Experts have predicted what will happen to the Ukrainian economy and the hryvnia in case of delay of money from the IMF.
Experts believe that even in the case of continuation of cooperation with the IMF, money from him we don’t get at least another six months.
According to the Executive Director of the Economic discussion club Oleg Penzin, Ukraine will get 500 million Euro bailout from the EU, as has already been stated by the head of the EU delegation to Ukraine Hugues Mingarelli. These two factors will allow big business to borrow at low interest rates abroad. In his opinion, this situation will have a positive impact on the economic growth in Ukraine.
The NBU explained the reasons for the delay bailout from the IMF. So, according to first Deputy Chairman of the NBU Kateryna Rozhkova, the Fund concerned about the de facto Amnesty for corrupt officials after the constitutional court of Ukraine abolished the article of the law that allows officials to explain why they cost more declared income.
According to many analysts, the IMF money in the short term do not play a decisive role in the return of debts. But without Ukraine it will be much harder. For example, economist Ivan Nikitchenko said that Ukraine has passed the peak period this year and in foreign exchange reserves of $ 20 billion must be returned to the Fund of about $ 600 million.
“We have a good balance of outflow-inflow of currency into the country, so if a positive decision on the tranche, albeit late, the hryvnia exchange rate will remain stable. But when the negative decision, the pressure on the exchange rate will not be until December, and most likely in the first quarter of 2020, will begin again when large payments on the external debt and it will take more than a year without assistance from external partners,” says Nikitchenko.
Pendzin at this time reminded that the fall of the Ukrainian budget expect much more expenses in addition to debt payments. For example, the purchase of foreign investors of government securities issued at high interest rates (18% per annum, which is twice the projected inflation rate) and the purchase of gas for the new heating season, which will result in approximately $ 2 billion of costs.
Analysts gave a forecast that tranche of the IMF Ukraine will receive not earlier than November-December of 2019.
“We need to adopt a new law on the fight against corruption, to resolve the issue with PrivatBank, the fall in connection with the cost of gas will again become a topical issue of increasing prices for the population, and, most likely, rates will rise. All this will do for the new Parliament and the Cabinet. If the scenario is positive: tranche received – the hryvnia will remain stable, the rate is expected to fall in the range of 27.5-28 UAH/USD. If negative: tranche postponed again until the end of this year will be more than 29 UAH/USD” – listed Pendzin.
At the same time Nikitchenko predicts that the lack of a tranche in any case, affect the hryvnia exchange rate and macroeconomic processes (slowing GDP growth, inflation) not earlier than the first quarter of 2020.
“We have a negative trade balance, which, when the deterioration of revenues by finoperatsy sharply escalates into a negative balance of payments – a situation we observed in 2008 and 2014,” – says Nikitchenko.