MOST LIKELY REGIMES AND THEIR PROBABILITIES
18‑Month: PR-led Coalition 75%
Five‑Year: PR-led Coalition 60%

FORECASTS OF RISK TO INTERNATIONAL BUSINESS
   

Turmoil

Financial Transfer Direct Investment Export

Market

18‑Month: Moderate C B C+
Five‑Year: Moderate B- (C) B (B-) B- (C)
( ) Indicates change in rating. *  Indicates forecast of a new regime.

 

KEY ECONOMIC FORECASTS
 

Years

Real GDP Growth %  

Inflation %

Current

Account ($bn)

2006-2010(AVG) 1.3 14.5 -4.85
2011(F) 4.4 8.7 -6.65
2012-2016(F) 4.2 8.1 -6.90

Yanukovych Seeking East-West Balance

In late August, President Viktor Yanukovych issued the most unequivocal declaration to date of his commitment to western integration, bringing some clarity to an issue that has been clouded in doubt since his election to the presidency in 2010. However, the prosecution of his political rival, Yuliya Tymoshenko, on abuse of power charges has drawn a warning from Brussels that what it views to be a politically motivated trial could undermine Ukraine’s efforts to forge closer ties with the EU. In truth, the EU will be loath to take any precipitous action that might push Yanukovych into the embrace of Russia, which has pressured Ukraine to join its so-called Eurasian Union by refusing to renegotiate an onerous gas agreement concluded by then-Prime Minister Tymoshenko in 2009 (and was the basis for her prosecution)…