Ukraine runs risk of losing more than $2 bln in loans over CCU ruling – Finance Minister

Ukraine is now at risk of losing more than $2 billion in loan financing due to the recent ruling by the Constitutional Court to abolish the Criminal Code article on inaccurate declaration of assets by officials, says Minister of Finance Serhiy Marchenko.

"Now the achievements and agreements of great importance for the country are under the threat of failure. I have the assessments of the World Bank's top management on the decision of the CCU regarding e-declarations. They believe that Ukraine is violating its obligations. This jeopardizes all the bank's projects with Ukraine. In general, we are talking about nearly $2.23 billion," the minister said, according to the Finance Ministry's press service.

Marchenko noted that the development of anti-corruption infrastructure in Ukraine is a key condition for obtaining loans.

Read alsoEU calls on Ukraine to restore e-declaration of assets, work of anti-graft bodies"The development of anti-corruption infrastructure in Ukraine has been a key condition of all international financial programs since 2014. Our partners consider any attempt to block anti-corruption reforms as a black mark. And this is a fair vision. After all, we agreed to such conditions and these reforms correspond to public demand. This, in fact, allowed us to reach favorable agreements and gain our partners' trust," the minister said.

Marchenko recalled that Ukraine this year had received several external loans: $2.1 billion from the International Monetary Fund and EUR 500 million from the European Union.

"This year, Ukraine received $ 2.1 billion from the IMF and 500 million euros of macro-financial assistance from the EU. At the same time, according to the cooperation program with the IMF, the state budget will be fully implemented, subject to receiving $ 6.2 billion in loans from official creditors. That is, while there is a fiscal gap of $ 3.5 billion, which should be financed. The country cannot afford to lose these funds, "the minister stressed.

Background

• The Constitutional Court of Ukraine on October 27 repealed Article 366-1 of the Criminal Code, which provides for criminal liability for inaccurate asset declaration by officials.
• Also, the CCU recognized declarations verification as unconstitutional and deprived the National Agency on Corruption Prevention of the relevant right, as well as the right to identify conflict of interest.
• On October 29, President Volodymyr Zelensky tabled in the Verkhovna Rada Draft Law No. 4288, proposing to terminate the powers of Constitutional Court judges and have the relevant appointing actors start the selection procedure to replace dismissed CCU members.
• The bill states, among other things, that the CCU judgment of October 27 is "null and void," handed down amid an actual "conflict of interests."