Ukraine faces two scenarios – bad and terrible
All banks with foreign capital operating in Ukraine are sitting on their suitcases and want to leave the Ukrainian market.
Financial analyst Alexey Kushch writes about this in an article published by the Kyiv online publication “Apostrophe”.
“The 2020 budget states that we will spend 145 billion hryvnia exclusively on servicing public debt - internal and external. This is not even repayment of the loan body, this is the payment of extremely high incomes to financial speculators. And this is already equal to the costs of education and significantly exceeds the costs of medicine, science and infrastructure projects,” notes Kushch.
He believes that the 2020 budget will not cause a default.
“A significant devaluation of the hryvnia is possible if a time bomb like PrivatBank explodes. It is now state-owned and has about 180 billion in deposits from the population. Any destabilization of this “mine” can lead either to social destructive processes or to devaluation,” the expert believes.
According to him, 60% of the banking system in Ukraine is now state-owned.
“This is also a time bomb. The 2014-15 crisis affected private banks, and the next one will affect the core of public banks. The state will be forced to either print money to return depositors, or introduce moratoriums, which will lead to a social explosion. Therefore, there will be a bad scenario and a terrible one. Our banks should be sold to private owners if buyers were found. But all the international banks that are in Ukraine are sitting on their suitcases and want to leave our market,” the analyst writes.
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