Авторы публикации
ANALYTICAL REVIEW OF THE MOST IMPORTANT DOMESTIC, FOREIGN POLITICAL AND ECONOMIC EVENTS OF THE WEEK
29.11.- 05.12.2021
CONTENT:
SUMMARY AND KEY TRENDS.
INTERNAL POLICY.
1. Speech by Vladimir Zelensky in the Verkhovna Rada and the "day of the coup" in Kiev.
2. The KSU refused to swear in new judges appointed by V. Zelensky.
3. Kiev Mayor Vitali Klitschko said that the Venice Commission had sent its comments to the bill on the capital.
4. Sociology. Parliamentary rating: Servant of the People party has lost its party leadership.
FOREIGN POLICY.
1. Statements of A. Lukashenko about Crimea and nuclear weapons.
2. News of Russian-American relations.
3. Attempts by the Republicans to impose new sanctions against the "SP-2" through Congress.
4. A new strain of coronavirus "Omicron" and the reaction of the world community to it.
ECONOMY.
1. Rada adopted the budget for 2022.
2. The quality of implementation of the 2021 budget.
3. The economic side of state policy in relation to big business.
4. Privatization of state banks, water utilities. The corporatization of Ukroboronprom and Energoatom.
SUMMARY AND KEY TRENDS.
Summing up the results of the outgoing week, we note that:
First , in the Verkhovna Rada, President Volodymyr Zelenskyy delivered an annual message that confirmed the intention of the President's Office to continue the trend to strengthen the personal power of the head of state. The protests of the nationalist-oriented opposition on the day of the message turned out to be less massive than expected and did not produce the desired informational effect. It is possible that this happened as a result of agreements between the opposition and Western partners.
Secondly , the trend continues to strengthen the power of the Office of the President at the regional level. On Bankova, they are determined to take away the chair of the head of the city administration from the mayor of Kiev, promoting the bill on the capital. For his part, V. Klitschko resists the OP by trying to attract Western partners to his side in this matter.
Thirdly , in the confrontation for influence on the country's judicial system, the president suffered another defeat from the judiciary of the Constitutional Court, which refused to swear in new judges appointed by V. Zelensky.
Fourth , the geopolitical confrontation between the United States and its allies, on the one hand, and the Russian Federation and its allies, on the other, not only does not subside against the background of Russian-American negotiations, but is growing. This week, its evidence was NATO's refusal of the Russian side's proposals to agree on guarantees of non-expansion of the bloc to the East and statements by Belarusian President Alexander Lukashenko about readiness to deploy Russian nuclear weapons in his country if American nuclear weapons are deployed in Poland.
Fifth , the Republicans in the United States are trying to undermine the foreign policy architecture in Europe, which is being built by the Joe Biden administration, by pushing through Congress amendments to the defense budget for next year, involving sanctions against Nord Stream 2. As conceived by the White House, Germany should become Washington's main ally in Europe. For this, the United States gave her the go-ahead to launch Nord Stream 2. Now, if Biden's opponents push through sanctions against the gas pipeline (which is unlikely), this will be a blow to the agreements between the US President and Angela Merkel.
Sixth , the budget of Ukraine for 2022 is in line with the requirements of the IMF on the level of deficit and liberalization of gas prices. Debt collection / service to the IMF is the largest expenditure item in the budget. Expenditures on the maintenance of power have grown, while expenditures on education and health care are stagnating. Also, expenditures on the president's initiatives - “Big construction”, the presidential university, etc., increased. By the first reading, the draft budget implied high tax revenues from big business, but as a result, the forecast for this item was halved. The social sphere, namely the support of the poor, teachers, and doctors, is stagnating.
Seventh , tax receipts to the state budget for November 2021 exceed the plan by 10 percent, receipts from customs - by 13 percent, the receipt of a single social contribution to the Pension Fund and social insurance funds - by 2.6 percent. Spending 6.5 percent behind the plan for 11 months of 2021. The government is overfulfilling the plans for filling the budget, but lagging behind in terms of expenditures. Funding for social spending, defense spending, debt service and subventions and subsidies to local budgets was carried out in full. At the same time, wage arrears in Ukraine increased by 1.5 times.
Eighth , de-oligarchization occurs selectively. The authorities are increasing pressure on D. Firtash's business empire by returning the Zaporozhye Titanium and Magnesium Combine to the state. The President's statements about the planned coup d'etat on December 1 plunged the value of R. Akhmetov's Eurobonds by 13%. At the same time, I. Kolomoisky does not feel such pressure.
INTERNAL POLICY.
Briefly :
This week, in the Verkhovna Rada, President Volodymyr Zelenskyy delivered an annual message that confirmed the intention of the President's Office to continue the trend to strengthen the personal power of the head of state. The protests of the nationalist-oriented opposition on the day of the message turned out to be less massive than expected and did not produce the desired informational effect. It is possible that this happened as a result of agreements between the opposition and Western partners.
The trend of strengthening the power of the Office of the President at the regional level also continues. On Bankova, they are determined to take away the chair of the head of the city administration from the mayor of Kiev, promoting the bill on the capital. For his part, V. Klitschko resists the OP by trying to attract Western partners to his side in this matter.
In the confrontation for influence on the country's judicial system, the president suffered another defeat from the judiciary of the Constitutional Court, which refused to swear in new judges appointed by V. Zelensky.
1. Speech by Vladimir Zelensky in the Verkhovna Rada and the "day of the coup" in Kiev.
On December 1, the day on which President Volodymyr Zelenskyy announced a "coup d'etat", a protest rally "Protect Ukraine - Stop the Coup" took place in Kiev. The main demand of the protesters was the resignation of the head of the President's Office, Andrei Yermak. Its members consider him to be involved in the disruption of the operation to detain the "Wagnerites". In addition, the protesters demanded a complete reset of the government and criticized V. Zelensky for the idea of direct negotiations with Russia. [1] . The protests outside the Office of the President looked unconvincing and insufficiently massive. The protesters soon dispersed and did not exert much pressure on the authorities.
The opposition could have canceled indefinite protests under the influence of Western partners, who believe that Russia could take advantage of destabilization in the country.
On the same day, in the Verkhovna Rada, President Volodymyr Zelenskyy delivered an annual message, which confirmed the intention of the President's Office to continue the course towards strengthening the personal power of the head of state.
During the report, the president announced the construction of a plant for the production of military drones, an electronic census in February 2023, a decrease in the national debt at the end of this year below 50% of GDP, as well as financing of the defense and security sector of Ukraine in 2022 in the amount of more than 11.7 billion dollars. The head of state also recalled the idea of dual citizenship, which he would like to extend to the Ukrainian diaspora, in particular, those living in the EU, Canada and the United States.
The distribution of passports to the diaspora and the introduction of online elections are considered part of Bankova's plan to organize the victory of V. Zelensky in the presidential elections.
In general, little was said about the real state of affairs of V. Zelensky. The President practically did not touch upon the problematic topics that cause a crisis of trust between society and the authorities. The topic of de-oligarchization replaced the topic of the fight against corruption in his speech. The President talked about successes and plans and tried not to touch upon sensitive issues, including rising prices, inflation, judicial reform, as well as Ukraine's integration into the European Union and NATO. V. Zelensky also believes that the Ukrainian authorities will not be able to stop the war and return Donbass to control without direct dialogue with Russia.
2. The KSU refused to swear in new judges appointed by V. Zelensky.
This week, the confrontation between V. Zelensky and the Constitutional Court continued . The latter did not swear in Alexander Petrishin and Oksana Grischuk, whom Vladimir Zelensky had previously appointed judges of the Constitutional Court of Ukraine on November 26 [2] . By a corresponding decree, the KSU postponed the swearing-in until the vacancies appeared.
Among other things, the statement said that Alexander Tupitsky and Alexander Kasminin remain acting judges of the Constitutional Court until their terms of office expire or until they are dismissed from their posts by the Constitutional Court itself. A. Tupitsky's term of office expires in May 2022, while A. Kasminin's - in September 2022.
Recall that on March 27, 2021, the President issued a decree, according to which the powers of two judges of the Constitutional Court of Ukraine Alexander Tupitsky and Alexander Kasminin were early terminated. For their part, the judges appealed the decision to the Supreme Court. On July 14, 2021, the Administrative Court of Cassation within the Supreme Court declared illegal the presidential decree of March 27.
The Law on the Constitutional Court, listing all possible grounds for terminating the powers of a judge of the Constitutional Court (Article 20) and for dismissal from office (Article 21), does not provide for such a possibility as “cancellation of the appointment decree”. Therefore, the cancellation of the decree on the appointment of a judge of the Constitutional Court of Ukraine is not a reason for the termination of his powers or dismissal.
Thus, in the confrontation for influence on the country's judicial system, the president suffered another defeat from the judiciary. At the same time, on Bankova it was reported that V. Zelensky was upset by the refusal of the KSU to take the oath of candidates[3] . “ For the Office of the President, this looks like wasting time in the hope that the mutual guarantee in the judicial system will work again, and the Supreme Court will make favorable decisions for the compromised elite of the KSU. "- said the press secretary of the President S. Nikiforov.
Having fired two judges of the Constitutional Court, the president hoped to informally subordinate him to himself, so that in the future he would not receive the repeal of the laws promoted by him through the mechanism of filing claims about their unconstitutionality in the Constitutional Court. But the KSU, apparently, realizes that in the current situation, the legitimacy of the appointment of new judges is under a big question and refuses to play by the rules of Bankova. Now the resolution of this problem will be postponed until the expiration of the terms of office of A. Tupitsky and A. Kasminin.
As we wrote earlier, after the decision of the Supreme Court, all decisions that were made by the KSU without the participation of A. Tupitsky have dubious legitimacy, including the decision of the KSU under the law "On ensuring the functioning of the Ukrainian language as the state language."
3. Kiev Mayor Vitali Klitschko said that the Venice Commission had sent its comments to the bill on the capital.
On December 1, during a speech at the Kiev Security Forum, the Mayor of Kiev V. Klitschko said that the Venice Commission had sent its conclusion on the text of the bill on the capital - 20 pages of comments. Earlier V. Klitschko sent the text of the bill №2143-3 "On Kiev - the capital of Ukraine" to the Venice Commission. On November 17, the Council of Europe provided a number of criticisms of the bill. In particular, the Council of Europe strongly recommends that this law be adopted after the adoption or in a package with a new law on local state administrations. Or, the final and transitional provisions of this draft law should postpone the implementation of the provisions on administrative supervision until the entry into force of the new law on local state administrations. It is noted that the revised draft law does not contain all the provisions that should ensure compliance with the European Charter of Local Self-Government in terms of the mechanism of administrative supervision [4] . It is recommended to remove paragraph 4 of Article 14, which gives the right to a large number of representatives and officials of the state administration to participate and express their opinions at meetings of the City Council, district councils and their bodies. Such provisions allow for undue interference and oversight of the acts of local authorities.
V. Klitschko stressed that for the adoption of a high-quality bill on the capital, the central government must listen to international partners and finalize it.
As a reminder, on November 18, consideration of the bill on the capital was postponed. The desire to adopt this legislative act continues the trend towards strengthening the power of the president at the regional level. The Office of the President is determined to take away the chair of the head of the city administration from the mayor of Kiev, also due to the fact that V. Klitschko is viewed as a potential competitor in the presidential election. For his part, V. Klitschko resists Bankova by trying to appeal to the opinion of Western partners (in particular, the Venice Commission).
The main purpose of the bill on the capital is to delimit the powers of the mayor, elected by the people of Kiev, and the head of the Kyiv City State Administration, appointed by the president. The law provides that the head of the Kiev city state administration cannot be the mayor of the city.
4. Sociology. Parliamentary rating: Servant of the People party has lost its party leadership.
This week, the Kiev International Institute of Sociology (KIIS) published a new case study[5] , according to which the leader in the parliamentary rating is now :
• European Solidarity - 17.1% (+ 2% compared to October). This is followed by:
• "Servant of the People" - 15%. Compared to the KIIS study conducted on October 20-25 [6] , the rating of the ruling party dropped by 3.3%.
• "Batkivshchyna" - 13.3% (-2.1%).
• D. Razumkov's party "Reasonable Politics" - 9.9% (+ 5.4%)
• HLE - 9.2% (-7.8% since the end of October).
• “Strength and Honor” -6.7 (+ 1.1%).
• "Ukrainian strategy of Groisman" - 5.7% (+ 2.1%).
• O. Lyashko's radical party - 5.4% (+ 0.9%).
• The party "OURS" - 5.3% (+ 3%).
There are 9 parties in total in parliament.
The results of the KIIS study clearly demonstrate the rapid decline in the Servant of the People rating and, as a consequence, the loss of party leadership. At the same time, for the first time in two years of the 9th convocation, another party, D. Razumkov, "Reasonable Politics" , is included in the four permanent leaders ("SN", "ES", "OPSZ", "Batkivshchyna") . With a result of 9.9%, the potential party ousted HLE from the four.
But the huge decrease in the HLE rating for the month attracts attention and raises many questions .
For its part, KIIS explains the decline in support for HLE by the fact that D. Razumkov's party “Reasonable Politics” appears on the list. The sociological service cites comparative dynamics with the survey from October 15-18 (13%), where the gap is not so noticeable (-3.8%).
But if we compare it with the last published research of KIIS at the end of October (October 20-25), the rating of the HLE party was at the level of 17%, and therefore the rating loss is (-7.8% per month).
FOREIGN POLICY.
Briefly:
The geopolitical confrontation between the United States and its allies, on the one hand, and the Russian Federation and its allies, on the other, not only does not subside against the background of Russian-American negotiations, but is also growing. This week, its evidence was NATO's refusal of the Russian side's proposals to agree on guarantees of non-expansion of the bloc to the East and statements by Belarusian President Alexander Lukashenko about readiness to deploy Russian nuclear weapons in his country if American nuclear weapons are deployed in Poland.
Republicans in the United States are trying to undermine the foreign policy architecture in Europe, which is being built by the Joe Biden administration, by pushing through Congress amendments to the defense budget for next year, involving sanctions against Nord Stream 2. As conceived by the White House, Germany should become Washington's main ally in Europe. For this, the United States gave her the go-ahead to launch Nord Stream 2. Now, if Biden's opponents push through sanctions against the gas pipeline (which is unlikely), this will be a blow to the agreements between the US President and Angela Merkel.
1. Statements of A. Lukashenko about Crimea and nuclear weapons.
On Tuesday, November 30, the Belarusian president gave an extensive interview to Russian journalist Dmitry Kiselev. The conversation took place at the Palace of Independence in Minsk.
In an interview, Alexander Lukashenko announced that he was going to visit Crimea. According to him, there is already an agreement on this with Russian President Vladimir Putin.
He clarified that he and Putin discussed the trip three times. The Russian president must decide when to choose the right time for this.
“When I invite him, we will fly,” the President of Belarus added and said that during his visit he would like to land at Belbek airport in Sevastopol.
Lukashenko also called Crimea Russian. Below is his quote: "Crimea, de facto, is the Russian Crimea. After the referendum and de jure, Crimea became Russian[7] ".
The Belarusian leader said that his visit to Crimea would mean the recognition of the peninsula as Russian by Belarus.
It would seem that such a harsh statement should have caused in Ukraine a flurry of criticism and threats to "take action" against Minsk. But the reaction of the official Kiev, contrary to expectations, turned out to be rather restrained.
Ukrainian Foreign Minister Dmitry Kuleba said that he would not evaluate the statement of the President of Belarus Alexander Lukashenko on the recognition of Crimea as part of Russia. According to the Minister of Foreign Affairs, it is necessary to evaluate the actions. Quote:
“I think it makes no sense to evaluate every manifestation of the stream of consciousness regularly carried out on various media platforms by Alexander Lukashenko. We will evaluate his actions. If Belarus really recognizes the illegal occupation of Crimea by Russia, this will deal an irreparable blow to Ukrainian-Belarusian relations. We will act Crimea is not the issue where we allow ourselves to be restrained[8] ".
Considering that Alexander Lukashenko's words, as a rule, do not differ from his deeds, it is likely that in the next month or two Kiev may face a difficult choice: to take some economic measures against Belarus (for example, to prohibit the export of food products from there) and completely probably - to get problems with the supply of electricity from a neighboring country at the height of the winter season, or silently swallow the recognition of Crimea as Russian by the Belarusian leadership.
The latter would create a very unpleasant precedent for Kiev and could lead to a "wave of confessions", after which it would become much more difficult for Ukraine to speak in the international arena about the annexation of Crimea by the Russian side.
But back to the interview with Lukashenka. In addition to the sensational statement about Crimea, the Belarusian president said one more important thing in it.
Alexander Lukashenko may turn to Vladimir Putin with a proposal to return nuclear weapons to Belarus.
"This will happen on condition that similar NATO systems are in Poland[9] ", - said the Belarusian leader.
Along with the statement about Crimea, these words of Lukashenka reflect the dense and final entry of Belarus into the sphere of Russian military-political influence.
In the context of the ongoing confrontation between the Russian Federation and NATO countries and the periodically sounding statements in the West about the possibility of redeploying American nuclear weapons to Eastern Europe, the Russian side decided to hint that it could give a symmetrical response to such actions. This hint was made by the lips of Lukashenka.
It is noteworthy that all of the above is taking place against the background of the continuation of the behind-the-scenes talks between Moscow and Washington, the central theme of which is the likely conclusion of a new agreement on strategic offensive arms control. Most likely, the "bellicose" statements of the parties, in this context, should be perceived as an element of bargaining.
2. News of Russian-American relations.
Russian President Vladimir Putin made important statements about the geostrategic situation in Eastern Europe this week.
According to him, the expansion of NATO's military infrastructure into the territory of Ukraine could be a red line for Russia.[10] .
Speaking at the Russia Calling VTB Capital investment forum, Putin noted that the red lines for Moscow are primarily in the creation of threats that may emanate from the territory of Ukraine.
The Russian president noted that Russia will be forced to create something similar in response to such a threat, "if this infrastructure (NATO) continues to expand."
Putin said the red lines are somewhat speculative. He recalled that relations between Russia and the collective West in the 90s and at the beginning of the century were practically cloudless. Further quote:
"Why did it take to expand NATO to our borders? Who can answer this question? There is no common answer, there is no common answer. We had an almost idyllic picture of relations, especially in the mid-90s. We were almost allies," the Russian president said.
According to him, despite warnings and requests from Russia, NATO's infrastructure approached its borders. As an example, he cited the missile defense systems in Poland and Romania.
In continuation of these theses of Putin, the next day it became known that Russia was proposing to start substantive negotiations on the achievement of legal guarantees of non-expansion of NATO to the east. This statement was made by the Russian president at the ceremony of presenting his credentials in the Kremlin.
According to him, Russia intends to seek "reliable and long-term security guarantees" and in negotiations with the United States and its allies will "insist on the elaboration of specific agreements, excluding any NATO advance to the east."
The head of state stressed that it is precisely the legal guarantees that Moscow needs, because the Western countries did not fulfill their oral obligations.[11] .
In response to these statements by Putin, NATO made it clear that they did not intend to give any guarantees of non-expansion. NATO Secretary General Jens Stoltenberg said that Russia has no right to impose restrictions on the accession of countries, including Ukraine, to NATO. This issue is exclusively within the purview of the Alliance. Further quote:
“We will also respect Ukraine’s decision that they aspire to NATO membership. We announced that they will become its members, but, of course, it is up to us, the 30 NATO allies, to decide when Ukraine is ready for membership, when they will meet NATO standards. Russia has no veto. Russia has no vote. And Russia has no right to create a sphere of influence. "
The last sentence in this quote is especially noteworthy. In the West, it is believed that "Russia has no right to create its own sphere of influence." But in fact, in the changed environment, the West is no longer able to dictate to Russia its rights. It seems that NATO officials are still under the illusion of a unipolar moment in international relations that ended in the late 2000s. But the world has changed. And a strong Russia with its own sphere of influence in it is an objective reality.
And since Washington and Brussels do not understand this, the continuation of a new Cold War in Eastern Europe with an increase in military capabilities by both sides is an inevitable prospect for the coming years.
The talks between Sergei Lavrov and Anthony Blinken, held at the end of this week, only consolidated the above positions of the parties.
3. Attempts by the Republicans to impose new sanctions against the "SP-2" through Congress.
Attempts are underway in the United States to expand sanctions against Nord Stream 2. Republican senators have proposed including a corresponding amendment in the draft defense budget, which was to be considered on December 1. However, the White House believes that new sanctions are not needed, and the current ones are enough. Biden just doesn't want to ruin relations with Germany[12] .
The Hill reported that Republican senators want to include amendments related to the Nord Stream 2 (SP-2) gas pipeline in the draft new defense budget for 2022, citing its sources. However, this was not a big secret.
Congressmen from the Republican Party have long demanded a toughening of Washington's stance on the long-suffering gas pipeline. Senators are now refusing to approve the defense budget until it includes new sanctions against SP-2. Idaho Republican Senator James Risch is demanding that the project include restrictions against companies that participate in the pipeline's inspections and certification.
The battles around SP-2 in the Senate have been going on for a week. The Republicans have already managed to block one of the defense budget projects. They explained this precisely by the fact that there was no talk of toughening up the policy regarding the gas pipeline.
The presidential administration is against new sanctions. The White House has asked all of its congressional supporters to back the current draft budget, leaving it without sanctions amendments. The Hill writes that US President Joe Biden does not want complications in relations with Germany. We will remind that earlier he agreed with the outgoing Chancellor of the Federal Republic of Germany Angela Merkel that there will be no sanctions if Berlin gets Moscow to extend the contract for gas transit through Ukraine for another 10 years after 2024. Germany has already asked the White House to prevent the adoption of sanctions, according to Axios. In any case, the American administration believes that the current sanctions are sufficient. However, opposition Republicans think differently.
The Hill writes that many congressmen use this issue as a kind of PR. For example, Republican Robert Menendez proposed another amendment to the defense budget, which would impose sanctions against Nord Stream 2, Russian President Vladimir Putin, Russian state-owned companies and banks if Russia "invades Ukraine." It was not adopted, but it also slowed down the adoption of the military budget.
Russia is not worried about US sanctions in words. “The SP-2 project is the business of Russia and the FRG. He has nothing to do with the United States, Moscow sees no problems for him in connection with the indignation of American lawmakers, ”said Dmitry Polyansky, First Deputy Permanent Representative of the Russian Federation to the UN.
The above-described situation around the new US sanctions against SP-2 is not only PR of Republican senators, but also attempts to undermine the foreign policy architecture in Europe being built by the Joe Biden administration. According to the White House's plan, Germany should become Washington's main ally in the Old World. For this, the United States gave her the go-ahead to launch Nord Stream 2. Now, if Biden's opponents push through sanctions against the pipeline, it will be a blow to Biden's agreements with Merkel.
4. A new strain of coronavirus "Omicron" and the reaction of the world community to it.
These days, coronavirus hysteria is gaining momentum all over the world. The reason for this was another strain of the virus called "Omicron", which originated in South Africa.
Thousands of covid strains circulate around the world as viruses constantly mutate.
But the new variant, called B.1.1.529 or Omicron, is of particular concern to experts, as the latest mutation in the virus has undergone significant changes from the original variant, so it may be more resistant to vaccines.
Omicron made a great evolutionary leap and went through about 50 mutations. About 30 of them touched the so-called spike protein - thorns on the virus envelope, resembling the solar corona in outline, with which the virus enters human cells.
This is the most disturbing feature of the new variant, scientists say, since most vaccines work precisely to neutralize these thorns.
Much is still unclear, since the new strain has been little studied.
"We do not know for sure whether Omicron is transmitted faster than, for example, the Delta strain. It is also not known whether the new mutation causes a more severe course of the disease compared to other variants.[13] ", the Ukrainian Ministry of Health writes on Facebook.
The scientific community is not inclined to regard the new strain as a "disaster".
“This is not a disaster, and the statements of some of my colleagues who say 'This is awful' are largely exaggerated by me,” microbiologist Calum Semple, who advises the UK government, told BBC Breakfast.
He believes that in any case, vaccines protect against severe disease, although they do not guarantee that a person will not get sick at all.
Therefore, even if a new strain is more easily transmitted from person to person, the unvaccinated first of all will be at risk, as was the case with other strains, experts are convinced.
Be that as it may, a number of states have already begun to renew strict restrictions on travelers arriving from South African countries. For example, at a meeting of the Cabinet of Ministers of Ukraine on Monday morning, it was decided not to allow persons who were on the territory of South African countries, where a new strain of coronavirus was recorded, into the country without self-isolation.
We are talking about such countries:
South Africa,
Republic of Botswana,
Zimbabwe,
Namibia,
Kingdom of Lesotho,
Kingdom of Eswatini,
Republic of Mozambique.
ECONOMY.
Briefly:
Ukraine's budget for 2022 is in line with the requirements of the IMF on the level of deficit and liberalization of gas prices. Debt collection / service to the IMF is the largest expenditure item in the budget. Expenditures on the maintenance of power have grown, while expenditures on education and health care are stagnating. Also, expenditures on the president's initiatives - “Big construction”, the presidential university, etc., increased. By the first reading, the draft budget implied high tax revenues from big business, but as a result, the forecast for this item was halved. The social sphere, namely the support of the poor, teachers, and doctors, is stagnating.
Tax receipts to the state budget for November 2021 exceed the plan by 10 percent, receipts from customs - by 13 percent, the receipt of a single social contribution to the Pension Fund and social insurance funds - by 2.6 percent. Spending 6.5 percent behind the plan for 11 months of 2021. The government is overfulfilling the plans for filling the budget, but lagging behind in terms of expenditures. Funding for social spending, defense spending, debt service and subventions and subsidies to local budgets was carried out in full. At the same time, wage arrears in Ukraine increased by 1.5 times.
Deoligarchization occurs selectively. The authorities are increasing pressure on D. Firtash's business empire by returning the Zaporozhye Titanium and Magnesium Combine to the state. The President's statements about the planned coup d'etat on December 1 plunged the value of R. Akhmetov's Eurobonds by 13%. At the same time, I. Kolomoisky does not feel such pressure.
1. Rada adopted the budget for 2022.
On December 2, the Verkhovna Rada supported the draft budget of the country , which was introduced by the Cabinet of Ministers the day before.[14] . An article appeared in it on social-economic development with funding of 6 billion. The social economist is traditionally called "wishlist" of deputies, it is believed that at its expense the votes of majority deputies are bought. There were also other changes, for example, 2.2 billion were allocated for airports, an additional 6.5 billion was allocated from import VAT, etc. By the second reading, the Ministry of Finance increased the revenue side of the budget by UAH 54.7 billion. Just the day before, the Rada adopted the controversial bill 5600 on amending the Tax Code. And the updated income indicators were promptly entered into the budget. Most of this money is planned to come from tax innovations. At the same time, earlier the potential of the bill 5600 was estimated at 60 billion, and a little later at 25-30 billion. "The real potential of the law 5600 is up to 30 billion," says economist Aleksey Kushch. "I doubt very much that they will pull out the 'extra' almost 55 billion. As in the inflation rate of 6.2% for next year. Today, inflation is already 13%, and it is not yet clear what will happen on the commodity markets next year," Economic Discussion Club Oleg Pendzin. "We have not revised the living wage to real indicators, social payments, the minimum wage will grow by only 200 hryvnia, the money for subsidies will be 10 billion less than this year, despite the fact that the authorities have actually signed up to the IMF to increase tariffs. that the budget has been carefully reconciled with the Fund. But I think that soon they will begin to make individual amendments, in particular, on subsidies - otherwise there will simply not be enough money for payments, "added Pendzin.
In general, due to the requirements of the IMF to reduce the deficit, a very modest increase in social standards is included in the budget, but taxes are increasing. At the same time, the largest expense item, as before, is payments on the state debt. On debts it is necessary to repay 393 billion, plus 180 billion for servicing. This is 43% of the revenues, but it is more correct to count from the total budget resource, taking into account loans (next year - 571 billion). In this case, 30% is obtained.
2. The quality of implementation of the 2021 budget.
The state budget deficit for 2021 only reaches the planned one by one third[15] . In January-November 2021, the general fund of the state budget was reduced with a deficit of UAH 57.4 billion. with the planned UAH 175.7 billion. In November, the general fund of the state budget received UAH 122.2 billion, which is 10.2% (+ UAH 11.3 billion) higher than the plan. Most of the funds are tax receipts in the amount of UAH 76.6 billion. (+ 9.8% to the plan). Almost half of these funds were received from corporate income tax (UAH 35.7 billion). About UAH 12 billion each brings the collection of personal income tax and value added tax. The budget received UAH 42.2 billion from customs. (+ 13.2% of the plan), of which UAH 39.5 billion. received in the form of value added tax, another 2.5 billion hryvnia. - import duties. UAH 29.8 billion was received from the unified social contribution to the Pension Fund and social insurance funds. For 11 months of the year, the budget received UAH 984.3 billion into the general fund.
Thus, the list was overfulfilled by 4.4% (+41.6 billion UAH). Of these, 564.7 billion UAH. - tax revenues (+ 5.6% of the plan), customs - UAH 363.9 billion. (+ 3.9%). We also exceeded the plan for the unified social contribution to the Pension Fund and social insurance funds. They received UAH 310.4 billion, or UAH 7.9 billion. over and above the plan. Of this amount, UAH 29.8 billion. received in November. As for expenses, for 11 months the plan is still not fulfilled by 6.5%. Their volume is more than 1 trillion. Funding for social spending, defense spending, debt service and subventions and subsidies to local budgets was carried out in full. Also, the borrowing plan is not fulfilled, which with a volume of 478.8 billion hryvnyas. lag behind the painting by 21.8%. UAH 313.3 billion was raised from the placement of government bonds to finance the state budget, including UAH 85.6 billion in foreign currency. ($ 2.5 billion and € 583.7 million).
From external sources, UAH 143.7 billion were attracted, including UAH 48.2 billion. (1.75 billion dollars) by placing 8-year OZGP at 6.876% per annum and their additional placement with a yield of 6.30%. In addition, in September the government received UAH 37.9 billion. (1.0 billion SDR) from the distribution of 650 billion dollars of IMF funds. In October, Ukraine also received UAH 600 million. macro-financial assistance from the EU, and in November - the second tranche of UAH 700 million. from the IMF. UAH 412.3 billion was allocated to repay the state debt. (96.4% of the plan), service payments - UAH 142.4 billion. (96.4% of the plan). The government, despite the overfulfillment of revenues to the state budget, continues to lag behind in expenditures in January-October by 7.3%.
Salary arrears in Ukraine increased by 1.5 times[16] . As of November 1, 2021, the total amount of wage arrears in Ukraine amounted to about UAH 4,007 million. This is 0.1% more than on October 1, and 50% more than at the beginning of this year. This is evidenced by the data of the State Statistics Service. According to them, at the beginning of November this year, more than three quarters of the debt fell on the industry (76.50%). At the same time, more than half of the total debt is concentrated in Donetsk (25.1%), Kharkov (13.2%), Dnepropetrovsk (11.9%) regions and Kiev (13.6%). The average nominal salary of a full-time employee of Ukrainian enterprises, institutions and organizations in October this year amounted to UAH 14 thousand. (UAH 14,045). This is almost 200 UAH. (UAH 194) less than in September (UAH 14,239). According to the State Statistics Service, over the past year (compared to October 2020), wages increased by 15.4%. Economy Minister Yulia Sviridenko solemnly announced that in 2021, the dollar GDP in Ukraine will reach a record $ 195 billion (recall that the previous maximum values were in 2008 - $ 180 billion and in 2013 - $ 182 billion)[17] . Dollar GDP and its dynamics is a purely arithmetic indicator and has nothing to do with the real state of affairs in the economy. It is achieved by accelerating inflation (both consumer + 11% and industrial + 57%) and actually fixing the exchange rate at last year's level of UAH 27 / $ (thanks to a favorable external economic environment). In other words, the dollar-denominated GDP does not take into account the accelerated growth of prices and inflationary inflation of the size of nominal GDP, therefore it does not carry any semantic meaning. There have even been years in Ukraine when dollar-denominated GDP was growing, while real (excluding inflation) was declining.
3. The economic side of state policy in relation to big business.
R. Akhmetov's Eurobonds fell in price by almost 12% after the President's statements on November 26[18] . Chinese investors in Motor Sich have increased their claims against Ukraine to $ 4.5 billion. November 29[19] . The lawsuit was filed with the Arbitration Court in The Hague. The court returned to the state the Zaporozhye titanium and magnesium combine of Firtash on November 30[20] . Nikolai Topalov, the author of the "Economic Truth" (EP) publication, suspects D. Firtash of obtaining gas for his enterprises at preferential prices for the population[21] . He also admits that de-oligarchization is selective. By tax law No. 5600, the poultry industry was transferred to a general taxation system of 18% of profits, despite attempts to keep it on a "simplified system"[22] . Thus, the oligarch Y. Kosyuk will also pay more taxes to the budget.
4. Privatization of state banks, water utilities. The corporatization of Ukroboronprom and Energoatom.
Privatization of water utilities will be prepared for the opening of the land market for foreigners by 2024[23] . Thus, the infrastructure of Ukraine is preparing for the takeover of TNCs in the near future, in which, moreover, there will be less and less space for Ukrainian oligarchs. According to the memorandum between Ukraine and the IMF, the state-owned banks PrivatBank and Oschadbank will prepare for partial or full privatization by foreign investors. The process of corporatization of "Ukroboronprom" and "Energoatom" is under way in terms of the formation of public opinion and the opinion of the political class that the state cannot be an effective owner of property in principle.
Edited by:
Ruslan Bortnik,
Daniil Bogatyrev.
Authors:
Daniil Bogatyrev,
Oksana Krasovskaya,
Andrey Timchenko.
