Next IMF mission to arrive in Kyiv on Sept 19 – preliminary offering memorandum
The next International Monetary Fund (IMF) mission to Ukraine to review the Extended Fund Facility (EFF) is expected to be on September 19, 2017, according to a preliminary offering memorandum for Ukraine's eurobonds, a copy of which has been sent to Interfax-Ukraine.
The document points out the importance of further cooperation with the IMF and implementation of the requirements outlined in the EFF.
"Should Ukraine be unable to obtain financing from external sources due to a failure to implement required structural reforms, the government's ability to meet the financing targets in the State budget could be jeopardized," the memorandum says.
As reported, First Deputy Managing Director of the International Monetary Fund (IMF) David Lipton arrived in Kyiv on September 12. He will stay with an official visit until September 14.
As reported, the four-year EFF program launched by the IMF in March 2015, in the total amount of SDR 12.348 billion (around $17.25 billion), initially involved quarterly reviews of the program, with the first tranche of $5 billion, and the next three, SDR 1.18 billion each (around $1.65 billion), to be paid during 2015, and decreasing quarterly tranches to SDR 0.44 billion ($0.61 billion) in 2016-2018.
Ukraine was able to receive, with a slight delay, the second tranche, $1.7 billion, under this program, in early August 2015, followed by a lengthy pause because of the country's failure to meet a number of conditions, political crisis and changes in the government.
Since the arrival of a new government led by Volodymyr Groysman in April 2016 talks over continued funding have resumed but it was not until mid-September that the IMF decided to allocate the third tranche, $1 billion. The fourth tranche was received on April 3, 2017.
According to the new schedule presented in the materials of the IMF, three reviews are planned for late 2017: fourth review in the middle of May, fifth in the middle of August and sixth in the middle of November.
If Ukraine successfully conducts reforms after the fourth review the country could raise $1.907 billion, after the fifth review - $1.28 billion, sixth review - $1.28 billion. In general, some $4.46 billion could be attracted.
In 2018, four more reviews will be conducted and Ukraine could raise around $955 million after each review or some $3.82 billion in general.