In an interview, Volodymyr Groysman hailed the International Monetary Fund's decision to disburse the next $1 billion installment of a $17.5 billion bailout as a "scorecard of recognition of the progress that has been achieved." On top of the IMF money, the EU disbursed a further EUR 600 million loan on Tuesday, FT reported.
But Mr. Groysman acknowledged the massive public disillusionment with reforms that, along with recession sparked by Russia's military intervention in Ukraine, have hit living standards and heaped pressure on pro-western President Petro Poroshenko's administration.
"Proof of change must be foremost judged by whether it is felt by the people," he said. "We are now at a point, a platform from where we move to growth and the people will feel it, or God forbid we will fall back into stagnation," he told the Financial Times.
Real economic output grew 2.3 per cent in 2016 — after a 17 per cent plunge over the previous two years — with growth accelerating to 4.7 per cent year-on-year in the final quarter. But millions of Ukrainians still barely scrape by in a country where pensions and the minimum wage are in the $100-per-month range.
Read alsoGroysman: Decentralization reform yields result - local budgets see additional UAH 100 blnReforms such as raising gas prices to international market levels and a groundbreaking shake-up of public procurement have begun to tackle endemic corruption, but have either raised living costs or been little noticed by ordinary Ukrainians. Government popularity ratings have slumped.
Ukraine has also had a bumpy start to the year with an increase in January in fighting in east Ukraine, a dispute that has ended trade with breakaway eastern regions, and an exiled Russian MP being gunned down outside a luxury hotel in Kyiv last month.
While Russian officials and media have presented the killing as a sign of lawlessness in Ukraine, Mr. Groysman insisted it was the latest in a long line of Russian-organized provocations. "This is Russian propaganda at work," he said.
With elections looming in 2019, Ukraine's government is banking on overhauls this year of dysfunctional public services, including the pension, healthcare and education systems, to start to turn around its ratings.
Kyiv also hopes to lure sorely needed investment by creating a competitive market for Ukraine's prized agricultural land and finally kick-starting the privatization of state enterprises.
"Implementing this program will give the people the clear feeling that the situation is changing," Mr. Groysman said.