Business news from Ukraine

UKRAINE WORKING WITH IMF TO HOST MISSION IN KYIV ASAP

President of Ukraine Volodymyr Zelensky, in a telephone conversation with Managing Director of the International Monetary Fund (IMF) Kristalina Georgieva, discussed the progress towards the adoption of the state budget of Ukraine for 2021, the preservation of the anti-corruption agenda and macroeconomic stability in the country.
“Our teams enjoy strong trust & work closely to welcome the IMF mission ASAP,” he wrote on Twitter on Tuesday night.

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EUROPE READY TO GIVE EUR 1.2 BLN TO UKRAINE, BUT FOR THIS IT NEEDS TO CONSTRUCTIVELY INTERACT WITH IMF

The European Union is ready to provide Ukraine with EUR 1.2 billion of macro-financial assistance, but for this it needs to constructively interact with the International Monetary Fund and fulfill the requirements related to the rule of law, said Josep Borrell, Vice President of the European Commission, EU High Representative for Foreign Affairs and Security Policy.
He said at a joint press conference with Ukrainian Foreign Minister Dmytro Kuleba in Kyiv on Tuesday that they are also ready to provide $1.2 billion in macro-financial assistance in order to help solve the problems associated with the economic recession caused by the coronavirus pandemic, but for this Ukraine needs to constructively interact with the IMF and also fulfill all those requirements that relate to strengthening the rule of law in Ukraine.

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UKRAINIAN PRESIDENT INFORMS IMF HEAD ABOUT PLANS TO NOMINATE CANDIDATE FOR NBU HEAD

Ukrainian President Volodymyr Zelensky has held a phone conversation with Managing Director of the International Monetary Fund (IMF) Kristalina Georgieva to inform her about his plans to nominate a candidate for governor of the National Bank of Ukraine (NBU) by the end of the week.
“Informed Kristalina Georgieva that by the end of the week I will have a new candidate for Head of the NBU for Parliament’s approval. It will be an independent technocrat, who will continue the Bank’s independent course. I make all my decisions only in the interests of the Ukrainian people,” the head of state said on Twitter on Tuesday.

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UKRAINE TO MAKE ALL HEATING TARIFFS MARKET-BASED BY LATE AUG 2020 – IMF

Ukraine in the memorandum to the International Monetary Fund (IMF) under the new Stand-By Arrangement has undertook by the end of August to review and approve all heating tariffs, linking them to the cost of gas and associated costs, including capital investments.
“We have eliminated the cap on household heating tariffs by revoking cabinet resolution No. 560 of June 26, 2019. We will ensure that, by the end of August 2020, all heating tariffs under the jurisdiction of both the NEURC (the National Energy and Utilities Regulatory Commission of Ukraine) and local authorities are reviewed and officially enacted to fully reflect gas and non-gas costs (including capex),” the document says.
“Starting with the 2020/2021 heating season, heating tariffs will be reviewed and set at least once per year before the start of the heating season to ensure that changes in gas and non-gas costs (including capex) are adequately reflected in heating tariffs. To that end, prior to the start of the 2020/2021 heating season, we will rescind cabinet resolution No. 1082 of December 24, 2019, which allows for the asymmetric changes in heating bills without the need to address heating tariffs when the price of input gas changes. In order to mitigate the risk of future arrears we will develop in consultation with the World Bank mechanisms to provide buffers for district heating companies to deal with the volatility in the wholesale gas price,” according to the report.
“By the end of June we will legislate an October 1, 2020 deadline for all new utility service contracts incorporating the revised heating tariffs to be concluded,” it says.

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FIRST DISBURSEMENT OF $2.1 BLN BY INTERNATIONAL MONETARY FUND SENT TO UKRAINE

The first disbursement of $2.1 billion by the International Monetary Fund (IMF) has been sent to Ukraine, Vladyslav Rashkovan, the representative of Ukraine in the IMF, has said.
“The first disbursement of $ 2.1 billion has already been sent to Ukraine. It will reach the accounts of the government, taking into account the time difference and the speed of funds flow in international payment systems,” he wrote on Facebook on Wednesday.

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UKRAINE EXPECTS FIRST IMF TRANCHE OF $1.9 BLN ON JUNE 5-6, $1.6 BLN IN AUTUMN, $1.5 BLN NEXT YEAR

Prime Minister of Ukraine Denys Shmyhal notes that Ukraine expects the IMF Executive Board to approve the first tranche of the agreed Stand-By Arrangement for the next 18 months on June 5.
“We have completed negotiations with the IMF, the president also had a telephone conversation with the IMF leader, and on June 5 we expect the signing of the agreement and the receipt of the first tranche. The program is for 18 months, a loan for 5 years, the amount is $5 billion. And this is a Stand-By Arrangement with rather simplified conditions, which will enable us to move calmly in overcoming the consequences of the coronavirus crisis that already exist,” he said on the air of the Savik Shuster Freedom of Speech program on Ukraine TV Channel.
Shmyhal pointed out that the first tranche from the IMF will be $1.9 billion, which Ukraine expects on June 5-6, another $1.6 billion will be in autumn, and $1.5 billion next year.

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