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2022-2024. MinFin expects the state debt to decline to 47.0% of GDP in 2024 (from expected 56.9% of GDP in 2021).
The major goals the strategy pursues include: (1) the increase of debt share in the national currency (from 41% in 2021 to 51% in 2024); (2) the extension of the average term of maturity (from 6.4 years in 2021 to 7 years in 2024); (3) concessional long-term financing (the increase of share from 6.3% in 2021 to 7% in 2024); (4) development of investor relations.
The document settles clear numerical benchmarks for assessment. The goals look achievable unless major economic shocks appear during the term of forecast, or budget deficit comes out of MinFin’s control. Importantly, the cooperation with IFIs is explicitly stated as a major point of the strategy. This means that the goal of state debt reduction is tightly bound with government’s commitment to go on with reforms.
Ukraine allows redemption/exchange of Eurobonds and expansion of currencies in an updated strategy of state debt management. The Ministry of Finance of Ukraine will continue the practice of buying or exchanging government securities (Eurobonds) to smooth the repayment schedule, according to the updated medium-term strategy for public debt management for 2021-2024. In addition, the strategy specifies the diversification of foreign currencies in the debt portfolio as one of the measures to reduce the currency risk of the public debt. As a result, the strategy aims to reduce Ukraine's direct public debt, which amounted to 60.8% of GDP at the end of 2020, to 56.9% of GDP by the end of 2021, 50.8% of GDP by the end of 2022, and to 47% by the end of 2024.
40 UKRAINE Country Report January 2022 www.intellinews.com