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Saturday, October 22, 2016

The Ukrainian authorities “painted” the GDP growth of 3%

Ukrainian authorities intend to take abroad for the next $2.8 billion At least this amount is included in the draft budget for next year. Need the money to service the previous Western borrowing. For a loan of $3 billion, which is almost three years ago took the Russian ousted President Viktor Yanukovych, in Ukraine, few people remember.

photo: pixabay.com

Last week the Cabinet of Ministers of Ukraine adopted a rather optimistic draft budget for 2017. According to the forecasts of local officials, the growth of GDP by the end of next year will reach as much as 3% with inflation slowing almost doubled to 8.1%. Unemployment down to 8.7%, the deficit is planned not more than 3%. Simultaneously, the government without increasing the tax burden on business is going to substantially increase spending on defense and security.

It’s hard to say how realistic is it to achieve such performance. This year the world Bank predicted GDP growth of just 1% when inflation is 15%. The head of the faction of the Radical party in the Verkhovna Rada Oleg Lyashko believes that the growth of the Ukrainian economy up to 3% is impossible. “This budget is the preservation of corruption. he said. Is the budget abuses. This is the budget that actually continues its policy of turning Ukraine into a raw material consumption. Our political team proposed to first focus on budget revenues. Because the budget revenues is possible only under condition of radical economic growth. The promised 3% GDP growth next year is a bluff. No growth will be.”

Really, and where did it come from, even if Ukrainian experts call the current growth of the industry “numbers game”.

“The main reason for the increase in industrial production is the base of comparison. – said President of the Ukrainian analytical center Alexander Okhrimenko. – In 2015, was a dizzying collapse. Then I quarter the decline in industrial production was more than 25%. Therefore, due to the slight stabilization of a rise of 3% after a 25% fall is more likely the effect of a comparison than something real. In addition, state statistics Committee began to consider the production of coal, coke and metal in the area of ATO, where we often do not make a profit. The result is a sharp increase in the production of these products in relation to 2015.”

Do not forget that Ukraine is in debt as in silks. In 2017, the budget will be spent on repayment of public debt more than 240 billion hryvnia (about $9.2 billion), $2.8 billion in payments on external loans.

Where Ukraine will get the money? Of course, it will. The total amount of debt will reach 66.4% of GDP.

The four-year program of financial assistance the IMF provides for the allocation of Ukraine $17.5 billion In 2015, was transferred two tranches of $6.7 billion last week, the IMF decided yet about one billion.

It was opposed by Russia, as Kiev refuses to pay us $3 billion. However, in order to support the economy of Ukraine, the IMF went on to revise its own rules. Previously, the Fund could allocate funds to countries with debt.

To receive the fourth tranche next year, the Fund has put forward new conditions — it is necessary to carry out pension reform (in fact, we are talking about reducing pension benefits), to develop a mechanism to increase tariffs for gas and heating, to approve the list of enterprises to be privatized, as well as to adopt a law on turnover of lands. The result may be that the most attractive Ukrainian enterprises and the topsoil will be sold under the hammer Western partners.


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