Government bonds, real estate, and land: Novak names the most profitable investments during the war
24 February 14:24
Investments in Ukrainian government bonds are currently among the most attractive on the market. This was stated by Andriy Novak, Chairman of the Committee of Economists of Ukraine, in an interview with the YouTube channel "Komersant Ukrainian".
Assessing investments in domestic government bonds, he emphasized:
“Investing in Ukrainian government bonds is very attractive. This is because the interest rates are very high, both for government securities and government bonds. Ukrainian businessmen with free capital are very actively using this mechanism. And this is basically correct,” he said.
However, the economist draws attention to the downside of the high yield of such securities.
“Another question is whether such high interest rates on Ukrainian domestic government bonds are appropriate. On the one hand, there seems to be no other option for a country at war. It is necessary to offer high interest rates in order to attract funds and domestic debt, not just foreign debt. But on the other hand, I would still think that the interest rates could be lower,” he added.
Novak emphasizes that any government debt is future taxes for citizens.
“Because all debt is external, in the end, it is only the citizens who pay for it. This is because the state has no other money than the money of taxpayers, individuals, and legal entities of Ukraine,” he says.
At the same time, the expert emphasizes that despite the war, Ukrainians are actively investing in government securities precisely because of their profitability.
Speaking about alternative investment areas, Novak advises differentiating the approach depending on the amount of savings.
“If you have small savings, you can divide them into hryvnia, dollars, euros, and keep them in commercial banks,” says the economist.
For those with greater financial resources, he sees a different strategy.
“If you have the opportunity to save more, now is the best time in Ukraine to invest in land and real estate. Any kind. Why? Because we currently have the lowest prices for everything. For any assets. The lowest. They won’t get any lower,” he says.
The economist notes that some developers are selling properties even below cost — just to maintain working capital.
Thus, according to Novak’s assessment, government bonds remain a profitable but expensive borrowing instrument for the state, while real assets — land and real estate — will have the greatest strategic growth potential after the war.
