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promise of 7% growth in the first year, though the Ministry of Finance noted that these estimates are based on the previous government’s predictions, and do not take into account incoming reforms, such as the lifting of the moratorium on land sales. Inflation is also projected to slow from 7.4% the previous year to 6%.
Debts: ​Ukraine owes approximately UAH351bn ($14bn) to international finance organizations, including the IMF, with $6bn due in 2020. The government has allocated UAH145bn ($5.88bn) for debt payments in 2020, while total debt payments in 2020 will total UAH438.1bn ($17.76bn).
Military: ​It’s no surprise that the government is privileging national security with the biggest slice of the government pie, as the war in the Donbas rages on into its sixth year. Military spending increased by UAH33.8bn ($1.36bn) to UAH245.8bn ($9.9bn). The biggest portion of funds will be granted to the Ministry of Defence, closely followed by the Ministry of Internal Affairs.
Social: ​Social policies and welfare also make up a good portion of the budget, with about 10% of the budget, UAH172.6bn ($7bn), allocated for pension payments. Pensions are also projected to increase by 8% over the course of the year, from UAH1,638 ($66.40) to UAH1,769 ($71.71), and the minimum wage will be boosted to UAH4,723 ($191.45). Subsidy reform, long a priority for Ukraine’s international creditors, may start to see progress as utility subsidies are decreased by UAH7.4bn ($300mn) from the previous year to UAH47.6bn ($1.9bn). Despite this, Finance Minister Oksana Markarova has stated that “Anyone who needs a subsidy will be able to receive it.”
Medical​: Medical spending will rise to around UAH108bn ($4.3bn), UAH10bn ($405mn) higher than the previous year. The rise in spending is expected to assist in continuing medical reforms started by the previous administration, including the financing of hospitals and clinics via service charges, instead of available patient slots.
Education​: UAH136.4bn ($5.5bn) is allocated to the Ministry of Education, an increase of UAH7.7bn ($312mn) on the previous year, with plans to improve teacher and educator qualifications, as well as create a national qualification exam system for higher education professionals.
Infrastructure (roads): ​Ukraine’s road system have long been fodder for jokes and criticism for Ukrainians, and it seems the new government is responding by setting aside UAH74.4bn ($3bn) for road infrastructure, with UAH67.9bn ($2.8bn) earmarked for the Road Fund. The government will also seek additional financing from international bodies.
Additionally, the budget has set aside UAH12.1bn ($490mn) for culture and sports spending, UAH4.4bn ($178mn) in agricultural subsidies, with a focus on smaller and family farms over agribusiness, and UAH2bn ($81mn) on strengthening Ukrainian energy independence from Russia.
6.1.1 ​Budget dynamics - results
Ukraine budget revenue rises 10% in 9M19, below the plan​. ​Ukraine's 9M19 state budget revenue rose 9.6% y/y to UAH739bn ($29.7bn), which is 4.8% below plan, the State Treasury provisionally reported on October 1.
34​ UKRAINE Country Report​ October 2019 ​ ​www.intellinews.com