The Cabinet of Ministers of Ukraine proposes to reduce spending on the “big” construction project of the construction and repair of roads in 2020 at 10 billion UAH. This is with reference to the analysis of the government’s proposed changes to the budget site reports Delo.ua.
According to estimates edition, 5.5 billion or 15% is proposed to reduce the road Fund, and UAH 3.2 bn – is also on 15% – to reduce the subsidy for regional road construction.
President Vladimir Zelensky have recently called on the government and the regional administrations not to stop the project “big construction”.
“To completely stop the country we have no right. The project “Large building” should continue, but should be safe,” said Zelensky.
That slow work because of the pandemic coronavirus is not planned, said and in “Ukravtodor”.
The reduction of funding for construction and road works – a bad signal to market participants, local authorities and international partners of Ukraine who intended to invest in the road to 27 billion UAH, according to the author of the article Dmitry Filipenko. In addition, questioned the receipt of “Ukravtodor” guarantees for lines of credit in the amount of UAH 19.5 billion, actually will be frozen the possibility of issuing Eurobonds.
The author notes that the companies incur huge costs on prepayment of equipment, materials, raw materials, to be able during the season to repair 30-40 km of roads in one lot. Therefore, the reduction in funding will lead to inefficient use of resources. In addition, reducing the cost of the road sector, the government deprives itself of additional revenue, the journalist writes. According to various estimates, from 50 to 60% of the funds allocated for the procurement of goods, works and services for road construction, are returned to the budget in taxes.
According to the author, the reduction of the cost of the road is an initiative of the Minister of Finance Igor Umansky and his Deputy Vasily Schurakova that with this initiative, “testing the waters” before totally start to cut spending on other infrastructure projects in favor of exclusively social benefits.
According to the newspaper, workers are preparing a special appeal to the government and the President with the requirement not to cut back infrastructure projects, that should be the “backbone” of economic recovery after the coming crisis.
Flash coronavirus infection COVID-19 began in December 2019 in China. March 11, the world health organization declared the spread of the coronavirus pandemic. According to the Ministry of health on the morning of March 26, Ukraine 156 laboratory-confirmed cases COVID-19, five people died. After that, a few regions reported new cases of infection. The publication “GORDON” monitoring the situation online.
Moody?s Analytics believes that the epidemic coronavirus infection can be a “black Swan” for the global economy and cause more damage than the financial crisis of 2008-2009.
According to the forecasts of the Office of the President, in the optimistic scenario, the fall of Ukraine’s economy from the spread of the coronavirus is 5% of GDP in 2020.
In Ukraine, on 2 March launched a national project “Large building” is a large – scale restructuring of infrastructure of Ukraine. The plans – during the year the construction of more than 100 schools, 100 gardens, 100 stadiums and over 200 new foster hospital departments. Also to be built 4000 km of roads.