World Bank recommends Ukraine double domestic gas prices and increase pension age

13:57

It is reasonable for Ukraine to double domestic gas prices in 2010 and start gradually increasing the pension age, World Bank Country Director for Ukraine, Belarus and Moldova Martin Raiser said at a press conference in Kyiv on Thursday.

According to Raiser, the country authorities need to realize that it is not worth expecting the improvement of the economic situation without decreasing state spending.

"The understanding of what the government can permit itself should be changed. You cannot further increase the quasi-fiscal deficit," he said.

Raiser said that an increase in energy tariffs was inevitable both for the public and business.

With regards to the pension sphere, Raiser stressed the importance of balancing the budget of the Pension Fund of Ukraine. According to his estimates, the state should annually increase the pension age by six months, raising it from 55 to 60 years.

The World Bank estimates Ukraine's pension expenses at a level of 17% of GDP, which is one of the largest indicators in the world.

The World Bank director named the preparation and approval of a realistic national budget for 2010 among the new government's priority tasks: the document is to foresee a decrease in expenses.