Ukraine, under the updated memorandum with the International Monetary Fund (IMF), has undertaken to complete and publish an audit of the remaining portion of the funds of the Fund to Fight against COVID-19 spent by Ukravtodor by late 2021.”Complete and publish the audit of the remaining portion of the funds spent out of the COVID-related spending program by end-December 2021,” according to the document released by the IMF on Wednesday.This condition is one of the structural benchmarks of the Stand-By Arrangement.It is clarified that all 100% of the funds allocated for the fight against COVID-19 will not be subject to audit, since the costs of a comprehensive audit in this area by far would outweigh the benefit.”We will complete the audit of the remaining portion of the funds spent out of this budget program – mostly spent by the state road fund [UAH 13.3 billion] – by end-December 2021,” the document said.”While confidentiality agreements with suppliers may not allow for public disclosure of details on some spending, we are currently exploring options to make this possible,” it said.According to the memorandum, following the audit of the COVID-related spending, law enforcement agencies are already considering 212 cases.
Ukraine intends to retain the half of $2.7 billion received in August 2021 from the International Monetary Fund (IMF) during SDR distribution as a buffer against future risks, according to the Memorandum of Economic and Financial Policies of Ukraine signed with the IMF, published by the IMF and the Ministry of Finance on Wednesday.”While the deficit has remained in check, given large gross external financing needs including a significant amount of debt maturing that was issued at concessional rates, we have used about half of the recent general SDR allocation,” the government said in the memo. The government said that this will help to buttress our external stability objectives.
President of Ukraine Volodymyr Zelensky has thanked the IMF for allocating a tranche of $ 700 million to Ukraine under the Stand-By Arrangement.”Grateful to the IMF Board of Governors for the decision to complete the review of the Stand-By program on the allocation of a tranche of about $ 700 million. We’ll use these funds to support the financial system and combat COVID-19 consequences. The IMF program will be continued,” the president said on Twitter.
Ukraine may receive a $700 million tranche from the International Monetary Fund (IMF) in September, the adviser to the President of Ukraine on economic issues, Oleh Ustenko, has said.
“The President of the country had a more than successful telephone conversation with Managing Director of the International Monetary Fund Kristalina Georgieva. The IMF mission is going to Ukraine. In addition, Ukraine has implemented all the preconditions of the IMF. We expect that a new tranche of about $700 million will be received from the IMF rather quickly,” he told Interfax-Ukraine.
“I suppose that now we are moving according to the following scenario: in September – the mission, at once the issue of Ukraine is brought up to a meeting of the IMF Board of Directors, and in September I expect that we will receive a new tranche,” the president’s adviser added.
At the same time, Ustenko does not rule out the possibility of extending the Stand-By Arrangement (SBA).
“We have made serious progress, and this was noted. So I do not rule out that the SBA may be extended,” he said.
The International Monetary Fund (IMF) will provide Ukraine with more than $2.7 billion “free of charge and without additional conditions,” according to the President’s Office of Ukraine website on Tuesday. The relevant decision was made by the IMF Board of Governors at the suggestion of IMF Managing Director Kristalina Georgieva to help restore the world economy affected by coronavirus (COVID-19) pandemic. In total, special drawing rights (SDR) in the amount of $650 billion will be allocated between the countries.
The IMF said in the official statement that this is the largest allocation of SDRs in the history of the fund. “The SDR allocation will benefit all members, address the long-term global need for reserves, build confidence, and foster the resilience and stability of the global economy. It will particularly help our most vulnerable countries struggling to cope with the impact of the COVID-19 crisis,” Georgieva said.
Ukraine is expected to receive the tranche on August 23.
According to a statement on the presidential website, the decision was made after a telephone conversation between President of Ukraine Volodymyr Zelensky and Georgieva last week.
“This will be a good gift for our country on the 30th anniversary of independence. These funds will help overcome the consequences of coronavirus crisis and stimulate our economy. I am grateful to the IMF and personally Kristalina Georgieva for this decision,” the President of Ukraine said.
He also said that cooperation with the IMF is very important for Ukraine, so it continues to implement reforms and carry out structural beacons to receive a new tranche under the current stand-by arrangements. “We are working on completing the first revision of the current program of the International Monetary Fund and expect the IMF mission in September. I spoke about that during our telephone conversation with Ms. Kristalina Georgieva,” Zelensky said.
Ukraine may receive a tranche from the International Monetary Fund (IMF) under the Stand-By Arrangement (SBA) by the end of 2021, Deputy Governor of the National Bank of Ukraine (NBU) Yuriy Heletiy said.
“Continuing cooperation with the IMF is the most important task for the NBU, Ukrainian stakeholders and all government agencies. Now we need to move towards reaching the Staff Level Agreement, which will mean updating our memorandum of cooperation for the first revision by the Board of Directors,” he said in an interview with Interfax-Ukraine.
According to the deputy governor, the NBU also expects to receive the second tranche of macro-financial assistance from the EU in the amount of EUR 600 million and the second part of the DPL from the World Bank for $350 million. He said that the possibility of obtaining this financing by Ukraine directly depends on success in cooperation with the IMF.
Heletiy said that in order to continue cooperation with the IMF, the NBU fulfills structural beacons, in particular, it conducts a self-assessment on the supervisory process, reporting and tools in accordance with the Basel Core Principles.
