Repayment of the state debt, which this year is expected to exceed 90 percent of GDP – 30 percent above the legal maximum of 60, and increased spending on the army and police make up the bulk of Ukraine’s budgetary outlays.
Adding to the government’s woes, the economy is in a tailspin with the hryvniya value dropping by more than twice in the past eighteen months.
The indexation of pensions by 13 percent from September 1, the first since March 2014, will not be enough to make up for the almost 70 percent drop in the average Ukrainian’s income and the hard-hitting, five-fold jump in the cost of heating gas.
