[idiom]

Perhaps Russia will 'bail' them out. Nationalise them even.

[uNkNowN ElEmEnt]

But why would Russia want them? They have now secured gas trasport through the Ukraine and now have a legit reason for building other pipelines through other countries.

Why take a bankrupt country when 1) Russia is going to have its own problems and 2) the Ukraine would add nothing but debt, more mouths to feed and more social issues and unrest to Russia's already big pile of problems.

If there were any way the Ukraine could get out of this mess, or any assets they could leverage to fix things, they could do it themselves. those non-existant assets would be the only real thing to lure Russia into such a position.

The government leader in teh Ukraine is pro-US. That would only add a lot of headache to Russia and the last thing they need is someone who would fuss and fight everything Russia asked them to do.

[Fishman]

Slave labor perhaps? Wipe out chunks of population like Stalin did and you have the breadbasket of the USSR reestablished.

[RdSnt]

I can see them doing that simply to regain unfettered access to the coast.

[wisconsin_cur]

Jan. 27 (Bloomberg) -- For Europeans, last week’s resumption of Russian natural gas shipments ended a two-week energy dispute. For Ukraine, it may have ended any hope of weathering the global financial crisis.

The accord with Russia will increase Ukraine’s spending on gas by almost 7 percent, to $9.16 billion, at a time when soaring bond yields are raising the specter of default. Already, Ukraine is living on the first installment of a $16.4 billion bailout from the International Monetary Fund. Further payouts will depend on whether the country balances its 2009 budget, cancels a tax on foreign exchange and strengthens banking laws.

Bloomberg

[bratticus]

As an Eastern Block nation the Ukraine produced wheat and steel.

At least the wheat is in demand still.

[bratticus]

Ukraine drifting towards default - Ukrainian MP

... experts estimate that the gas row with Russia could have cost Ukraine billions of U.S. dollars. ''

[eXpat]

Ukraine Stares Into an Economic-Political ‘Abyss’

Jan. 27 (Bloomberg) -- For Europeans, last week’s resumption of Russian natural gas shipments ended a two-week energy dispute. For Ukraine, it may have ended any hope of weathering the global financial crisis.

The accord with Russia will increase Ukraine’s spending on gas by almost 7 percent, to $9.16 billion, at a time when soaring bond yields are raising the specter of default. Already, Ukraine is living on the first installment of a $16.4 billion bailout from the International Monetary Fund. Further payouts will depend on whether the country balances its 2009 budget, cancels a tax on foreign exchange and strengthens banking laws.

Ukraine hasn’t been so fragile since the early 1990s, following the breakup of the Soviet Union. The economy may shrink as much as 10 percent this year, which would be the deepest recession in Europe except for Iceland’s. President Viktor Yushchenko’s support is close to zero and clashes with Prime Minister Yulia Timoshenko may bring down the government.

link

[bratticus]

Ukraine leader goes to court over cbank resolution

Reuters
January 27, 2009

KIEV, Jan 27 (Reuters) - Ukrainian President Viktor Yushchenko said on Tuesday he would ask the constitutional court to review a parliament resolution that rescinded the appointment of the central bank chairman.

His political opponent, Prime Minister Yulia Tymoshenko, said late on Monday she supported the parliament's resolution and urged Yushchenko to find a new candidate for the post.

... skip ...

The hryvnia began to weaken rapidly in September and by December lost half of its value against the dollar, as exports dropped and the financial crisis began to take hold.

... snip ...

[bratticus]

IMF may 'deny' Ukraine loan
The head of President Yushchenko's economic office has said Ukraine could miss out on the second part of an International Monetary Fund (IMF) loan.

BBC
February 10, 2009

Roman Zhukovsky said the IMF has demanded the Ukraine reduce its budget deficit to 1% of GDP in 2009, from the current forecast at 3%.

In November Ukraine received $4.5bn (£3.04bn) of a $16.4bn IMFloan to help weather the economic crisis.

The second tranche - worth $1.9bn- is now due.

"As we are not going to honour the engagements set out in the memorandum, it will be very difficult to count on the second tranche of the loan," said Mr Zhukovsky.

The IMF will decide whether it will pay the second part of the loan on February 15.

Mr Zhukovsky denied suggestions that the Ukraine will be required to repay the first tranche it had missed its fiscal targets.

... snip ...

Ukraine's currency has halved in value against the dollar during the past six months, and inflation is running at more than 22% per year.

... snip ...

[jdmartin]

Why does the Ukraine have to reduce to 1%? Here in the US we're going to run a deficit of about 10% this year of our GDP. Why the double standard?

[BlueGhostNo2]

you don't need an imf loan!.. yet

[bratticus]

Why does the Ukraine have to reduce to 1%? Here in the US we're going to run a deficit of about 10% this year of our GDP. Why the double standard?

Does the US collect IMF loans? How can the conditions of an IMF loan be a double standard unless you compare only countries which are trying to get an IMF loan?

[bratticus]

Ukraine May Be Next To Default
Delay to IMF loan and Fitch downgrade may be enough to push the country over the edge.

Vidya Ram
Forbes
February 13, 2009

In December, Ecuador became the first country to buckle under the current financial crisis and default on its loans. Now with its outlook deteriorating rapidly, there's a good chance that Ukraine will become the second.

Ukraine took three significant blows within the space of the week. The International Monetary Fund said on Feb. 7 it was delaying the second $1.9 billion tranche of a $16.4 billion loan, which led to Thursday's resignation of Ukraine's finance minister Viktor Pynzenyk -- he said he was stepping down because of the government's refusal to cut its budget deficit according to the terms of the loan left him in an untenable position.

... snip ...

I had no idea about Ecuador but it makes perfect sense considering the price of oil and Ecuador being back in OPEC again.

[bratticus]

SOS: Mysterious calls to Ukraine turn into $7,000 phone bill for Baraboo businesswoman

Dee J. Hall
608-252-6132
[email protected]

When Charlene Foster won a free trip to Washington, D.C., and an Internet phone system in a contest for women who own small businesses, she was thrilled.

But when bills for more than $7,000 in unauthorized calls to Ukraine arrived late last year, the Baraboo businesswoman was floored.

... snip ...

She should read peakoil.com forums more. Then this would not come as so much of a surprise to her.

[bratticus]

The Economic Outlook: 2012 and beyond

Abbas Bakhtiar
American Chronicle
February 22, 2009

... skip ...

The misery list includes most of the Eastern European countries as well with some such as Ukraine set to experience severe contraction. According to IMF Ukraine’s GDP will shrink by 8 to 10% in 2009.

... snip ...

So 7% is doubling every ten years.

10% would be halfling every six or seven years?

[bratticus]

While Rome Burns

John Mauldin, Millennium Wave Advisors
February 22, 2009

... skip ...

[The IMF's] $16bn rescue of Ukraine has unravelled. The country -- facing a 12% contraction in GDP after the collapse of steel prices -- is hurtling towards default, leaving Unicredit, Raffeisen and ING in the lurch.

... snip ...

[bratticus]

FM Pynzenyk quit the right time as Ukraine is bankrupt, Hrytsenko says
Head of VR committee for national security and defense Anatoly Hrytsenko is sure Ukraine has gone bankrupt and must announce a domestic default, the lawmaker told ZIK correspondent Feb. 17.

ZIK
February 17, 2009

“Ukraine has gone bankrupt. The state cannot meet its commitments under the budget. The state cannot pay salaries and pensions simultaneously. Some critical items of local budgets do not get any funding,”

However, internationally, Ukraine cannot be described as a bankrupt. “In this sense, it is not correct to say there is a real threat of Ukraine’s default,” he claims.

Ukraine’s foreign debt is not big and, if nothing serious happens to the economy, the country can cope with it. As to the country’s corporate foreign debt, there exist very grave problems, the lawmaker warns.

So the IMF loan is either "not foreign debt" or "not big", right?

[eXpat]

I want my money!!, err, nop
Ukraine risks unrest as ills worsen

Olexander Pavlenko, a young computer programmer, is one of tens of thousands of Ukrainians who cannot get their money out of the bank.

He stood in line in Kiev at Nadra Bank and Ukrprombank, two big troubled banks, planning to withdraw more than $10,000 (€7,950, £7,125). But like many others, he was told the cash was not available.

“I stood in line a couple times with other bank clients who were protesting, crying and screaming. But the bank told me: ‘Sorry, we simply don’t have the money now and can’t help you.’”

With about nine banks now under the central bank’s special control, Ukrainians are increasingly worried.

Even those with their money in apparently solid banks, including those controlled by west European banking groups, are concerned because the central bank has banned the early redemption of term deposits, the most popular form of saving in Ukraine.

Altogether, hryvnia bank deposits have dropped 20 per cent since September and those in foreign currency 10 per cent.

http://www.ft.com/cms/s/0/67fba682-075a-11de-9294-000077b07658.html?nclick_check=1

[Daniel_Plainview]

I want my money!!, err, nop
Ukraine risks unrest as ills worsen

Olexander Pavlenko, a young computer programmer, is one of tens of thousands of Ukrainians who cannot get their money out of the bank.

He stood in line in Kiev at Nadra Bank and Ukrprombank, two big troubled banks, planning to withdraw more than $10,000 (€7,950, £7,125). But like many others, he was told the cash was not available.

“I stood in line a couple times with other bank clients who were protesting, crying and screaming. But the bank told me: ‘Sorry, we simply don’t have the money now and can’t help you.’”

With about nine banks now under the central bank’s special control, Ukrainians are increasingly worried.

Even those with their money in apparently solid banks, including those controlled by west European banking groups, are concerned because the central bank has banned the early redemption of term deposits, the most popular form of saving in Ukraine.

Altogether, hryvnia bank deposits have dropped 20 per cent since September and those in foreign currency 10 per cent.

http://www.ft.com/cms/s/0/67fba682-075a-11de-9294-000077b07658.html?nclick_check=1

"Ukraine’s credit default swap rate – a risk measure – stands at around 3,700, compared with about 1,000 for Latvia and 560 for Hungary, two other east European states on IMF support."