Posted on July - 05 - 2010
IMF agrees $20.8b loan
KIEV – AN INTERNATIONAL Monetary Fund mission said on Saturday it had agreed to recommend a loan of US$14.9 billion (S$20.8 billion) for Ukraine in a deal to help fill the country’s budget gap and boost investor confidence.
The deal commits the ex-Soviet republic to cut its budget deficit faster than it planned, to 3.5 per cent of GDP next year, and the IMF said in a statement its board would consider the deal for approval at the end of July after Ukraine made agreed adjustments to its budget and financial sector.
Assuming approval by the IMF board, the programme will last two and a half years.
The final amount was slightly lower than expected as the mission had been discussing a new stand-by facility worth up to US$19 billion in negotiations that dragged on for months.
‘Policies under the programme include fiscal adjustment to contain the 2010 consolidated general government deficit to 5.5 per cent of GDP … and 3.5 per cent in 2011 with a view to setting public debt firmly on a declining path,’ it said.
‘The fiscal adjustment is to be achieved by tax and social security structural reforms, expenditure rationalisation, combined with efforts to improve tax administration.’ The statement came a day after US Secretary of State Hillary Clinton said the United States hoped Ukraine would win the deal. — REUTERS
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