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Expert: Ukraine economics minister’s resignation reduces Kiev’s chance to get IMF loan

February 03, 20:58 UTC+3 KIEV
Aivaras Abromavicius was the guarantor that reforms in Ukraine would proceed under the Western management style understandable for foreign investors, a Ukrainian expert believes
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© EPA/ROMAN PILIPEY

KIEV, February 3. /TASS/. The resignation of Ukraine’s Economic Development and Trade Minister Aivaras Abromavicius, which he announced on Wednesday, darkens the prospect for Kiev to get the next loan tranche of macro-economic assistance from the International Monetary Fund (IMF), a Ukrainian expert said on Wednesday.

Andrei Blinov, economist and head of the joint project "Successful Country" of the Kiev international economic forum with leading Ukrainian media outlets, told TASS that Abromavicius’ resignation was complicating very seriously the possibility of getting the IMF’s third loan tranche.

"First of all, from the emotional point of view as there will be a lot of judgments on this score in international media on whether it is worth while supporting the Ukrainian economy, if loans are granted against the credibility of specific officials who manage this money," the expert said.

"Abromavicius was the guarantor that reforms in Ukraine would proceed under the Western management style understandable for foreign investors," the expert noted.

Abromavicius is one of the persons against whose credibility international investment went into Ukraine. The other credible persons in the Ukrainian government include Prime Minister Arseniy Yatsenyuk, Finance Minister Natalia Yaresko and National Bank Head Valeriya Gontareva, the expert said.

Meanwhile, "the resignation of Abromavicius does not necessarily mean that there will be no credit [of trust] at all," Blinov added.

Against this background, "an issue will resurface again of the [Ukrainian] debt to Russia [on $3 billion Eurobonds], which Ukraine failed to repay in December but which the IMF recognized as sovereign," the expert said.

This issue will be raised again because pressure will be exerted on the IMF, the expert added.

The interbank currency exchange is expected to react to the news of Abromavicius’ resignation in a day or two, leading analyst of Forex Club Group Andrei Shevchikhin said.

"This is an important position for the economy, the investment activity and the reforms. Abromavicius is the figure that is perceived positively and with considerable trust from creditors," the expert said.

Ukraine expects to get $7 billion in loans from the IMF in 2016. Specifically, the third loan tranche may total about $1.7 billion.

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