Government ups state debt forecast to 44.5% of GDP by end of 2009

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Ukraine's aggregate state debt in 2009 will grow to 44.5% of gross domestic product (GDP), reads the prospectus of the issue of OJSC Naftogaz Ukraine's eurobonds worth $1.595 billion, which contains this forecast by the government.

According to the document, the state debt will continue growing in 2010 and will hit 48.4% of GDP.

The previous materials of Naftogaz and the Ukrainian government made public on September 25, 2009 simultaneously with the Naftogaz $500-million eurobond swap offer said that the state debt forecast by the end of 2009 and for 2010 was considerably lower: 37.8% of GDP and 37% of GDP respectively.

The government projects that Ukraine's direct state foreign debt (without the debt of the National Bank of Ukraine owed to the International Monetary Fund) will grow to 14.6% of GDP by the end of 2009, yet, it will decrease to 13.2% of GDP by the end of 2010, reads the Naftogaz bond prospectus.

Ukraine's aggregate state debt remained relatively moderate in 2006-2008: it was 14.8% of GDP by the end of 2006, 12.4% by the end of 2007 and 19.9% of GDP by the end of 2008.

Direct state foreign debt alone was 9.1% of GDP by the end of 2006, 7.5% by the end of 2007 and 9.1% by the end of 2008.

As was reported earlier, the Ukrainian Finance Ministry said that Ukraine's aggregate state debt January through September 2009 rose by 41.9%, or $10.31 billion, to $34.91 billion.

The aggregate state debt in the hryvnia equivalent has grown by 47.6%, or UAH 90.21 billion, since the beginning of 2009, to UAH 279.62 billion.

The Budget Code of Ukraine stipulates that the country's state debt should not exceed 60% of GDP.

14.11.2009