Tuesday, December 16, 2014

John Helmer — IMF, World Bank Halt Lending To Ukraine

Multi-billion dollar lending to Ukraine by the International Monetary Fund (IMF) and World Bank has stopped amid growing doubts among country board directors at the two international organizations that the Ukrainian Government can meet repayment commitments and loan covenants for 2015, or deliver on reform promises and budget financing targets tabled in Kiev this week. 
For the first time since the change of government in Ukraine last February led to civil war in the east of the country, European bankers and multilateral fund sources acknowledge that Kiev is now likely to default on its international debts, and will seek a reorganization of its bond debt.
Ahead of Lipton’s visit to Kiev, William Murray (right), a spokesman for IMF managing director, Christine Lagarde,revealed that because of doubt that Ukraine can meet current IMF financing requirements, conditional lending by the Fund may be suspended, while a fresh bailout is pursued outside the Fund’s member states without conditions. According to Murray, “we need financing assurances, programs have to be funded, and it’s a 12 month horizon… it’s really important that the donor community step up and provide financing to Ukraine.”
US and EU on the hook for Ukraine's bill, with tips to the oligarchs.

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John Helmer

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