Poroshenko in Davos, met with Lagarde: Ukraine and the IMF will soon agree on the next tranche

Complete reconciliation of the last of the technical issues of granting Ukraine the next tranche of macro-financial assistance can be expected within the next few days. So says the managing Director of the IMF Christine Lagarde.

“I have every reason to believe that the last few technical details that need to be addressed in the next couple of days, will lead to positive results,” she told reporters in Davos, Switzerland on Thursday, after talks with President of Ukraine Petro Poroshenko.

Lagarde noted that during the meeting with Poroshenko was very effective. The sides discussed the large amount of reforms carried out by Ukraine.

“We just finished with Mr. Poroshenko very effective meeting in which we discussed the many reforms and progress, which was chaired by President Poroshenko and his team,” said Lagarde.

According to her, teams from both sides are sent to work to resolve the remaining issues regarding the provision of the IMF tranche for Ukraine, to within a few days to achieve results.

In turn, Poroshenko emphasized that Ukraine’s progress towards reform was marked by the leadership of the IMF.

“I am proud that in these difficult times for the economy and financial stability we have an excellent cooperation with the IMF,” he said.

We will remind, open to the IMF in March 2015 the four-year EFF program total amount of SDR12,348 billion (about 17.25 billion U.S. dollars) from the first tranche of $ 5 billion originally envisioned by the quarterly revision of the program, the allocation in 2015 of three more tranches of SDR1,18 billion (about us $ 1.65 bn) and a decrease in quarterly tranches in 2016-2018, up to SDR0,44 billion (0.61 billion us dollars).

Ukraine was able to obtain a small delay in the second tranche for this program to $ 1.7 billion in early August 2015, and then there was a long pause because of the outstanding number of conditions, political crisis and change of government.

After the arrival of the new Cabinet, headed by Volodymyr Groisman in April 2016, the negotiations on the continuation of funding was resumed, however, the IMF decided to allocate the third tranche of $ 1 billion only in mid-September. The revised schedule of funding, a further allocation of funds was planned on a quarterly basis, the results of the performance criteria, in particular, the fourth tranche in the amount of 1.3 billion dollars in mid-November 2016. The largest tranche is planned for the first quarter of 2017 – more than 1,986 billion, then the size of the two following will be reduced to 1.33 billion dollars, and the remaining five to 735 million dollars.

After the nationalization of PrivatBank and adoption of budget-2017 heads of Finance and the national Bank stated that the likelihood of a positive decision of the IMF to allocate to Ukraine the fourth tranche of the EFF program in late January of 2017.