Business news from Ukraine

ZELENSKY SETS TASK TO CUT BUDGET EXPENSES ON MAINTENANCE OF OFFICIALS

Ukrainian President Volodymyr Zelensky at a meeting with top managers of the government and lawmakers has set a task to cut budget expenses on maintenance of officials by 10%. “We held a meeting to prepare the 2020 national budget for second reading. I listened to the Minister of Finance on the main indicators. I set the task to reduce national budget spending on officials for the next year by 10%,” Zelensky said in his Telegram channel on Friday.
The president said that this would save money and allow channeling funds to socially important budget items.
“This reduction should not affect teachers and doctors, those on whom the future of Ukraine depends,” Zelensky said.

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BUDGET OF UKRAINIAN STATE FINANCES 163 ORGAN TRANSPLANTATIONS ABROAD IN 2018

In 2018, a budget of Ukrainian state financed 163 transplantations of organs abroad and 110 transplantations of bone marrow performed to the Ukrainian patients.
This data was presented by Oksana Dmytriyeva, Chairwoman of the Subcommittee on Transplantation and Modern Medical Technologies of the Parliamentary Committee on National Health, Medical Care and Health Insurance during a roundtable on October 8.
She said that UAH 600 million were allocated for such kind of operations in 2018.
“If the transplant system in Ukraine worked in a proper way, several thousands people could be treated for these means,” she said.
According to Dmytriyeva, nearly 5,000 persons annually seek for transplantation of organs for health reasons, however just 130 transplantations are performed in a year. Though, Ukraine is one of the last in Europe according to death donorship.
For her part, Health Minister Zoryana Skaletska said that it was a necessity in additional financing of the patients, who long for transplantation abroad since the funds provided for 2019 have already been spent.
Besides, Skaletska said that there was a need for more efficient use of public resources, including through the development of domestic transplantology.
As head of the bone marrow transplantation and intensive chemotherapy and immunotherapy department at the Okhmatdyt hospital, Oleksandr Lysytsia reported, today bone marrow transplantation from an unrelated donor was carried out only abroad. At the same time, performing of such operations in Ukraine would make it possible to reduce their cost by more than 30%.
As reported, the Cabinet of Ministers of Ukraine in its program determined setting of the conditions for the development of transplantation in the country as one of the priority tasks, which would allow at least 30% of Ukrainian patients, who had previously received transplantation services abroad, to receive them at home.
The state budget of 2019 raised UAH 689.9 million for the program “Treatment of Ukrainian Citizens Abroad”, of which UAH 608 million has already been allocated for treatment.

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STATE-RUN NAFTOGAZ’S ENTERPRISES TRANSFER UAH 83.7 BLN IN TAXES TO BUDGET

NJSC Naftogaz Ukrainy and its member companies paid UAH 83.7 billion in taxes and dividends to the national budget in January-September 2019, the company’s press service said.
Budget payments from the group accounted for about 15% of total budget revenue for the nine months of 2019, the company’s press service said.
As reported, in 2018 Naftogaz and its affiliated companies paid UAH 137.8 billion in taxes and dividends to the state budget in 2018, which was 27.2% more than in 2017. In particular, dividends were paid in the amount of UAH 29.5 billion, oil and gas production royalties totaled UAH 28.5 billion, VAT payments stood at UAH 37.4 billion, payments of corporate profit tax were UAH 23.9 billion.
Naftogaz brings together the country’s biggest oil and gas producers. It holds a monopoly on the transit of natural gas and its storage in underground facilities and on the transportation of crude oil by pipeline throughout Ukraine.

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DRAFT STATE BUDGET FOR 2020 PROVIDES FOR 5.4% OF GDP FOR DEFENSE

The draft national budget of Ukraine for 2020 provides for the allocation of UAH 245 billion for national security and defense, which makes up 5.4% of the gross domestic product of Ukraine, Minister of Finance Oksana Markarova has said. “In our spending, we focus on national security and defense. In this budget, UAH 245 billion is allocated for national security and defense. This is 5.4% of GDP. Expenses are allocated based on 2019 expenditures,” Markarova said, presenting the draft national budget in the session hall of the Verkhovna Rada.

“Please note that there appeared a separate budget program, in which additional funds are foreseen for the National Security and Defense Council, which will be distributed by second reading,” she added.

The draft national budget for 2020 foresees UAH 245.8 billion for national security and defense, including UAH 207.8 billion in expenses under the budget programs of the Ministry of Defense, UAH 10 billion in state guarantees, UAH 28 billion in additional expenses from the general fund according to the budget program of the National Security and Defense Council (NSDC) “Unallocated expenses on national security and defense,” which will be distributed separately by the decision of the NSDC.

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DEFICIT OF UKRAINE’S STATE BUDGET COMES TO UAH 871 MLN IN H1

The deficit of the national budget of Ukraine in January-June 2019 amounted to UAH 871 million, in particular the general fund deficit was UAH 8.67 billion with the target being UAH 22.99 billion, the State Treasury Service has said.
According to the agency, government borrowings for the six months amounted to UAH 246.8 billion, while debt repayment some UAH 210.67 billion.
In general, the national budget for this period received UAH 506.85 billion of revenues, the general fund revenues amounted to UAH 448.4 billion with the target being UAH 476.36 billion.
The national budget expenditures in January-June of this year were at the level of UAH 508.56 billion, in particular UAH 459.33 billion on the general fund with the plan standing at UAH 502 billion.
According to the report of the agency, local budgets in this period posted a surplus of UAH 21.93 billion, while the surplus of the general fund amounted to UAH 39 billion.
The surplus of the consolidated budget in the first half of the year was UAH 21 billion, including UAH 30.38 billion in the general fund.

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NATIONAL BANK OF UKRAINE TO SEND UAH 65 BLN TO BUDGET

The National Bank of Ukraine (NBU) will send part of its profit for 2018 in the amount of UAH 64.878 billion to the national budget, Head of the NBU Council Bohdan Danylyshyn wrote on his Facebook page, referring to the decision of the NBU Council. “The Council decided to approve the distribution of profits of the National Bank of Ukraine for 2018 in the amount of UAH 64.878 billion in the following areas: the formation of total reserves of net worth of the National Bank of Ukraine – UAH 3.566 billion; obligations of the National Bank of Ukraine to the national budget of Ukraine for 2018 year – UAH 64.878 billion,” he wrote.
As reported on the website of the NBU, the main components of the profit of the central bank are the interest profit, as well as the results of operations with financial assets and liabilities in foreign currency and financial tools.
Net interest income after the release of reserves for 2018 is UAH 34.9 billion (in 2017 – UAH 45.2 billion). In 2018, the result of currency revaluation for the first time since 2013 became negative due to the strengthening of the hryvnia exchange rate to foreign currencies and amounts to UAH 2.2 billion. A positive result from the revaluation of debt securities at fair value is UAH 6.7 billion (in 2017 – UAH 2.7 billion). Administrative expenses of the NBU and costs associated with the manufacture of banknotes, coins and other products amount to UAH 3.78 billion (in 2017 – UAH 3.59 billion). Also in 2018, funds secured for legal obligations, including lawsuits, in the amount of UAH 2.1 billion were released.
The schedule for transferring part of the NBU profit for 2018 to the national budget will be agreed with the Finance Ministry of Ukraine, the NBU said.

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