In a July 2 report for the Financial Times, Roman Olearchyk writes: Gross domestic production in Ukraine, one of the world’s most recession-battered economies, contracted by 20 per cent in the first quarter of 2009, according to official government figures released on June 30.
After months of delay, the figures were released by the government of Yulia Tymoshenko, prime minister, during a visit to Kiev by an International Monetary Fund mission. The Fund is mulling whether to grant Ukraine a third tranche from a $16.4bn lifeline granted last fall.
European leaders and bankers are keeping a close eye on Ukraine, whose economy is deep in recession and finances are stretched to the limit. With a 40 per cent stake on the Ukrainian market, European banks fear troubles in the country’s shaky bank sector could spill over. Europe also worries Kiev’s inability to pay for Russian natural gas imports could spark another energy war. Its pipeline system feeds Europe with 80 per cent of Russian natural gas imports, but Ukraine has in recent months struggled to pay Gazprom. Russian leaders have pressured Brussels to help broker a loan of $2bn-5bn for Ukraine, warning that supplies to Europe could be cut off as during a January dispute if Kiev fails to pay.
