News / Europe

IMF Predicts Unsettled Ukraine Will Meet Its Debt Payments

Ken Bredemeier
The International Monetary Fund (IMF) is sending loan money to Kyiv to help the embattled Ukrainian government boost the country's weak economy. But as Ukraine seeks to root out long-standing corruption in the government and block Russian intervention in eastern Ukraine, even the IMF said the loan approval could be risky.

The director of the IMF's European department, Reza Moghadam, told reporters Thursday that the Washington-based agency expects Ukraine to meet all its financial obligations, even as it teeters on the brink of bankruptcy. That includes $2.2 billion it owes Russia for natural gas purchases.

The IMF announced a $17 billion loan package for Ukraine over the next two years, and the World Bank, the European Union, Japan , Canada and the United States have pledged another $15 billion. The loans come with a requirement that Kyiv undertake economic reforms, including tax hikes, wage freezes and cuts in social aid.

But Moghadam acknowledged that the $17 billion IMF loan is not as big as it appears. He said $5 billion of the figure is meant for Ukraine to pay back money it already owes the IMF from a previous loan.

With Ukraine's weak economy, its struggle to maintain control of mostly Russian-speaking eastern Ukraine and Russian troops massing just across the border, Moghadam had a blunt assessment of the current state of Ukrainian affairs.

"The degree of uncertainty is very large," said Moghadam.

One expert on former Soviet republics like Ukraine, University of New Hampshire political scientist Lionel Ingram, says in a VOA interview that the IMF was right to be wary of sending more money to Ukraine.

"If I were the IMF, I'd be very, very careful about providing money to Ukraine. On the other hand, if I were the IMF, I'd understand the dire necessity of at least trying to help," said Ingram.

U.S. Vice President Joe Biden, who recently visited Ukraine, condemned Russian intervention there in a Washington speech this week. But he also leveled criticism at Ukraine, saying corruption is one reason Kyiv is struggling.

"The corruption is incredibly corrosive. It may not be politic to say, but it is a reality," said Biden.

The IMF's Ukraine mission chief, Nikolay Gueorguiev, says the agency sees improvement in Ukraine's effort to combat corruption.

"We already see major progress in this area, admittedly from a low starting point," said Gueorguiev.

He said Ukraine has undertaken some reforms , including preventing illegal domestic production of alcohol.

You May Like

Obama: I Will Do 'Everything I Can' to Close Guantanamo

US president says prison continues 'to inspire jihadists and extremists around the world' More

Sierra Leone Educates on Safe Ebola Burials

Also, country is improving at rapid response to isolated outbreaks, but health workers need to be even faster, officials say More

Christmas Gains Popularity in Vietnam

Increasingly wealthy Vietnamese embrace holiday due to its non-religious glamor, commercial appeal More

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
US Decision on Cuba Underscores Divisions Among Miami Cubansi
X
Sharon Behn
December 19, 2014 9:34 PM
For decades, older, more conservative Cubans have been gathering at Café Versailles on the corner of Calle Ocho to eat Cuban food and talk politics. After hearing of President Barack Obama’s decision, a number of them gathered in front of the café with posters to protest. VOA's Sharon Behn reports on the situation.
Video

Video US Decision on Cuba Underscores Divisions Among Miami Cubans

For decades, older, more conservative Cubans have been gathering at Café Versailles on the corner of Calle Ocho to eat Cuban food and talk politics. After hearing of President Barack Obama’s decision, a number of them gathered in front of the café with posters to protest. VOA's Sharon Behn reports on the situation.
Video

Video Three Cities Bid for Future Obama Presidential Library

President Barack Obama still has two years left in his term in office, but the effort to establish his post-presidential library is already underway. The bid for the Obama Presidential Library is down to four locations in three states -- New York, Hawaii, and Illinois. As VOA’s Kane Farabaugh reports, each of them played an important part in the president’s life before he reached the White House.
Video

Video Cuba Deal is Major Victory for Pope’s Diplomatic Initiatives

Pope Francis played a key role in brokering the US-Cuba deal that was made public earlier this week. It is the most stunning success so far in a series of peacemaking efforts by the pontiff. VOA religion reporter Jerome Socolovsky has more.
Video

Video Fears of More Political Gridlock in 2015

2014 proved to be a difficult year politically for President Barack Obama and a very good year for the U.S. Republican Party. Republican gains in the November midterm elections gave them control of the Senate and House of Representatives for the next two years -- setting the stage for more confrontation and gridlock in the final two years of the Obama presidency. VOA National Correspondent Jim Malone has a preview from Washington.
Video

Video Sudan School Becomes Target of Aerial Attacks

The school dropout rate is at an all-time high in Sudan's South Kordofan state because many schools have been destroyed during the three-year civil war between the government and SPLA-N rebel forces. Adam Bailes visited Sudan's Nuba Mountains' region and reports many children are simply too scared to go to school
Video

Video VOA Reporter Tours Devastated Peshawar School

Islamist militants wearing military uniforms and strapped with explosives attacked a military run school Tuesday in the northwestern Pakistani city of Peshawar. At least 141 people were killed in the horrific attack, most of them young students. VOA reporter Ayaz Gul visited the devastated school and attended the funeral of the principal who courageously tried to save her students from the deadly attack.
Video

Video Nigerians Fleeing Boko Haram Languish in Camp Near Capital

In its five-year effort to impose Islamic law in northeastern Nigeria, the Boko Haram extremist group has killed thousands of people and forced hundreds of thousands to flee. Some of those who ran for their lives now live in squalor on the edges of the capital, Abuja. Chris Stein reports for VOA.
Video

Video Aceh Rebuilt Decade After Tsunami, But Scars Remain

On December 26, 2004 there was an earthquake in the Indian Ocean so powerful it caused the Earth’s axis to wobble a few centimeters. Onshore on the island of Sumatra, the resulting tsunami was devastating. A decade later, VOA Correspondent Steve Herman reports from Banda Aceh, Indonesia, where although there is little remaining evidence of the physical devastation, the psychological scars among survivors remain.

All About America

AppleAndroid