Author: Olena Hrazhdan

Ukrainian President Volodymyr Zelensky is gearing up to overhaul his Cabinet of Ministers, with plans to request the resignation of Prime Minister Denys Shmyhal, a source within the Kyiv Post reported. The Verkhovna Rada, Ukraine’s parliament, has been notified to anticipate deliberations and a vote on a new cabinet on Tuesday, July 23, as per the Kyiv Post’s source. Speculation suggests that there will be a comprehensive revamp of the cabinet, rather than just a few new appointments, with some ministers likely to remain, such as Economics Minister Yuliia Svyrydenko, Finance Minister Serhii Marchenko, and Interior Minister Ihor Klymenko. Rumors…

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The proposal by Eurobond holders for debt restructuring in Ukraine fails to address the current wartime situation, says a report by Ukraine’s RRR4U economics think tank consortium. The harsh terms proposed could lead to default if an agreement is not reached by August 2024. The report, authored by the Resilience, Reconstruction, and Relief for Ukraine Consortium, warns of a looming default due to tight deadlines imposed by the International Monetary Fund and creditors’ unrealistic negotiation stance. Ukraine, recognizing its inability to pay post-invasion, offered two restructuring options for its $20 billion Eurobond debt. The proposed vanilla bonds and “Ukraine Recovery…

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Recent reports suggest that Saudi Arabia may have played a role in the G7’s decision to withhold direct seizure of $280 billion in Russia’s frozen assets. According to Bloomberg, Saudi Arabia hinted at potential consequences if the G7 decided to make all of Russia’s frozen assets available for Ukraine’s defense and reconstruction, suggesting they could sell Eurobonds and French bonds. While Saudi officials denied making any threats, the kingdom’s significant holdings could have had an impact on the G7’s decision-making process. Ultimately, the G7 agreed to provide Ukraine with $50 billion from Russia’s frozen assets, rather than seizing the entire…

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The Dutch Good Growth Fund (DGGF) injected nearly €5 million into Bank Lviv in Ukraine, marking the bank as the first in the country to attract a foreign investor since the onset of the war. Managed by Triple Jump and PwC on behalf of the Dutch Government, DGGF’s investment in Bank Lviv was announced at the Berlin Recovery Conference. Following DGGF’s investment, the bank’s largest shareholder, ResponsAbility Participations, added an extra €1 million to bring the total capital increase to €5.5 million. This capital infusion aims to enhance financial support for small and medium-sized businesses in western Ukraine, a region…

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Ukraine’s Ministry of Digital Transformation has announced the launch of the ePermit system, allowing businesses to access five pilot services for permits, licenses, and reports on occupational safety. The ePermit system is part of the Unified State Electronic System of Permit Documents, in line with the goals outlined in the Ukraine 2023 Report for EU Accession. First Deputy Prime Minister and Minister of Economy, Yuliia Svyrydenko, stated that the government aims to simplify the process for businesses to obtain permit documentation, with the first service set to be available by the end of July. Through the Diia website, businesses can…

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The National Bank of Ukraine released its Financial Stability Report, highlighting ongoing anxiety in the financial sector due to Russian strikes on energy infrastructure. Despite this, the Index of Financial Stress remains below pre-invasion levels. One major impact is the rise in Ukraine’s Eurobond yields, decreasing the value of existing bonds while interest rates for in-country bonds have fallen, making them attractive for investment. Banks are increasing their holdings of government bonds, along with business loan volumes, which rose by 12 percent year-over-year. Peer-to-peer lending is a driving force in the market, with easy access being a key competitive advantage.…

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The recent negotiations between Ukraine’s government and Eurobond holders have not resulted in a compromise, as both parties are at an impasse. The government is emphasizing the need for private creditors to cooperate and not hinder the country’s efforts to navigate a wartime economy without defaulting on its debt. The debt restructuring talks have been shrouded in secrecy until a recent press release on June 17, shedding light on the challenges faced by both sides. Since Russia’s invasion in 2022, Ukraine has been unable to make payments on its Eurobonds, leading to mounting debt and a dire need for financial…

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In order for Ukraine to access EU funds, follow the Ukraine Facility plan, and be part of the Extended Fund Facility IMF program, a series of reforms are required. These reforms are crucial for the country to recover from the ongoing war with Russia, meet EU integration standards, attract more investments, and improve governance. Vox Ukraine has outlined a comprehensive four-year plan for Ukraine to implement various reforms in governance, sectoral changes, and public finance management. Key areas of focus include anticorruption measures, aligning with EU regulations for businesses, improving the banking sector and financial markets, effective public finance management,…

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Welcome to the Ukraine Recovery Conference 2024 The recent Ukraine Recovery Conference in Berlin showcased a promising future for Ukraine’s reconstruction efforts, despite key resignations prior to the event. With over 3,000 participants, including First Deputy Prime Minister Yulia Svyrydenko, the conference yielded significant agreements in various sectors. Economic and Budget Noteworthy agreements include the transfer of €1.5 billion from frozen Russian assets, €1.4 billion in guarantee agreements under the Ukraine Investment Framework, and €188 million in financial aid from Japan. The European Bank of Reconstruction and Development (EBRD) also pledged €517 million to support Ukraine’s economy and recovery. Local…

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Ukraine’s economy is facing challenges with a gradual decline in domestic government bonds and deposits, but the central bank remains calm about inflation. Despite Russian shellings impacting energy infrastructure, the demand for electricity and energy equipment imports is expected to increase without severely affecting inflation. In May, inflation only rose to 3.3 percent annually, mainly due to a decrease in raw food prices. The National Bank of Ukraine reported that this decline in food prices is the fourth time in 25 years, partly attributed to a surplus of raw products per person resulting from migration. Favorable weather conditions, reorientation of…

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