Geert Bekaert and Campbell R. Harvey's
Chronology of Economic, Political and Financial Events in Emerging Markets
Major Political and Economic Events
The date of official creation of Ukrainian Stock Exchange (USE). gg
Adoption of Decree of President of Ukraine "On measures to stimulate foreign trade activity". USE received the right to carry out currency trades and auctions. gg
The beginning via USE money privatization. gg
The Cabinet of Ministers Decree on Foreign Investment Regimes came into effect.a3(first entry)
Performance the first electronic securities trade. gg
Adoption the Decree of President of Ukraine "On Participation of Ukrainian Stock Exchange in Privatization Processes". gg
Adoption the "Order of performing the auction trades on selling state-owned shares of privatized companies at Ukrainian Stock Exchange" by both SPFU and USE. gg
Performance of the first auction trades on selling state-owned shares of privatized companies at: Eastern-Ukrainian branch of USE (city Kharkiv); Southern-Ukrainian branch (city Odessa); Mariupolska branch. gg
Performance of the first auction trades on selling bills. gg
The Foreign Investment Law passed. It guarantees foreign investors equal treatment with local companies, and the "unhindered transfer" of profits, revenues, and other proceeds in foreign currency after covering taxes and other mandatory payments.pp
(Controls on credit operations) Procedures for the registration of credits from nonresidents replaced licensing of such credits.a3(first entry)
The National Bank switched to a new trading band of 1.8 to 2.25 HU to the dollar. The bank also sold DM 750 million three-year bonds to replace more costly short-term domestic debt and formulated a program to reduce the budget deficit from 3.3% to 2.5% of GDP. The government announced an ambitious $1 billion privatization program.
The Communist Party won 26% of the parliamentary elections. The hryvna fell to records low, prompting the government to issue euro-denominated bonds that were bought by the national bank. The auctions to sell several power distribution companies and oil refineries failed.
The National Bank raised the discount rate from 51% to 82%.
ADR effective date. (Company=CENTRENERGO - REG S) a11
The government actively sought more than $2 billion in loans from the IMF to shore up the reserves and announced that it would sell more than 25% of telecommunications companies Ukrtelecom before the end of the year.
Russian crash paralyzed Ukrain's markets for 2 months.
The National Bank widened the trading band for the hryvna from 2.5 to 3.5 per dollar.
(Controls on credit operations) A ban was introduced on the provision of trade credits to residents in foreign exchange and on the provision of foreign exchange to service private sector loans contracted by residents at interest rate higher than 20%.a3
(Controls on capital and money market instruments) Payment of investments by nonresidents in treasury bills, which were not rescheduled, were blocked.a3
The National Bank widened the trading band for the hryvna from 2.5 to 3.5 per dollar.
The IMF resumed negotiation over a $2.2 billion Extended Fund Facility lending program, suspended in November 1998. The government announced a 26% devaluation of the hryvna.
The National Bank of Ukraine lifted a ban on the interbank forex market operations, not operated since August 1998. The State Securities Commission announced that deals in shares of selected companies would not be registered unless conducted on organized stock markets, effective Feb. 1, 1999.
(Provisions specific to commercial banks and other credit institutions) The restrictions on granting credits in foreign exchange locally were eliminated.a3
The IMF would grant the Ukraine two EFF loan tranches for the month of April and May, worth $65 million each.
A new currency band of 2.4-3.5 hryvna per dollar became effective.
President Leonid Kuchma was reelected.
The new reformist government of Viktor Yushchenko implemented less stringent monetary and fiscal policies.
The hryvna was free floated.
Prime Minister Yushchenko tried to gain support of the U.S. government for the resumption of IMF funding. An audit of the National Bank of Ukraine's operations revealed that Ukraine had misrepresented its foreign-currency reserves several times in 1997.
In the third quarter, the U.S. inquired the international money laundering by Ukraine's Deputy Prime Minister Yulia Tymoshenko. The U.S senate held a hearing on the treatment of American businesses in former communist countries, focusing on Ukraine's lak of legal infrastructure, corruption, and the arbitrary exercise of state power. A coup failed and the foreign minister was sacked.
Prime Minister Yushchenko announced that the government had no plans to borrow in international financial markets in 2001 due to poor credit ratings. It planned to generate US$1.5 billion in privatization revenues. The government also started to accept bids for controlling stakes in six of its 27 regional power distributors. However, there were tensions between the government and President Leonid Kuchma over privatizations.
In the first quarter, IMF renewed its credit for Ukraine under a US$2.6 billion Extended Fund Facility program. But later IMF withheld the March 2001 quarterly tranche due to political chaos.
The reformist government was dismissed by a "no confidence" vote.
Both the IMF and the World Bank resumed financing for Ukraine.
In the fourth quarter, S&P assigned a 'B' rating to Ukraine's long-term local and foreign currency credit ratings. IMF continued to delay financing for Ukraine.
200110 Ukrainian military accidentally shoot down Russian air liner over the Black Sea, killing all 78 on board. Defence Minister Olexander Kuzmuk resigns.
The National Bank of Ukraine cut interest rates by 250 basis points.
200203 General election results in hung parliament. Parties opposed to President Kuchma allege widespread electoral fraud.
200205 Leadership announces decision to launch formal bid to join Nato.
200209 Opposition stages mass protests demanding resignation of President Kuchma whom they accuse of corruption and misrule
200211 President Kuchma sacks Prime Minister Kinakh. Viktor Yanukovich, governor of Donetsk region, appointed to replace him. He promises to fight poverty and work for integration into Europe.
20030114 Ukraine Subscribes to the IMF's Special Data Dissemination Standard
200303 Tens of thousands of people join Kiev demonstrations demanding that Kuchma resign
200306 Defence Minister Shkidchenko resigns after the leadership criticises armed forces reform. Kuchma appoints Security Council chief Yevhen Marchuk to replace him
200308 First detachment of Ukrainian troops leaves for Iraq. Kiev promises to send 1,600 soldiers to help restore order.
200310 Border dispute erupts with Moscow after Russia embarks on building causeway across the Kerch Strait between Russian coast and Ukrainian island of Tuzla off Crimean shores. The strait also separates the Black Sea from the Azov Sea. Ukraine sends troops to Tuzla.
200312 Constitutional court rules that President Kuchma may run for third term in 2004.
20040311 Ukraine issues Letter of Intent of the government of Ukraine describes the policies that Ukraine intends to implement in the context of its request for financial support from the IMF.
20040329 IMF approves 12 month stand-by arrangement for Ukraine
Regulations on Foreign Investors

Restrictions: Every purchase by a non-resident has to be registered with the Foreign Economic Relations Ministry, in order to be able to repatriate funds. The investment of foreign capital takes place in accordance with the Currency Law. Restrictions on foreign share holding are made in strategic industries, i.e. mass media, telecoms and insurance.

Taxation: A law amending business profit tax law took effect in Aug. 1007: 30% profit tax unless exempted by a double taxation treaty, 30% tax on dividends on corporate rights and interest on Securities operations in the Ukrain.a7


No Changes through 2003

Last updated on 7/9/04 by Jerome Mo, Duke University

corporate rights and interest on Securities operations in the Ukrain.a7

2003 No Changes through 2003

Last updated on 7/9/04 by Jerome Mo, Duke University