REUTERS
The Ministry of Finance expects a positive decision from the Board of Directors of the International Monetary Fund – Ukraine’s key creditor – regarding a new four-year cooperation program with Ukraine, but says the meeting of the Board of Directors of the IMF will be postponed in connection with Ukraine's failure to meet a number of requirements.
The ministry said the problems included the delayed adoption by parliament of amendments in the tax and pension legislations, and the law on rehabilitation of NJSC Naftogaz of Ukraine.
"We expect that the Ukrainian issue will be resolved positively, but only after we fulfill a number of preconditions," First Deputy Minister of Finance of Ukraine Ihor Umansky said on Wednesday.
He stressed that the key condition put forward by the IMF is the adoption by the parliament of a number of laws that have already been agreed.
"We wanted everything to be completed this week. But now it looks like that will not be done until Tuesday, March 3, when the session of the Verkhovna Rada takes place. However the situation, especially in the foreign exchange market, is dramatic."
As UNIAN reported earlier, previously the head of External Relations Department of the IMF Gerry Rice has stated that the meeting of the Board of Directors of the IMF, during which the organization will make a decision on a new four-year loan program for Ukraine worth of $17.5 billion, had been scheduled for late February - early March. According to him, meanwhile there will be talks with other potential creditors of Ukraine concerning the previously announced loan package totaling $40 billion.
On February 12, the Ukrainian government approved a memorandum of cooperation with the International Monetary Fund on a medium-term program of financial assistance for Ukraine, designed for four years, under the Enhanced Extended Fund Facility (EFF). At the moment, Ukraine and the IMF are implementing a two-year Stand-by program approved by the IMF in April 2014.
The program provides for changes in fiscal policy aimed at stabilizing the public finance, ensuring social support after increase of tariffs for gas and heating, bringing NJSC Naftogaz of Ukraine to a deficit-free level by 2017 by implementing a set of measures, including a gradual increase in gas tariffs, and other measures for stabilization of the macroeconomic situation in the country and improving the investment climate.
In late February, the government submitted for consideration by parliament a number of bills, including changes to the state budget of 2015 related to revenues and expenditures, changes to pension legislation with regard to an increase in the retirement age for women, a reduction of pension benefits for working pensioners, and the total abolition of current pension payments for MPs and persons classified as such. It is also planned to introduce mechanisms for recovering of debts from local heating utility and industrial companies owed to state oil and gas company Naftogaz Ukrainy.