Business week: changes to the state budget, division of Halyna Baluvana and growth of the national debt

Last week, Ukraine saw important events affecting both public finances and citizens' wallets. The Cabinet of Ministers proposed large-scale changes to the state budget for 2025 – expenditures are planned to increase by more than UAH 400 billion, most of which will be spent on defense. Meanwhile, the survey showed that 68% of Ukrainians have no savings due to low incomes, and housing in hryvnia in some cities has risen in price by more than 80%.

Other news includes an investigation into embezzlement at Ukrzaliznytsia tenders, the collapse of oil prices after de-escalation between Israel and Iran, the division of business between former partners of Galia Baluvana, new data on Ukraine's growing public debt, and the expansion of preferential roaming in the EU.

It also became known that the United Kingdom for the first time bought weapons for Ukraine with interest from frozen Russian assets, and MFIs are increasingly competing with banks in the consumer loan market. Read more about these and other topics in the weekly digest LIGA.net .

Cabinet of Ministers approves amendments to the state budget for 2025 worth over UAH 400 billion

The Cabinet of Ministers approved changes to the state budget for 2025 to cover increased defense spending.

The draft law proposes to adjust the expenditure side of the state budget by over UAH 397.492 billion. In particular, it is proposed to increase expenditures under certain budget programs by UAH 448.83 billion (including UAH 412.37 billion for the security and defense sector) and to reduce expenditures and loans by UAH 51.34 billion.

More than UAH 100 billion in additional funding is proposed to strengthen the capacities of the Ministry of Strategic Industries, the National Guard, the State Border Guard Service, the Security Service of Ukraine, and the Main Intelligence Directorate.

68% of Ukrainians have no savings due to low incomes

68% of Ukrainians said that they do not keep money in banks due to lack of savings as a result of low income. This is evidenced by the results of a survey conducted by the Rating sociological group.

Another quarter of respondents (25%) said they do not keep money in banks because they do not trust the financial system. Other reasons include high fixed costs, unstable income, or lack of a permanent job.

Despite the difficult economic situation, the share of those who keep most of their money in banks increased by 3% compared to 2023. Overall, 29% of respondents keep at least half of their savings in banks.

Housing prices in some Ukrainian cities have increased by 80%

In most cities, the median price in hryvnia increased by 30-80%. But when translated into dollars, the picture changes. In the currency equivalent, in many cities, the growth barely reaches 10-20%, and in some places, a drop is recorded at all.

The most significant increase in housing prices in hryvnia terms was in Chernihiv, up 83% (from UAH 663,000 to UAH 1.21 million). This is unexpected for a city that was at the epicenter of hostilities in 2022. Ternopil (+82%) and Vinnytsia (+74%) showed similar growth rates. In dollar terms, the increase is 19.9%, 19.4%, and 13.8%, respectively .

In the capital, the median price increased from UAH 2.19 million to UAH 3.1 million, or 42%. However, in dollars, this is 7%: $80,000 in 2021 versus $75,000 in 2025. This dynamics is explained by the devaluation of the hryvnia – from 27.3 to 41.7 per $1.

The situation in Lviv is similar: 25% growth in hryvnia, and 18% in dollars. In Rivne and Odesa, hryvnia prices increased, but the real value of housing in dollars decreased by 2-3%. Lutsk, Uzhhorod, Chernivtsi, Cherkasy, Khmelnytsky, and Kharkiv are also in the "red zone" in terms of currency – a decrease of 7% to 14%.

Read more about what is happening on the real estate market in Ukraine in the article: Housing prices in Ukrainian cities: where prices have risen and where they have halved in four years.

Ukrzaliznytsia embezzled UAH 15 million in paint and linoleum tenders

NABU and SAPO exposed a scheme to embezzle more than UAH 15 million from Ukrzaliznytsia. According to the investigation, the money was withdrawn through public procurement of paint and linoleum. Five participants in the scheme were suspected.

The suspects include the organizer of the scheme, two representatives of suppliers, a former deputy of the Production Support Center branch, and a manager of Ukrzaliznytsia who was responsible for procurement.

According to the SAPO, in 2022, the scheme's participants ensured that predetermined companies won tenders. If an unnecessary participant appeared in the bidding or someone offered a lower price, the tender was canceled. After that, agreements were signed with the "right" companies, but at inflated prices.

The scheme ran from September 2022 to April 2023. During this time, Ukrzaliznytsia lost more than UAH 15 million. The scheme participants used these funds at their own discretion.

Oil prices fall below $70

World oil prices on Tuesday, June 24, fell to the lowest level in more than a week as US President Donald Trump announced a truce between Iran and Israel. The de-escalation of the conflict reduces fears that there will be disruptions in oil supplies from the Middle East.

European Brent crude oil fell to $68.4 per barrel as of 9:20 a.m. Kyiv time.

In the previous days oil prices were rising rapidly due to the escalation of the conflict, especially after the US attacked Iran's nuclear facilities over the weekend. This raised concerns about a possible expansion of the conflict between Israel and Iran.

Former Galya Baluwana business partners now share assets

Roman Kordon , a partner of the Halya Baluvana semi-finished products chain from Khmelnytsky, has changed the brand to Multi Cook. Signage was changed in 26 stores at once – 22 in Khmelnytsky, two in Kyiv and two in Izmail, Odesa region. The rebranding of the outlets is currently underway. The Multi Сook brand is owned by Volodymyr Matviichuk, former co-owner of Galia Baluwana.

The franchisee from Khmelnytsky explained his decision to move to MultiCook by saying that he believes this business model is more efficient and that Volodymyr Matviychuk's approach to management is more progressive.

However, the vacated space in the region will not be empty. As Alla Teliga, founder of the Galya Baluwana chain, told LIGA.net, two more partners are currently entering Khmelnytsky, compared to the one that had previously worked in the city. The first stores of the new franchisees will open in July. The partners plan to open 10 outlets by the end of September .

For more details on what is happening to Galia Baluvana's business, see: Galia Baluvana vs Multi Cook: How former partners became competitors for the Ukrainian market.

Britain buys weapons for Ukraine for the first time with interest from Russian assets

The UK has for the first time used percentage of frozen Russian assets to directly purchase weapons for Ukraine. The new £70 million military aid package to Ukraine will include 350 ASRAAM air-to-air missiles, modified to be launched from Raven ground-based launchers. Five such systems are also included in the new package.

"Russia, not Ukraine, should pay the price for Putin's barbaric and illegal war. It is only right that we use confiscated Russian assets to strengthen Ukraine's air defense. Ukraine's security is vital to our own security," said the UK Prime Minister Keir Starmer .

Ukraine's national debt increased by $1 billion in a month

In May 2025, the total state and state-guaranteed debt of Ukraine increased by $1 billion (UAH 34.88 billion) to $180.97 billion (UAH 7.515 trillion).

In the structure of the debt, the state part is 96.3%, or $174.32 billion. The remaining 3.7% is state-guaranteed debt of $6.65 billion.

The bulk of the public debt is external. It amounts to $134.48 billion (UAH 5.58 trillion), which is 74.3% of the total amount. Domestic debt is $46.48 billion (UAH 1.93 trillion).

Mobile operators will extend preferential roaming for Ukrainians in the EU until the end of the year

Ukrainian and European mobile operators have agreed to extend until the end of the year the agreement allowing Ukrainians to roam in the EU at reduced rates.

We are talking about the Joint Statement, which has been in force since 2022. It allows Ukrainians in EU countries to use mobile communications without additional charges or at reduced rates.

The current document expires on July 9, 2025, but operators have confirmed their readiness to extend it until December 31, 2025.

Ukrainians are increasingly taking loans from microfinance organizations

According to information from Opendatabot, more than 2.17 million loan agreements were concluded with MFIs in the first quarter of 2025. This is 8% more than in the same period last year.

It is noteworthy that the number of long-term loans in the MFI portfolio increased 15 times. And the share of loans with a maturity of 32 to 92 days decreased by more than five times. This may indicate that MFIs are beginning to take over the share of banks in the consumer lending segment.

At the same time, over the past year, the total amount of Ukrainian debt to IFIs has doubled: from UAH 11.85 billion in the first quarter of 2024 to UAH 24.3 billion in the first quarter of 2025.

How MFIs attract borrowers and what advantages they have over banks – read in the text: Microfinance organizations are winning over banks in consumer lending. There is an uneven playing field.