IMF mission, Ukraine start discussing potential program in Warsaw
MOSCOW. March 9 (Interfax) - A mission of the International Monetary Fund (IMF) and Ukrainian representatives started to discuss an IMF funding program in Warsaw on Wednesday.
"An IMF mission, led by Gavin Gray, starts policy discussions today with the Ukrainian authorities on a potential IMF program," the Ukrainian media quoted IMF Resident Representative in Ukraine Vahram Stepanyan as saying.
"Representatives of the Ukrainian Finance Ministry, the National Bank of Ukraine and other bodies responsible for policy in the economics, energy, anti-corruption measures, and supremacy of law are taking part in the discussions on behalf of Ukraine. Meetings are taking place in Warsaw and in the online format," the Ukrainian Finance Ministry said in turn.
National Bank Chairman Andrei Pyshny said on social media that his deputies, Sergei Nikolaichuk, Yury Gelety and Dmitry Oleinik, are working in Warsaw and he will join them in a few days.
"We begin the discussion with a certain vision of the program parameters and have arguments for each of them. Our team is well prepared for the discussions and is set to achieve the result, which will strengthen Ukraine," Pyshny said.
Ukrainian Finance Minister Sergei Marchenko said earlier that the IMF mission would be working in Warsaw on March 8-15. "The terms, the content, the volume and so on will be coordinated there. It is too early to speak of specific details, because of the numerous issues of the Fund's internal discussion," Marchenko said on March 1. "I believe we will arrive at the necessary decisions so that we have a full-value program with the Fund starting from April," he said.
For now, this is about a four-year program to make respective adjustments and help Ukraine, which currently spends 50% of its budget on military needs and finances the rest with the help of partners, becomes "more or less" sufficient after the crisis.
"For now, the Fund does not set any unbearable conditions that we cannot fulfill. We are talking about programmatic, basic things: ensuring monetary and fiscal stability, reducing the budget deficit and ensuring an acceptable level of pressure on the budget, as well as good governance and best corporate practices. And we are talking about anti-corruption programs that were traditionally part of the IMF programs," he said.
Ukrainian Prime Minister Denis Shmygal noted that the program might amount to $15 billion, including $5 billion Ukraine would like to receive this year.
As reported earlier, Ukraine asked the IMF for four-month Program Monitoring with Board Involvement last fall, given the Fund's unpreparedness for substantial allocations. The IMF granted the request on December 20.
The IMF mission completed its work in Warsaw on February 17 and declared an achievement of SLA agreement on early termination of the current program and preparations for an extended program with funding. The agreements, which still require coordination with the IMF leadership, paved the way to negotiations on the extended fund facility.
Kiev hopes to replace Program Monitoring with Board Involvement with Extended Fund Facility of about $15 billion as early as in the beginning of the second quarter of 2023 to close the gap in covering $38-billion deficit of the 2023 budget, which currently amounts to $5 billion -$10 billion.