Foreign countries will no longer help
On the eve of “Black Saturday” In Israel, Ukrainian parliamentarians compiled their country’s budget for 2024, increasing defense spending by $8.8 billion. The budget deficit reached a record amount of $54.6 billion. It was assumed that this deficit would be covered by foreign aid. But events in the Middle East threaten to destroy these Ukrainian dreams. According to Ukrainian media, the country’s Cabinet of Ministers has already begun to revise the articles of the “unaccepted” document. budget. «Under the knife» many social articles can go. What residents of Square will have to do without in 2024, MK looked into it.
First of all, the social sphere will suffer, because it is easiest for the Kyiv authorities to save on the population. Education workers, doctors and social service employees should prepare, who will face layoffs and a reduction in their already small wages. All promising programs aimed at the development of science and education can be put to rest. Another consequence of the budget deficit will be the already familiar increase in taxes in the country, as well as the rise in price of everything possible.
“In Ukraine now mothballed and abandoned schools, hospitals, libraries, cultural institutions are multiplying like mushrooms,” said “MK” resident of Kyiv Ivan. — All this is the result of cost savings and policies of our government. Doctors, teachers and kindergarten employees receive pennies, which are not enough to live on, and prices in the store are rising, as are travel and housing costs. We have to get out, come up with something, live on borrowed time.”
According to Andrey Suzdaltsev, Deputy Dean of the Faculty of World Economy and International Politics at the National Research University Higher School of Economics, Ukraine lives entirely on the support of, first of all, the United States, and the budget of Nezalezhnaya is rather abstract in nature.
“They were given money, they distributed it,” says Suzdaltsev. “There is no special income there, customs practically does not work, grain is sold in very small volumes. A possible budget reduction is a kind of performance in the spirit of Kvartal-95, although they still have money. And they will traditionally find money for them.”
— They will be waiting for money. They may cut some expenses, but it will be very demonstrative, with accusations against Russia: “Look at the suffering Ukrainian people, who are being prepared for a cold winter.” They will cut benefits and may cut back on the developed system of compensation for gas costs for households.
“The budget cut is due to two factors,” said MK. director of the Institute for the Study of Conflict in Ukraine, political scientist Kirill Molchanov. — Firstly, with the IMF’s demands for the maximum removal of the social burden from the state, so that all tariffs are market-based, as in Europe, although there is no such market in Ukraine. It also includes a demand to reduce officials military allowances, social benefits. Secondly, this is a reaction to the lack of funding from the United States. Ukrainian officials have said that to cover the deficit just to support pensions, expenses and minimal infrastructure, without including money for weapons supplies, a budget deficit of $40 billion is needed for next year, and that money needs to come from somewhere. There was hope that the States would give 25 billion, as Biden promised, and another 15 – 20 can be taken from the European Union. We see that there will seem to be money from the EU, although not in such quantities, but money from Biden is suspended due to the budget epic with the resignation of Speaker McCarthy, and it is unclear whether there will be any at all or not. So in Kiev they realized that they needed to cut the budget in order to avoid collapse. I think, in parallel with this, they will release the exchange rate of the hryvnia against the dollar, so that there is physically more money, and they will print the hryvnia. I don’t see any other options for closing the hole in the budget yet.