17 Feb 2023 13:50

External sources help cover nearly 70% of Ukrainian budget deficit in 2023

MOSCOW. Feb 17 (Interfax) - External assistance made up 68.8% of sources that helped cover Ukraine's budget deficit between the beginning of the year and February 15, head of the Verkhovna Rada's budget committee Roksolana Pidlasa told Ukrainian reporters on Friday.

"If we compare it to the previous year, we will see a growth of the share of external assistance in financing sources. First and foremost, it is because the National Bank is no longer buying OVGZ as it did last year, consequently issued securities are not being used to cover the state budget deficit," Pidlasa said.

Ukraine's state budget has already received 171.9 billion hryvni from international partners, she said. It is mostly macro-financial loan assistance from the European Union (3 billion euros) and grant aid from the United States ($1 billion).

"At the same time, the government is continuing to issue military bonds - securities which account for nearly 31% of all budget financing sources," she said.

As reported, due to a considerable reduction of expenditures, Ukraine's budget deficit dropped to 72.3 billion hryvni in January 2023 from 99 billion hryvni in December 2022, and to 78.9 billion hryvni from 101.3 billion hryvni for the general fund.

According to State Treasury data, cash expenditures of Ukraine's state budget in January declined to 193.7 billion hryvni, including to 183.6 billion hryvni for the general fund, or 80.6% of those planned for that period. General fund revenue stood at 104.4 billion hryvni, including 36.6 billion hryvni in international grant assistance.

Meanwhile, data from the Finance Ministry shows that actual state borrowings to the general fund in January 2023 stood at 160.1 billion hryvni, or 54.7% of the planned amount, including 41.1 billion hryvni from the placement of government bonds, 2.6 billion hryvni of which was in foreign currency ($40.2 million and 29.4 million euros).

Three billion euros arrived from external sources through an EU macro-financial assistance tranche.

Ukraine's budget for 2023 was approved with a deficit ceiling of 1.296 trillion hryvni, including 1.124 trillion hryvni for the general fund.