Fitch forecasts that the IMF will provide Ukraine with a $1.9 billion tranche within the year
Ukraine will receive the next credit tranche from the International Monetary Fund in the amount of $1.9 billion this year, experts of the international rating agency Fitch believe. According to them, the constant interaction with the IMF and other international partners remains a key condition for Ukraine's access to external financing for national debt service in 2020-2021.
The nomination of Yakov Smolii as the chairman of the National Bank of Ukraine (NBU) should reduce uncertainty regarding the stability and independence of the regulator, Fitch said. According to the agency’s analysts, a discount rate increase in the NBU indicates that the regulator is still focused on reducing inflation as part of the planned transition to inflation targeting.
Ukrainian President Petro Poroshenko expressed hope that Ukraine would receive the next tranche as early as April. He believes that the country has fulfilled 80% of the IMF’s requirements. Also, according to the President, the government is ready to set gas prices for household needs at the Fund’s request.
On Wednesday, January 24, in Davos, Poroshenko met with IMF Managing Director Christine Lagarde and assured her that Ukraine was ready to continue constructive cooperation with the International Monetary Fund. Lagarde expressed hope that Ukraine would continue to fulfill the terms of the cooperation program and that the National Bank would receive independent and professional leadership.
The IMF’s latest four-year Extended Fund Facility (EFF) program has been operating in Ukraine since 2015 and provides $17.5 billion. The country must conduct serious reforms, including creation of an Anti-Corruption Court.