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Saving Ukraine's economy requires reducing the discount rate to 4% — Bakhmatyuk
17 July 2019, 13:06
The mismanaged policy of the National Bank of Ukraine (NBU) prevents the Ukrainian economy from recovering. High discount rate and high profitability of the National Bank certificates of deposit are beneficial for profiteers, but not for investors. Such an opinion was expressed by Oleg Bakhmatyuk, the founder of Ukrlandfarming, UNIAN reports.
Surveys of the analytical center of the Federation of Employers of Ukraine showed that more than 75% of respondents are not ready to invest in the Ukrainian economy under the current conditions when the discount rate of the National Bank is 17.5% and inflation stands at 9%. Such a gap makes it impossible to develop the economy, blocks lending to the industrial sector.
"As long as there are certificates of deposit that are higher than real lending rates, there will exist this system. When a profiteer withdraws money from the system, the national currency will collapse. We need to make a decision for ourselves: we are preparing a cover of USD 3 billion, then we are gradually reducing the rate from 17% to 8%, and then in three years we go for 4%," said Oleg Bakhmatyuk.
Not only foreign but also Ukrainian investors are looking for opportunities to invest in the economies of other countries with more favourable conditions.
"More than 61% of respondents consider other countries with lower interest rates as an alternative to financing investments in Ukraine. And many are already investing in other countries. That is, the majority of businesses are ready to invest and create jobs anywhere, but not in our country, because the policy of the NBU, the Ministry of Economy, the Ministry of Finance is not conducive to investment in Ukraine," said Dmitry Oleynik, Chairman of the Federation of Employers of Ukraine.
In the opinion of Oleg Bakhmatyuk, a number of branches of agricultural production in Ukraine are unprofitable social projects, and without state support, agribusiness will be forced to shut them down gradually.
