IMF says to start new loan talks with Ukraine next week
The International Monetary Fund
will send a mission to Ukraine next week to start talks on a new
loan programme, its office in the former Soviet republic said on
Friday.
Next year, Ukraine is due to pay foreign creditors $9.1
billion in principal and interest, up from $6.5 billion this
year. The 2013 sum includes $6.4 billion owed to the IMF.
“At the request of the authorities, an IMF mission headed by
Mr. Christopher Jarvis will visit Ukraine on December 7-17 to
initiate negotiations on a new Stand-By Arrangement,” Max Alier,
the IMF Resident Representative in Ukraine, said in a statement.
The IMF suspended lending to Ukraine in early 2011 after the
Kyiv government refused to raise household gas and heating
prices, an unpopular move which the Fund sees as essential to
control the budget deficit.
The Fund has also urged Ukraine to allow more hryvnia
exchange rate flexibility and carry out other reforms aimed at
improving the business climate and avoiding a build-up of debt.
Central bank chairman Serhiy Arbuzov told local magazine
“Kommentarii” on Friday that Kyiv hoped to refinance the
maturing IMF debt.
Ukrainian Prime Minister Mykola Azarov told Reuters last
month his cabinet wanted to secure fresh IMF lending without
raising household gas and heating prices.
Ukraine’s economy, dominated by steel exports, shrank by 1.3
percent year-on-year between July and September due to falling
global demand for the metal while the state budget deficit
nearly tripled in January-October to about $4 billion.