Ukraine found itself at risk of not receiving 1.96 billion euros of macro-financial assistance from the European Union due to delays in the implementation of structural reforms provided for by the Ukraine Facility program. This is especially relevant in the conditions when the government plans to increase state budget expenditures by 400 billion hryvnias, a large part of which will be financed through the placement of domestic state loan bonds with a high yield of more than 16%.
For by the results monthly monitoring of the fulfillment of obligations to the IMF and the EU, conducted by the RRR4U think tank consortium, reports:
“In general, within the framework of the IMF program for 2025, up to 2.3 billion US dollars will be allocated to Ukraine based on the results of four review stages. The next review is scheduled for August.
At the same time, Ukraine has not yet submitted a report on the implementation of the indicators provided for in the Plan of Ukraine for the first quarter of 2025. If for the fourth quarter of 2024, all indicators were fulfilled on time and in full, then for the first quarter of the current year, four indicators remain unfulfilled, three of which require the adoption of relevant laws. Because of this, there is a risk of losing 1.96 billion euros from the expected tranche of 4.48 billion euros.”
Among the unfulfilled are, in particular, key commitments that were supposed to be completed in the first quarter: expanding the staff of the High Anti-Corruption Court, reorganizing the National Asset Management Agency (ARMA) and reforming the territorial organization of the executive power. These steps are of critical importance for the further receipt of funds from the European Union.
At the same time, Ukraine fully fulfilled its obligations to the International Monetary Fund within the eighth review of the program, in particular by successfully integrating priority public investments into the budget process. This gives reason to expect another tranche from the IMF in the amount of 490 million dollars in the near future.
Despite the fulfillment of certain commitments, the overall course of reforms within the framework of the IMF program remains difficult. In particular, part of the structural tasks, such as customs reform, was officially postponed from the end of June to the end of the current year.
It will be recalled that in March the IMF published an updated memorandum of economic and financial policy based on the results of the seventh review of the EFF extended financing program for Ukraine. The document notes that five structural benchmarks were not completed within the set time limits, and four more were postponed to the July-September period. In addition to the list, four new obligations were added, which should be fulfilled by the end of the year.
