“Credit ratings of Ukraine reflects the low per capita income, as well as the difficult institutional environment and political situation,” the message said.
The prediction ‘stable’ reflects, on the one hand, the risk of the negative influence of the unfavorable economic conditions for the economy of Ukraine and the possibility of the spread of the reforms; on the other hand – the increased volume of the international reserves.
The positive rating factors for Ukraine, according to S&P experts, are the increase of the quality of the macro-economical policy since 2015 and the increase of the foreign exchange reserves, fulfillment of the reform program that provides the government of the country with the access to the loans at the capital markets and financing on the concessional terms from the side of the international financial institutions.
The current foreign exchange reserves are ‘airbag’, which allows to mitigate the risks of the possible worsening conditions of the external financing.
S&P experts say that they might cut ratings if unsteadiness of the access to the soft financing or capital markets in the next year will doubt the capability of the government of Ukraine to service debt. It might take place, if the government refuses from the holding of the key reform, particularly, the provision of the independence of the National Bank of Ukraine.
Meanwhile, the increase of the ratings during the next year is possible if the S&P considers that the consolidation of the budget takes place more rapidly than the agency predicts. It might take place in case of increasing the pace of the restoration of the economy. The improvement of the rates of the external liquidity up to the levels surpassing the expectations of S&P also may positively influence the ratings of Ukraine.
S&P analytics predicts the reduction of Ukraine’s GDP by 6% in 2020 and the growth of the economy in 2021 due to the recovery of the internal demand.
Earlier, the international rating agency Standard&Poors affirmed Ukraine's long-term foreign and national currency ratings at ‘B’, short-term ratings ’B’ and ratings on the national scale “uaA”, the outlook on them is “stable”.