Ukraine budget revenue falls 6.5% yoy in November

Ukraine’s state budget revenue declined 6.5% yoy in November (+1.0% yoy in 11M13), the state Treasury reported on December 3. State collections amounted to UAH 308 bln in 11 months of 2013, while the approved 12-month plan is UAH 371 bln.

Alexander Paraschiy: With only a month left in the year, the state budget shortfall might be even deeper than our worst estimates. If we exclude possible NBU support in December, we see the budget revenue underperformance at close to UAH 30 bln in 2013, promising a fiscal gap of nearly UAH 80 bln, or 5.5% of GDP (excluding Naftogaz funding). Recall that the 10M13 state deficit was reported at UAH 40.8 bln, which means that in November-December MinFin would need to find an extra UAH 40 bln to meet the outlined spending level in the budget.  No doubt the number is beyond any capacity of the authorities, especially in view of strengthened devaluation sentiments fueled by mass protests.  Thus we can confirm again our forecast that the budget deficit will not exceed 4% of GDP by the end of December, with the remaining liabilities counted as arrears