On Path of Recovery?: Ukraine vows to speed up reforms - Financial Times

11:23 Sep. 15, 2016

Ukraine vows to speed up reforms - Financial Times

Crowns are seen playing with a yellow-blue Ukrainian national flag on the top of Foreign Ministry building downtown Kyiv, Ukraine (Getty Images)

Kyiv pledges crackdown on corruption as IMF backs USD 1bn in aid

Ukraine has pledged to accelerate economic reforms — including a crackdown on corruption — as the International Monetary Fund cleared the way for the payment a long-delayed USD 1 bn in assistance to the war-torn country.

The IMF board on Wednesday approved the payment after a 13-month delay, deciding that despite missing a number of important targets the new government in Kiev was making progress on reforms required as part of a USD 17.5bn IMF bailout.

In an interview with the Financial Times ahead of the decision, Ukraine's finance minister Oleksandr Danyliuk said the country was ready to accelerate reforms including overhauling the pension, education and healthcare systems.

"Yes, it took us 13 months, but now is the crucial time to … show that we continue working with the IMF and are implementing reforms," he said. "We are ready to accelerate reforms."

The fresh financial assistance is needed to prop up a fragile economy that has managed to display its first green shoots since Russia's annexation of Crimea in 2014 and a devastating war with Russian-backed separatists in far eastern regions that continues to smoulder more than two years on.

Government figures released this month put January-July growth at 0.7 per cent following a more than 16 per cent GDP contraction in 2014-2015. Mr Danyliuk said he believed Ukraine's economy would grow 1 per cent this year and 3 per cent in 2017.

"The economic situation has stabilised, but if you take a look at the longer perspective, you can easily see how it can go down," Mr Danyliuk cautioned.

Among the things holding up discussions with the IMF over the past year had been concerns that Ukraine had not been doing enough to tackle corruption. But Kyiv has in recent months introduced a new electronic disclosure system for public servants to declare their assets and tried to cut graft at the customs service.

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