Ukraine in ‘full-blown financial crisis’ – National Bank head
The country’s foreign exchange reserves shrank to $9.9 billion, as Kiev gave Naftogaz an estimated $8.6 billion to buy gas and settle state guaranteed Eurobonds. $3.1 billion went to settle the debt with Russia’s Gazprom, Gontareva explained.
The conflict over Russia’s reunification with Crimea has killed more than 4,700 people has also killed the economy.
“There is a full-blown financial crisis,” Gontareva told reporters Tuesday. “We can only overcome it if we implement quick and even extreme reforms.”
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Ukraine’s national currency, the hryvnia, has lost half of its value by November.
“…. There’s almost 100 percent devaluation in the country. From the economic territory, it’s called a 50 percent devaluation,” Gontareva said.
She said it is impossible to keep the hryvnia stable.
“This is simply an unrealistic task, because it’s not fixed in any constitution.”
Earlier in the week, after the unprecedented 10–hour session the Ukrainian parliament adopted the 2015 budget that sees a number of drastic cuts and import duty raised to 10 percent, which should give way to new IMF funds. The last IMF estimate showed that Ukraine needs another $15 billion, on top of the $17 billion the Fund had already agreed to allocate.