We estimate that Ukraine’s increasingly insolvent banking system needs fresh capital in the range of US$10.5-16 billion – three times more than official projections. What will the Ukrainian authorities be able to do about this problem? The ceaseless power struggle between competing political and business interests precludes swift action and up-front pain. But rather than rushing into Argentine-style solutions, the authorities will strive to keep up at least the appearance of orthodox...
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