Managing Director of the International Monetary Fund (IMF), Christine Lagarde, says the Ukrainian economy is on the path to recovery but stresses the importance of structural reforms to support economic growth, according to a posting on the IMF website.
”Ukraine is showing welcome signs of recovery, notwithstanding a difficult external environment and a severe economic crisis,” a statement reads.
The IMF managing director has pointed to the pickup of activity in Ukraine, and the decrease of inflation. The country has seen its gross international reserves and bank deposits rising, according to Lagarde. Growth is expected to be higher in the period ahead, the IMF forecasts.
”This progress owes much to the authorities` program implementation, including sound macroeconomic policies, bold steps to bring energy tariffs to cost-recovery levels, and measures to rehabilitate the banking system,” Lagarde said.
”Further progress in fiscal reforms is key to ensure medium-term sustainability. The authorities need to avoid tax policy changes that lead to higher deficits. The focus should be on improving tax and customs administrations,” she added.
Further, priority should continue to be given to reducing inflation and rebuilding international reserves, also to make room for the gradual removal of remaining administrative measures. The authorities need to further strengthen the banking system through recapitalization, unwinding of related-party lending, and resolution of impaired assets, according to Lagarde.
As UNIAN reported earlier, the IMF Executive Board completed the second review of Ukraine`s economic program supported by an arrangement under the Extended Fund Facility. The completion of this review enables the disbursement of about $1 billion to Ukraine.