Moscow - Russia's $3-billion loan received by Ukraine has "dissolved" without any radical change in the Ukrainian economic situation, Ukrainian Economic Minister Pavlo Sheremeta said.
“The Russian loan has ‘dissolved’ somewhere. I hope that at best [it was spent] on some social spending and expenditures. It might have relieved the tensions of the end of year,” the minister said on the Ekho Moskvy radio on Tuesday.
The Ukrainian economy is currently in an extremely difficult situation, Sheremeta said.
“The past two years have seen a slump in our economy. There was a major budget deficit. Effectively, our public purse is empty, we have foreign-currency reserves for less than two months of critical import, which is very bad,” he said.
The main problem is that Ukraine is a deficit-dependent economy, the minister said. In the current situation Ukraine needs to overcome its budget and trade deficit.
“For a long time, not even for the past four years, our expenditures have been chronically exceeding our revenues, quite significantly. We import much more than we export. This disease should be treated in the same way as they treat drug and alcohol addiction. We are grateful to Russia, but effectively it is a portion of drugs. It is yet another deficit at the time when we need to reduce one and the second deficit. This is the only way for us to achieve sustainable growth and to promise to our creditors, including Russia, a repayment,” Sheremeta said.
Asked whether Ukraine will ask Russia to continue honoring the agreement on the provision of the remainder parts of the 15-billion loan, Sheremeta said that Kyiv insists on the confirmation of the agreements signed earlier.
“The agreement is valid. Any money will not be too much. We would like this to be on acceptable market terms. To make Ukrainian securities interesting for Russian stocks as well,” he said.
Russian Economic Minister Alexei Ulyukayev and I continue to maintain contact, Sheremeta said.
