15:48 Nov. 24, 2016
National Bank Governor says Ukraine may not receive next tranche this year
Ukraine is facing a threat of losing support of international financial institutions and not receiving another tranche from the International Monetary Fund (IMF) this year, National Bank (NBU) Governor Valeria Gontareva said on Thursday.
"Ukraine risks being left without the support of international financial institutions. Unfortunately, we see a very high risk that we will not receive the tranche from the IMF this year," Gontareva said at a meeting of the NBU council in Kyiv
"This year, we have changed our forecast on reserves three times already. As of today, our forecast is USD 17.5 billion, but it includes EUR 600 million from the EU and USD 1.3 billion from the IMF," she said, adding that there is a possibility of another revision of reserves forecast toward their reduction.
The NBU head added that in 2017 Ukraine hopes to receive four IMF tranches totaling USD 5.4 billion. However, the country would have to pay over USD 2.5 billion to service its debts and return USD 1 billion of the stand-by loan received from the IMF in 2014.
"Our forecast is that the deficit of the current account of Ukraine's balance of payment will total USD 2.9 billion. I want everyone to understand that if we have .5 billion of reserves today we would start losing them every day all together with fragile stability we have been living in for the last year and a half," Gontareva said.
In a statement released on Nov. 18, the IMF mission to Ukraine, led by Ron van Rooden, stressed that despite "good progress has been made," the Ukrainian authorities need more time "to implement policies to ensure medium-term fiscal sustainability."
"Strength, durability of recovery depends on implementation of reforms to support the transition to a full-fledged market economy," the mission concluded.
Besides that, the IMF highlighted the importance of decisive steps to be taken to achieve "tangible results in prosecuting and convicting corrupt high-level officials and recovering proceeds from corruption."