The foreign exchange reserves have apparently fallen from $20bn on 1 January to about $15bn currently. The hryvnia has lost 30% of its value. The government meanwhile has banned seven Russian food producers from selling in Ukraine, and has defaulted on its gas bill to Russia.
The debt to GDP ratio is likely to be in the region of 50-60% (at least) by the end of the year. This means Russia will most likely exercise the option of selling (or dumping) its $3bn in Eurobonds per the agreement of late last year.
From the Moody's report:
However, in order to secure the IMF credit, the country of 46 million was forced to cancel fuel subsidies to private citizens and businesses, sparking a 50 percent hike in oil and natural gas bills.
Ukraine has also promised the IMF it will cut its budget deficit to 2.5 percent of GDP by 2016.
“The country is on the edge of economic and financial bankruptcy,” Prime Minister Arseniy Yatsenyuk said in Kiev last week. “This package of laws is very unpopular, very difficult, very tough. Reforms that should have been done in the past 20 years.”
Yatsenyuk warned GDP could shrink by 3 percent in 2014, while inflation could hit up to 14 percent.
There is a good deal of arrogance in Yatseniuk's statement, and a frightening lack of any real appreciation of what unpopular, difficult and tough reforms will mean to ordinary people; also a lack of appreciation that the sort of package he thinks is needed can't be just imposed on the citizens of a democracy. I wonder if he understands how democracy works.
Given that he is a person who has arrived in a position of power through what Moodys euphemistically calls 'regime change', and lacks a popular mandate for any of the reforms he has agreed to as conditions of aid, he comes across as someone who doesn't seem to think he answers to the electorate. I do not think he is a respecter of democracy. A revolutionary through and through.