Ukraine finance minister anticipates next IMF wire in 2015

Ukraine finance minister anticipates next IMF wire in 2015



20 листопада 2014 года
Конкорд Капитал

Ukrainian Finance Minister Oleksandr Shlapak anticipates receiving a USD 2.8 bln tranche from the IMF only in 2015, he informed journalists on Nov. 19 after the weekly Cabinet meeting. Shlapak complained about the slow progress of forming the coalition government, which has delayed approval of the 2015 budget and, subsequently, the next IMF wire. Also he confirmed that he anticipates the exchange rate strengthening to nearly UAH 13/USD in 2015, from the current rate of 15.5/USD. Earlier this week, National Bank of Ukraine Head Valeriia Gontareva said the IMF might provide the new tranche before the end of 2014 if the new government is formed by Nov. 25, the day in which the IMF mission currently working in Ukraine will complete its work.



Alexander Paraschiy: The IMF is concerned about the willingness of authorities to narrow the budget deficit, which will exceed 10% of GDP this year (counting Naftogaz refunding). Yet painful spending cuts are the only way for the government to stabilize its finances and ForEx market. That is why we expect the IMF will be waiting till the moment the 2015 budget is approved to make any loan decision. Given that the political negotiations are moving slowly and the IMF will need time to make an assessment, we believe it’s realistic to expect the next wire in early 2015 if a reasonable spending plan is approved.



For Ukraine’s solvency and local currency stability, it makes no difference whether the new tranche will be wired couple of days before or after the new year. An earlier disbursement of USD 2.8 bln from the IMF could have served as psychological support for Ukraine, as it would have allowed the government to finish this year with more than USD 10 bln in gross international reserves.

Источник: Конкорд Капитал

Аналитик: Александр Паращий
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