Growing rating of Ukraine
2011-07-22 16:03:48
On Thursday, July 21st Fitch Ratings Agency has changed the rating of the country concerning long-term debt in national and foreign currency emissions from “stable” to “positive”. Head of analytical group Fitch Charles Sevil explained improvement of the current situation as the result of lower budget deficit compared to the past period as well as recovery of the economy and expenses’ optimization.
Government of Ukraine was able to achieve progress in terms of lowering the level of budget deficit to 4% GDP in 2011 from 7.9% GDP in 2010. Partially these 4% are comprised of 0.5% deficit from losses of “Naftogaz Ukraina”, which refused to adjust internal prices for gas as requested by IMF. One of the positive changes determined by IMF is determined to be pension reform which will enable solving medium-term fiscal problems and will stabilize national debt to approximately 30% of GDP.
Rating Agency will increase the ratings even higher in case banking sector will be seen improving, and there will be less macroeconomic issues in terms of debt. Such positive review will most likely contribute to further growth of investments in the country from foreign investors, especially with various issues in Euriope.