IMF mission to Ukraine has made progress, fund says

by Reuters
Thursday, 13 March 2014 16:36 GMT

(Adds comments, details about Kiev mission, IMF reforms)

WASHINGTON, March 13 (Reuters) - The International Monetary Fund has made good progress in its fact-finding mission in Kiev and will then discuss Ukraine's economic situation with IMF management, a fund spokesman said on Thursday.

A team from the IMF arrived last week in Kiev to assess the country's economic situation and discuss a possible bailout program. Ukraine's new government has said it desperately needs cash to cover expenses and avert a possible debt default.

"My understanding is that ... the discussions in Kiev had made good progress, there has been a very good exchange of views," IMF spokesman Gerry Rice told reporters. He also said the mission would conclude soon, possibly on Friday.

Following the mission, IMF staff would brief the fund's management and the board, which will make the final decision on whether Ukraine will get access to IMF funding, Rice said.

However, he said it was too early to speak about Kiev's financing needs.

The U.S. passage of long-delayed reforms to the IMF's structure would allow Kiev to access more cash, but there are other factors to be considered as well, Rice added.

U.S. lawmakers have been debating a proposed bill that ties aid for the Ukrainian government with a shift in Washington's funding for the IMF, which is necessary to implement 2010 reforms to the financial institution.

The Obama administration has said approving the reforms would double the IMF's resources, allowing emerging market economies like Ukraine to access more funds.

Ukraine's access to IMF resources is based on the size of its quota, or voting share. That is just one factor that determines how much aid it would be able to get, in addition to issues such as its balance of payments situation and the strength of its policies, said Rice.

"(Also) why the quota reform is important from the financial side ... is that it puts the fund's resources and capital base on a much more secure footing, and that's important for the entire membership, and for any potential crisis situations that may occur," Rice said. (Reporting by Anna Yukhananov; editing by James Dalgleish and G Crosse)

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