agency Standard Poor `s reported that the continuing political risks in Ukraine after the elections will not prevent the new government to adopt the budget and to resume work with international creditors. This will allow the state to cover the budget deficit and minimize the risks of default. Ukrainian experts confirm the optimistic assessment of SP, since the volume of external payments in 2010 were negligible.

International rating agency Standard Poor `s (SP) said on Friday that despite the numerous threats to financial stability, the situation in the public finance of Ukraine in 2010 will gradually improve. Expected GDP growth of 4% and the resumption of cooperation with the International Monetary Fund (IMF) in late spring and early summer. Threat to the financial system of Ukraine will be political instability, change of the National Bank and the law “On state social standards and state social guarantees”.

SP

Experts believe that the law will not work because it will increase the budget deficit to 2,5-7% of GDP. At the same time, the remaining amount of the IMF loan in the amount of $ 5,500,000,000 will be able to cover only 5,5% of the budget deficit, and the possibility of attracting other external borrowing is limited. In 2010, Ukraine has to pay a foreign loan to 35.1 billion Japanese yen ($ 392.3 million), and therefore the SP continues to believe that “default Ukraine is not inevitable.”

No 2010 state budget, according to SP, a positive effect on financial stability. “This means that at least during the I quarter of 2010 the new government will be able to make expenditures in its sole discretion within the lower budget costs. Read the rest of this entry »

The Russian stock market on Friday, quickly retreated down and the RTS index lost 3.55%, falling to 1,411.14, while the MICEX index lost 2.88% to 1,355.64. The situation on foreign markets is haunted by the Russian players. Problems of the European powers (Spain, Greece, Portugal and Italy) signal that the world economy is far from recovery. Besides macroeconomic data provide indirect confirmation of this, as in Germany, industrial production unexpectedly dropped, and the U.S. labor market remains difficult situation, because the unemployment rate fell against the backdrop of declining employment outside of agriculture. The dollar continues to exert pressure as the stock and commodity platforms. As a result of serious sales were observed in the papers of steel and oil companies. In general, the negative trend was observed in all sectors, in pursuit of the other Friday off VTB, which in the previous session, rose against the general trend. Nevertheless, and this time turned out to be paper, heading into the top, so the shares of Rostelecom was demand after reports that the paper company to be placed in the western areas after the consolidation of the assets on the basis of Svyazinvest Rostelecom. European stocks Friday continued the site to lose weight. In the foreground are still difficulties associated with the state debt and budget deficits in countries like Italy, Portugal, Spain and Greece which make a major contribution (about a quarter) in the value of the euro area GDP. In addition, statistics are not provided grounds for optimism that has added to the sales markets. Reports of companies and their predictions were largely negative, adding more negative emotions. Desheveyuschee raw materials has led to the collapse of securities of mining and energy companies.

U.S. stock markets managed during the bidding to break the negative opening, closing is not a big increase. The situation with the debts of European states and by statistical data indicated the negative start to the day, but after the data on consumer credit, which have demonstrated positive dynamics, shopping has increased, allowing the index to move in the positive zone. On the positive side also became known that the number of people employed on temporary employment contracts has increased as the average workweek, which points to some recovery in the labor market.

Asian stock exchanges today, mostly falling, playing the events of Friday trading in the U.S. and Europe. Part of the market is trying to get into the positive zone thanks batted prices for raw materials.

Russian shares open slightly decrease, while the MICEX index back down to 1345/1340. Now attention is focused on the bidders to events in Europe, news from there can play a decisive role. The dollar continues to strengthen, which will overshadow sites. Market support may have made at the meeting of G7 statements in support of the economy of European countries, as well as new anti-crisis measures. Perhaps that is against this background market will bounce a bit but the growth prospects look dim yet. In the case of rebound goal at the top of the MICEX index - 1370.

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steady growth of gross harvest of cereals in the last 6 years should not become an occasion for relaxation. With such a warning acted central government of China, which for the first time in the new year resolution to devote, as it was in previous years, the agricultural sector. Necessary to ensure stable grain production and supply of grain, says the d1000ecision, which provides guidance and advice to address the problem of paramount importance.

Thus, the note referring to the document “number one”, the analysts, the country”s goal - to gather in 2010 at least 500 million tons of the crop, if it will not interfere with the serious natural disasters. As analysts say, a good grain harvest will strengthen the country”s capacity to overcome the effects of the global financial crisis and will help bring down inflation expectations in the domestic market.

Gross grain harvest in China will not fall below 500 million tons in 2007, when this milestone was reached first in the new century. Before this country was able to reach a level only in 1998, but then keep rising trend failed and soon the grain has gone sour.

To prevent a recurrence of this situation, in November 2009 the State Committee on Development and Reform Commission announced a program aimed at strengthening capacity-building for grain production: the amount of grain harvest in the country by 2015 should grow to 530 million tonnes by 2020 - 550 million and tons more. Read the rest of this entry »

Clients bursting SC will be able to pay for avtograzhdanke, without waiting for the official bankruptcy of companies. Last week came into effect changes to the Status of “The Fund for the victims.” According to the document Motor (Transport) Insurance Bureau of Ukraine (MTIBU) will hold the payment instead of facing financial problems of insurance companies.

“compensation will be paid out of the guarantee fee, which troubled insurer, introduced in the fund when joining the Motor Bureau,” - explained the president MTIBU Vladimir Romanishin. Previously, under the laws of payments from the fund offices were made only in case of bankruptcy of the company.

“This should support temporarily insolvent insurers and their customers. Because payments will be at the expense of the money them1000selves and the UK with their consent, it would not be a violation of law,” - commented the Financial Services Commission Chairman innovation Viktor Suslov.

Recall that when joining the Motor Insurers Bureau to the Fund in the protection of victims from 100 to 500 thousand euros (exchange rate at the time of the contribution). Amount of contribution depends on how many policyholders avtograzhdanki, which annually sells UK. Leaving the ranks of the Bureau of Motor, a company could withdraw their contributions from the fund, the money returned to the insurer within three years from the date of loss of membership in the organization.

With the adoption of a new document has changed. Withdraw money from the fund will be only the UK which are fully paid off with customers on compulsory insurance of civil liability of automobile owners. If the insurer fails to meet obligations, he can either bow out as amended by the fund money forever, or to sign the contract-order, giving MTIBU authority to conduct payments at the expense of the down payment. Prior to this, the insurer will be required to provide written confirmation of the Financial Services Commission that his license is compulsory insurance avtootvetstvennosti suspended or revoked, the auditor”s report, indicating the absence of a company funds, liquid assets, etc., as well as return all unused forms of policies.

Transient option payments from the fund was run-in SC “Avionics”, excluded from the organization in November 2008. Read the rest of this entry »

agribusiness companies in Ukraine are increasing their presence in the markets of European countries. The next factor contributing to this trend may become a possible solution to the import into the European Union (EU) Ukrainian chicken. According to financial analyst for the group of companies (CC) Syncom Andrei Patioty, the likelihood is high that in June-July 2010 the existing restrictions will be lifted, according to a press release of the CC.

in May 2010 will be a re-inspection of Ukrainian producers of poultry products by specialists of the European Commission”s Directorate General for Health and Consumer Protection (SANCO). European experts have already conducted an inspection Ukrainian poultry in June 2009, but their results have not led to the admission of domestic business in EU markets.

At the same time, experts GC Syncom not see the results of last year”s inspection significantly negative. “The comments mainly related to not do business or to animals that are usually very carefully inspected by European officials, and legislative gaps,” - notes APatiota.

Possible lifting of the ban in his opinion, would lead to the allocation of the Agricultural Producers Ukraine”s quota in the European market 100 tons of chicken meat per year (with a total market of about 12 million tons). Given a minimum of 25% difference in price for the product on the domestic and European markets, it also will enhance the profitability of the business. An additional advantage of Ukrainian producers due to geographical proximity is the possibility of supply in the EU expensive fresh chilled meat. Their American and Brazilian competitors are forced to occupy a niche of cheaper frozen meat.
These perspectives allow Ukrainian agricultural sector in an active capacity expansion. Read the rest of this entry »

Ukraine needs a profound change in approach to monetary and exchange rate policy, which would serve the interests of attracting investments and the transition to investment-dependent path of development with the whole spectrum of problems caused by the crisis. Told the director of the Institute of Economics and Forecasting of the National Academy of Sciences of Ukraine Valeriy Geyets during a meeting of the Finance Press Club.

scientist noted that t1000he subsequent uncertainty in such matters as the problem of inflation, exchange rate, methods for their regulation, the question of how to influence the money supply and, consequently, the demand will lead to national economic growth by only 2-3 %, which inevitably increase social problems.

“ensures that this growth will be accumulated problems in the social sphere, of consumption. It is about the need to grow by 5-6% as a minimum - only in this case are laid perspective is that over time the accumulated problems can be solved” - noticed Geyets.

According to him, the situation with economic growth through exports and the stimulation of domestic demand through external borrowing, which lasted nine consecutive years, is now impossible.

“Both in 2010 and subsequent years will not work. We must focus on the investment. appears extremely difficult task: how and in what way will appear to invest in Ukrainian economy and what the scenario” - the expert said.

Geyets stressed that now there is a serious task of modernization of the real sector of the economy, because during the entire period of economic growth, this issue has remained out of sight of both domestic and foreign investors. Read the rest of this entry »

While the whole world fighting for the right production and marketing of an increasingly technology-related products with additional income, Ukraine almost two decades, is moving in the opposite direction - to the deindustrialization of the national economy, said Dr. Sergei Korablin Economic Sciences.

“In the early 90″s, few talked about the risk of commodity redevelopment of Ukraine. Today it is no longer a risk and not a threat but a fait accompli, not causing any discussions,” - states Korablin.

According to the expert, on the eve of the crisis the share of commodities within the domestic industry was 70% against 14,6% of investment goods. Similar relationships are observed in the structure of merchandise exports. Moreover, if in the 80 years it dominated the production of machinery - approximately 37% and the share of ferrous metallurgy was two times less (18%), in the 2005-2008 year have been observed directly opposite proportions: Engineering - 15% black Metallurgy - 40%, says the analyst.

For example, during 1990-2008, the proportion of machinery in the industrial structure of the country has declined by half - from 31 to 14%, while in the steel industry, by contrast, has grown - from 11 to almost 27%.
“Independent Ukraine, it seems, has not realized that its legacy aircraft industry - technological luxury, the right of possession which belongs to only a few countries. And if, contrary to national policy, it is not lost, it was only due mortgaged once the reserve of strength, which is not limitless. Moreover, the domestic aviation industry has long lost the signs of mass production, huddled up to build a few planes a year “, - noted the expert.

Thus an apparent “attenuation” of innovation, notes Korablin. Thus, the associated development of industrial production declined in 2003-2008 tripled. Read the rest of this entry »

Fitch Ratings said that the majority of rating actions in respect of banks in the world were positive in 4 square meters. 2009, which was the first such quarter since the beginning of the financial crisis in 3 square. 2007 At the same time, this trend was mainly related to the large number of rating actions after a positive rating changes with regard to Turkey (”BB” /Stable), as well as maintaining a low level of negative rating actions, in contrast to the situation in previous quarter. The share of positive rating actions on banks increased from 24% in 3 square. 2009 to 54% in 4 square. 2009

In 4 th quarter 1968 Fitch has a positive rating actions in the banking sector (3 square. 2009: 22) from a total of 126 actions. The 4 square meters. 2009 ratings have been upgraded 19 banks compared with 7 banks quarter earlier. About half of the positive rating action was due to affirmative action in regard to Turkey (”BB” /Stable) rating is 4 square meters. 2009 were placed on the list Rating Watch “positive”, and then increased later in the same quarter. 70% of banks rated by Fitch in the world at the end of 4 square meters. 2009 had a “Stable” outlook.

“Despite improvements in the major developed economies, Fitch expects that the banking system will remain under pressure - said Jerry Roklif, managing director of Fitch”s financial institutions. - In general, for banks is the lag on the recovery of the economy, so as unemployment rates in most major economies have not yet reached the peak, continuing to put pressure on asset quality. But the bulk of the banking systems were able to significantly rebuild its capital base during the year, primarily at the expense of taxpayers, but also increasingly by private capital, which is the main sign of restoration of confidence. Read the rest of this entry »

To implement clearing operations now will need to obtain permission of the National Bank of Ukraine.

This is provided for the NBU Board of January 5, 2010 № 6 “On approval of changes to the activity in Ukraine domestic and international payment systems” (registered in Ministry of Justice of Ukraine - 30 January 2010), which has UNIAN.

“requirements of this provision apply to entities that have concluded agreements on the membership /participation in international payment systems to banks and non-bank institutions, which created a domestic /international payment systems, to legal persons who intend to carry out clearing operations and calculations, to other entities, as well as individuals who are subjects of relationships that arise during the transfer of funds “- the document says. Read the rest of this entry »

Statistics did not help

Morning background for the Russian Market today turned out to be extremely negative. Thus, the U.S. stock markets on Thursday continued negative dynamics, major stock indexes declined on average by 3%. S P500 index closed lower by 3,1%. It is better to market the shares of technology companies, worse than the market - paper commodity and financial companies. The negative economic situation spread to Asian markets, where the average reduction of key indices in the morning is more than 2%. On commodity markets, Brent futures fell and traded near $ 72 a barrel, prices of basic metals groups show mixed dynamics.

As expected, the domestic site opened sufficiently serious decline. During the day the market tried to rebound, but after the release of statistics and the opening of overseas sites fall continued. In general it can be noted that the published statistics proved to be better than expected. For example, the U.S. unemployment rate in January fell to 9.7% from 10%, while analysts expected a small increase. Despite the positive job market U.S. markets opened lower, outright breaking the key milestone in the 10000 index DowJ. In general, in my opinion, at the moment investors should prepare for a prolonged correction of the market as a whole, 10-15% from current levels. The impetus for such a correction could be consolidating overseas indices below the key index and a possible drop in oil below $ 60 a barrel mark Brent.

One of the notable events of the outgoing week was the publication of “Severstal production results for the 4th quarter. Thus, the total steel output in October-December increased by 2%, output of rolled stock rose by 1%. Most business segments of the company recorded a moderate growth in production and a gradual shift towards the production of products with high added value. Also note the steady growth in sales prices on average by 10-20% Confident growth both in output and sales prices recorded the mining division of Severstal. Especially marked 16% rise in gold production and 41%-s” off the production of coking coal in the fourth quarter. We estimate published operational results of Severstal as a positive, the company continues to restore capacity utilization, and the main effect of this recovery, we expect to see in 2010. Another positive factor was the growth in sales prices of virtually all products Severstal. We expect that the market will respond positively to the operating statements of the company. Our fair valuation of shares of Severstal at $ 14.3, growth potential - 23%.

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