destructive budget for the economy,” Tymoshenko told journalists in the parliament.
According to the leader of Batkivschyna, the minimum wages and pensions provided in the estimates in U.S. dollar terms are 1.7 times less than they were at the beginning of 2014, health care financing has been reduced by 1.6 times.
According to Tymoshenko, it is unacceptable that the budget for 2019 is based on the old tax base, with twice the higher rates than in developed countries, which significantly slows down the development of the economy.
The politician noted that if the government draft budget is adopted, “the economy’s falling, emigration of people to other countries, the destruction of the middle class will continue.”
“This budget, in essence, is a verdict to the country. I hope that the deputies will not risk voting for it,” Tymoshenko stated.

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