Cost of completing first stage of currency liberalization in Ukraine estimated at $5.5 bln - NBU
MOSCOW. May 2 (Interfax) - The steps announced by the National Bank of Ukraine (NBU) in the near future to complete the first stage of currency liberalization may require about $5.5 billion of foreign currency reserves, but are expected to significantly expand business opportunities, improve conditions for attracting investment and involving private capital in the restoration and ultimately have a positive impact on economic dynamics, Ukrainian media quoted the NBU press service as saying.
"Currency liberalization will cost $5.5 billion. This is essential to give more oxygen to businesses and the economy," the press service said, adding that these steps have already been taken into account in the updated forecast, which envisages maintaining international reserves this year and next year at a level close to the current one that is, at $43 billion to $44 billion.
NBU representatives said that as part of the completion of the first stage of liberalization, this includes the possibility of partial payment of new dividends, the removal of restrictions on imports of services, payment of leasing and rent, the possibility of payments on old loans and a number of measures to ease the work of volunteers.
At the same time, the NBU noted that individual proposals voiced currently, for example, to increase the period of return of foreign currency proceeds from the export of basic agricultural products from 90 to 180 days or from 180 to 360 days for the metallurgical industry may complicate the implementation of such liberalization.
The overdue repayment of foreign currency proceeds exceeded $4.5 billion by last fall, the NBU press service added. The decision made in mid-November to return foreign currency proceeds from major agricultural exports within 90 days instead of 180 days had a positive impact on the foreign exchange market, including for the first quarter of this year, the inflow of foreign currency from agricultural exports to the market reached $1.3 billion against $800 million in the first quarter of last year, the NBU said.
As reported, at the monetary briefing on April 25, NBU Governor Andrei Pyshny announced steps on currency liberalization in the near future, as part of the strategy of easing currency restrictions agreed with the International Monetary Fund.
"So far, we see grounds to complete the first stage, which implies certain relaxations regarding new dividends, the abolition of the ban respectively on imports of services and currency liberalization of the possibility of servicing old debts. At present, the National Bank is at the stage of finalizing and final adjusting these decisions, which we intend to announce in the near future," he said.
Given the record external receipts of almost $9 billion in March, international reserves rose 18%, or by $6.7 billion, up to a record high of $43 billion 762.7 million.