The release explains the Executive Board of the International Monetary Fund (IMF) conclusions of the 2013 Article IV consultation and the first Post Program Monitoring Review, as well as the Ex Post Evaluation of Exceptional Access under the 2010 Stand-By Arrangement with Ukraine.
“The Ukrainian economy has been in recession since mid-2012, and the outlook remains challenging. In January–September 2013 GDP contracted by 1¼ percent y-o-y, reflecting lower demand for Ukrainian exports and falling investments. Consumer prices stayed flat, held down by decreasing food prices and tight monetary policy. Weak external demand and impaired competitiveness kept the trailing 12-month current account deficit elevated at about 8 percent of GDP by end-September despite a significant reduction in natural gas imports. The high current account deficit amid less favorable international market environment pressured international reserves, which fell below the equivalent of 2½ months of imports by end-October 2013. Under currently planned policies, modest growth should return in 2014, driven by improvements in external demand, strong grain exports, and continuing consumption expansion. However, this outlook is subject to significant risks, emanating from the inconsistent policy mix and heightened political and economic uncertainty in recent weeks,” stated IMF in its press release.