IMF warns Ukraine on possible disruption of loan program – media

The International Monetary Fund (IMF) is dissatisfied with the latest decisions of the Ukrainian government regarding the authority of the Ministry of Finance and subordination of the State Fiscal Service.

A letter written by IMF Mission Chief for Ukraine Ron van Rooden to the Ukrainian government refers to two decisions taken at the closed part of the Cabinet meeting a week ago, Liga.net reports citing a source in the Cabinet of Ministers.

The Fund notes Ukraine violates its commitments made while receiving the previous tranche. It is about the government's unpublished decisions to deprive the Ministry of Finance of the authority to approve government financial documents.

The press service of the prime minister refutes information about the decisions taken. It argues that the closed session raised the issue of applying the principle of "tacit consent" in cases where the Ministry of Finance delays the coordination of issues to review legislative acts that are submitted for consideration by the Cabinet. "The current norms say that if such issues are put to the vote in the Cabinet, except for tacit consent, the Ministry of Finance retains its rights," Groysman said.

Read alsoGroysman calls Danyliuk's letter to G7 envoys unacceptable, unreasonableIn turn, Finance Minister Oleksandr Danyliuk said that such decisions of the Cabinet had already been prepared and received by the Ministry of Finance. "The government is not yet willing to make these decisions public. It would be a big blow for the country and threaten it with the disruption of the IMF program," the minister said at a meeting with businessmen and the press.

So far, neither the Ministry of Finance nor the Cabinet of Ministers have announced draft resolutions on changing the government's regulations proposing to deprive the Ministry of Finance of the authority to approve financial documents, as well as to withdraw the State Fiscal Service from the Finance Ministry's control. "If they are published, the Ministry of Finance will challenge both decisions, but I'm sure the Cabinet will not take such a step," Danyliuk said.

As UNIAN reported earlier, Danyliuk wrote a letter to G7 Ambassadors, claiming that Ukrainian President Petro Poroshenko had attempted to appoint his ally to the post of deputy finance minister, while Prime Minister Volodymyr Groysman had refused to endorse the candidate nominated by the minister.

Read alsoNew IMF program to be available to Ukraine no earlier than 2020 – NBUDanyliuk asked Groysman at a government meeting on May 23 why Yana Bugrimova had not been appointed as deputy finance minister for two years by then. Bugrimova was expected to be in charge of the reform of the State Fiscal Service (SFS) of Ukraine.

Groysman said that Danyliuk's reaction to the fact that Bugrimova's appointment was not included in the agenda of the May 23 meeting was "weird and unpredictable." According to the prime minister, there were no reasons for such an emotional reaction.

After the said meeting, media reported about the Cabinet's decision to transfer the SFS to the government's subordination. Earlier, the SFS was accountable to the Finance Ministry.