Thursday, May 11 2017 22:22 EEST
Ukraine
Gontareva's farewell letter: "Mission accomplished"
Gontareva's,  Farewell,  Letter, Mission, Accomplished

On May 10 was Valeria Gontareva's last working day as head of the National Bank of Ukraine (NBU). From May 11, she is on leave until the Verkhovna Rada accepts her resignation.

First Deputy Governor Yakiv Smolii will be acting NBU governor from May 11 until the appointment of a new NBU head. 

"This is my last working day at the National Bank today, so I would like to say goodbye and thank everyone who supported [me] on this difficult path of reform in our country's financial and banking system. "I've never seen many people who I am grateful to: I can only guess who launched the Save Gontareva campaign at the end of 2014, which gathered over 1,000 likes in a sea of universal hatred. 

"I still do not know the name of the person who wrote at the height of the war and physical destruction of our industry in the east of the country: 'Gontareva is to blame for the fall of the hryvnia no more than a stewardess for the crash of the plane,'" Gontareva wrote in her column on the Novoe Vremya weekly's website. She claims change of the NBU head was her personal choice rather than a political decision.

"For the first time in the Central Bank's history, this decision has nothing to do with politics. And this has proven once again that the country has changed in support of real democratic values. For three years, I have constantly been fighting for the National Bank's real independence," she wrote.

Gontareva also described in flashback the condition of the banking system at the moment of her appointment and the transformation it has seen since then.

"We lost 15% of our GDP and 30% of forex income in Donbas in the blink of an eye. Our enterprises stopped and the infrastructure was completely destroyed. The country's balance of payments was simply 'torn to pieces' and the forex rate, which reflects the balance of payments, reacted accordingly.

"Not to mention constant destructive imbalance in all sectors of the domestic economy and the banking system that has accumulated in the past 20 years of simulation of real reforms.

The treasury's coffers were empty, there was a hundred-billion-dollar hole in NJSC Naftogaz [a state-run oil and gas producer], and there were a huge number of deadly sick banks," Gontareva wrote. According to her, Ukraine was able to survive and stabilize its economy only thanks to the international community, namely the IMF, the World Bank, the EBRD, the European Union, and the U.S. government. 

Gontareva said that she had fulfilled all the goals she had set before herself. "Mission accomplished – all the tasks that I set for myself have been completed. The country has switched to a flexible exchange rate and launched a new monetary, inflation targeting policy. 

We have cleared the banking system of insolvent banks and reinforced its sustainability. Moreover, the National Bank has grown into a powerful modern institution with reorganized internal processes," she said.

"Now there cannot be any U-turn of the flow of the river: the modern ship named 'NBU' has a new professional crew of reformers and the macroeconomic sea has been calm for more than two years. But this does not mean that it will be easy.

"In a country with no justice, where 'political animals' gnaw each other till bloodshed, where those who want change for the better are smeared on all TV channels almost every day and [empty] coffins are brought to their central entrance, they must have strong spirit and willpower. Therefore, the main advice is to keep the NBU's new team together, tightly sticking together with our 500 Spartans. 

"This new structure of the NBU is the real basis of independence. Now no one can take decisions at the bank on their own. There cannot be any 'one man show' any more," Gontareva wrote. In her words, the regulator's new chief will still have to deal with populist MPs who are trying to rewrite the law on the National Bank of Ukraine.

"The most responsible front is ahead – the struggle against populist lawmakers who are trying to rewrite the law on the National Bank of Ukraine. The struggle against illiterate functionaries and pseudo-academics, consciously or unconsciously playing into the hands of populist politicians," Gontareva added.

Gontareva took up her NBU head's duties on June 19, 2014. Early in April 2017, she announced her resignation from May 10

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