Budget revenues fell sharply, the monthly deficit was about $5 billion. Direct monetary financing from the NBU covers about one-third of the government’s total expenditure needs.
By the end of 2022, the Ukrainian economy has shrunk by more than 35%, the monthly budget deficit is estimated at $5 billion. This is stated in the UN report, Ukrinform reports.
“Ukraine’s economy will contract by more than 35% in 2022 due to massive infrastructure damage, especially rail and other communications with neighboring countries, road and bridge networks. Industrial and commercial activities are interrupted, there are significant labor losses due to migration or conscription into the army,” UN experts said.
It was noted that the state of the economy is significantly affected by Russia’s attack on energy infrastructure facilities, blockade of ports and damage to metallurgical plants.
Budget revenues have fallen sharply, with a monthly deficit of about $5 billion, the report said.
At the same time, direct monetary financing from the National Bank covers almost a third of the government’s total spending needs. This led to the depletion of foreign exchange reserves, prompting Ukraine to devalue the national currency.
However, Ukraine receives strong bilateral and multilateral financial support, the authors of the report note. Assistance from the European Union, United States, IMF, World Bank and other structures will cover almost half of the total needs in 2022.
At the same time, aid is partially provided in the form of loans, which increases the debt burden.
According to UN economists, even if the European Union plans to provide 18 billion euros in economic support for Ukraine in 2023, it may not be enough.
“The outlook for the Ukrainian economy in 2023 and 2024 is very uncertain and will depend on many factors, especially the cessation of hostilities and the start of reconstruction work,” the report said.
According to its authors, the reconstruction of Ukraine after the war will require huge resources – from 350 to 500 billion euros.
It was previously reported that Japan offered Ukraine a deferral of debt payments.
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Source: korrespondent
I am David Wyatt, a professional writer and journalist for Buna Times. I specialize in the world section of news coverage, where I bring to light stories and issues that affect us globally. As a graduate of Journalism, I have always had the passion to spread knowledge through writing.