2020 State Budget Revenues Overperformed by UAH 54 billion

The Ministry of Finance has presented the report on the implementation of the State Budget 2020. Despite difficult conditions at the beginning of the year, MinFin managed to achieve an overperformance of the state budget revenues by UAH 54 billion.

The year 2020 has become a real challenge for the strength of Ukraine's economy, that in the conditions of the world pandemic COVID-19 got under "perfect storm". Therefore, the conditions under which the State Budget of Ukraine had to perform were quite unfavorable.

In the fourth quarter of 2019, the macroeconomic situation began to deteriorate. The underperformance of the revenues of the general fund of the state budget in January-February 2020 amounted to UAH 18 billion. It indicates the discrepancy of the forecast indicators with the actual conditions. In the first quarter, the real GDP decreased by 1.3% y-o-y, while the state forecasted and budgeted (as amended) real GDP growth at 3.7% y-o-y in 2020.

The situation was considerably worsened by the introduction of quarantine restrictions related to the outbreak of COVID-19.
At the end of March 2020, the government macroeconomic forecast for 2020 was revised to reflect the new reality. Thus, the state budget revenues were reduced by UAH 119.7 billion, the expenditures by UAH 84.4 billion, and the state budget deficit maximum indicator was increased by UAH 204.1 billion (to UAH 298.4 billion).

To promptly counteract the consequences of the pandemic, the UAH 64.7 billion Anti-COVID-19 Fund was established and expenditures on several budget programs were revised according to their relevance and priority. During the year, by amendments to the Budget Law and decisions of the Government, the fund was increased to UAH 80.9 billion.

Thus, thanks to the coordinated work of the Government and Parliament, the well-balanced budget policy of the Ministry of Finance, and the introduced tools to curb the further decline of the economy, the Ministry of Finance managed to perform this difficult budget even with better results than expected:

• State budget revenues were overperformed by UAH 54 billion the amended budget law target and amounted to UAH 1076 billion;
• State budget expenditures totaled UAH 1288,1 billion and were carried out in full under the budget plan. Thus, the financing of social expenditures, defense expenditures, debt service, and expenditures from the COVID-19 fund was ensured;
• State budget deficit was kept at the level lower than the plan: 5.3% of GDP (UAH 217.6 billion) under the plan of 7.5% of GDP.