Ukraine plans big rise in defence spending in 2024 draft budget

Ukraine plans big rise in defence spending in 2024 draft budget
# 15 September 2023 19:55 (UTC +04:00)

Ukraine's government approved on Friday a draft budget for next year, planning for higher defence spending and counting on continued Western financial support to cover the expected deficit, APA reports citing Reuters.

The draft 2024 budget puts the deficit at 1.548 trillion hryvnias ($42 billion) or at about 20.4% of gross domestic product.

More than half of all planned Ukrainian budget spending next year, or 1.7 trillion hryvnias, is planned for the defence sector to fund the war effort against Russia.

The finance ministry said in a statement that spending on defence was expected to be more than 21% of gross domestic product. The spending includes an allocation of 48.1 billion hryvnias for buying drones, which have been widely used by both sides in the almost 19-month-old war.

The forecast for budget financing provides for reduction of the deficit to 20.4% of GDP from 27% in 2023, the ministry said.

Finance Minister Serhiy Marchenko said he hoped for continued Western financial support. Since the start of the war almost 19 months ago, Ukraine had already received nearly $62 billion in foreign aid.

Public debt repayment is planned to be 606.5 billion hryvnias, including 421.6 billion hryvnias to be spent on internal debt repayments and 184.9 billion hryvnias for external debt repayments.

Budget revenues are expected to be 1.56 trillion hryvnias. About 468.8 billion hryvnias is budgeted for social spending, and 30.8 billion hryvnias allocated for business support.

The budget draft also envisages GDP growing by 5% in 2024 to reach 7.824 trillion hryvnias.

The draft has yet to be approved by parliament.

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