A further $15 billion may be needed to bailout struggling Ukraine, which seems ever closer to economic disaster.
The International Monetary Fund (IMF) has spotted a shortfall of $15 billion on top of the $17 billion bailout loan package it has worked out for the troubled country, according to reports. This black hole is especially worrisome as the world’s economies are facing slower global growth and so the appetite to help out Ukraine may dwindle – especially as the country’s economy is such trouble.
Besieged by conflict in some of its most important economic areas and the collapse of exports to Russia, Ukraine’s economy is expected to shrink by 7 percent this year, according to its government. Its currency reserves have shrunk, raising concerns that its central bank will not be able to keep propping up the country’s currency, the hryvnia. If Ukraine’s currency – which has been world’s the worst-performing this year — falls even further, Ukraine could enter the dangerous territory of hyperinflation, where prices rise by more than 50 percent in a month. Inflation already hit 22 percent in November.
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