What will be the salary and the dollar: the forecast for 2018

For two years the salaries of Ukrainians are expected to increase, but the dollar could jump up to 35 UAH. Such predictions of life in the country for 2017-2018 made in the Ministry of economic development and trade (MEDT). How realistic are these figures, found “Today”.

FIGURES. According to the calculations of the authorities, will have a steady increase in real GDP, wages in dollar terms will increase from nearly $ 215 to $ 250, and price growth is likely to lag behind income growth by 12%. Experts say the plans are too optimistic in terms of GDP growth and wages, however, agree that on average a macro is achievable, but provided the de-escalation of hostilities. Otherwise, the economy will nedobirayut GDP, budget revenues, salaries and “sorted” for the growth of inflation and unemployment, the devaluation of the hryvnia.

As you can see from the infographic, intelligence Ministry gave three scenarios for the macro. For example, real GDP growth is estimated at 1.5—3% in the current year and 2-5% in the next, the inflation rate changes from 9% to 13.7% and from 6 to 11%, respectively. The increase in the average wage also varies from 600 to 1600 UAH per year. A more certain situation with forecasts of nominal GDP, revenues and expenditures of the state budget and the dollar — a maximum from the minimum differs by 7-20%.

EVALUATION. Economist Ivan Nikitchenko believes that the baseline may be the average forecast of the Ministry with the inclusion in some directions the maximum position. “For two years, real GDP growth is 2-3%, inflation will fluctuate in the range of 9-12%. This is a good scenario to demonstrate further recovery of the economy. The inflation forecast at 9% in 2017 can be considered optimistic, because in our situation the index potreban less than 10% suggests that the income level of the population will gradually adapt to the current exchange rate, growth komuslug, etc. All this will lead to a real increase of average salaries of the population with 5200 last year to 7000 UAH to 8000 UAH this and in the next. Start increasing earnings given as mentorplace already is 3200 UAH. That is, employers will be forced to withdraw income out of the shadows, to create legitimate jobs. All this will allow for two years to reduce the unemployment rate to 8-9% from 9.9% in 2016”, — said Nikitchenko.

The President Ukranalittsentra Alexander Ohrimenko more pessimistic: “GDP, income, reserves, salaries, our Center expects minimal growth, but for inflation, dollar exchange rate, expenditure, growth of public debt, on the contrary, the maximum. For example, the national Bank’s reserves will be reduced due to the fact that you have to repay the IMF loan and new loans may not be or they will be small — 1-2 billion dollars per year.”

FORECASTS. According to Nikitchenko, the average scenario is real because in 2017-2018 is not expected sharp fluctuations in the exchange rate. “The economy Ministry promised that the average annual dollar exchange rate will be UAH 28-29 this year and RS 30-32 next — predicts Nikitchenko. — This is possible because the national Bank now follows a policy of slow devaluation of the hryvnia, which corresponds to the current state of the economy. As a rule, the hryvnia depreciates in January-February and October-December when the greatest pressure is inflation, the need to purchase gas and coal, improving social standards, the growth of “communal”. To the fall of the hryvnia was not sharp, the NBU uses the resources in order for 2-3 months to stabilize the hryvnia fluctuations,” — said Nikitchenko.

Okhrimenko most worried about the hryvnia — the expert considers undervalued, even maximum performance of the Cabinet. In his opinion, the expected increase in gas prices will increase the cost of its purchase that will reduce the arrival of foreign currency in the country and increase its outflow. “The hryvnia exchange rate much more than before, will depend on the money of our migrant workers abroad: the more VCS will come from them in the country (in 2016 was about $ 5 billion — Ed.) the stronger will be the hryvnia, as the currency will go to market. Most real average annual rate of about 30 UAH/USD. in December 32 UAH/USD. Forecasts to 2018 to give now difficult, as they depend on many factors,” — said Okhrimenko us.

While both experts clarify that the baseline scenario at any time may deteriorate as the Ukrainian economy remains highly dependent on various force majeure — in the form of prospects of cooperation with the IMF, the risks of escalation of the conflict in the East or surprises in terms of special elections to the Verkhovna Rada. “But despite that our economy is showing continuous recovery. And if the current trends remain unchanged, then in 2-3 years people will be able to experience the real and steady improvement in the standard of living,” summed up Nikitchenko.