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6.1.2​ Budget dynamics - funding
“Ukraine is overtaking Turkey this year to become the top market for the EBRD,”​ said Matteo Patrone, EBRD regional managing director. He expects new EBRD lending to Ukraine to hit €1.1-1.2bn by the end of December. Noting that Ukraine does not have a natural resource bonanza to create a “Red Bull economy,” he said: “All they can do is hard work, structural reforms, rule of law, de-monopolization, and de-regulation – all anchored to accord with the IMF.”
Net foreign purchases of new hryvnia treasuries has increased 17-fold to $4.4bn,​ reports the National Bank of Ukraine. Now, the central bank wants to expand the secondary market by creating “a liquidity centre in the government bonds market based on a modern trading platform.” Even with most trading going through Ukraine’s stock exchanges, buying and selling volume is up almost 70% y/y, to $2.7bn through Nov. 8, reports the central bank
6.1.3​ Budget dynamics - privatization
Prime Minister Honcharuk advocates selling up to one-third of the state post office to ‘strategic investors.’​ He told the ‘Right to Power’ news show: “We can prepare to sell 20-30% of Ukrposhta’s shares to different shareholders who would come with their money cheaper, provide new resources to this enterprise, bring in the right corporate culture, and accelerate its development.”
Of 500 state companies listed for privatization, 2/3 have already been transferred to the State Property Fund from the Cabinet of Ministers​. The job of the Fund is to “prepare them for sale through transparent auctions, through the ProZorro system. Sales to sell to an effective owner,” Prime Minister Honcharuk said after the Cabinet meeting on Thursday. Honcharuk said he has no doubts that the final third will be transferred to the Fund by the end of next month.
Ukraine’s draft national budget for 2020 includes UAH6bn ($220mn) of receipts from privatisation ​of large companies and the same sum from privatisation of small companies, according to the nation's Prime Minister Oleksiy Honcharuk has said. "The driver of our development will be both small and large privatisation," news agency Interfax quoted the PM as saying on November 5. "We also hope that the parliament will support the bill on the legalisation of gambling." According to calculations of ​bne IntelliNews correspondent in Kyiv, the State Property Fund (SPF) secured around $11mn of revenues from privatisation in 2018.
With an eye to privatization and foreign investment in the alcohol industry, Ukrspyrt, the monopoly state alcohol producer has been transferred ​to the Ministry of Economic Development, Trade, and Agriculture, a political bastion for privatization. In advance, President Zelenskiy said that “criminal organizations” control 55% of the state companies' output. Government officials charging that only 17 of ​Ukrspyrt​’s 84 companies actually function and that tax evasion reaches hundreds of millions of dollars a year. This month, an independent audit is being performed. Next month, the Rada is to pass a bill ending the state monopoly and allowing private
41​ UKRAINE Country Report​ December 201 ​ ​www.intellinews.com