The lack of cash savings of the population affects consumption in Ukraine
The Ukrainian economy as a result of coronavirus crisis falls stronger than the others for two reasons.
The lack of financial savings of households and the possibility to increase taxes are the reasons for Ukraine’s economy this year will lose 8.2 percent. Such opinion on Thursday, June 25, expressed by the IMF resident representative in Ukraine Jost Lungman during an online-conference of the European business Association.
“There are two factors why the Ukrainian GDP falling more than in other countries. First – the Ukrainian house-no such cash buffers, as in other countries,” he said.
Therefore, the level of consumption has greatly fallen and continue to fall more, said Longman.
Furthermore, there is no basis for the introduction of new taxes which would increase revenues and public expenditure, including public support, he said.
The representative of IMF has specified that in comparison with other countries Ukraine is in the middle of the level of support given to the economy in this crisis, but it is limited fiscal space and financial instability.