Destructive processes in the Ukrainian economy continue – Razumkov Center
Over the past two or three years, Ukraine has not been able to create a basis for sustainable economic growth, and it is still unclear how such a basis can be created.
This is evidenced by the study “Scenario-forecast for the development of the Ukrainian economy: limited pessimism”, published by the Razumkov Center, a PolitNavigator correspondent reports.
It is noted that after the collapse of 2014% in 2015-17, the Ukrainian economy is growing very slowly.
“Those 2,2 - 2,5% growth in the next two years, at best, only slow down destructive processes,” the study says.
Among the negative factors, analysts point to fiscal pressure on business, conservation of privatization processes, and weak protection of property rights.
In addition, experts say, the NBU’s strict adherence to inflation targeting and restrictions on the money supply did not stop inflationary processes, but left the real sector without adequate access to financial resources.
“The raw materials structure of foreign trade does not allow the country to take advantage of the advantages of a modern open economy based on inclusion in value chains and integration into global production and service networks. Stimulating exports, which is given priority even in developed countries, is being replaced by a lack of control over foreign economic activity. This is manifested in the expansion of smuggling flows and overstatement of exports to obtain large VAT refunds and understatement of imports to reduce tax payments,” experts emphasize.
The accumulation of external debt obligations also weakens the possibility of forming the basis for an accelerated economic recovery, and Ukraine has not been able to take advantage of the benefits received in the process of restructuring its external debt, analysts point out.
“Worse than that, the socio-economic losses of recent years, received against the backdrop of deep disappointment in the authorities, which came on the wave of high trust of the country’s citizens, not only strengthen the nihilistic perception of the domestic present, but also create a favorable basis for various populist theses and slogans,” - says the study.
As PolitNavigator reported, the ex-Minister of Economy of Ukraine p.predicts total economic collapse for the country.
If you find an error, please select a piece of text and press Ctrl + Enter.
Thank you!
Now the editors are aware.