Business welcomes Parliament decisions to unlock cooperation with the IMF

31/ 03/ 2020

Yesterday, the Verkhovna Rada passed the laws required for Ukraine to receive the financial assistance from the International Monetary Fund under the Extended Financing Program (EFF), as well as to obtain crisis funds aimed at fighting against the coronavirus. It is about the adoption of the Draft Law № 2572-e on the impossibility of returning the banks (nationalized or liquidated) to the ex-owners, hopefully, in a few days it will be adopted together with the law on the land market. Anna Derevyanko. EBA Executive Director. In the current situation, assistance from the IMF and other international partners remains perhaps the only opportunity for the country to survive. So, we really thank the Verkhovna Rada for responding to the business appeal and taking prompt actions. And although the economic downturn caused by the pandemic is likely to be the toughest ever in the country′s independence, the decisions may weaken the blow. It should be reminded that, according to preliminary forecasts, in case of the prolongation of the quarantine period to several months and the approved IMF the program, Ukraines GDP will fall by 9% in 2020, and the hryvnia exchange rate may reach 35 UAH / USD. Without the support of the IMF and other international organizations, the hryvnia devaluation could reach 45-65% of the current level, up to 50-80 UAH / USD. At the same time, it is still important to address some of the issues regarding taxation, audits, social payments, in order to distribute the extra economic burden evenly between companies and the state, as it was done in the majority of developed countries. It is worth noting that as of today there are about 10 proposals of the business community are not taken into account. A detailed list is available at the link. So, after all, we hope that the Verkhovna Rada will take a comprehensive approach to the current crisis in the country and support the proposals of the business community so that companies can withstand the period of uncertainty

Anna Derevyanko EBA Executive Director

In the current situation, assistance from the IMF and other international partners remains perhaps the only opportunity for the country to survive. So, we really thank the Verkhovna Rada for responding to the business appeal and taking prompt actions. And although the economic downturn caused by the pandemic is likely to be the toughest ever in the country′s independence, the decisions may weaken the blow.

It should be reminded that, according to preliminary forecasts, in case of the prolongation of the quarantine period to several months and the approved IMF the program, Ukraine’s GDP will fall by 9% in 2020, and the hryvnia exchange rate may reach 35 UAH / USD. Without the support of the IMF and other international organizations, the hryvnia devaluation could reach 45-65% of the current level, up to 50-80 UAH / USD.

At the same time, it is still important to address some of the issues regarding taxation, audits, social payments, in order to distribute the extra economic burden evenly between companies and the state, as it was done in the majority of developed countries. It is worth noting that as of today there are about 10 proposals of the business community are not taken into account. A detailed list is available at the link. So, after all, we hope that the Verkhovna Rada will take a comprehensive approach to the current crisis in the country and support the proposals of the business community so that companies can withstand the period of uncertainty