Ukraine economy

Rinat Akhmetov, Ukraine’s richest oligarch, claimed to the Financial Times on Monday that he pleaded with Viktor Yanukovich to resign when he last saw him on February 22, two days after nearly 100 anti-government protestors in Kiev were killed amid sniper fire and clashes with riot police. Continue reading »

What price an invasion? Rising alarm at the stand-off between Russia and the west over Ukraine is feeding straight through to Russian assets including the rouble, equities, bonds and CDS spreads.

So it was little surprise that Russia’s central bank decided on Friday that its “temporary” sharp hike in interest rates this month was not so temporary after all. Continue reading »

By Dalibor Rohac, of the Cato Institute, in Kiev

Beside the professional security in front of the building of Ukraine’s Cabinet of Ministers, a small group of volunteers from the Maidan is holding guard, a reminder that the political elite is there to serve the people, not the other way round. Inside, in a quintessentially post-Soviet boardroom with heavily draped windows and photographs of stern-looking former Ministers, a senior government official tells our group that they are “a government of kamikazes.” Continue reading »

The authorities in Kiev are not only in danger of losing control of the political and military situation in the Crimea; they may also lose the major state-owned companies based on the peninsula.

On Wednesday, Rustam Temirgaliyev, Crimean first deputy prime minister, told Interfax that the Crimean authorities were planning to take over state-owned giant, Chornomornaftogaz, which implements offshore oil and gas projects in the Black Sea and Azov Sea, “in the near future”. Continue reading »

By Christopher Granville, Director of Russia Research, Trusted Sources

For investors exposed to Russia and the wider market fall-out from Russia’s military move in the Crimea, it may be helpful to recall the lessons of a previous shock that threatened to undermine the investment case for Russia. The analogy I have in mind is the Yukos affair.

Then, as now, President Putin perceived a paramount interest that he decided to pursue regardless of the high costs to business and financial market confidence. Continue reading »

While the focus in Ukraine has turned to government formation, Russia’s response, and chase-the-president, it’s worth keeping an eye on some of the economic charts.

Here’s a run down. Continue reading »

Ukrainian bonds are rallying strongly on Monday as investors digest the weekend’s dramatic events. Short term bonds issued by the sovereign and by Naftogas, the state gas company, have recovered from their recent panic levels.

But is there so much for investors to cheer about? Continue reading »

We did this a couple of days ago but here it is again: the $1.6bn bond of Naftogaz, Ukraine’s state gas company, due on September 30. If 30 per cent in less than eight months wasn’t apocalyptic enough, its yield has now gone to 34 per cent and counting. Does this look like some kind of endgame?

Source: Thomson Reuters

 Continue reading »

This is the yield on the $1.6bn bond of Naftogaz, Ukraine’s state gas company, due on September 30 this year. Thirty per cent for less than eight months, anyone?

Source: Thomson Reuters

 Continue reading »

Source: National Bank of Ukraine

Foreign currency reserves of crisis-hit Ukraine plunged $2.6bn in January, the country’s central bank revealed on Friday hours after introducing fresh capital controls that bankers warned could choke trade and boost black market business activity. Continue reading »

By Ievgen Vorobiov of the Polish Institute of International Affairs

With protests in Kiev turning increasingly violent, the chances of a political compromise seem far less than they were just a month ago. Until recently, hopes for an agreement rested partly with the supposedly moderating influence of the country’s oligarchs. But this has changed. Continue reading »

Source: Thomson Reuters

How long can Kiev hold the hryvna? As fastFT reports, the currency has edged down for nine straight days to 8.37 to the US dollar, its weakest since September 2009.

It looks like a managed devaluation, of sorts. The exchange rate is controlled by the central bank so its slide shouldn’t be seen as a direct reaction to the turmoil on Kiev’s streets. But monetary policy can be almost as haphazard as the government’s reaction to opposition protesters. Continue reading »

A Russian bailout that Ukrainian president Viktor Yanukovich brokered last month appears to have propped up Kiev’s central bank reserves that were dwindling last year amid weak demand for Ukraine’s exports and a recession that was triggered, in part, by lack of reforms.

But the bailout has not stabilised the situation on Kiev’s streets. Continue reading »

Today beyondbrics begins a series of posts by guest commentators on the outlook for emerging markets in 2014. Our first contribution is by Timothy Ash of Standard Bank

As we move to the end of 2013, discussion inevitably moves onto which investment stories will be making the news in 2014. One country crisis which has been in focus as 2013 draws to an end – and seems set to drag into the New Year and beyond – is Ukraine. Continue reading »

Viktor Yanukovich, the embattled Ukrainian president, flew to Moscow in comfort on Tuesday, taking a lift on the luxurious Airbus owned by Rinat Akhmetov, his long-time backer and the richest of Ukraine’s oligarchs. Yet it’s far from certain that, back in Kiev, Yanukovich was comfortable about his controversial $20bn bailout deal brokered with Vladimir Putin – or that Akhmetov was happy to have provided his plane for the trip.

Both men’s discomfort will have been exacerbated on Wednesday by news that the EU and IMF had been ready to offer Ukraine $20bn in loans if Yanukovich had signed up to EU trade and association agreements as expected in late November. Continue reading »