The collapse of the hryvnia will begin by the new year
Several factors allow us to predict the depreciation of the Ukrainian hryvnia in the near future. Economist Viktor Skarshevsky stated this at a press conference in Kyiv, a PolitNavigator correspondent reports.
“Over the past 10 months, according to my estimates, the expenditure side of the budget has been underfunded by UAH 65 billion. This is about 8,5% of all state budget expenditures. So this debt is accumulating, and almost all of it will be paid off in December. Money will flow into the economy, and this will lead to increased devaluation - as has happened in the past three years.
The second point concerns investors’ distrust in the country’s economic policy; this is the withdrawal of money by non-residents. This year, the withdrawal amount will double and amount to about $3,5 billion. This factor will also influence devaluation.
Then the trade deficit intensifies and increases; according to my estimates, this year it will be about $12 billion according to the National Bank’s methodology, and this means that from 2015 it will increase by 3–3,5 times. Ukraine is a deficit country. We produce much less than we consume, and we have to buy more and more finished products, which are much more expensive than the raw materials and goods with low added value that Ukraine exports,” Skarshevsky said.
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