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The Regions This Week
January 26, 2018 www.intellinews.com I Page 7
Eastern Europe
Yulia Tymoshenko leads in the polls for the Ukraine presidential election with 8.7% of respondents saying they would vote for the opposition leader, former prime minister and head of the Batkivshchyna (Fatherland) party if the election was held next Sunday. Another 7.6% said they would support President Petro Poroshenko.
Russia’s Finance Ministry says the 2017 budget deficit will come in at RUB1.3 trillion in 2017, or 1.4% GDP, well below the previous expectation
of RUB1.5 trillion deficit (1.6% GDP). The official deficit forecast for this year is 3.2% GDP, but Russian Finance Minister Anton Siluanov said last week he expects a surplus this year if oil prices stay at around $70.
German exports to Russia in 2017 rose by 21% to €24.1bn – the first increase in five years thanks to Russia’s economic recovery, which is pulling
in imports. The imports over the first 11 months were more than the €21.5bn of imports from German to Russia recorded in the whole of 2016.
Russia's industrial output ended 2017 on weak note, declining by 1.5% year-on-year in Decem- ber after a record-high drop of 3.6% in November, according to Rosstat. Industrial output in 2017 overall underperformed with only 1% growth.
Ukraine’s retail sales increased by 8.8% in 2017, according to the State Statistics Service. Retail finished the year on a strong note with sales up 16.1% in December vs the same month a year earlier.
Retail trade turnover in Russia increased by 1.2% y/y in 2017 (up by 4.6% in 2016), posting 3.1% year-on-year growth in December alone, stable as compared to previous months, according to the data released by Rosstat statistics agency on January 25.
Moody's Investors Service upgraded the outlook on Russia's Ba1 long-term issuer and
senior unsecured debt ratings to ‘positive’
from ‘stable’, the agency said on January 25. The upgrade of the outlook comes as good news after a weak start of 2018 showing industry and GDP underperforming in the end of 2017.
Russia's largest bank Sberbank could increase its 2017 dividend payout to 35% of net profit, although the final decision will not be made until March or April, the CEO of the bank German Gref told the press at the Global Economic Forum in Davos on January 23.
Retail lending grew 13% year-on-year in Russia in 2017, according to the Central Bank of Russia (CBR). However, in line with general trend of output lagging behind consumption, aggregate corporate loan book remained flat y/y and total sector profit came in at RUB790bn, less than the RUB1 trillion the CBR was hoping for.
Russia's bailed-out Promsvyazbank (PSB) will write off $1.3bn of Eurobonds after its capital went negative in January, the bank announced on the Ireland Stock Exchange on January 23. As of December 25 PSB's capital was minus RUB134bn ($2.37bn), driven by RUB208bn in losses.
Troubled Russian development bank Vnesheconombank (VEB) expects its IFRS net loss in 2017 to be "significantly lower" than the planned RUB305b ($5.4bn), the head of the bank Sergei Gorkov told the press on January 22. In January-September VEB made net loss of RUB110bn under IFRS following RUB112bn loss in 2016.
Russian banks reduced their foreign debt by $18bn in 2017, according to the Central Bank of Russia (CBR). Russian foreign debt increased to $529bn in 2017 or by $15bn y/y, while corporate foreign debt (banks and companies) declined slightly by $4bn to $458bn in 2017 vs. $462bn in 2016, the CBR said.