Ukrainian economic growth in 2017-2018 could be achieved by increasing exports, improving terms of foreign trade, improvement in consumer and investment demand. This opinion was expressed by analysts of ForexClub.
GDP growth this year, according to forecasts of experts, will be 1.2%. However, the risks to the stability of the economy still remain.
“Given the falling prices in commodity markets, the main export routes of Ukraine, and perhaps keeping them at low levels until the end of the year, the inflow of foreign exchange can be significantly reduced. And when you consider the loss of part of production capacity of nationalization on the uncontrolled territories, the potential losses to the economy in 2017, can reach to 2 – 2.5 billion dollars. Furthermore, it is likely imports will continue to exceed exports as a result of import substitution and investment demand,” the analysts say.
At the same time, the main driver of economic growth in the years 2017-2018. according to experts, will be an investment, and expansion of export potential of Ukraine.
Analysts point out that the important work on entering new markets and diversifying the existing ones, the implementation of the transit and industrial potential, introduction of free trade zones, improvement of investment climate, cooperation with IMF and reform.
“Creating an attractive investment climate and export promotion are key conditions for increasing the inflow of foreign currency into the country and the number of jobs, the increase in consumer demand, in particular, the formation of a strong domestic market and the growth of the economy as a whole. An important prerequisite for this is the successful conduct of macroeconomic policy and structural reforms needed to preserve financial stability. In fact, in the case of ineffective implementation of reforms, increase the risk of negative impact on inflation and the hryvnia ” – said the expert ForexClub Ruslan Demus.
However, according to experts, the growth of the economy in the current year will not help the hryvnia exchange rate – during the year, the national currency can be in the range of 28.5 – and 31.5 UAH per dollar.
“The risks associated with the payment of the “debt of Yanukovych” and the nationalization of Ukrainian enterprises in uncontrolled areas can cause a drop of 3 to 5.6 UAH per dollar. Support the stability of the hryvnia to provide cooperation with international lenders, particularly the IMF, the recovery of exports and reducing imports, a balanced monetary policy and the relative stability in global markets,” said Demus.
We will remind, on April 3, the Board of Directors of the IMF completed the third review of the economic program of Ukraine in the framework of the extended financing facility (EFF) that allows you to give Ukraine about 1 billion dollars.
The decision to allocate the tranche was made after further examination by the IMF of a possible impact of the trade embargo on the Ukrainian economy and update the macroeconomic forecasts of the NBU and the Ministry of Finance. The IMF came to the conclusion that the situation will be a moderate impact on economic growth and the balance of payments and will not pose a threat to the implementation of the inflation target of the NBU.
The money is not yet credited to the account of the National Bank and the Ministry of Finance of Ukraine.
Ukraine and the IMF in March 2015 signed a Memorandum of economic and financial policies which the country should undertake in the framework of the extended Fund (EFF). The entire program provided Ukraine with about $ 17 billion of which have already been allocated 7,7 billion dollars. So, in September 2016 after a delay of a year, the IMF approved the granting Ukraine the third tranche in the amount of one billion dollars.
