26 Apr 2010 14:56

Ukraine govt expects 2010 budget deficit to almost triple, debt to soar 46%

KYIV. April 26 (Interfax) - The Ukrainian government expects the budget deficit to widen 2.9-fold in 2010 compared with 2009 and public debt to rise 46%.

The draft budget introduced to the parliament targets a deficit of UAH 57.745 billion, up from UAH 19.866 billion in 2009.

Debt is capped at UAH 308.316 billion, up from last year's end result of UAH 211.624 billion.

Budget revenue is planned to rise 18.7% to UAH 267.452 billion and spending to rise 33.5% to UAH 323.556 billion. Revenue and spending projections do not include the issuance and repayment of loans.

The government previously targeted a 2010 deficit of 5% of GDP.

The government expects to borrow UAH 100.3 billion or approximately $12.65 billion this year, the draft says. Foreign borrowing could amount to UAH 34.1 billion.

Ukraine could issue $1.3 billion in Eurobonds to finance the deficit, and borrow $2 billion from the International Monetary Fund (IMF) and $500 million from the World Bank, among other sources.

The government could issue UAH 66.7 billion in domestic bonds. The budget allocates UAH 6.7 billion for foreign debt repayment and UAH 17.1 billion for domestic debt repayment.