The state and state-guaranteed debt reached UAH 5.5 trillion, or $145.3 billion in foreign currency equivalent as of December 31, 2023. This is reported on the website of the Ministry of Finance.
The ratio of public debt to GDP was 85%. At the end of 2022, this ratio was 78.4%, and in 2021 - 48.9%. In October, the IMF predicted that Ukraine's public debt would reach 88% of GDP in 2023 and exceed 100% of GDP by 2025.
In 2023, the public debt increased: in hryvnia by 35.4% (UAH 1.4 trillion), in foreign currency equivalent by 30.4% (+$33.9 billion).
The largest impact on the debt growth in 2023 was made by the receipt of macro-financial assistance (concessional loans) from the EU for €18 billion, which accounted for 55% of the total growth in public debt in hryvnia and 61% in foreign currency. The increase in public debt was also influenced by loans from the IMF, World Bank, EBRD, and the Canadian government, explains Danylo Hetmantsev, chairman of the Parliamentary Committee on Finance and Taxes.
As in 2022, the lion's share (about 6/7) of the growth in total public debt in 2023 was due to an increase in external debt. The rest (1/7) was due to domestic government bonds.
Expenditures on public debt service in 2023 amounted to 8.2% of the general fund expenditures of the state budget (compared to 6.5% in 2022 and 12.4% in 2021).
"Over the two years of war, the structure of the public debt has objectively deteriorated. The debt burden on the economy remains high, debt risks have increased, but the situation is under control. This is evidenced by the successful restart of the domestic debt market, the extension of the restructuring to official creditors, as well as the announced plans of the Ministry of Finance to return to the external commercial borrowing markets in 2025-2026," commented Hetmantsev.
He reminded that part of the external debt has been restructured: to official creditors from the G7 and the Paris Club - until the end of March 2027, to commercial creditors (Eurobonds, GDP warrants) - until August 2024, and the IMF program is also scheduled to be extended until 2027.
This significantly reduces the burden on the budget: the restructuring is expected to save $4.6 billion on public debt repayment and servicing in 2024, and $14.8 billion in total by 2027.
