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 Ukraine's economy set to recovery after 18-month decline, - Bloomberg

Ukraine’s economy probably exited 1 1/2 years of recession last quarter, reaching a milestone toward what officials predict will be a drawn-out recovery.

Censor.NET reports citing Bloomberg.

Gross domestic product rose 1 percent in July-September from the previous quarter, the central bank estimates, buoyed by a modest industrial revival and relative peace in the nation's east. The annual decline eased to 9.5 percent, according to the median forecast in a Bloomberg survey of five economists. The State Statistics Office is due to report the data Monday in Kyiv.

economy

A cease-fire in Ukraine's 19-month conflict with pro-Russian militants has allowed companies to boost production and eased pressure on the hryvnia, this year's fourth-worst performer against the dollar. While the government is trying to turn the economy round with help from a $17.5 billion International Monetary Fund loan, growth may only rebound by 1 percent to 2 percent in 2016, according to investment bank Dragon Capital.

"Consumption, investment and exports will improve slightly," Olena Bilan, Dragon's chief economist, said by phone from Kiev. "Reform progress next year will determine Ukraine's future growth model -- whether it embarks on a sustainable, investment-driven growth path or remains a volatile economy driven by consumption and exports."

Read more: Russia cannot impede allocation of IMF loan to Ukraine, - National Bank head

The central bank is a little more optimistic, forecasting economic expansion of 2.4 percent in 2016 after this year's projected 11.5 percent contraction. Industry is one bright spot, with Metinvest, the nation's biggest metals producer, reporting that output at its iron and steel plant in Mariupol, on the edge of the conflict zone, jumped 16 percent from the previous three months in the third quarter.

Reform efforts, including a crackdown on corruption, are key to the flow of aid from the IMF and other ally governments such as the U.S. and Japan. U.S. Treasury Secretary Jack Lew reiterated Friday to reporters in Kiev that assistance in the form of loan guarantees hinges on progress to revamp Ukraine's economy and institutions.

"The more we do, the more we'll get," Prime Minister Arseniy Yatsenyuk told the same news conference.
 
 
 
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