NBU expects two tranches from IMF this year

Ukraine can count on two tranches from the International Monetary Fund (IMF) this year, given the longer negotiation process, according to the National Bank of Ukraine (NBU).

NBU Governor Kyrylo Shevchenko said this in an interview with Interfax-Ukraine.

"The main assumption of our macroeconomic forecast remains the continuation of cooperation with the IMF. Given the longer course of negotiations, we can focus on two tranches," Shevchenko said.

He expressed hope that the Verkhovna Rada, returning to normal work, would pass all the laws necessary to continue cooperation with the IMF.

"Currently, even if the volume decreases (although I'm not ready to talk about the volumes) there is nothing threatening. These funds can be replaced by the placement of Eurobonds. We know that the IMF is not primarily about money, but about confidence in the country. This is a strong signal to investors," Shevchenko said.

He also stressed that the NBU would not finance the state budget deficit in the absence of funding.

"Last year, there was a lot of speculation on this topic. I can only quote my favorite article of the law on the NBU, No. 54: 'The National Bank does not finance the state budget deficit.' Neither the NBU nor I plan to deviate from this point," Shevchenko said.

On June 9, 2020, the IMF approved an 18-month Stand-By Arrangement for Ukraine for SDR 3.6 billion (about $5 billion) with the immediate disbursement of the first tranche of $2.1 billion. After the first tranche was allocated, four reviews were planned and several more tranches were to be allocated, but this plan was not implemented.

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