The debt owed to banks for compensating the preferential interest rate under the government program "Affordable Loans" primarily arose due to support for working capital in 2022 and will be gradually repaid, stated Deputy Minister of Economy Andrey Telyupa.
"These loans are being extended gradually, and we cannot abruptly close everything. However, in 2024, we have already made changes: we reduced the banks' margin and revised the program's conditions. We are also collaborating with the World Bank and IMF to enhance the program to eliminate the debt within a few years," he said in an interview with the "Interfax-Ukraine" agency.
Telyupa specified that 18 billion UAH was allocated in the state budget for financing the program in 2024, which enabled the financing of approximately 25,000 preferential loans amounting to 92 billion UAH.
The Deputy Minister reminded that in 2024, the program's emphasis was shifted: less support for current operations and more for long-term investments: investment loans, loans for processing, and support for regions with high military risks.
"For 2025, the same amount of funds is allocated for interest rate compensation – 18 billion UAH. We are currently working with the Ministry of Finance and the National Bank to improve the program: reducing the banks' margin, making rates more accessible for businesses, and increasing the efficiency of credit resource utilization," noted the Deputy Minister.
According to him, the goal is for the program to support only priority and vulnerable categories of businesses, while other enterprises can receive loans under acceptable market conditions.
In general, commenting on the criticism of reallocating budget funds for economic support through government programs, Telyupa emphasized that this is a long-standing economic debate between Keynesians and the Austrian School of Economics.
"In global practice, which we are actively studying, we do not see long-term successful examples of a completely liberal economic policy… The position of the Austrian school regarding market self-regulation is essentially the law of the jungle, where only the strongest corporations survive. During wartime, not all market participants, especially small and medium enterprises, have the same strength and resilience," pointed out the Deputy Minister.
He stated that the Ministry of Economy aims to help them endure difficult times so they can develop under market conditions.
"All support programs and price regulation are temporary. They are aimed at overcoming problems caused by the war," Telyupa declared.
He also cited the example of Argentina, where the new libertarian president Milei is implementing reforms; however, the country's GDP declined by 4% in 2024, while in Ukraine, it grew by 4%.
According to the National Bank of Ukraine's Financial Stability Report in December, the government’s debt to banks for interest rate compensation under the "5-7-9" program by the end of 2024 will amount to approximately 10 billion UAH compared to 7 billion UAH the previous year. At the beginning of 2024, the government transferred 2.3 billion UAH to the banks participating in the program, planning to repay the remaining 4.7 billion UAH between March and May. However, according to the NBU's Financial Stability Report, the debt at the beginning of June rose again to 5.8 billion UAH.
The full text of the interview with Andrey Telyupa is available on the "Interfax-Ukraine" agency's website at the following link: https://interfax.com.ua/news/interview/1039906.html