Ukraine parliament passes budget to unlock US$3.9 bln in IMF loans

KIEV: Ukrainian lawmakers passed the 2019 budget, taking a crucial step to unlock US$3.9 billion of loans from the International Monetary Fund to tide over a choppy election period next year.

Exact details of the budget’s final version are not yet public, but Prime Minister Volodymyr Groysman has promised to keep it in line with the IMF’s requirements, which include a budget deficit of around 2.3 per cent.

“We have begun many processes, reforms and transformations,” Groysman told lawmakers before the vote, held after parliament had worked through the night.

“The country’s budget is a key tool for the implementation of these tasks. In the year ‘19, in the year of turbulence, we must ensure stability.”

Groysman had told Reuters last week he hoped to secure an IMF tranche as early as December once the budget passed, which would also pave the way for similar disbursals from the European Union and the World Bank.

Ukraine has tapped the IMF and other international bodies for money to guarantee its stability, as it faces a rising debt burden over the next two years and closely-fought parliamentary and presidential elections in 2019.

The IMF loans may come at a political cost. The government was required to raise household gas prices by nearly a quarter as a precondition for them, a move criticised by some opposition lawmakers during Thursday’s parliamentary debates. — Reuters