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Concorde Capital Research: Ukraine has completed its IMF negotiations, finance minister says

July 13, 2016 | Cbonds

Ukrainian Finance Minister Oleksandr Danyliuk announced on July 12 that negotiations with the IMF to receive the next loan tranche are completed, Interfax-Ukraine reported. “We have effectively finalized negotiations with the IMF,” he said. “We put a final end to this issue. Now we are anticipating a decision from the executive board.” At the same time, he mentioned that the Ukrainian parliament has not passed all the bills required by the IMF, while some approved legislation even contradicts agreements with the Fund. “A law was approved that envisages a moratorium on debt collection on Naftogaz debtors that we need to veto,” Danyliuk said. “It’s a very bad signal before the executive board meeting. We will try to fix the issue promptly.”

Remarkably, Ukraine is not on the agenda of the IMF executive board until at least July 22, according to the IMF website.

Alexander Paraschiy: It looks as though Ukraine receiving the next IMF loan tranche will be delayed one more time. Previously, Dmytro Shymkiv, a deputy head in the Presidential Administration, stated that 19 bills should be approved to get the next IMF wire. As of today, only three were approved entirely and four in the first reading. We do not see in this list any critical bills, but only some relatively minor technical changes. Nonetheless, the IMF can’t approve the next wire if these requirements are overlooked.

Since some parliamentary forces have already started playing the “early elections game” by blocking the tribune and threatening to surrender mandates, we see a high risk that the approval of the bills will be moved till September. In light of all this, it’s unlikely the IMF tranche will arrive by the summer.

Company: Ukraine

Full company nameUkraine
Country of riskUkraine

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