IMF urges reforms in Ukraine, endorses Poroshenko

The IMF will continue to support Ukraine “in its
reforms efforts under President Poroshenko’s leadership,” said Managing
Director Christine Lagarde, according to a Jan. 23 IMF press release. In her
talks with Poroshenko in Davos the same day, she stressed “the urgency for
Ukraine to accelerate reforms and transition to stronger growth, which is
needed to improve people’s living standards.” At the meeting, IMF and Ukraine
representatives discussed economic developments and the implementation of
measures under the stand-by loan program signed in December 2018.

Alexander Paraschiy: With this statement, the IMF has made a clear endorsement of
Poroshenko and his commitment to continue cooperation with the fund. 
Given his record on IMF cooperation in his first term, Poroshenko is the most
reliable presidential candidate for the IMF. On the other hand, the populist
rhetoric of Yulia Tymoshenko, the most likely alternative to Poroshenko,
contradicts the IMF’s key positions on Ukraine’s economic policy, especially in
the energy sector. Tymoshenko is promising to slash natural gas prices for
households, while the government has agreed with the IMF to another price hike
in May. Tymoshenko has also indicated that she may try to limit the
independence of Ukraine’s central bank in its monetary policy, which would be a
big concern for the IMF.