KIEV, Ukraine -- An aide to Ukraine's president attacked the central bank on Thursday, accusing it of failing to stabilise the hryvnia currency despite selling almost $5 billion in three weeks of financial crisis.
The criticism by Oleksander Shlapak, President Viktor Yushchenko's top economic aide, followed a similar call to action by Prime Minister Yulia Tymoshenko on Wednesday urging the central bank to spend its reserves to stabilise the hryvnia.Shlapak said the bank must introduce a transparent mechanism for intervention, amid bickering between the two political camps that again on Thursday put off debate on legislation needed to secure a $16.5 billion bailout deal with the IMF.'Over three weeks (the central bank) has spent nearly $5 billion dollars of the country's reserves, but the market has felt no positive effect of this colossal intervention,' Shlapak said in a statement on the presidential Web site.The currency has been falling against the dollar for several weeks and lost almost 15 percent of its value on Wednesday, hitting a historic low of 7.2 to the dollar. On Thursday, it bound back to trade at 5.9-6.07/$.Ukraine has signed a preliminary deal with the International Monetary Fund for the loan, some of which could be used to prop up the central bank's reserves.The central bank has been intervening every day for two weeks to try to halt the hryvnia's descent. It offered buy and sell rates of 5.95/6.05 hryvnias to the dollar for the first time on Thursday.'Clearly, the central bank has been spending the money in a far from optimal way,' Shlapak said.'Moreover, the criteria for distributing these considerable resources are incomprehensible not just to the public but to the market players themselves. This gives rise to justified suspicions of corrupt actions in the central bank's activities,' he said in the statement on the website.Asked to comment on this part of Shlapak's statement, the central bank said: 'The very basis of that statement is not true.'BLAME GAMESome analysts saw the criticism as the start of a campaign to oust Central Bank Chairman Volodymyr Stelmakh. Under the constitution, only the president can sack and appoint the central bank head, subject to a vote in parliament.A leader of Tymoshenko's bloc, Andriy Kozhemyakin, said Stelmakh should resign and that the party would vote for this in parliament. But the opposition Regions Party, led by former Prime Minister Viktor Yanukovich, disagreed.Analysts said it might be convenient for Tymoshenko and Yushchenko to blame Stelmakh for Ukraine's financial woes as their parties face a snap parliamentary election.'Stelmakh could be made into a scapegoat,' said Volodymyr Fesenko, director of the Penta think tank. He added that at 69, Stelmakh was at a pensionable age, an additional factor against him.'The comments by the premier and the president's secretariat show they want to distance themselves from Stelmakh and the central bank,crimeajewel. Neither Tymoshenko nor Yushchenko want to take responsibility for the problems, which can only worsen.'Others disagreed.'At the moment, when large financial groups are interested in receiving IMF money, I don't think it's possible to have a shake-up and Stelmakh will stay after all,' said Andriy Yermolayev of the Sofia think tank.'People within the central bank are using the bank as an instrument to save specific financial groups. The talk should be not about changing the head, but changing all the managers of the bank.'Stelmakh is a veteran of the central bank. Last year, many analysts and politicians believed he would quit after putting himself forward as a candidate in a parliamentary election and winning a seat.He declined to take the seat and remained in his job.
..........................................................................................................................................................
No comments:
Post a Comment