JCR Eurasia Rating has assigned sovereign ratings of ‘B+’ on the Long Term Scale and Short Term sovereign ratings of ‘B’ to Ukraine. All ratings have been placed under ‘Stable’ outlooks. Detailed rating categories are listed in the table below:
Long Term Foreign Currency : B+ / (Stable Outlook)
Long Term Local Currency : B+ / (Stable Outlook)
Short Term Foreign Currency : B / (Stable Outlook)
Short Term Local Currency : B / (Stable Outlook)
A significant regional player with its strategic location, Ukraine has exhibited considerable socioeconomic development throughout the last decade with the exception of a large scale contraction in 2009 due to its pronounced vulnerability to externalities. The recovery from the global crisis, as evidenced by the two years of successive growth, was accompanied by a 9-year low consumer inflation.
Despite being exposed to challenges and conflicts with neighbors due to inevitable foreign policy trade-offs, Ukraine has succeeded in diversification of its trade sphere, enhancement of convenience of access to external debt markets and attraction of sizeable foreign direct investment during the 2000s through its strengthening relations with international community and harmonization efforts with the European Union. However, excessive government regulation, corruption and deficiencies in the judicial system in general, as well as security of property rights, legal permits, registration of property, payment of taxes and across border trading facilities in particular, remain barriers to further improvement of the investment climate.
On the other hand, the fierce competition between political actors adversely affects the political scene to the extent that the functioning of parliament was blocked in some instances in the previous years.
The state of political rivalries, pre-election actions regarding social spending and their effects on inflation and steps to improve the enforceability of law and social contracts shall be the primary matters to be closely monitored in the determination of future ratings of the sovereign.
For more information regarding the rating results you may visit our internet site http://www.jcrer.com.tr or contact our analyst Mr. Zeki Metin COKTAN.
JCR EURASIA RATING