Leading analytical centers of Ukraine have called on the Ukrainian authorities to take a number of steps in anticipation of an impending global crisis due to the coronavirus pandemic, first of all, to prevent default in the country, UNIAN reports.
This is stated in a joint letter composed by economists at the Institute for Economic Research and Policy Consulting, the Ukrainian Institute for the Future, the Center for Economic Strategy, the Eidos Center, CASE Ukraine and EasyBusiness.
Analysts emphasize that Ukraine’s default would mean a rollback of the country’s economy by 5 years.
“The margin of safety allows servicing and paying off debts, and the support of the International Monetary Fund, the European Union, and other international institutions gives access to cheap financing, even when traditional financial markets are closed. Not to take advantage of this is to lose almost a decade of the country’s development,” the letter reads.
Economists recalled that this year Ukraine should return USD 7 billion to domestic investors and almost the same amount to external ones, and since financial markets are simply closed to developing countries since 2008, the program with the IMF should continue.
Economists also called for keeping the budget deficit within the planned framework and creating a fund to “extinguish fires,” including the negative consequences of falling global trade and quarantine across the country, unforeseen health care costs, unemployment assistance and sick leave pay, and rescuing companies and banks.
Analysts also recommend that Ukraine develop a plan to support the economy, introduce credit vacations and special credit lines for small businesses, establish control over the provision of loans to affiliated parties and the possible withdrawal of funds from banks, take measures to minimize panic in the financial markets, and pursue a sound exchange rate policy.
Read more: Coronavirus spread may slow down economic activity in Ukraine.
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