Business appeal to the Government, Parliament, IMF and international partners of Ukraine to take action
July 20 is the deadline to negotiate with the IMF about cooperation. This was announced by the business community at a joint press conference on the importance of unlocking a tranche of $1.9 billion from the IMF and related financing from other partners of Ukraine. The press conference was held on July 12. The event was attended by representatives of the European Business Association, the American Chamber of Commerce in Ukraine, the Union of Ukrainian Entrepreneurs and the Independent Association of Ukrainian Banks.
As the President of the European Business Association Tomas Fiala commented: «Today it is very important that cooperation be continued as quickly as possible, and the IMF mission arrive this summer, not in September. In September, to the existing requirements of the Fund will be added the need to harmonize the state budget for the next year, so this process could potentially drag on until 2019».
Executive Director of the European Business Association Anna Derevyanko began with good news. She said that, firstly, Ukraine has risen numerous places in the ranking of innovative economies. Secondly, investors have improved confidence in the investment climate in Ukraine. “We understand that if cooperation with the IMF will not be continued, Ukraine’s place in various ratings will be reduced. During the last few years a lot was done – the law on currency was passed, the Anti-Corruption Court, the deregulation of the economy was started, various electronic services were implemented”, – emphasized Ms. Derevyanko.
She also noted that it is important for business to work with the IMF to maintain macroeconomic stability, while taking the necessary steps in the IMF program: land reform, privatization, budget deficit control, continuing initial reforms in various areas, effective anti-corruption reform and reduction of the shadow economy. Without cooperation with the IMF in the short term, Ukraine can’t expect more investors, more jobs or wage growth and macroeconomic stability will be under question.
The conference participants spoke with one voice to urge the Ukrainian authorities, the IMF and Ukraine’s other international partners to reach a compromise, summarizing their call to action as follows:
- We urge the Ukrainian government, the IMF and Ukraine’s international partners to make every effort to put in place a workable deal before July 20 in order to unlock the $1.9 billion IMF tranche.
- We urge the Ukrainian government and the IMF to find a workable solution to the issues of gas tariffs and the state budget by July 20 and call on the Ukrainian Parliament to support it.
- We urge the Ukrainian Parliament to approve on July 12 Draft Law #7441 together with the amendment concerning appeals against ongoing cases of the National Anti-Corruption Bureau of Ukraine.
- We urge the IMF and Ukraine’s international partners to take into account Ukraine’s broader economic and reform environment along with relevant social implications and make rational decisions based on current realities.
- We believe that what is at stake for Ukraine is the loss of two years of future GDP growth, hard-won financial stability, billions of dollars of investment, thousands of jobs, the containment of brain drain, and hope for a better future.
The American Chamber of Commerce in Ukraine, the European Business Association, the Union of Ukrainian Entrepreneurs and the Independent Association of Banks of Ukraine believe that continuing cooperation with the IMF under the current Memorandum of Understanding is crucial for Ukraine’s continued macroeconomic stability, economic growth and attracting foreign direct investment.