IMF mission to return to Ukraine in few weeks, official says

Poul Thomsen, the director of the IMF’s European
Department, told media on Oct. 18 that the fund is intending to send a mission
back to Ukraine “in a couple of weeks” to continue talks on reforms and a new
EFF loan program. He also said the fund did not discuss with Ukraine the size
of the future program, only stating that a three-year program is being
discussed.

The IMF’s primary focus is the independence of the
National Bank of Ukraine – not only in monetary policy, but also in bank
supervision – and issues around Privatbank, Thomsen said. In the IMF’s view,
the state should continue “its effort to try to limit losses to taxpayers”
from the bank’s resolution, he said. The second set of issues is structural
reforms, including land reform, anti-corruption issues and issues of
“monopolistic structures.”

Recall, the latest IMF mission concluded its two-week visit to Ukraine on Sept. 26 after
which the mission head promised to continue discussion with the government “in
the coming weeks.”

Alexander Paraschiy: Among the
five issues mentioned by Thomsen, the topic of monopolistic structures sound
like something new. So we would like to see what exactly the IMF will require
from the government to reduce the economy’s monopolization in Ukraine, with a
possible measure being active privatization. The other four issues are
well-known, and it’s a big question whether Ukraine will be able to provide
adequate assurance that things will move in the direction that is desired by
the fund. In any case, we see a high probability that the IMF and the
government will be able to agree on all key issues and the new program will be
signed in late 2019, soon after Ukraine adopts its 2020 budget.