Ukrainian parliament disagrees on bills needed to secure $ 8 billion IMF package


KIEV (Reuters) – Ukrainian lawmakers on Monday failed in their first attempt to approve an emergency budget, appoint a finance minister or pass the reform bills needed to unblock a $ 8 billion loan. dollars from the International Monetary Fund.

President Volodymyr Zelenskiy had urged lawmakers to pass banking legislation and lift the ban on selling land – the last hurdles to a deal with the IMF – or risk plunging the country into default due to the economic shock of the coronavirus epidemic.

But there was not enough consensus to put bills on the parliamentary agenda at the start of the day, the speaker said.

The banking law, which would prevent former owners of banks declared insolvent from recovering their assets, is seen as contrary to the interests of Ihor Kolomoisky, a wealthy tycoon and one of the first supporters of Zelenskiy’s presidential campaign in 2019.

The government was also unable to muster enough votes to approve the appointment of Serhiy Marchenko, a former deputy finance minister in a previous administration, as the new finance minister after his predecessor was sacked less than a week. months after taking office.

Parliament could resume voting later on Monday, but it was not immediately clear whether the government would have enough votes to pass its proposals.

“There will most likely be an evening meeting of parliament – at a time like this you cannot leave the country without a finance minister,” Oleksandr Kachura, a lawmaker from Zelenskiy’s party, told Reuters.

With the number of coronavirus cases rising rapidly, Parliament also voted to dismiss Health Minister Illia Yemets, who had also been appointed as part of a massive government reshuffle in early March.

In the revised forecast submitted to parliament on Monday, the government said it expected the budget deficit to triple and inflation to rise to 8.7% from a previous estimate of 5.8%. The economy could shrink 3.9%, a government spokeswoman said.

Ukraine’s economy has been bolstered by IMF agreements since Russia’s annexation of Crimea in 2014 plunged the country into turmoil. Such agreements, conditional on the adoption of reforms and the fight against endemic corruption, have also strengthened investor confidence.

Zelenskiy in a nationwide speech on Sunday urged lawmakers to pass the bank and land sales bills.

“Our country has indeed found itself at a crossroads because of the coronavirus, and has two paths,” he said. A path meant passing the bills.

“Otherwise – the second way. Failure of these laws leading to economic slowdown and even the threat of default. “

Writing by Matthias Williams; edited by Nick Macfie

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