Published: July 5, 2010
Support conditional on legislation to sort financial problems.
The International Monetary Fund (IMF) has agreed to help Ukraine’s government stabilise its recession-hit economy through providing a multi-million dollar aid package.
The US$14.9bn agreement is conditional upon approval from the IMF’s management and executive boards, which is expected in late July. But before the funding is made available the government must push through new financial legislation to repair the banking system by increasing liquidity and strengthening the independence of the National Bank of Ukraine.
Policies under the program include adjusting the government deficit to 5.5% of GDP this year and 3.5% in 2011, which will be achieved by tax and social security structural reforms as well as improving tax administration.
The agreement follows a visit by the IMF to Ukraine to discover how the organisation can help support the country through its financial problems.
After the visit was concluded, Thanos Arvanitis, the IMF’s mission chief for Ukraine, said the authority’s goal is to provide financial stability, advance structural reforms and prepare the country for sustainable and balance growth.
“Legislative reforms will be aimed at modernising the economy and improving business environment, to restore robust economic growth over the coming years,” he adds.