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Road repairs and construction: UAH55bn ($1.96bn)
The Finance Ministry forecasts real economic growth at 3% next year, which is in line with the World Bank’s forecast of 3.5%.
The minimum salary will be increased from the current rate of UAH3,723 to UAH4,173 (from $133 to $149) and will remain unchanged throughout the year.
The budget forecasts an exchange rate of UAH29.4 to the dollar by the end of the year, and annual inflation at 7.4%. GDP is seen at just under $133bn.
The bill appropriates UAH145.45bn ($5.2bn) for repayment of the public debt on IMF loans and government bonds.
“Without support from the international institutions, it will be significantly harder to refinance over $6.1bn of public debt with a due date in 2019,” the explanatory note to the budget bill read.
Besides the IMF tranche, Ukraine expects a 500mn euro tranche of 1bn euros of aid from the European Union by the end of this year.
Privatization of state enterprises and increased tariffs on natural gas for households – the two key requirements of the IMF – are expected to bring to the budget UAH17bn ($607mn) and UAH9bn ($321bn) respectively. To assuage public discontent over the gas tariff hike, the government promised subsidies for low-income citizens.
The budget bill foresees revenues of UAH1bn ($35mn) from the new customs duties on used cars imported from the EU, which the parliament passed on November 8. This money will go to the Pensions Fund.
President’s foundations
The budget plan generously funds the Presidential Foundation for educational and scientific programs for youth, which President Petro Poroshenko, who is also running for re-election next year, established in November. The foundation will receive UAH1bn ($35mn) for “connecting village schools to the internet, purchasing school buses, constructing swimming pools, and for partially compensating for extra expenses from the increase in gas tariffs.”
Poroshenko’s wife became the head of the Ukrainian Cultural Foundation in January, and the organization’s budget has increased by almost three times: Next year it will get UAH780mn ($27.8mn) of taxpayers’ money to award grants for art projects and patriotic films.
A journalistic investigation by Schemes project of the Radio Free Europe/ Radio Liberty found that the first lady was appointed without competition and that she works pro bono without an official employment contract, which is against the law since she is a public official who manages public funds.
Other expenses
The Central Election Commission will receive UAH2.3bn ($82mn) and UAH1.9bn ($68mn) to finance the presidential and parliamentary elections respectively.
The Defence Ministry will get an additional UAH1bn ($35mn) to improve fire safety at its ammunition depots. There were devastating ammunition explosions at depots in the village of Kalynivka in Vinnitsya Oblast in September 2017, in a town of Balakliya in Kharkiv Oblast in May 2018, and in
42 UKRAINE Country Report December 2018 www.intellinews.com