Macroeconomic Analysis of the Efficiency of Regulation of the Ukrainian Economy: The Retrospective and the Present Financial-Economic Situation

Abstract

With the beginning of Russia’s large-scale war against Ukraine on February 24, 2022, Ukraine’s economy suffered shock influences, which on the part of the main public administration bodies caused an urgent need to respond promptly to the sharp changes and dynamics of events that have since unfolded. In addition, it was necessary to understand why and for what reasons the financial-economic system of Ukraine reacted in the way it behaved. Thus, the presented study is aimed at defining and assessing the effectiveness of the implementation of the previous systemic policy along with analyzing the operational actions of the National Bank of Ukraine as the main financial-economic regulator in the conditions of belligerency with regard to the country’s economy. Such an analysis provides an opportunity to further adjust the tactics of managing the financial-economic processes, taking into account the identified shortcomings in the implementation of decisions of previous periods. The research uses a comprehensive approach to macroeconomic analysis, methods of structural analysis and analysis of the dynamics of financial-economic indicators in retrospection. The research is built in two stages. At the first stage, with the help of retrospective financial-economic analysis methods, an assessment of the efficiency of the implementation of the defined Strategy for the development of financial markets in Ukraine for the period from 2016 to 2021 was carried out. At the second stage of the research, the actions of the Central bank were recorded, which led to the stabilization of the macroeconomic crisis in the country, the main directions of operational regulation during martial law in Ukraine were determined, their efficiency was assessed. A retrospective analysis of the actions of the National Bank of Ukraine in 2016-2022 showed that during this period the following important results were achieved in ensuring both financial and price stability, also the stability of the monetary unit: the monetary regime was used quite successfully in conducting inflation targeting, the standards of commercial banks were increased, a program for the accumulation of international reserves was carried out, and the exchange rate was regulated in order to ensure its growing. The assessment of the actions of the National Bank of Ukraine during the period of martial law after February 24, 2022 showed that the following measures of operational regulation were carried out: a number of external and internal incoming and outgoing financial barriers were applied, the accounting rate was regulated, special measures were constantly taken to ensure the financial-economic reserves of the financial system of Ukraine, new mechanisms of financial levers for the credit situation were developed. Further on, it would be advisable to consider the efficiency of regulating the financial-economic situation in a more distant period in order to be able to assess the correctness and fallacy of the decisions taken and adjust the regulator’s actions to maintain a stable state of the economy and further gradually exit from the crisis status. This analysis allows society to apprehend the complexity, consistency of actions of the central economic regulatory bodies, to understand the consequences and expediency of such actions. The presented research is original and comprehensive, touching on all macroeconomic aspects of the activities of the main financial regulator of Ukraine, its influence on the financial-economic situation of the country.