KIEV, July 29 – Ukraine will seek to get its next $3.1 billion installment from the International Monetary Fund in September, two months earlier than planned, acting Finance Minister Ihor Umanskiy said Wednesday.

“As far as I know the IMF is considering this and most likely this decision will be approved and the [program] review will be in September,” Umanskiy said. “I believe an IMF team will arrive in Ukraine late September.”

The comment comes a day after the IMF approved disbursement of a $3.3 billion installment to Ukraine, increasing to $10.9 billion the amount of cash released since November, and suggests the government continues to face serious financial difficulties and these are not likely to improve within the next few months ahead of upcoming foreign debt payments by year end.

The government has been facing significant financial pressure due to severe economic contraction this year that was triggered by the global credit crunch.

Ukraine’s economy contracted 20.3% on the year in the first quarter, one of the worst such indicators in the world, but Prime Minister Yulia Tymoshenko has recently said that she expected the economy to improve before the end of the year.

A chief analyst at the National Bank of Ukraine, Valeriy Lytvytskiy, recently warned the government that additional steps must be made to prevent the next wave of the economic crisis hitting the country’s banks.

Securing lending from the IMF is one of the steps, according to Lytvytskiy.

Tymoshenko said recently she did not believe the second wave of the crisis would hit Ukraine, but the plans to secure lending earlier-then-planned may be an indication the government has been preparing for the attack.

John Lipsky, the first deputy managing director at the IMF, said Tuesday the government must be watching the banking sector carefully, which is important for returning to economic growth.

“Restoring confidence in the banking system, which is essential to facilitate the economic recovery, remains a key priority,” Lipsky said.

“Recent important steps include the recapitalization of the systemic banks, the decisions taken with regard to two other banks, and the adoption of legal amendments to enable the resolution of non-systemic banks,” he said.

The IMF approved $16.4 billion two-year Standby loan in November 2008 to support Ukraine, which appears to be one of the worst-hit countries by the global economic crisis. (nr/ez)