Page 45 - UKRRptMar19

The state guaranteed debt of Ukraine fell from 71.8% to 62.7% of GDP in 2018 , according to the Finance Ministry’s preliminary estimates released via Facebook on January 31.
The Finance Ministry says that the aggregate state debt grew by UAH26.94bn in hryvnia’s, to UAH2.169 trillion and by $2bn in US dollars, to $78.3bn in 2018.
The ministry said that direct state debt by the end of 2018 was 85.8% of the state guaranteed debt.
At the end of August 2018, the government of Ukraine reviewed the medium-term strategy of public debt management by setting more ambitious goals to reduce the direct state debt and GDP ratio, in particular, to 60% of GDP by the end of 2018, instead of the previously planned 62% of GDP. The figure should be cut to 52% by the end of 2019 and to 49% by 2020, the ministry says as cited by Interfax Ukraine.
Ukraine's state debt for the period of 2017 increased by 11.1%, to UAH1.834 trillion, or $65.3bn, foreign debt alone rose to $38.5bn. However, the ratio of the debt to the country's GDP decreased from 69.2% to 61.5%. If government-guaranteed debt is included, the ratio fell from 80.9% of GDP to 71.8% of GDP.
Ukraine’s state and state-guaranteed debt rose 4.8% m/m to $78.3bn in December , the Finance Ministry reported on January 25.
The state domestic debt rose 5.3% m/m to $27.5bn, while foreign debt increased 2.1% m/m to $39.7bn. In addition, state-guaranteed debt jumped 14.1% m/m to $11.1bn.
In UAH terms, overall state debt increased 2.2% m/m as state-guaranteed debt rose 11.3% m/m. Meanwhile, state debt in UAH terms almost did not change as the increase of state domestic debt by 2.7% m/m was offset by the decline of state foreign debt by 0.5% m/m.
In 2018, state and state-guaranteed debt rose 2.6% y/y in dollar terms. In particular, state foreign debt increased 3.2% y/y and state domestic debt rose 2.4% y/y. State guaranteed debt increased 14.1% y/y.
“The surge in December state debt was prompted by Ukraine receiving a $1.38bn loan tranche under the 14-month IMF stand-by arrangement. In turn, that enabled the World Bank to provide a $750mn financial guarantee for the loans Ukraine is intending to attract in 2019 from Western financial institutions,” Evgeniya Akhtyrko of Concorde Capital said in a note.
“As a third factor, MinFin intensified domestic borrowing with the placement of local bonds (including local Eurobonds) to deal with traditional surge of government spending in the end of the calendar year. Meanwhile, the lower growth rate of the state debt in UAH terms is explained by the 0.5% appreciation of the Ukrainian currency in December,” Akhtyrko added.
The 2018 year-end state and state-guaranteed debt of $78.3bn was 61-62% of GDP vs. 71.8% of GDP in 2017, according to Concorde Capital’s estimate.
45 UKRAINE Country Report March 2019 www.intellinews.com