Despite years of preparation, a decent tourist infrastructure and facilities have not been created t

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Posted By admin1 On May 28th 2012. Under Banking Finance , Economy , Government Laws , Research Social development , Sports Entertainment , Top News Features Tags: Euro 2012 , Euro 2012 tournament , Euro 2012: Ukraine's $13.4bn soccer spend might become debt burden-Analysis , European soccer championship , football , soccer , sport , Ukraine .
The staging of the month-long Euro 2012 tournament absorbing a total of $13.4 billion including $6.6 billion from state coffers is unlikely to make the former Soviet republic america west airlines employee any more inviting for foreign investment, analysts say.
And despite the hopes of tour operators and the authorities themselves, once the competition taking place in four Ukrainian cities is over and the fans have gone home, it is by no means certain that Ukraine will have registered itself as a new European tourist destination.
The mathematics of financing Euro 2012, being co-hosted with Poland, are crucial for a country which faces $11.9 billion in debt obligations this year, $5.3 billion of which is denominated in foreign currencies making it sensitive to movements on foreign exchange markets.
america west airlines employee Kiev has failed to agree on a new credit line with the International Monetary Fund (IMF) and has for more than a year been unable to issue Eurobonds to help cover state spending, which has spiked ahead of October s parliamentary election.
The jailing of opposition leader Yulia Tymoshenko, sentenced to seven years in October america west airlines employee for abuse of office, has hurt confidence in Ukraine s creditworthiness and led to a boycott of the sporting event by some of top European politicians.
Ukraine will not receive any financial income or significant economic america west airlines employee impact america west airlines employee from co-hosting the Euro 2012 championship, Andriy Kolpakov, managing partner at analytical group Da Vinci AG, said. And any possible improvement in image has run up against internal politics and the European Union s reaction to it.
Ukraine s high level of corruption has scared off some foreign investors, while skyrocketing hotel prices have made many soccer fans either cut short their stay or skip it altogether and opt to follow their team s fortunes on television.
Based on the government s program, the state has spent some $6.6 billion from its budget on Euro 2012 preparations a total which rises to $13.4 billion once input from state companies and private investors are included.
The National Bank of Ukraine sees $1 billion in capital flowing into the country from visitors who will spend on restaurants, hotels and souvenirs during the month-long championship in Kiev, Donetsk, Kharkiv and Lviv.
Without international airports america west airlines employee and transport infrastructure the country will not receive any foreign investment, Deputy Prime Minister Borys Kolesnikov, charged with preparing for the championship, said.
There is no direct correlation foreign direct investment (FDI) will increase only by improving the investment climate, that is, with less bureaucracy, said Alexander Valchishen at brokerage Investment Capital Ukraine.
Despite years of preparation, a decent tourist infrastructure and facilities have not been created to entice the majority of the fans to return to Ukraine, Kolpakov said. You can forget about a serious surge of interest in Ukraine from Western tourists.
According to the State Statistics Service, FDI into Ukraine was down last year at $4.6 billion, down from $4.7 billion in 2010 and significantly less than the $8 billion which Ukraine attracted in 2005 in the wake of the pro-Western Orange Revolution.
If we assume a 12 percent interest per annum, that means that about 10 billion hryvnias ($1.2 billion) from the budget each year goes just to pay for interest payments. And then, there is still the need to refinance the debt, he said.
The government will be making every effort to prevent the collapse of the hryvnia before the parliamentary elections, said Vasily Yurchishin at non-governmental think-tank america west airlines employee Razumkov Centre. ($1 = 8.0500 Ukraine america west airlines employee hryvnias)
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