About one third of measures under IMF program involve stronger governance, anti-corruption efforts - IMF representative to Ukraine
MOSCOW. May 2 (Interfax) - The role of the government in the economy during the crisis naturally increases and will likely remain elevated for some time due to the huge spending needs on defense, social sector and reconstruction, so it is necessary to have an even stronger focus on transparent and efficient governance and expectations of continuous anti-corruption efforts, International Monetary Fund (IMF) Resident Representative to Ukraine Vahram Stepanyan said.
"Under the EFF-supported program, the authorities have committed to safeguarding and continuing reforms to strengthen governance and anti-corruption frameworks, including through legislative changes. This area is an important part of the program," he said in an interview with Ukrainian media.
The IMF representative said that, overall, about one third of measures under the program measures explicitly relate to governance and/or anti-corruption efforts.
Examples include the targeted restoration of asset declarations, and work on the Anti-Money Laundering/Countering the Financing of Terrorism legislation, he said.
"Many measures in the fiscal and financial sectors also have a transparency and governance angle, including enhancing transparency in reporting and management of risks in public finances, strengthening public investment management, improving revenue administration, and strengthening governance in SOEs and the financial sector," Stepanyan said.
As reported, the IMF approved the four-year, $15.6 billion Extended Fund Facility program for Ukraine in late March.
In terms of improving governance and combating corruption, the nearest of the four structural beacons of the program with a deadline set for late July is to pass the law to restore the declarations of public officials who are not directly involved in the mobilization and military operations, with restoring the powers of the National Agency on Corruption Prevention for their check and verification.
By the end of September, the law on financial monitoring and anti-money laundering should be amended to restore enhanced due diligence measures for politically exposed persons (PEPs) in accordance with a risk-based approach consistent with FATF standards. (It was reduced from life to three years last year).
Then by the end of October, the asset declaration system should be simplified by linking with other databases and registries, and by the end of the year legislation should be passed to increase the institutional autonomy of the Specialized Anti-Corruption Prosecution Service, in particular regarding selection procedures, opportunities to regulate organizational activities and the mechanisms of discipline and accountability.
In terms of state corporate governance, the goal is to transfer shares in the Operator of the Gas Transmission System of Ukraine (OGTSU) from the Trunk Pipelines of Ukraine (TPU) directly to the Energy Ministry with a corresponding change in the charter by late July.