Ukraine needs more progress on reform to get new tranche, IMF says
Ukraine expects to receive $2.2 billion in three equal tranches from the IMF in 2021REUTERS
The International Monetary Fund says Ukraine must show more progress on reform to secure a new tranche under a $5 billion Stand-By Arrangement with the international lender, the Fund’s representative says.
“Discussions will continue,” representative Goesta Ljungman said in a statement February 13, after the fund’s mission held talks with Ukraine officials, RFE/RL reports.
The talks, which Ljungman said were productive, focused on strengthening governance of the National Bank, improvements to the legislative and regulatory framework for bank supervision and resolution, policies to reduce the medium-term fiscal deficit, legislation restoring and strengthening the anti-corruption framework and the judiciary, as well as on energy policy.
Ukraine expects to receive $2.2 billion in three equal tranches from the IMF in 2021, National Bank Governor Kyrylo Shevchenko told Reuters.
The IMF in June approved the $5 billion loan program and disbursed the first tranche of $2.1 billion to help the pandemic-hit economy.
However, further loans have been held up over the slow pace of reforms.
The IMF also voiced concern over the government’s move last month to regulate household gas prices.
On June 9, 2020, the IMF’s Executive Board adopted an 18-month Stand-By Arrangement for Ukraine with funding equivalent to SDR 3.6 billion (about US$5 billion) aimed at helping Ukraine overcome the consequences of the COVID-19 pandemic.
On June 12, Ukraine received the first tranche of the IMF loan under the SBA worth US$2.1 billion.
In late November, the Finance Ministry reported on the successful completion of talks with the IMF on benchmarks of the draft budget for 2021, which was one of the major prerequisites for starting the SBA review.