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In September, Cabinet will present a draft budget for 2017 year. The Prime Minister of Ukraine Volodymyr Groisman said: "Our duty is to formulate the state budget for 2017 in September this year."
The Prime Minister noted that the Government used a new approach to formulate the state budget for 2017; it took into account the priorities of Ukraine. The first and key priority, as Groisman noted in his speech, is financing of defense and security (5% of GDP). The second priority for the government in 2017 is road building. The third one is decentralization. "We need now to strengthen local government anf local budgets," noted Groisman.
The fourth priority is energy efficiency. "In 2017 in Ukraine will create Energy Efficiency Fund, a concept which was recently approved by the government," said the politician.
In addition to this, the state should support the agricultural sector. The Cabinet of Ministers is going to add 1% of revenues from agribusiness (which is about 5 billion UAH) to support small farms.
Sixth priority is an international policy. According to Groisman, the government will offer Parliament to increase funding for Ukrainian diplomatic missions, and by the end of the year to create a full-fledged trade representation of Ukraine in each country. "I believe that our export potential is underdeveloped. We need to have support structures in each country," said Groisman.
And finally, the seventh priority of the budget is education. It is planned to review the pre-school and school education; Groisman has also promised next year to increase salaries of the Ukrainian teachers.
Comment of Andriy Novak, an economist:
5% of GDP on defense is not a whim, but a necessary step of our government. Ukraine should be protected from direct military aggression of Russia. Different methods could be used to get this amount: take it from the state budget and through direct military aid that we receive from the United States, Canada, and the EU. Since 2014, we have been already getting $ 300 million annual military aid from the US. At least the same amount we can get in 2017.
As for the other budget priorities, I am confident that the government would form an optimistic development of the economic situation in Ukraine. And in fact, all forecasts, both internal and external, claim that we would have a small GDP growth this year. It is about 1% of GDP growth. But neither citizens, nor businessmen would not perceive this change due to the low nature of the economic base.