Ukrainian President Volodymyr Zelensky has said he is trying to find a fruitful friendly format for relations with the International Monetary Fund (IMF) without damaging Ukraine’s interests.
“I don’t think that the IMF should impose any other conditions other than economic ones. Is this happening? Not really. I think that we need to try to find the right contact with everyone, friendly contact, a profitable one without losing ourselves,” Zelensky said during a press marathon with journalists in Kyiv on Thursday.
“But at any moment you know what can be done. Just stand up and hit the table with your fist. Dialogue does not start from this, but it’s where dialogue can end,” he said.
Zelensky noted that the IMF “is more about money,” and he is “more about emotions” and thinks dialogue should begin with the latter.
The National Bank of Ukraine (NBU) and the International Monetary Fund (IMF) have begun joint work on a new cooperation program, the NBU press service said on Facebook. According to the report, on September 12 the first meeting of the NBU board with the IMF mission, which arrived in Ukraine, took place.
It was attended by NBU Governor Yakiv Smolii, his first deputy Kateryna Rozhkova and deputy Oleg Churiy, as well as representatives of the IMF mission led by Ron van Rooden.
During the meeting, Smolii emphasized that cooperation with the IMF is extremely important to support macro-financial stability in Ukraine, primarily because it is the key to further reforms in the country, without which a long-term growth of the Ukrainian economy is impossible. Also, cooperation with the IMF provides Ukraine with access to official and private financing.
IMF representatives expressed their intention to continue a constructive dialogue on a new cooperation program, the report said.
The position of the International Monetary Fund (IMF) on negotiations with Ukraine on the resumption of funding remains the same: the Fund is awaiting the formation of a new government and wants to see priorities of its policy.
IMF Spokesperson Gerry Rice said at a press briefing in Washington, D.C., on Thursday that the IMF team was ready to return to Kyiv to continue discussions after the parliamentary elections as soon as the new government is able to decide on its policy priorities.
Ukraine will be able to sign a new program with the International Monetary Fund (IMF) in the amount of $6-8 billion by the end of 2019 and make necessary payments on foreign debt in 2020 and 2021, Raiffeisen analysts predict. In the document, they noted a high probability of obtaining the majority by the pro-presidential party Servant of the People, which was leading in polls with an indicator of 41.5-52.30%, which will ensure the implementation of reforms promised by President of Ukraine Volodymyr Zelensky, due to which Ukraine will be able to receive IMF support.
According to the analysts, even if it fails to independently form the government, the Servant of the People party can form a coalition with Svyatoslav Vakarchuk’s Holos party, which is supported by 5-7% of the respondents.
“Given the commitment of President Zelensky to reforms, the new government will be able to sign a new three-year program with the fund in the amount of $6-8 billion by the end of 2019,” the report says.
Raiffeisen analysts point out that 40% of payments on Ukraine’s gross external debt are in 2020–2021 ($16.8 billion in 2020 and $18.5 billion in 2021), therefore the government needs a new cooperation program with the IMF as soon as possible. “Even given the full rollover of inter-company loans and the refinancing of 50% of corporate credits, Ukraine will have to pay $12.5 billion in 2020 and $15 billion in 2021,” the document says.
The updated macro-forecast of the National Bank of Ukraine (NBU) assumes receiving $2 billion from the International Monetary Fund (IMF) under the Extended Fund Facility, deputy governor of the NBU Dmytro Sologub has said at a press conference in Kyiv.
“We expect that in the fourth quarter the new program is likely to start with the IMF, and Ukraine will receive $2 billion. And we also expect $2 billion in each of the next years as part of the new structural financing program,” he said.
Sologub stressed that such an assessment is an expert commentary. According to him, if the funds arrive a little earlier or a little later, it will not have a significant impact on other macroeconomic parameters, except for international reserves.
The banker also estimated, based on the example of other countries and the size of Ukraine’s quota in the IMF, that the size of the new program could be in the range of $5-10 billion for a period of 36 to 48 months.
“We have no insight, this is our expert assessment,” he said.
Sologub also said that the National Bank laid down in its forecast another entry of Ukraine to foreign markets with eurobonds in the amount of about $1 billion as its expert assessment.
Ukraine could receive a tranche under the Stand-By Arrangement with the International Monetary Fund (IMF) in June, First Deputy Governor of the National Bank of Ukraine (NBU) Kateryna Rozhkova has reported. “Most likely, in June Ukraine may receive a tranche, because if they the IMF mission come in May, they simply won’t be able technically to provide the tranche in May,” she said in an interview with the LB.ua online portal. According to Rozhkova, the first unexpected and unpleasant surprise for the IMF was the cancellation of the article on illegal enrichment in Ukraine, the second one was the situation with the court rulings on PrivatBank.
“Of course, we’ve informed them about the events and that first we need to get the decisions of courts and only after that we will be able to comment on some legal position, the arguments of the courts … As you know, the IMF makes its decisions at a meeting of the executive board. The mission comes to the board, reports on the trip, on the results of the borrower’s work. What will they say this time: look, they reverse the reform?” she said.