Martial law will not influence the cooperation with the IMF, as Christine Lagarde, the Managing Director of the organization, said during a phone conversation with the President of Ukraine Petro Poroshenko, as the press office of the Head of the State reported.
“The Head of State informed Madame Lagarde about the adoption and the key parameters of the State Budget of Ukraine for the year 2019. Madame Lagarde noted that, according to the IMF’s preliminary estimates, the key indicators of the State Budget of Ukraine are in line with the parameters agreed with the Fund,” the message reads.
The IMF Managing Director confirmed readiness to provide relevant technical support of Ukraine in reforming the fiscal policy and tax administration.
Besides, the interlocutors discussed the further steps to be taken in terms of the session of the IMF Executive Board in December for consideration of stand-by program for Ukraine.
October 19, the Government adopted the decision on the gas price increase by 23.5 percent from November 1. Within one hour after the relevant decision of the Cabinet of Ministers, a statement appeared on the website of IMF that Ukraine and the Fund reached an agreement on a new 14-months-long support program of economic policy Stand-By Arrangement (SBA) that is supposed to replace the Extended Fund Facility (EFF), which is adopted in March 2015 and expires in March 2019.
The Monetary Fund expects that the IMF Council will adopt the program by the end of 2018 under the condition that Ukraine fulfills all agreements. That includes the adoption of the state budget by the Ukrainian Parliament, which corresponds to the recommendations of the Fund.
The credit program for Ukraine in the amount of $17.01 billion was approved by the IMF at the end of April 2014, and the first tranche of Stand-By Arrangement loan in the amount of $ 3.19 billion was granted in early May.
In March 2015, the Board of Directors of the International Monetary Fund approved the allocation of $ 17.5 billion to Ukraine under the 4-year EFF (Extended Fund Facility) program instead of the SBA program.
The SBA program has been replaced by the Extended Fund Facility due to the longer need of the balance of payments of Ukraine.