Reform's delay will cost cuts of tranche for Ukraine

07.07.2017 - 08:55 #Ukraine, #Cuts, #Tranche

The NBU has earlier cut its economic growth forecast for 2017 to 1.6% from 1.9% and said inflation had accelerated to 15% year-on-year in June

Ukraine's central bank said on Thursday that the government's delays in passing reforms mean Ukraine will probably receive $3 billion in aid from the International Monetary Fund this year instead of the $4.5 billion originally envisaged, according to Reuters.

The government is trying to push contested legislation through parliament, including raising the pension age and lifting a ban on land sales, as part of a $17.5 billion bailout agreed with the IMF in 2015, Reuters wrote.

One tranche of IMF aid will likely be postponed until 2018, acting Central Bank Governor Yakiv Smoliy told reporters at a press conference. "Due to the fact that the consideration of important draft laws, which were key when the IMF Board of Directors decided to allocate the next tranches, are delayed... we expect that one tranche will be transferred to the next year," he said.

The NBU has earlier cut its economic growth forecast for 2017 to 1.6% from 1.9% and said inflation had accelerated to 15% year-on-year in June, higher than predicted. The central bank also said that "uncertainty remains regarding the implementation of macroeconomic policies and structural reforms necessary to maintain macrofinancial stability, increase the economy's potential and continue the program with the IMF."

Source: UNIAN