International standards of public debt statistics and their implementation in the public finance management system of Ukraine
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Cited by 4 publications
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The large-scale aggression of the Russian Federation against Ukraine caused such damage to the financial system that the providing for critical needs was threatened. There was a need to review approaches to the management of public expenditures, as well as their financial provision. During the war, public expenditures increased sharply, while revenues decreased. Such changes required the introduction of fundamentally new approaches to the cost management and resource mobilization performed in compliance with the principles of fiscal sustainability. An analysis of the peculiarities of financial provision for public expenditures in Ukraine during the war and the application of measures to improve it is carried out using such research methods as historical, logical, abstraction, description, generalization, comparison, grouping, analysis and synthesis. The increase in budget deficit is noted that goes far beyond the limits established by the fiscal rules functioning before the war. To cover it, the placement of loans on the domestic market was expanded. Due to the hindered access to the international market, the supply of resources was organized as a part of assistance from foreign partners. Making changes to the management of public finance during the war made it possible to maintain its critical level and financial stability. Public debt obligations were placed mainly for long terms, no sharp increase in their yield. External borrowings were obtained from foreign partners on preferential terms. Measures to improve the financial provision for public expenditures during the war and to overcome the latter’s consequences are determined: reduction of state budget deficit indicators by increasing the coverage of expenditures by revenues; regulation of fiscal rules application during the war; limitation of monetary financing; decrease in the amount of public resources to finance the budget deficit; strengthening control by non-governmental organizations over the use of resources mobilized from all sources for financial provision for public expenditures.
The large-scale aggression of the Russian Federation against Ukraine caused such damage to the financial system that the providing for critical needs was threatened. There was a need to review approaches to the management of public expenditures, as well as their financial provision. During the war, public expenditures increased sharply, while revenues decreased. Such changes required the introduction of fundamentally new approaches to the cost management and resource mobilization performed in compliance with the principles of fiscal sustainability. An analysis of the peculiarities of financial provision for public expenditures in Ukraine during the war and the application of measures to improve it is carried out using such research methods as historical, logical, abstraction, description, generalization, comparison, grouping, analysis and synthesis. The increase in budget deficit is noted that goes far beyond the limits established by the fiscal rules functioning before the war. To cover it, the placement of loans on the domestic market was expanded. Due to the hindered access to the international market, the supply of resources was organized as a part of assistance from foreign partners. Making changes to the management of public finance during the war made it possible to maintain its critical level and financial stability. Public debt obligations were placed mainly for long terms, no sharp increase in their yield. External borrowings were obtained from foreign partners on preferential terms. Measures to improve the financial provision for public expenditures during the war and to overcome the latter’s consequences are determined: reduction of state budget deficit indicators by increasing the coverage of expenditures by revenues; regulation of fiscal rules application during the war; limitation of monetary financing; decrease in the amount of public resources to finance the budget deficit; strengthening control by non-governmental organizations over the use of resources mobilized from all sources for financial provision for public expenditures.
Public Financial Management in martial time and post-war reconstruction of Ukraine: scientific support of transformations
Introduction. The scale of pandemic and war in Ukraine was not fully forecasted, but the crisis phenomena of these disasters have specific signs. One of the priorities of the tax and budget policy is resilience to threats, both foreseeable and unforeseeable. Problem Statement. The full-scale Russian invasion of Ukraine has led to significant changes in the resource base, economic potential and the common system of public finances, these can no longer function on pre-war principles. New realities, both internal and external, have emerged; it is impossible to ensure the successful development of the state without scientific understanding of them. Purpose. Justification of directions for the formation of internal pillars of stability and security of the economic development of Ukraine through transformations in Public Financial Management (PFM) during the period of martial law and post-war reconstruction. Methods. Based on trends in statistical indicators, a comparative analysis of national anti-crisis reforms in the field of public finances was conducted. The methodology of the system approach, methods of factual, situational analysis and synthesis were used. Results. Ukraine's acquisition of the status of a candidate for the EU membership, the modern realities of statehood and national economy recovery amid when the signs of fundamental turmoil in the global economic space, require significant changes in the PFM. It is necessary to rethink from scientific perspective and adjust the policy of countering threats of global and regional economic and social contradictions. International discussions on the plans for the post-war reconstruction of Ukraine prove the still uncertain, extremely multidimensional picture of the development of various components of the national socio-economic system. The amount of external financial support will depend on whether the measures to improve PFM during the period of martial law, as well as post-war reconstruction, will be interconnected, subordinated according to the space-time vector, etc. Conclusions. International financial institutions provide resources to conflict-prone and fragile states not only to correct imbalances, but also to build confidence during crisis situations when countries risk losing their ability to borrow on open markets. Taking into account the escalation of the geopolitical conflict associated with the full-scale Russian invasion of Ukraine, transformations in the fiscal sphere should be aimed at winning the war, preserving the territorial integrity of the state, supporting economic sovereignty and combating corruption, stimulating investment processes in the post-war recovery.
Budget deficits and public debt of Ukraine under the shocks of pandemic and military aggression
Introduction. The extraordinary conditions for the government’s functioning during the pandemic and warfare provoked a strong respose of the state institutions, as a result of which the size of budget deficit in Ukraine over 2022-2023 exceeded a lot the historical values and averages for the different country groups as most indicators of the debt burden worsened, generating the danger of debt unsustainability. Problem Statement. Identification of the nature of Ukraine’s fiscal policy through the lens of past and contemporary global phenomenon, identification of macro-financial factors impacting he state of debt sustainability under the extreme conditions, analysis of debt burden indicators and fiscal risks in order to outline the ways of solving the fiscal and debt problems in Ukraine. Purpose. To reveal the global patterns and national features of the expansive fiscal policy conduct and public debt accumulation in emergency conditions which are connected with the pandemic and military actions , to investigate the factors of Ukrainian government’s solvency deterioration and to assess the relevant risks, as well as to define the tools of public debt management in the medium run. Methods. General scientific and special methods are applied: analysis and synthesis, description and comparison, historical method, method of theoretical generalization and abstract-logical method. Results. It has been found that the impact of operations of the general government on aggregate demand in Ukraine was positive in 2020, 2021 and 2022, and this situation was in sharp contrast to the period of 2015-2019, when fiscal policy produced restrictive effects. Fiscal policy in Ukraine was of pro-cyclical nature in 2014-2018 and turned to countercyclical stance only in 2020 with sustaining this course until 2023. It has been proven that in Ukraine the debt sustainability criteria are violated across major part of debt burden indicators , that signal the high solvency risks and liquidity risks for general government; moreover, relative to 2019, the dynamics of most indicators in 2020 and 2022-2023 were unfavorable. Computations conducted indicate that refinancing risks, foreign exchange and interest rate risks inherent to the structure of public debt have increased significantly with the start of hostilities in Ukraine. Conclusions. In the post-war period, contraction of budget deficit and well-balanced restructuring of the external public debt should become the main levers for debt reduction. Effective management of public debt with consideration of existing risks are important for securing macro-financial stability and active government’s involvement in the post-war reconstruction of the country.
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