Ukraine may come under pressure from the International Monetary Fund (IMF) to accelerate the devaluation of the hryvnia, lower interest rates, and increase tax collection to cover a significant budget deficit. About this informs Bloomberg, citing sources among Ukrainian officials.
The IMF mission, which began work in Kyiv on September 4, aims to discuss key economic reforms and steps to continue financial support to Ukraine. If these negotiations are successful, Ukraine can receive another tranche in the amount of 1.1 billion dollars.
Despite the pressure, the National Bank of Ukraine opposes further weakening of the hryvnia. Since the abolition of the fixed exchange rate, the currency has already depreciated by more than 10%. Sources say further devaluation could destabilize prices and cause political tension, as Ukrainians are already suffering the economic consequences of the war.
Financial support for Ukraine from international donors, including the IMF, the USA and the EU, reached $122 billion. However, according to the estimates of Prime Minister Denys Shmyhal, the budget deficit for next year will amount to 15 billion dollars, which requires additional commitments from donors.
The IMF also criticized the government’s plan to raise taxes, calling for stronger action. One possible measure could be an increase in the value added tax (VAT), which could become an additional lever for increasing government revenues.
