OREANDA-NEWS. November 28, 2014. Despite the decline of industrial production, this year the Government managed to collect by 5% more revenues to the budget than last year. This is due to the partial closure of shadow schemes, de-shadowing of trade by petroleum products and tough tax measures towards big business, Ukrainian Prime Minister Arseniy Yatsenyuk underlined at a Government’s meeting summing up the governmental nine-month work.

Arseniy Yatsenyuk stressed that the Russian military aggression "hasn’t just hit the Ukrainian economy but caused serious losses to the country": "It has undermined any investment attractiveness of the state, so, to invest in a country where there are Russian tanks and Russian terrorists is a risky business".

Therefore, according to him, the Government has resumed its cooperation program with the IMF, the World Bank, the European Bank for Reconstruction and Development, the European Investment Bank, "Today, private investors are not ready to invest in Ukraine, but international institutional investors help Ukraine cope with financial problems".

Arseniy Yatsenyuk has informed that today Ukraine received in general USD8.6 billion from international financial institutions, " USD 9.1 billion have been spent on the debts that we didn’t do, as well as on the interests on these debts. Another US\\$1 billion 670 million we spent on the debts of Naftogaz Ukrainy, namely Eurobonds that we repaid a month ago."

He has ordered the Ministry of Finance "to let the whole country see from whom we received the money as well as lenders who received this money."

"We are grateful to our international investors for assistance, as without their support we would have failed to repay our external debts, which are huge," the Prime Minister added.

The PM believes social spending to be the main burden of the state budget.

Arseniy Yatsenyuk has reminded that, according to preliminary forecasts, the economy was assumed to fall to minus 10%: "Today we expect minus 7%, but not minus 10%. 3% is a serious log that we managed to achieve. However, this is still a downward trend in our economy that is going down due to the Russian military aggression, huge budget military expenditures, and that [economy] is partially destroyed on the eastern territories of Ukraine by Russian terrorists."

The Prime Minister has underlined that despite the decline of industrial production by 10% - "caused by bombed mines and enterprises" – in 2014, the Government managed to collect by 5% more revenues to the state budget than in 2013, "It is my clear answer to the question whether we managed to close partially shadow and corrupt schemes. Yes, partially we did, including through de-shadowing trade in petroleum products and excise taxes on petroleum products, through tough tax measures primarily aimed at large profitable business."

"For some reason or other, all the predecessors had failed to raise the rent for ore, oil and gas, despite the fact that they had had a majority in the House and declared good purposes. We did it. Thanks to that, we increased revenues to the state budget," Arseniy Yatsenyuk added.

He has also reminded about the forecasts concerning the budget deficit of minus 7% and 10%: "We are holding the state budget deficit at the level of 4%. For a country that is at war, which has been totally looted, budget figures for revenues by 5% more than in the previous year and the deficit within 4% are acceptable."

Arseniy Yatsenyuk has also noted that the Government managed to build the VAT refund system, "Despite the difficult economic situation, we are refunding VAT to our producers and, moreover, we have introduced a public reporting system."

"Some shadow schemes have been eliminated. Some, of course, haven’t. We must continue to restore order, especially at customs in the State Fiscal Service. This will give the opportunity of de-shadowing revenues as well as additional filling of the Ukraine’s state budget", the Prime Minister emphasized.