Ukraine is developing a plan that will help obtain the necessary funds and cover the budget deficit in the event that financial assistance from the United States is blocked. This was reported by Bloomberg with a link to sources.
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This plan includes three key elements: expanding sales of domestic bonds, raising taxes and cutting spending.
According to the agency, Ukrainian officials should propose this plan to the IMF during a three-day visit of its staff in Kiev next week.
“Although Ukraine is meeting its obligations, the Ministry of Finance and the National Bank believe that there is a risk that the IMF board of directors will not approve a subsequent loan repayment without a fiscal plan if US funds are still will be blocked. According to the IMF program, Kyiv should receive $5.3 billion this year,” writes Bloomberg.
The agency writes that the main source of funds for American replacement is the expansion of domestic government borrowing. Ukrainian banks have high levels of liquidity, and the government expects them to continue investing in high-yield government bonds.
This could bring in at least $5 billion in revenue this year. The government can also raise taxes or cut spending if necessary.