IMF could cut forecast for drop in Ukraine GDP to 12% in 2009

The International Monetary Fund said it was prepared to revise its forecast for the decline in Ukraine’s GDP from 8% to 12% in 2009, according to Ukrainian News, which cited an IMF letter to Ukrainian officials. The IMF cited concerns over the situation regarding Naftogaz of Ukraine’s lack of opportunities to attract foreign loans to pay for natural gas and low domestic natural gas prices. Andrii Parkhomenko: We downgraded our 2009 GDP forecast from 7% to 12% in our April macroeconomic overview, based on the low probability that Ukraine’s economy will advance substantially this year. The GDP figures for 1Q09 have not been released yet, but we estimate a decline of 20-25% yoy, and the 8% currently forecasted by the IMF looks unduly optimistic.