IMF ready to revise Ukraine program immediately if peace talks succeed
Kristalina Georgieva, Managing Director of International Monetary Fund (photo: Getty Images)
International Monetary Fund (IMF) will promptly review Ukraine's extended financing program in case of successful peace negotiations, Managing Director Kristalina Georgieva said at a meeting of the Executive Board of the Fund, which considered a decision on the disbursement of funds to Ukraine.
"The program will be promptly recalibrated in the case of successful peace negotiations," Georgieva said.
She listed obligations undertaken by Ukrainian authorities under the program: fighting corruption, promoting formalization of economic activity, counteracting tax evasion, reforming energy markets, and strengthening the infrastructure of financial markets.
The head of the International Monetary Fund noted that thanks to skillful policymaking supported by the previous EFF program of 2023 and exceptional financial assistance from international partners, the authorities of Ukraine preserved overall macroeconomic and financial stability, achieved progress in mobilizing domestic revenues, advanced some critically important reforms, and carried out the restructuring of commercial external debt.
"The economy recovered, inflation was contained, and reserve buffers were rebuilt. Nevertheless, the war has taken a toll on economic and social conditions, with slowing growth and the outlook remaining subject to exceptionally high uncertainty," Georgieva said.
According to her, the new agreement with the International Monetary Fund is aimed at preserving barely achieved macroeconomic and financial stability, as well as at expanding and deepening structural reforms under conditions of ongoing war.
"This will resolve Ukraine's balance of payments problem and restore medium-term external viability, ensure strong prospects for reconstruction and growth in the post-war period, and facilitate Ukraine's path to EU accession," the head of the International Monetary Fund noted.
At the same time, she acknowledged "exceptionally high uncertainty" for the concluded agreement.
"The success of the program will depend not only on continued support by the international community to help close fiscal and external financing gaps and restore debt sustainability, but also the authorities' steadfast determination in implementing ambitious structural reforms and readiness to undertake additional measures if needed," Georgieva explained.
International Monetary Fund program for Ukraine
The Executive Board of the International Monetary Fund approved a new four-year financing program (EFF) for Ukraine worth 8.1 billion US dollars. The first tranche is expected in the near future.
Last week, Prime Minister of Ukraine Yulia Svyrydenko said that the International Monetary Fund canceled previous conditions for a new loan program worth 8.1 billion US dollars.
According to her, these concerned requirements regarding value-added tax for individual entrepreneurs, duties on parcels, tax for digital platforms, and military levy.
At the same time IMF, within the framework of the new financing program, requires Ukraine to adopt several tax changes. The deadline for Kyiv is the end of March.
