Ukrainian Finance Minister says that progress has been made in negotiations with IMF on gas tariffs in Ukraine
Finance Minister Oleksandr Danylyuk announced progress in negotiations with the International Monetary Fund on the price of gas. Ukraine has been attempting to postpone the increase of tariffs by changing the price formula, whereas the IMF demands that this issue be depoliticized.
"We have not reached a final agreement yet, but we have progress, established certain principles. Negotiations continue," Interfax-Ukraine quoted Danylyuk as saying at a briefing in Washington where he met with the Fund's leadership.
The head of the Ministry of Finance also reported on the completion, together with the IMF, of an analysis of the adopted pension reform. "In general, we did not find any fundamental differences, and I am sure that we will receive a positive response from both the World Bank and the IMF," Danylyuk said.
In response to a question about the risks to the Ukrainian economy in case the IMF tranche is not received by the end of the year, the head of the Ministry of Finance expressed his firm belief that this would not happen. "We expect that we will get it," he stressed.
"But in general, we are not in the situation where a month or two make a difference. We worked hard to strengthen our economy so as not to count days and months. The main issue is to pass a law on privatization; it is important for us find a fair formula for gas price. When we do this then the tranche issue will be a technical issue," Danylyuk added.
Another requirement of the IMF is the creation of an anti-corruption court, Danylyuk said earlier.
In March 2015, the IMF started a four-year EFF program for Ukraine for $17 billion. It assumed a quarterly review of the program and the allocation four tranches to Kyiv in 2015 and then four more in 2016. In reality, Ukraine received only four tranches, and the timing of their allocation was delayed.
The first tranche of $5 billion was received by Ukraine in March 2015, the second tranche of $1.7 billion in August 2015, the third tranche of $1 billion in September 2016 and the fourth tranche of $1 billion in April 2017.