February 23, 2011
Ukraine Debt Rating Now Super-Duper Junk
On Friday, Standard & Poor’s cut Ukraine’s long term foreign debt rating to CC from CCC-. The rating of CC is one notch above C, which is used when a debtor is in the process of filing for bankruptcy protection.
In 2008, Ukraine’s GDP was $180 billion. This year, Standard & Poor’s estimates it to come in at just $73 billion, a 50% drop. That has direct impacts on an otherwise educated workforce seeking to integrate with the West.
GDP per capita is expected to fall to around $2,000 this year, an embarrassment which puts the number on par with India. Ukraine’s population is 45 million.
In 2008, Ukraine’s debt to GDP ratio was a solid 20%. Today, it is very high 93% according to Standard & Poor’s.