The government’s unwillingness to implement systemic reforms is leading Ukraine towards economic suicide. According to the press service of Serhii Rybalka, former chair of the Verkhovna Rada financial committee, he mentioned this while commenting on the announcement IMF made yesterday regarding the postponement of the next stage of the credit program because of the failure of Ukraine to comply with certain obligations.
“In September, the Ukrainian government, for the first time in a while, managed to borrow 3 billion dollars in the international market. Next year, the government plans to borrow a slightly larger amount. The government has calmed down: they expect to win the upcoming elections easily. So the IMF’s money is no longer considered necessary and the reforms can be postponed until some time in the future. This is a path towards an abysm” Serhii Rybalka said.
He underlined that the government borrowed funds using Eurobonds with a 7.375% interest while IMF lends with a 3% interest. “For several years, we have been unable to pass important bills to strengthen the financial system even though we had taken corresponding obligations before our international partners. “For instance, the bill on protection of the rights of the lenders and the bill on the credit registry. But this is what we all need, so that, in the future, Ukraine could avoid more massive bank failures” MP mentioned.
“The experts are warning that we are moving towards a default. We are paying too much in interest on our debts. The rest of funds is wasted, mostly to buy imports. We export cheap raw materials abroad. So we end up with less and less funds for development. The situation is worsening” Serhii Rybalka said.
He reminded that Ukraine has reached a record high level of state debt in its history, 86% of GDP. “The government has got no proper strategy for reducing it. In the upcoming year’s budget, it is planned to increase external and internal borrowing to 56 billion hryvnias. Interest payments will constitute 13.7% of the total budget expenses. Meaning, what we are paying in interests, could have been spent on stimulation of economic growth, education for our children, hospitals, and schools” MP highlighted.
On December 14, IMF deputy spokesman William Murray announced that International Monetary Fund does not plan to send a mission to Ukraine for reconsideration of the partnership program and disbursement of the next credit tranche since not all conditions have been fulfilled by the Ukrainian party.
Previously, on December 10-13, Serhii Rybalka visited Washington D.C. where he discussed the sabotage of anti-corruption and economic reforms in Ukraine with American politicians, government officials, and experts.
Who we are: About us, Contacts. How we write news and our principles: Editorial code. We did our best. If you found this valuable – please support us.
To request a correction, please send an email.