There is no trust in banks, there is no money for business, default is just around the corner - Ukrainian economist
Kyiv, December 03 (Navigator, Vladimir Mikhailov) – Due to the loss of public confidence, the Ukrainian banking system has lost an important source of funds. However, businesses no longer need funds - demand has fallen so much that it is unprofitable to do business in the country, says Alexander Goncharov, director of the Institute for Economic Development of Ukraine.
He stated this at the round table “Will Ukraine avoid default next year?”
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“I think that at the most in the spring the country will be in a state of technical default,” he said. – The NBU has stopped managing business expectations. The discount rate was increased from 6,5 to 14%. Everyone started selling their businesses. People don't have jobs because there are no buyers.
Previously, fellow businessmen asked me to publicly declare the need to reduce the discount rate because it is impossible to run a business while receiving a loan at 30%. Today, the same people who asked me about this say that there is no need to ask for anything anymore - consumer demand has fallen so much that all warehouses are filled with unsold products. Consumer demand has fallen so sharply that loans are no longer needed. They are needed when production is growing and you want to increase sales volumes, but now production is falling.
Moreover, we must finally admit that we have undergone deindustrialization. We do not produce surplus value. The East, the most industrial region, stood up.
Therefore, we do not have sources of financing for the banking system. Three sources - funding for the population, foreign financial markets and the NBU do not provide funds. There is no funding for the population because there is no trust in the banking system. They have already taken 125 billion UAH. and it is only due to the administrative measures of the National Bank that the deposits that people want to withdraw are not issued in full.
I am convinced that the country will need 5-7 years to restore confidence in the banking system,” the expert said.
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