Ukraine-IMF talks stalling

RUSSIA / FSU POLITICS - In Brief 03 Dec 2019 by Alex Teddy
Ukraine has a USD 3.9 billion standby arrangement with the IMF. This has almost run to the end of its 14 month lifespan. Ukraine desperately needs another IMF deal. There does not seem to be any other party willing to bankroll Ukraine. Talks are foundering on the issue of PrivatBank and the chance that the National Bank of Ukraine (NBU) will cease to be independent. Ihor Kolomoisky used to own PrivatBank. It was nationalized against his will due to gross mismanagement. He once said he did not want it back but only wished to receive adequate compensation. Kolomoisky has changed his tune and is demanding it back. He has used his very deep pockets to mobilize public opinion on the issue. The IMF does not want to see any concessions to Kolomoisky and his cronies. President Zelensky allegedly had his campaign funded by Kolomoisky. Zelensky's silence about PrivatBank has been deafening. The IMF is worried that Ukraine's reforms will be reversed and the country will not meet payments on its loans. The Ukrainian budget for 2020 is seen as profligate. The recent land reform act banned foreigners from owning land. The IMF regards this as intolerable. The IMF said that all the law does is prevent fair competition and allow Ukrainian oligarchs to purchase land at a fraction of its true value. The IMF is worried that Ukraine may return to the 1990s scenario when the country was the oligarchs' playground.If Ukraine plays ball with the IMF is credit rating will rise. The World Bank and EU might lend money too.

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