Ukraine successfully passed IMF mission
This is stated in a release on the IMF website, Censor.NET reports with reference to Economic Truth.
"This agreement, which must be approved by the IMF leadership, paves the way for the start of discussions on a full-fledged program supported by the Fund," the text says.
At the end of the discussions, the Head of the Mission, Gavin Gray, stated that thanks to the joint efforts of the Ukrainian government and the National Bank, all quantitative and indicative tasks for the end of December, as well as all five structural benchmarks for the end of January, were fulfilled.
Among them are the submission to the parliament of a package of tax laws aimed at increasing revenues, taking measures by the Ministry of Finance to eliminate debt, developing a conceptual note for the social protection system, creating a supervisory board of Naftogaz, and agreeing on the key elements of banking sector diagnostics.
Gray noted that in 2022, the Ukrainian economy shrank by 30%, less than previously expected, and inflation began to slow down. Meanwhile, the immediate outlook has worsened since the mission was approved in December, including attacks on critical infrastructure. However, the economy is adjusting, and a gradual economic recovery is expected during the year.
"The timely delivery of substantial external support has been critical for macroeconomic stability, and large-scale disbursements will remain essential in 2023 and beyond to cover financing needs and contribute to stability. Efforts to expand bond issuance on the domestic bond market should continue to ensure stable financing and eliminate dependence on monetary financing," the head of the mission added.
The IMF also noted that the National Bank reacts in a balanced manner to excess liquidity in the banking system
"Since the start of the war, large-scale martial law emergency measures have helped maintain financial stability. Preparations are now underway to gradually lift emergency measures to bring local regulations in line with international standards," added Gavin Gray.
He emphasized that a full-fledged IMF program would support the Ukrainian government's efforts to join the EU. In particular, reform initiatives to improve business productivity and competitiveness need to be promoted to help lay the foundations for strong post-war growth amid progress toward EU accession.
"The authorities are making progress on reforms aimed at strengthening public administration, fighting corruption and the rule of law, as well as laying the foundations for post-war growth, although the reform agenda in these areas remains important," the Foundation representative added.
The public sector will play an important role in post-war recovery, and measures to improve the efficiency and transparency of public finances and governance will be critical.
The IMF also expects that the private sector will join the reconstruction of Ukraine.
"The mission met with the head of the National Bank of Ukraine Pyshnyi and the Minister of Finance Marchenko and other high-ranking government officials and would like to thank the authorities for open and constructive discussions. The IMF staff hopes to continue close cooperation in the coming weeks," the head of the mission summarized.
