There were IMF requirements to Ukraine on gas prices

Появились требования МВФ к Украине о ценах на газ

The IMF expects the Ukrainian authorities to further increase gas prices

Ukraine needs to increase gas price for the population by 15% until may, and by 2020 to make the price market.

The program of the International monetary Fund Stand-By arrangement provides two necessary conditions for Ukraine: the budget deficit at 2.3% of GDP, and raising gas prices to market levels. This is stated in the report of the Fund, published on Tuesday, January 8.

The IMF suggests that the Cabinet will increase the retail price of gas for households by 15% until 1 may. The next stage is complete in the price range of the market from 1 January 2020.

Also, the IMF experts expect that, due to pension reform the Pension Fund deficit will decrease to 4.25% of GDP, and the size of pensions will increase by at least 8.5-9.5 per cent.

At the same time, the Fund stressed the importance of pension reform for Ukraine through the unfavorable demographic trends, given the low birth rate and aging population, and also travel abroad a growing number of employees.

In the future, the IMF experts expect that Ukraine will be able to reduce the Pension Fund deficit to 3% of GDP.

At the same time, the IMF noted the high risks of implementation of the program because of unresolved conflict in the Donbass and unstable external environment. In addition, the program is under threat due to the risk of the implementation of populist policies ahead of the upcoming elections or a change of course.

These risks are mitigated by decisive action, including approval of the budget for 2019, and significant external funding to support reform, including new funding from the world Bank and the European Union, said the IMF.

Also, the IMF called the timing of peresmotra execution of the program, the results of which decisions will be made on the allocation of two tranches of $ 2.6 billion.

We will remind, on 18 December the IMF Executive Board approved a new financing program for Ukraine at 3.9 billion dollars. Kyiv received the first tranche of 1.4 billion dollars in three days.

As you know, the IMF agreed to a new program for Ukraine after the government raised gas prices by 23.5%. According to media reports, the IMF demands to raise gas prices by 40%.

 

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