The International Monetary Fund (IMF) sees no grounds for default in Ukraine, IMF Resident Representative in Ukraine Max Alier said at a forum in Kyiv on Wednesday, UKRINFORM reported.
"The default we were talking about did not happen, and I believe that this happened thanks to [the government's] proper policy. If you look at rating agencies and ratings, they are evidence of the [country's] ability to pay and the commitment to pay. In terms of public debt, I would say that it has increased significantly over the past two years, but it's still not so high - about 40% of GDP, and I see no grounds for default here," Alier said.
He said that despite the fact that Ukraine had been largely affected by the crisis of 2008, timely measures taken by the authorities had helped minimize negative consequences for the economy.
While commenting on further cooperation between Ukraine and the IMF, Alier said that the probability of Ukraine's getting a new tranche from the IMF was linked to reforms. "We have clearly outlined reforms and explained why they should be conducted. In your country 18% of GDP is spent on pensions, and this is one of the highest figures in the world," Alier said.
As reported, a new program of cooperation between Ukraine and the IMF, which was approved in July 2010, foresees the allocation of a USD 15.15 billion loan to Ukraine. The program is designed for two-and-a-half years. The funds are raised at an interest rate of 3.5%. Ukraine has already received two tranches under the stand-by arrangement totaling about USD 3.4 billion.
In order to receive the next tranche of the loan from the International Monetary Fund, Ukraine must meet several requirements, in particular, to conduct pension reform in order to reduce the expenditures of the Pension Fund of Ukraine, bring energy tariffs to an economically justified level, etc.
"The default we were talking about did not happen, and I believe that this happened thanks to [the government's] proper policy. If you look at rating agencies and ratings, they are evidence of the [country's] ability to pay and the commitment to pay. In terms of public debt, I would say that it has increased significantly over the past two years, but it's still not so high - about 40% of GDP, and I see no grounds for default here," Alier said.
He said that despite the fact that Ukraine had been largely affected by the crisis of 2008, timely measures taken by the authorities had helped minimize negative consequences for the economy.
While commenting on further cooperation between Ukraine and the IMF, Alier said that the probability of Ukraine's getting a new tranche from the IMF was linked to reforms. "We have clearly outlined reforms and explained why they should be conducted. In your country 18% of GDP is spent on pensions, and this is one of the highest figures in the world," Alier said.
As reported, a new program of cooperation between Ukraine and the IMF, which was approved in July 2010, foresees the allocation of a USD 15.15 billion loan to Ukraine. The program is designed for two-and-a-half years. The funds are raised at an interest rate of 3.5%. Ukraine has already received two tranches under the stand-by arrangement totaling about USD 3.4 billion.
In order to receive the next tranche of the loan from the International Monetary Fund, Ukraine must meet several requirements, in particular, to conduct pension reform in order to reduce the expenditures of the Pension Fund of Ukraine, bring energy tariffs to an economically justified level, etc.
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