Wednesday, December 24, 2014

Ukraine Situation ( December 24 , 2014 ) - Key political ( domestic and international ) and financial crisis updates touching on Ukraine !

Ukraine situation.....


Self-proclaimed DPR republic nationalizes Ukrainian state companies

Ukraine’s anti-corruption agency could be led by US citizen, another candidate is Georgia's Saakashvili — media

Some 600,000 Crimeans blacked out since Thursday morning - Russian Energy Ministry


Economy ....

Expected wholesale market price of electricity on the wholesale electricity market of Ukraine since January 1, 2014 will increase by 5% (to 47.05 USD) - from 940.98 USD to 988.03 USD per 1 MWh (without VAT).

Recall in 2014 (December 2014 to December 2013) forecasted wholesale market price of electricity increased by 25.7% - from 748.43 USD to 940.98 USD per 1 MWh (without VAT)


This is stated in the report of the State Statistics Service.
As of November 1, 2014 arrears of salary in Ukraine amounted to 2 billion 205 million 751 thousand. UAH. Thus, in the past month, it increased by 7.3% (or 161 million 118 thousand. UAH).
At the same time debt of economically active enterprises is 1 billion 960 million 134 thousand. UAH (82.8% of total debt), bankrupt enterprises - 371 million 774 thousand. UAH (15.7%), economically inactive enterprises - 34 million 961 thousand . USD (1.5%).

The NBU may legally ban the issuing of deposits

Marc PollockMARC POLLOCK 2308 24 December 2014, Wednesday, №214 (391)

On Monday, the Cabinet of Ministers registered in the Verkhovna Rada bill No. 1564 on measures for the capitalization and restructuring of banks initiated by Premier Arseniy Yatsenyuk. In the document it is proposed to make amendments to the law on the National Bank of Ukraine. The drafters of the amendments want to legislatively empower the central bank to prohibit the issuing of bank deposits, effectuating transfers, settlements and hard currency transactions by financial institutions. The NBU will be granted such a function if it discovers signs of “the erratic state of the banking system, which threatens its stability and the interests of depositors and other creditors of banks”, it is written in the bill.


“The refusal of the bank to issue deposits upon the demand of depositors even if it is based on the ban of the NBU will be illegitimate and can be challenged in a court of law,” says lawyer of the law firm Ilyashev & Partners Oleksandr Vyhovskiy. Amendments to the Civil Code must be made in which it is clearly specified that term deposits in banks can be prematurely withdrawn only upon the bank’s approval, leading analysts of the Expert Rating agency Vitaliy Shapran agrees.


“The possibility of premature withdrawal of deposits is destructive to the banking system and the economy of Ukraine as a whole,” Managing Partner of the Capital Times investment company Eric Naiman believes. In January-November clients withdrew 30% of their deposits in hard currency accounts and 15% from hryvnia accounts.



"[We propose] setting the limit amount of cash payments between enterprises (entrepreneurs) during one day at 15 minimum wages, established by the law on the national budget of Ukraine for the relevant year; between individuals and enterprises (entrepreneurs) during one day – 15 minimum wages; between individuals under sale and purchase contracts, which are subject to notarization, at 15 minimum wages," reads the document.
Given the minimum wage stipulated by the government in the draft national budget for 2015 (from January 1 - UAH 1,218, from December 1 – UAH 1,378), this limit for 2015 will amount to UAH 18,270 and UAH 20,670 respectively.

Prime Minister Arseniy Yatsenyuk said at a government’s session that the draft of the national budget for 2015 was accepted at the average exchange rate of UAH 17/ US $1.



About a dozen activists are trying to break through police cordons into the Kharkiv City Council session.
Up to a hundred supporters are cheering from the street. They are chanting, "Put Hepa in Prison" and "Shame," an Interfax-Ukraine correspondent has reported from the site.
The attempt to break through police cordons has been unsuccessful for now.


The Presidential Administration expects the arrival of the representatives of the International Monetary Fund to Ukraine until January 6, 2015.
“We expect that the specialists of the IMF will work actively in Ukraine even before the Christmas holidays (January 6-7), even earlier. We expect that all package decisions on macro-financial assistance will be approved by the end of January – it would be optimal,” Head of the Presidential Administration for Internal Affairs Valeriy Chaliy said at a briefing.
As Capital reported, the IMF mission will return to Kyiv in January 2015 to continue the political discussions.

EU is running out of budgetary capability to support Ukraine, European Commission President Jean-Claude Juncker said on Thursday upon arrival at a regular EU summit.
He said the heads of state and government of the 28 member-nations would discuss financial and economic assistance to the Ukrainian government but the EU had reached the upper limit of its budgetary capacity.
"There is only a small margin of flexibility for additional financing next year. And if we fully use our margin for Ukraine, we will have nothing to address other needs that may arise over the next two years," Juncker said.

The International Financial Donor Conference where the Ukrainian government hopes to receive US $15 bn is being postponed again. Previously the governments of Ukraine and European countries announced that it was scheduled for January-February 2015, while now it is more likely to be held in spring. By that time investors require that the Cabinet of Ministers show positive results and improvement of the situation in Ukraine.

EU demands

A source of Capital in the Cabinet said that at the moment the preparations for the International Financial Donor Conference that was scheduled to be held in January-February 2015 have basically been suspended. «At the moment, there are no talks about preparations for this conference in Kyiv at the start of next year. Europe has made it clear that the conference will not be held earlier than next spring,» the source said.



Crimea’s largest airport functioning as usual in spite of major blackout

Ukraine Contact Group rounds up meeting in Minsk

DTN Italy: 'Difficult' Ukraine talks end without new date agreement: Ukrainian and rebel envoys concluded "diff...

Rolling blackouts start in Crimea because of restricted energy supplies from Ukraine

Russian Investigative Committee analyzing evidence in case of Malaysian Boeing crash

Russia’s Finance ministry plans no more foreign currency sales

World NewsCrimea hit by power cuts in Ukraine energy crisis - Financial Times: The Moscow TimesWorld NewsCrime...

Civilians Despair as Both Sides Break the Rules in East Ukraine