International Monetary Fund adds 3 conditions for aid to Ukraine

The International Monetary Fund (IMF), following the results of the latest audit of Ukraine's performance of its obligations under the Extended Fund Facility (EFF), has added three new structural warnings (mandatory conditions) to Kiev, TASS news agency reported on December 22. This was announced by the head of the Finance Committee of the Ukrainian Parliament, Daniil Getmantsev.

“As for the sixth revision of the EFF program, Ukraine has updated the memorandum on economic and financial policies. Three new mandatory conditions have appeared. The new structural warnings are strict reform obligations with deadlines that the borrower undertakes during the implementation of the IMG program,” Getmantsev said on his social media channel.

Mr. Getmantsev explained that, among the new conditions, there are the preparation of an operational strategy for the securities and securities market regulator, the preparation and submission to the Parliament of a bill on significant third-party risks faced by banks, non-bank institutions and payment systems, as well as the conduct and publication of external assessment work by the regulator in the energy and utilities sector (NKREKU).

In March 2023, the IMF approved a four-year program for Ukraine with $15.6 billion in financing. The first tranche of $2.7 billion was released to the general fund of the country's budget on April 3, 2023. To continue receiving funding, Ukraine must fulfill certain obligations - the so-called structural beacons.

During the audit, the fund's experts assessed Ukraine's compliance with the terms of the memorandum on economic and financial policy, in particular the implementation of the budget, the status of international reserves and the implementation of reforms.

On December 20, the IMF Executive Board, following the results of the sixth audit, approved the next tranche of $1.1 billion to Ukraine through the EFF.

The Ukrainian authorities, which depend on financial support from Western partners, regularly report on the fulfillment of their conditions for implementing “recommended” reforms. At the same time, allies are increasingly linking continued support and Ukraine’s European integration process to the fulfillment of these conditions, including legislative amendments.