PM views IMF program as realistic and complex reform plan for Ukraine
OREANDA-NEWS. February 17, 2015. "The program, which will be signed with the International Monetary Fund and approved by the Board of Directors of the IMF - realistic and complex. But most important, it is not a program for reform of the International Monetary Fund. This is a reform program for Ukraine. And it will be effective if the political forces represented in the Parliament perform what they have been chosen for and what the Cabinet of Ministers has proposed", the Prime Minister of Ukraine Arseniy Yatsenyuk emphasized at a meeting of the Government on Saturday, February 14.
He stressed that there were very difficult discussions in negotiations with international creditors: "Thus, Ukraine was demanded to adopt decisions, which in modern terms we couldn’t accept either politically or economically. Because they gave no economic benefit, while they could create a serious political confrontation."
Among the key challenges, as reflected in the program and in the reports of international rating agencies, the Prime Minister called Russian military aggression and escalation of the conflict in eastern Ukraine, "Therefore, it is important that Russia fulfills the commitments, which she has undertaken for the second time. It is important to avoid repeating the fate of the first Minsk deal".
He has also stressed that the Ukraine’s Government welcomes a G7 statement promulgated yesterday "on tough position towards Russia, if the Russian Federation fails to fulfill the basic requirements of the Minsk new round of negotiations on the implementation of the agreement already signed by Russia."
The second challenge, according to Arseniy Yatsenyuk, concerns reforms: "Unfortunately, there was a very bad history of cooperation with the International Monetary Fund in Ukraine until 2014. Only with a new stand-by program, which was launched in April 2014, everything has been changed. Each commitment undertaken by Ukraine to implement reforms was fulfilled. And it was the precondition for the International Monetary Fund to consider Ukraine's bid for obtaining not a one-, but four-year program."
"The reforms in the country are assessed by those who provide financial support to the state. These are the International Monetary Fund, the World Bank, the European Union. And if in 2014 we had made a mistake somewhere, in 2015 nobody would sit with us at the negotiating table", he added.
Arseniy Yatsenyuk reminded that in 2014 Ukraine had obtained from the international creditors USD 9 billion, while to pay off loan obligations it had returned USD 14 billion, "We paid off 14 billion dollars of debt, which had been accumulated not by us, but by Yanukovych and his gang supporting him. But now we are implementing the obligations of the state".
"It is crucial for us to stabilize the economic situation, to meet our external obligations. And due to the fact that we are provided with an opportunity to carry out our external obligations, we have an additional resource to maintain our own army, to finance salaries and pensions," he stressed.
Arseniy Yatsenyuk emphasized that the program has several major objectives, “The first is to fulfil our external obligations. The second is to accumulate money in the foreign exchange reserves of the National Bank to stabilize the banking sector and to stabilize the currency and the exchange rate".
"The program hasn’t got a goal: "just take the money and spend it wherever you want". The program has a very important goal - "just embark on difficult reforms that are not accepted with ease, but tomorrow they will yield positive and economic, political and social results," he said.
According to Arseniy Yatsenyuk, to ensure economic growth in 2016 we should approve a decision this year to form a basis for stabilization and economic growth.
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