World Bank Country Director for Belarus, Moldova and Ukraine Satu Kahkonen says that the Ukrainian authorities have done very much in the past three years to rebuild the economy, and they should maintain the pace of reforms in order to achieve GDP growth by 3-4% per year in the mid-term outlook.
According to her, if the government opts not to move further in the direction of structural reforms, the economic outlook will remain weak and there will be economic imbalances with negative effects on the living standards of the population. However, maintaining the current pace of reforms while winning investors` confidence will help the country to achieve economic growth by 3-4% in the medium term, she said at the 7th Ukrainian Investment Forum by CFA Ukraine in Kyiv on Thursday, November 17.
”As a result of these reforms, the economy is more or less stabilized, and experts in macroeconomics see some recovery, albeit it is insignificant – real GDP grew by 1.1% in the first three quarters. The deficit of the state administration sector was reduced to 2% of GDP in 2015, against 10% in 2014. You also know that the clean-up of the banking sector is under way now, and more than 80 banks have been withdrawn from the market already,” she said.
In her words, the government has conducted more reforms in the past three years than in the previous 15 years. Among the achievements are the transition to flexible rate fixing, fiscal consolidation and an increase in gas tariffs along with the introduction of subsidizing for low-income households, as well as deregulation, and electronic declaration of assets.
”The process continues, much has been done, but much more needs to be done. Strong and sustainable recovery has not yet begun. Unfortunately, poverty in Ukraine has increased in recent years. It`s high time for Ukraine to start eliminating serious structural bottlenecks, which prevent economic development. What is more, anti-corruption measures must be enhanced,” she added.