The National Bank has calculated how, in the event of the closure of the “grain corridor”, foreign exchange earnings will decrease
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The risk of stopping or complicating the work of the “grain corridor” has noticeably increased. Additional problems can be created by the extension of the term of restrictions on the import of Ukrainian food by some European countries. This is stated in the Inflation Report of the NBU for April 2023.
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According to the regulator’s forecast, such a scenario will worsen the prospects for the export of agricultural products and reduce foreign exchange earnings:
- for $270 million per month — in the event of a continuation of the ban on food exports to neighboring countries,
- for $290 million per month — in case of non-renewal of the “grain corridor”,
- for $800 million per month — in the case of simultaneous action of both restrictions, taking into account a partial reorientation to alternative supply routes.
According to the National Bank, export restrictions will temporarily reduce food inflation in Ukraine due to increased supply in the domestic market.
But this will complicate the activities of farmers and may force them to reduce crops, which will negatively affect economic activity in the future and increase the pressure on the exchange rate.
Read also: State budget deficit in 2023 will be more than 26% of GDP — NBU
Let’s remind
Russia threatened to block the work of the “grain corridor” after May 18. Negotiations between Ukraine, the UN, Turkey and Russia continue.
The Ministry of Finance wrote that the European Commission has restricted the free circulation of four Ukrainian agricultural products – wheat, corn, rapeseed and sunflower – on the territory of Bulgaria, Poland, Romania, Slovakia and Hungary since May 2.
Author: 
News editor Roman Myronchuk writes on the following topics: Economy, finance, banks, cryptocurrencies, investments, technologies
Source: Ministry of Finance
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