Economy minister: Permanent conflicts between NBU and Cabinet contribute to deep fall of GDP in 2009

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Nov. 21, 2009, 10:38 p.m. | Ukraine — by Ukrainian News
Economy Minister Bohdan Danylyshyn has said the permanent conflicts and lack of understanding between the National Bank of Ukraine and the Cabinet of Ministers was one of major factors of the deep fall of the Ukrainian GDP in 2009, as the conflicts affected the efficiency of the anti-crisis policies of Ukraine. Ukrainian News learned this from his article published in the Zerkalo Tyzhnia newspaper.

"Permanent conflicts and lack of mutual understanding between the National Bank of Ukraine and the Cabinet of Ministers affect the efficiency of the anti-crisis policies of Ukraine. This has become one of key reasons for the very deed fall of the gross domestic product this year and the aggravation of a number of economic tendencies that will show their negative effects in future," he said.

According to Economy Minister Danylyshyn, the National Bank perceives its functional tasks narrower than it should. The central bank limits the tasks to the provision of the stable exchange rate of the hryvnia and realization of anti-inflation measures. This stance of the central bank virtually removes it from the circle of executors of the systematic anti-crisis measures.

If the government and the National Bank of Ukraine fail to coordinate their efforts, the time of the crisis will be extended, he said.

Unlike in Ukraine, the political elites in virtually all other countries consolidated the bodies of their governments and drew up agreed anti-crisis strategies, he said.

"Only in Ukraine the president [Viktor Yuschenko], the Cabinet of Ministers, the National Bank of Ukraine, and the parliament cannot arrive at a compromise in the questions 'who is to blame' and 'what must be done,'" the minister said.

Even more than this - in Ukraine the conflict of stances and strategies exists not only among the branches of the government, but also inside the branches, according to Bohdan Danylyshyn. As a result, the Cabinet of Ministers, which is the major body for the realization of anti-crisis policies pursuant to the legislation, is isolated from potential levers of the anti-crisis influence.

As Ukrainian News earlier reported, Prime Minister Yulia Tymoshenko in October scolded National Bank Governor Volodymyr Stelmakh for his refusals to meet with her for coordinating anti-crisis efforts.

Presidential candidate Yulia Tymoshenko has pledged of submitting to the Verkhovna Rada a new candidate for the governor of the National Bank if elected the president.

Yulia Tymoshenko hopes the leadership of the Prosecutor General's Office and the National Bank of Ukraine will be changed after the presidential elections.
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