17:58 25.08.2021

Marchenko: Reducing electricity tariffs for public with their fiscal balance corresponds to arrangement with IMF

2 min read
Marchenko: Reducing electricity tariffs for public with their fiscal balance corresponds to arrangement with IMF

The government's decision to reduce the electricity tariff for the population is within Ukraine's obligations under the stand-by arrangement with the International Monetary Fund (IMF), provided that this decision does not carry fiscal risks for the budget, Finance Minister Serhiy Marchenko said.

"I see no reason why this decision should affect the negotiations. Our arrangement, by and large, does not focus on increasing or decreasing tariffs. These tariff stories are interesting from the point of view of fiscal risks," the minister said in an interview with Interfax-Ukraine.

According to him, while there is no negative communication from the Fund regarding this decision, he does not expect it in the future either.

"This is the Energy Ministry's business, they communicate with the Fund. I think they discussed this decision. But there is no doubt that this decision should be fiscally balanced. We will not cover any tariff needs from the budget," Marchenko said.

He noted that the main task is to balance the energy market. "If Energoatom and Ukrhydroenergo agreed to this reduction, it means that they have calculated these risks. Thus, the Ministry of Energy bears all risks and responsibility. In no way will the budget of Ukraine subsidize these companies," the Minister of Finance said.

Marchenko pointed out that assistance in the form of state guarantees for Ukrenergo's "green" bonds can only be provided to pay off debts to "green" generation companies accumulated in previous periods, as it is regulated in the state budget for this year.

The minister confirmed that the issue of such bonds is being prepared, but he did not give other details, referring to the fact that a decision was made to transfer Ukrenergo from the Finance Ministry to the management of the Energy Ministry.

"Now Ukrenergo is under the jurisdiction of the Ministry of Energy, so, as they say, bon voyage. The government made this decision, we abstained from it. But it was adopted, there is no point in discussing," Marchenko said.

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