LONDON – The main reason of delay in considering a bill on the national budget of Ukraine for 2012 is the ongoing talks with Russia on the revision of gas contracts of 2009, although the national budget 2012 should be passed by the end of this year, Vice Premier and Social Policy Minister Sergiy Tigipko has told Interfax-Ukraine.
"The budget should be [passed] on time in any situation: it would be difficult for business to plan their operations without [the budget]. I hope that by the end of this year [the budget] will be adopted," Tigipko said on the sidelines of the Inside Ukraine conference organized by the Economist magazine with support of the Foundation for Effective Governance (FEG) in London.
He said that the government expects to have the gas price reduced at the talks with Russia.
"If we fail to find understanding with Russians, we’ll take those prices we have under the 2009 agreement and we’ll base our budget on those prices," he said.
He added that even if the situation develops in this way, the political decision to increase tariffs in Ukraine has not been made.
The vice premier said that this would lead to a rise in tariffs on utility services by 32% for 10 million out of 17 million Ukrainians.
In addition, Tigipko said that a large problem, especially in the conditions of the present situation on global financial markets, is the fact that next year Ukraine will have to return or refinance $15 billion.
"The way out of the situation is only one – we should have an agreement with the IMF [International Monetary Fund]," he said.
He added that bilateral agreements would be a partial alternative.
"Despite the fact that a list of countries that could help us is not large – Russia, China, Brazil, India, and maybe one or two countries, it still would be an option," he said.
"I believe that first we should rely on cooperation with the IMF, as if the situation [in the world] worsens and stick to the scenario we see now, it would be difficult for us without aid from international organizations," he said.
He said that the Ukrainian government has agreed with the IMF Mission the vision of the budget with the deficit of 2.5% of GDP and all macroeconomic indicators for 2012, foreseeing a more conservative GDP growth scenario – 3.9%.
"We’re waiting for the mission this month," he said.
