KYIV, April 21 – The deficit of the state budget of Ukraine in 2022 due to the war unleashed by Russia will increase to 17.8% of GDP from 4% of GDP in 2021, this is the forecast given by the International Monetary Fund (IMF).

According to the Fiscal Monitor released by the IMF on Wednesday, in subsequent years the deficit will also remain at a very high level: 2023 - 13.1% of GDP, 2024 - 11.9% of GDP, 2025-2026 - 10.9-10.8% of GDP.

Only in 2027, according to the IMF's estimates, the deficit will fall below 10% of GDP and amount to 9.3% of GDP.

The IMF said that this is generally about the deficit of the public finance sector, which also includes local budgets, social funds, state-owned companies, etc. In Ukraine, in recent years, it has practically coincided with the state budget deficit, but earlier it was higher due, in particular, to the deficit of NJSC Naftogaz Ukrayiny.

The IMF said that Ukraine's primary budget deficit this year is expected to widen to 13.4% of GDP from 1% of GDP last year. Next year it will decrease to 7.3% of GDP, in 2024 to 5.8% of GDP, in 2025 to 4.9% of GDP, in 2026 to 5.2% of GDP and in 2027 to 4.1% of GDP.

According to IMF estimates, this year the revenues of the consolidated budget of Ukraine will fall to 27.8% of GDP from 36.6% of GDP last year, and in the next five years they will gradually increase from 29.7% of GDP to 30.4% of GDP.

At the same time, spending, as the fund predicts, will increase to 45.6% of GDP this year from 40.6% of GDP last year, then will gradually decrease from 42.8% of GDP in 2023 to 39.7% of GDP in 2027.

Ukraine's gross public debt will increase to 86.2% of GDP in 2022 after declining from 61% of GDP to 49% of GDP last year, this forecast is given by the IMF.

According to the Fiscal Monitor released on Wednesday, public debt will remain at this new high level in subsequent years due to a sharp expansion of the state budget deficit and falling GDP.

In particular, by the end of 2023, the IMF expects Ukraine's public debt at the level of 78% of GDP, 2024 - 78.7% of GDP, 2025 - 82.9% of GDP, 2026 - 88.7% of GDP and 2027 - 92.3% of GDP.

As reported, the fund predicts a 35% drop in Ukraine's GDP in 2022 and so far refrains from assessing its dynamics in subsequent years due to a great uncertainty.

The Fiscal Monitor clarifies that the average maturity of the Ukrainian debt is 6.8 years, and the differential between the interest rate for servicing it and the dynamics of the economy for 2022-2027 is estimated at 0.6%, which means the need to have a primary state budget surplus. (om/ez)