Governor of the National Bank of Ukraine (NBU) Yakiv Smolii has said further cooperation with the International Monetary Fund (IMF) remains the basic assumption of the macroeconomic forecast.
"Further cooperation with the International Monetary Fund remains the basic assumption of the macroeconomic forecast. This will allow Ukraine to attract other official financing, improve the conditions of access to the international capital markets, and support the interest of investors in Ukrainian assets. These borrowings will make it possible for the government to finance large payments on the external public debt. In addition, the private sector will get an opportunity to attract foreign investment," he said at a press briefing on monetary policy.
"As a result, international reserves will reach USD 23 billion in 2021," Smolii added.
He said the main internal risk to the above scenario was a further strengthening of threats to macrofinancial stability.
"Court rulings, legislative initiatives, or other steps that invalidate previous achievements, and delays in implementing key reforms may increase the vulnerability of Ukraine's economy and pose an obstacle to further cooperation with the IMF. That could affect exchange-rate and inflation expectations and make it harder for Ukraine to access international capital markets in order to repay a heavy debt load in the coming years. The following risks also remain important: a suspension of Russian gas transit through Ukraine starting in 2020, an escalation of trade wars and rising geopolitical tensions, and an escalation of the military conflict, and the imposition of new trade restrictions by Russia," Smolii said.