Is investment rate really growing in Ukraine?

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Judge for yourself: for the first quarter of 2018, the index of capital investments in Ukraine increased by 37.4% compared to the same period last year. But it is worth recalling that for the first quarter of 2014, capital investments fell by 23.1%. What happened so that everything began to grow[/img]

Who can recall how many times our president and prime minister told us how the investment attractiveness of Ukraine among foreign investors has sharply increased? Here only the figures speak about something else. Back in the first quarter of 2011, and when the power was in the “hands of criminals” and no one has fought against corruption, the share of foreign investments in the total amount of capital investment was ten times more, in other words, 3% of the total.
The real economy of Ukraine is more pragmatic, and in this, it is not unusual that the population and Ukrainian business are the main investors in the economy, and thanks to them the Ukrainian economy has not completely collapsed yet.
But what is not enough for a real drive is that the investment growth is not situational, but regular and that everything grows at times. In Ukraine, there is no normal business lending. The share of loans in the total amount of capital investments for the first quarter of 2018 was 8.4%. In the first quarter of 2013, before the Maidan, this figure was 18%. And this is not enough. In normal countries, the share of loans that help businesses to develop is up to 50% of the total investment. Without a revival of normal lending, one should not even dream of a normal economic growth. Because the money of the population is not unlimited. But the hryvnia has stabilized, there is no risk of a big devaluation, businessmen, and ordinary Ukrainians have become more inclined to invest. In general, as soon as the hryvnia devalues, the population and business buy up dollars, but as soon as the hryvnia exchange rate is more or less stable, they start thinking about what to do with dollars. Just now, these same currency "stash" of the previous periods is used, when it makes sense to change dollars to a hryvnia and build a house for themselves or buy an apartment. Everything is moving, everything is changing.
The biggest risk is that the "stash" will run out, and lending will not start, and then the dizzying growth of capital investments will disappear as sharply as it appeared. All this talks about the fact that now Ukraine will defeat corruption and foreign investors will invest in Ukraine – it’s just a wish. No one is going to rush, and what corruption has to do with people investing? For any investor, the most terrible thing is different kinds of revolutions, a mess and a collapse of the hryvnia, which are so popular after political upheavals. And most importantly: money loves silence, not stupid reforms that only harm business and create problems for the population. We just need fewer reforms and run a normal business lending. And the economic miracle in Ukraine will flourish.
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