KYIV, March 24 - Ukraine is close to finishing talks for more loans from the International Monetary Fund but has no plans to restructure its debt to cope with the fallout from the coronavirus epidemic, Finance Minister Ihor Umanskiy told Reuters.
The government provisionally agreed a $5.5 billion loan deal with the IMF in December but disbursement is contingent on Ukraine passing banking and land reforms, as well as taking steps to tackle corruption.
Lawmakers plan to hold a special parliament session on Thursday to pass legislation to deal with fallout from the coronavirus, which has led to a national lockdown, two lawmakers from President Volodymyr Zelenskiy’s party said.
Turbulence from the epidemic has dragged down the hryvnia currency and prompted the government to ask the IMF for additional emergency assistance. The government has not disclosed how much more money it would like.
Ukraine restructured its debts in 2015 in a previous crisis triggered by Russia’s annexation of the Crimea peninsula in 2014 and the outbreak of conflict in the eastern Donbass region.
“As for today, questions about the restructuring of the commercial, interstate, internal, external, any debts are not discussed and have not been initiated,” Umanskiy said by phone.
In December, Kyiv and the IMF reached a preliminary deal about an Extended Fund Facility (EFF) program. Umanskiy said the government also expanding the IMF’s assistance.
“We are now talking about the main EFF program. But within the framework of this program, we are certainly holding discussions ... taking into account what is happening in Ukraine and the world, including the coronavirus,” the minister said.
A sticking point for the IMF deal is how to handle fallout from the 2016 nationalization of PrivatBank, Ukraine’s largest lender which was owned by a prominent local businessman.
The IMF wants to ensure the nationalization is not reversed and legislation is pending parliament’s approval to prevent banks declared insolvent from returning to their former owners.
“Ukraine’s parliament must take bold, decisive, and rapid action this week to vote on necessary legislation to conclude the deal with the IMF that will enable disbursements to start in the near term,” the American Chamber of Commerce in Ukraine said. (rt/ez)