Ukraine: IMF Chief Visits, States “Stability is Taking Hold”

The head of the International Monetary Fund is in Kiev to gauge the impact of the IMF’s $17.5 billion stimulus on the Ukrainian economy. Thus far, indications have been positive, according to Nikolay Gueorguiev, who has stated specifically that the project has been well implemented and that “stability is taking hold.” The second, $2.5 billion tranche of the stimulus is still pending, and will likely be used to solidify the country’s foreign reserves, which have nearly been exhausted as a result of the country’s ongoing economic crisis.

Despite the generally optimistic statements, the IMF recently revised downwards its growth projects for the Ukrainian economy. The country’s estimated inflation rate for 2015 is expected to be at 46% and the country is currently involved in debt restructuring.

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News Briefs:

  • Ukrainian President Petro Poroshenko appointed Mikheil Saakashvili, the former President of Georgia, as the governor of the Ukrainian region of Odessa. Saakashvili is an inveterate opponent of the the Kremlin and a strong proponent of stronger relations with the West, making his appointment appear to have motives that go beyond governance. The Saakashvili has stated that he will work to combat corruption and improve the economy over the next few months.
  • In what appear to be counter-sanctions directed at the European Union, Russia imposed an entrance ban on 89 European military and political officials. The majority of those on the list have reportedly spoken negatively of the Russian government. Already, some of those prohibited from Russia have expressed outrage at the maneuver.
  • The Guardian recently posted a new piece depicting the Iranian technology sector. Specifically, the article focuses on the start-up scene, which it even compares to Silicon Valley due to the enthusiasm of young Iranians and the relatively high amount of recent graduates with engineering and computer science degrees.
  • Russian energy major Gazprom released a statement showing that the Ukrainian government owes them a total of $29.5 billion in natural gas payments. Gazprom is currently embroiled in arbitration with Naftogaz, Ukraine’s state-owned oil and gas firm, and a deal appears to still be far off. The two sides are at loggerheads over payments Naftogaz allegedly should have made in 2013, 2014 and 2015.
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