Ukraine to keep budget's gross financing needs at 10% of GDP in 2019-2025

Ukraine has undertaken to keep the national budget's gross financing needs at an average of 10% of GDP through 2019-2025, and no more than 12% of GDP, according to parameters laid down in the new EFF program of Ukraine and the International Monetary Fund (IMF).

In addition, it is planned to generate $15 billion in public sector financing during the program period and to bring the public and publicly guaranteed debt/GDP ratio under 71% of GDP by 2020.

It is planned to cut the total budget deficit in 2015 to 7.4% of GDP from 10.3% of GDP in 2014, in particular that of Naftogaz - to 3.1% from 5.7% of GDP respectively. In addition, it is expected that by 2018 the total budget deficit will shrink to 2.6% of GDP, while Naftogaz will reach deficit-free operation.

As reported, the IMF Executive Board on March 11 approved providing Ukraine with SDR12.348 billion (about $17.5 billion) under the EFF program.

The new program includes broad bilateral and multilateral support from other creditors, including holders of sovereign loans, with whom the Ukrainian government intends to hold consultations to improve medium-term debt sustainability.