IMF sees no need for Ukraine debt restructuring now
Posted on Mar 28 2014 | IANS
Washington, March 28 : The International Monetary Fund (IMF) said Thursday that it does not see a need to restructure Ukraine's debt even as it reached preliminary deal on financial aid for the country.
"We don't proceed with programmes if they're deemed to be unsustainable," Xinhua quoted IMF spokesperson William Murray as saying at a briefing. "So the fact that we're proceeding with the programme indicates that we don't envisage at this point a debt restructuring."
While noting there is no hard rule in terms of timeline for the loan programme to be approved by the IMF management, the spokeperson said the Fund hopes to wrap everything up sometime in April.
He mentioned several outstanding issues including finalising the bilateral and multilateral components of the financing package, as well as a number of "prior actions" that the Ukrainian officials have to implement, expressing confidence of moving the programme forward.
The IMF mission chief in Ukraine said earlier Thursday that it has reached a staff-level agreement with the authorities of Ukraine on a two-year loan programme. The agreement is subject to approval by the IMF management and the executive board.
The financial support from the broader international community that the IMF rescue deal will unlock amounts worth USD 27 billion over the next two years. Of this, assistance from the IMF will range between USD 14-18 billion, with the precise amount to be determined once all bilateral and multilateral support is accounted for, the IMF said.
The global lender noted Ukraine's economic outlook remains difficult, with the economy falling back into recession. With no current market access, large foreign debt repayments loom in 2014 and 2015.
The IMF's most recent programmes with Ukraine went off track as the Ukrainian authorities failed to live up to the agreed-upon policies. The 188-member global lender previously offered a multi-year loan programme of USD 15 billion to Ukraine in 2010, but ceased to provide funding at the end of 2011 as the country did not stick to the reforms measures it had committed.