Statistical Modeling of the Financial Security in Ukraine

Abstract

A financial security system will be effective once the sources of potential threats and the resources available or required for their elimination are clearly defined and assessed, which raises the importance of studies focused on modeling of the financial security in Ukraine. The problems of financial security in Ukraine are addressed in the article through the prism of statistical modeling and finding ways for security enhancement.

The internal and external factors affecting the financial security of a country are highlighted. The modeling of the financial security in Ukraine is conducted by the methodic recommendations of the Ukrainian Ministry for Economic Development and Trade and the National Institute for International Security Problems of Ukraine. The integral indicators of bank security, security of non-banking financial sector, debt security, budget security, currency security, monetary security (all for Ukraine) over 2012–2016 are analyzed. An econometric model of the financial security in Ukraine is constructed using the factors of economy’s monetization, budget deficit and inflation. The expected level of financial security of Ukraine in 2017–2018 is estimated. According to the model, the most likely level will make 0.15 in 2017 and -0.05 in 2018, showing the decreasing level of financial security in Ukraine. Recommendations on the financial security enhancement are given.