The world Bank last week said that the Ukrainian government will have to postpone hopes of economic growth until 2016, as it is projected to decline 8 percent this year and 1 percent next year because of a violation of industrial activities in the East. Alarmed by the crisis, and poisoned relations between Kiev and Moscow, investors have dumped Ukrainian assets, pushing bond yields to the heavens, and the hryvnia to historic lows.
The main hope of the destroyed economy of Ukraine are under the rubble in the Eastern regions, where most of the crippled industrial power. Only when industrial production will come out of the dive, and currency stabiliziruemost probably then there will be the credibility of the recovery of the economy which is shrinking at the fastest pace since the global financial crisis of 2009.
At the annual meeting of the International monetary Fund and the world Bank in Washington, Ukraine wants to renegotiate the deal with IMF in April in the amount of 17 billion dollars. Kiev said that the country is at war and it needs to build new armed forces. But some analysts say the new loan terms can have negative consequences for Ukraine's economy.
Economist Oleh Soskin, Director of Institute of society transformation in Kyiv, said the world Bank estimated the Ukrainian economy will shrink by eight percent is too optimistic. We expect Ukrainian GDP will fall by about 15 percent at the end of 2014, and the country should be wary of borrowing more money from the IMF.