WASHINGTON, Dec. 20 - Despite the Ukrainian authorities' efforts to maintain macroeconomic stability, the Ukrainian government's policy mix has generated large external and fiscal imbalances and has contributed to deepening the recession in the country, the International Monetary Fund said.
While summarizing an annual analysis of the Ukrainian economy, the fund's executive director recommended the Ukrainian authorities implement a package of comprehensive policy adjustments in several areas, including curtailing the fiscal and external current account deficits, phasing out energy subsidies (that reached about 7.5% of GDP in 2012), strengthening the banking sector, and improving the external competitiveness of the economy.
The IMF expects Ukraine's real GDP to shrink by 0.3% this year and grow by only 1% in 2014.
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