Ukraine's govt split on '09 budget, fcasts-report

15:54, 17 December 2008
Ukraine
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Disagreements are delaying the passage of the budget

Disagreements within Ukraine`s government over key macroeconomic forecasts for next year are delaying the passage of the budget, the daily newspaper Delo reported on Wednesday, according to Reuters.

Citing government sources, it said Prime Minister Yulia Tymoshenko was calling for the budget to be based on forecasts of 0.4 percent gross domestic product growth (GDP) and 9.5 percent inflation. It said she wanted a budget deficit of 3 percent of GDP.

"However, Finance Minister Viktor Pynzenyk is categorically against such forecasts," the paper said.

Pynzenyk last week backed the economy ministry forecast a fall in GDP of 5 percent, compared to projected 3.5-4 percent growth this year. He also said his estimate of inflation next year was not far from the IMF`s prediction of 17 percent.

The cabinet has for weeks been discussing amendments to next year`s budget after it became clear that initial forecasts of 6 percent growth next year were unrealistic as the global financial crisis reached Ukraine.

The International Monetary Fund has agreed a loan of $16.8 billion to Ukraine, but with conditions -- one of which was for a balanced budget next year.

Reuters via Interactive Investor

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