The UX Index was up by 0.9% in UAH terms on Tuesday, and up by 0.3% in the US dollar terms. At the same time, the PFTS index was up by 1.3% in UAH terms. Six out of ten companies in the UX index were up in the UAH terms, with the largest increase in prices observed for Enakievo MP (7.4%), Ukrnafta (2.5%) and Bank Aval (2.0%).
On the interbank exchange market, the USD/UAH spot rate was up by 0.7% with the closing price of 15.34 (mid price), according to Minfin.com.ua, while the average exchange rate reported by the NBU was 15.11.
Ukraine 5-year credit default swaps were up by 4.9% on Tuesday.
- Newly-appointed Ukrainian government to prepare draft of Ukraine’s state budget for 2015 till December 20, 2014
Newly-appointed Ukrainian government to prepare draft of Ukraine’s state budget for 2015 till December 20, 2014
Yesterday the Ukrainian parliament approved the new government. Three Western-educated foreigners were appointed to the Cabinet: co-founder and CEO of the Western private equity funds operator Horizon Capital Natalie Jaresko as Minister of Finance, partner of the Swedish investment company East Capital Ayvaras Abromavichus as Minister of Economic Development and Trade and former minister of Health in Georgia Alexander Kvitashvili as Minister of Public Health. Also Ukrainians with profound business background got posts at the Cabinet: CEO of fuel retail company “Continium Group” Andriy Pivovarskyi as Minister of Infrastructure, and Volodymyr Demchyshyn as Minister of Energy and Coal Industry. Also some ministers from the previous government were appointed for the second time: Serhiy Kvit (Minister of Education), Arsen Avakov (Minister of Internal Affairs), Pavlo Klimkin (Minister of Foreign Affairs) and Pavlo Petrenko (Minister of Justice).
The newly-appointed Minister of Finance Natalie Jaresko already has claimed that the project of the state budget for 2015 year would be prepared in 2.5 weeks till December 20, 2014. Besides this, the Prime-Minister Arseniy Yatsenyuk ensured that the government would urgently prepare completely new Budget Code and prepare changes to the Tax code. The new Budget Code would add additional financial responsibilities to the local budgets. Amendments to the Tax Code would reduce the number of taxes, change taxation base, implement progressive scale of taxation and decline taxation payments from the salaries.
The news is extremely positive for the Ukrainian economy. Fast appointment of the new government by the parliament gives grounds for hope that the Western-educated and business-minded ministers would work hard on urgent reforms together with IMF, European Commission and other international financial organizations. Preparation of the state budget for the next year would be only the first step towards more efficient co-operation with the IMF and international donors. We expect that the IMF mission would make decision on the next tranches of stand-by loan just at the beginning of January. Moreover, the new government would be able to hold a conference for international donors in order to attract help for recovery of Eastern regions of Ukraine.
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