№ 1/2020

Fìnansi Ukr. 2020 (1): 8–25https://doi.org/10.33763/finukr2020.01.008

ECONOMIC SECURITY: THEORY, PRACTICE, MANAGEMENT

LYUBICH Oleksandr ¹, DROBIAZKO Anatolii ²

¹SESE “The Academy of Financial Management”
OrcID ID : https://orcid.org/0000-0002-9339-4242
²SESE “The Academy of Financial Management”
OrcID ID : https://orcid.org/0000-0002-0453-0709

Macroeconomic aspects of financial stability of Ukraine

In 2019, for the first time in its history Ukraine faced the phenomenon of significant strengthening of the exchange rate of the national currency for a long period. The strengthening of the exchange rate took place on the background of degradation of industrial production and the growth of negative commercial balance of goods and services. For the Ukrainian practice of managing monetary policy, such ambiguous tendencies need a new scientific rethinking. After signing of the memorandum between the Government of Ukraine and the International Monetary Fund in 2014, the National Bank of Ukraine transferred its instruments to conduct inflationary targeting policies. In the currency market, the NBU conducted the policy of free floating exchange rate. In 2019, the National Bank of Ukraine continued to pursue consistent policy of liberalization of the foreign exchange market. The opening of the internal market of government securities fixed yield for a foreign investor through the Clearstream system from 2019 reveled the possibility of uncontrolled flows of speculative foreign capital. This financial flow had a strong influence on Ukraine's macroeconomic performance in 2019. In 2019 Ukraine served its international obligations without attracting IMF credits and managed to increase foreign exchange reserves. In 2015, the Government of Ukraine conducted restructuring of previous external debts. To do this, the government of Ukraine issued a part of the debt of derivatives that are tied to the growth rate of the economy starting from 2019. In 2019 the economic growth took place within the limits specified in the conditions of derivatives circulation. Under the terms of derivatives circulation, the first payments should be made in 2021. Within the last 30 years Ukraine has been considerably behind in its economic development compared to the neighbor countries, by the level of welfare of citizens. Harsh conditions for the derivatives circulation will force the government of Ukraine to send funds from the growth to the payments on derivatives starting from 2021,but not on the growing welfare of citizens. Article reveals the complex mechanisms for measuring macroeconomic processes in the framework of economic security indicators system. The proposed financial models reveal the essence of relations between different indicators of economic security.

Keywords:macroeconomic units, economic security indicators, financial stability, GDP dynamics, consumer inflation, discount rate

JEL: E44, E53, F52

Lyubich O. . Macroeconomic aspects of financial stability of Ukraine / O. . Lyubich, A. . DROBIAZKO // Фінанси України. - 2020. - № 1. - C. 8-25.

Article original in Ukrainian (pp. 8 - 25)

Download

Downloads :220

1. International Monetary Fund. (2006). Financial Soundness Indicators: Compilation Guide. Includes bibliographical references. Washington, D. C. Retrieved from www.imf.org/external/pubs/ft/fsi/guide/2006/pdf/rus/guide.pdf.
2. Iefymenko, T. (2016). Fiscal and Monetary Security of National Economy. Kyiv: SESE “The Academy of Financial Management” [in Ukrainian].
3. Cabinet of Ministers of Ukraine. (2017). On Approval of the Strategy for Reforming the Public Financial Management System for 2017–2020 (Decree No. 142-p, February 8). Retrieved from zakon.rada.gov.ua/laws/show/142-2017-%D1%80 [in Ukrainian].
4. Cabinet of Ministers of Ukraine. (2017, February 21). The Government has supported the updated Strategic Reform of the Public Banking Sector. Retrieved from www.kmu.gov.ua/ua/news/uryad-pidtrimav-onovleni-zasadi-strategichnogo-reformuvannya-derzhavnogo-bankivskogo-sektoru [in Ukrainian].
5. Reinhart, C. M., Rogoff, K. S. (2011). This time everything will be different. Eight centuries of financial recklessness. Moscow: Career Press [in Russian].
6. Demirguc-Kunt, A., Detragiache, E. (1998). The determinants of banking crises in developed and developing countries. IMF Staff Papers, 43 (1), 81–109.
doi.org/10.2307/3867330
7. Kaminsky, G. L., Reinhart, C. M. (1999). The Twin Crises: The Causes of Banking and Balance of Payments Problems. American Economic Review, 89 (3), 473–500. DOI: 10.1257/aer.89.3.473.
8. Kindleberger, C. P. & Aliber, R. Z. (2010). Panic crashes. A history of financial crises. St. Petersburg: Peter [in Russian].
9. Krugman, P., Rogoff, K., Fischer, S., & McDonough, W. J. (1999). Currency Crises. Feldstein, M. (Ed.). International Capital Flows. University of Chicago Press. URL: www.nber.org/bookstoc/icftoc.html.
10. Bereslavska, O. I. (2017). Currency policy in conditions of inflation targeting in Ukraine. Proceedings of the University of the State Fiscal Service of Ukraine, 2, 24–36. Retrieved from nbuv.gov.ua/UJRN/znpnudps_2017_2_4 [in Ukrainian].
11. Korablin, S. O. (2005). Aggregate supply and optimal inflation. Economy and Forecasting, 1, 9–32. Retrieved from eip.org.ua/docs/EP_05_1_09_ru.pdf [in Ukrainian].
12. Budget resolution indicators for 2019. (n. d.). Retrieved from ukr.lb.
ua/economics/2018/05/16/397753_byudzhetnu_rezolyutsiyu_20192021_roki.html [in Ukrainian].
13. Shevchenko, P. (2019, April 2). Morgan Stanley predicts hryvnia devaluation. NV Business. Retrieved from nv.ua/ukr/biz/finance/morgan-stanley-prognozuye-devalvaciyu-grivni-50014310.html [in Ukrainian].
14. Ukraine, International Monetary Fund. (2018, December 5). Letter of Intent and Memorandum on Economic and Financial Policy. Retrieved from bank.gov.ua/files/fplTmRcRptHiHVi [in Ukrainian].
15. National Bank of Ukraine. (2016). On Approval of the Regulation on Determining the Amount of Credit Risk for Active Banking Transactions by Ukrainian Banks (Decree No. 351, June 30). Retrieved from zakon.rada.gov.ua/laws/show/v0351500-16 [in Ukrainian].
16. National Bank of Ukraine. (n. d.). Official data. Retrieved from www.bank.gov.ua/control/uk/index [in Ukrainian].