Ukraine Cabinet approves 2018 draft budget with 2.4% of GDP deficit
18 September 2017
Ukraine’s Cabinet of Ministers has approved the 2018
draft budget and submitted it to parliament, the Finance Ministry reported on Sept
15. General budget revenues are expected to increase 15% to UAH 1.1 trln,
while the minimum wage will be 16.3% higher than a year ago. The budget deficit
is targeted at 2.4% of GDP, real GDP growth is at 3% yoy and inflation it at
7%. The hryvnia exchange rate is assumed at UAH 29.3/USD on average per year.
Alexander Paraschiy: The Finance
Ministry has shared few details about the budget so far as the full package is
not available to the public. However, the numbers available so far are very
close to our view, including the revenue target. We are more optimistic on GDP
growth (3.5% yoy), the exchange rate (UAH 28.5/USD), as well as inflation
tendencies (6.6% YTD in 2018).
IMF outlined (2.5% of GDP), meaning that the spending plan has good chances for
positive feedback from the IMF. The 2018 budget does not presume any radical
changes in taxation rules and envisages a noticeable increase in financing for
all programs. We expect smooth approval of the budget in parliament.
