On December 4, the Center for Public Energy "Vezha" hosted a discussion between Valeriy Klochok and economist Illya Netskhodovskyi about Ukraine's 2024 state budget. The experts reviewed major budget lines, focusing on defense spending, social policies, and external financial support.
Mr Netskhodovskyi noted that while a large share of the budget is allocated for the military, defense and research expenditures have not increased compared to the previous year. Significant attention has been given to social programmes, such as salary increases for teachers, a "medical checkup" programme, support for new births, and a "winter thousand" payment. The expert described the budget as "electoral", arguing the distribution resembles pre-election benefits for voters.
The discussion also addressed employment and internal revenue. The state is making little progress in boosting revenues via customs, tackling the shadow economy, or incentivizing local production. Netskhodovskyi highlighted the need for reforms in taxation and bureaucracy as prerequisites for economic growth and emphasized the importance of supporting the real economy.
Another major topic was the search for EU financial support. Experts discussed possible reparations loans based on frozen Russian assets in European banks, including the stances of Belgium and France. Obstacles include potential vetoes by certain EU member states and the influence of political elites.
In conclusion, the experts voiced skepticism about significant economic growth or improvement in the public sector without major reforms. Even if the war ends, Ukraine will still require European financial aid, but obtaining it may become increasingly difficult in the future.
