Rada approves IMF program bills on NBU and NABU

Ukraine’s parliament approved on Oct. 19 a set of
bills that are among commitments under the IMF’s current program. Namely, three
bills were approved aimed at improving the corporate governance and financial
flexibility of the National Bank of Ukraine (concerning the rights and
obligations of the NBU council and top management, the NBU’s interaction with
other government institutions, management of the NBU’s reserves).

Also, bill #5459-1 was approved to amend legislation
on the National Anticorruption Bureau (NABU), determining its status in line
with the constitution and securing its independence from Cabinet. Also, the
bill stipulates that international experts will have decisive votes in the
selection of a new NABU director. “In this case, the president and his party
have fulfilled their promise  – NABU’s independence is preserved,” the
Anti-Corruption Action Center NGO reported on Oct. 20.

Alexander Paraschiy: This is
indeed good progress towards the IMF deal, which now looks increasingly likely
this year. Possibly remaining issues towards the approval of the program review
by the IMF board are: adoption of the state budget for 2022 with the drafted
fiscal deficit (3% of GDP), and the election of the head of Anticorruption
Prosecutor’s Office who won’t irritate western partners.

On top of that, while implementing the above, the government
must not undermine any achievements reached in the past (in anticorruption,
monetary and corporate governance areas, as well as in the energy/utility
sector) – this is a task that is easier to say than to do. Taking into account
all the above, we see the probability of an IMF tranche this year as slightly
above 50%.