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Ukraine increases defence spending in 2024

The Ukrainian government on Friday approved a draft budget for 2024. According to the draft, the deficit will be 1.548 trillion hryvnias ($41.92 billion) and defence spending will increase to 1.7 trillion hryvnias ($46.1 billion), which is more than 21 per cent of GDP, according to Reuters.

Prime Minister Denys Shmyhal attributed the increase in military spending to the need to fund Ukraine’s war effort after a full-scale Russian invasion in February 2022.

This amount (defence spending) is 113 billion hryvnias ($3.1 billion) more than this year. There will be even more weapons and equipment. More drones, ammunition, missiles.

The Finance Ministry says that defence spending will account for more than 21 per cent of gross domestic product. It will include 48.1 billion hryvnyas ($1.3 billion) for the purchase of drones widely used in almost 19-month military standoff.

The ministry also forecasts the deficit to fall to 20.4% of GDP from 27% by the end of 2023.

The Ukrainian government plans to repay 606.5 billion hryvnyas ($16.5 billion) debt. Of these, UAH 421.6 billion ($11.5 billion) will be allocated to the internal debt, and UAH 184.9 billion ($11.5 billion) will be used to repay the external debt.

The government expects budget revenues to reach UAH 1.56 trillion ($42.3 billion). The ministry will allocate UAH 468.8 billion ($12.8 billion) for social spending and UAH 30.8 billion ($835 million) for business support.

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