Ukraine complies with IMF monitoring program tasks, awaits arrival of IMF mission
MOSCOW. Feb 6 (Interfax) - Ukrainian agencies responsible for compliance with the five structural tasks of the International Monetary Fund (IMF)'s monitoring program have reported their timely achievement ahead of the first program review, before January 31, 2023.
"We are achieving the tasks and are communicating with the IMF representatives on an absolutely daily basis," Ukrainian Deputy Finance Minister Olga Zykova told Ukrainian reporters on the sidelines of a business forum in Luxembourg where Ukraine's reconstructions were discussed.
The memorandum tasked the Finance Ministry, acting together with the Ukrainian government, with drafting an action plan for the prevention and repayment of debts in the fulfillment of the budget for 2023 and the later period.
In turn, the National Bank of Ukraine timely achieved its structural task of cooperation with the IMF by coordinating and endorsing a concept of diagnostic inspections of banks and respective approaches, National Bank Chairman Andrei Pyshny said earlier.
"We have timely accomplished the mission. everything is done," Ukrainian First Deputy Social Policy Minister Larisa Marchak said on social media, while commenting on the drafting of a conceptual note as to how to reform the social security system to provide targeted, relevant and effective social assistance to the population with due account of the needs of the new disadvantaged categories while providing fiscal resilience.
Meanwhile, the Verkhovna Rada registered a governmental bill "On Amending the Ukrainian Tax Code and Other Laws of Ukraine in Regard to the Specifics of Taxation amid Marshal Law" on January 31. For instance, the bill cancels from July 1 the 2% simplified tax and resumes inspections and fines over the failure to use cash registers.
Back on January 24, the Ukrainian government confirmed the appointment of a new supervisory board of Naftogaz of Ukraine upon holding a contest, thus complying with one of the five tasks.
Consistent with terms of the IMF Program Monitoring with Board Involvement, as well as other IMF programs, a program shall be reviewed by a mission, which releases a conclusion on the program success.
The National Bank chairman said on social media on February 2 that the IMF mission would start working shortly.
"We are hoping that the successful implementation of the monitoring program will pave the way to a new full-value IMF program with proper financing from the second quarter of this year. This will help us close the gap [in financing the 2023 budget]," Ukrainian Finance Minister Sergei Marchenko said at a joint meeting of the Ukrainian government and the European Commission in Kiev on the same day. He estimated the gap at $10 billion.
As reported earlier, Ukraine asked the IMF for a four-month PMB, given the IMF's unpreparedness for immediate substantial financing. The program was approved by the IMF on December 20. Kiev hopes that PMB, which does not envisage financing, will be replaced with an expanded EFF program early this year, which may partially compensate for the 2023 budget deficit estimated at $38 billion.