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Ukrainian finance minister confident of one more IMF tranche in 2017
September 12, 2017 / 9:49 AM / 7 days ago

Ukrainian finance minister confident of one more IMF tranche in 2017

FILE PHOTO - Ukrainian Finance Minister Oleksandr Danylyuk speaks during a news conference in Kiev, Ukraine, June 23, 2017. REUTERS/Valentyn Ogirenko

LONDON (Reuters) - Ukraine is on track to pass a long-delayed pension reform “within weeks”, unlocking at least one more IMF loan tranche before year-end, Finance Minister Oleksandr Danylyuk told Reuters.

Danylyuk, who was in London on a roadshow to sell dollar bonds and swap short-term debt, also said the government was hopeful about passing a contentious land reform bill this year, despite opposition within parliament.

The two reforms, along with a review of gas prices that could lead to a rise in utility tariffs, are seen as essential for the International Monetary Fund to continue with its $17.5 billion (£13.20 billion) program for Ukraine.

The country has so far received $8.4 billion.

In an interview late on Monday, Danylyuk said that while two more tranches from the IMF had been expected this year, at least one - worth $1.9 billion - would be received for sure, following a Fund mission at the end of September.

While this would hinge on parliament passing a pension reform bill by then, Danylyuk said he was “very optimistic”.

“On the pension reform things are looking very positive, there is a consensus in parliament and it will be adopted within weeks. It is ready, pretty much,” he said.

Danylyuk said the government would also discuss gas reform with the IMF mission, putting forward its plan on how to implement this.

Land reform, involving making agricultural land a saleable commodity, may prove trickier, with swathes of the population and lawmakers opposing it. While passing this reform is not a condition for the next tranche, the IMF considers it a requirement for releasing money in future.

“Whether it’s part of the conditionality or not, we as the government support this reform,” Danylyuk said, though he admitted more work was needed to win support for the bill.

Asked if it could be passed this year, he said: “That’s the position of the government. We will try to do that.”

Ukraine is holding roadshows this week in Europe and the United States and hopes to return to global bond markets for the first time since its 2015 debt restructuring.

Kiev has also asked holders of bonds maturing in 2019 and 2020 to swap into longer-maturity bonds.

Reporting by Karin Strohecker and Sujata Rao; Editing by Mark Trevelyan

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