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Poroshenko: Ukraine Could Tap IMF Funds to Pay for Russian Gas Deliveries

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Ukraine could use money provided by the International Monetary Fund (IMF) and other international lenders to cover a shortfall in the funds earmarked for the purchase of Russian natural gas supplies, the country’s President Petro Poroshenko said late on Saturday.

KIEV, October 19 (RIA Novosti) - Ukraine could use money provided by the International Monetary Fund (IMF) and other international lenders to cover a shortfall in the funds earmarked for the purchase of Russian natural gas supplies, the country’s President Petro Poroshenko said late on Saturday.

“We have several options at our disposal, from borrowing the funds of the International Monetary Fund and to using the funds of international financial organizations that could help cover NJSC Naftogaz deficit,” Poroshenko said in an interview to several local TV channels.

Ukraine currently owes Russia more than $5 billion in unpaid bills. Russian Energy Minister Alexander Novak said Friday Kiev appeared to be ready to pay for future deliveries of Russian gas in advance, adding that all remaining issues could be resolved during the trilateral Russia-Ukraine-EU talks in Brussels on October 21.

Speaking with journalists Saturday, the Ukrainian leader said that a special IMF mission would be sent to Ukraine soon, but only after a new Cabinet is formed.

“We have no time left. An IMF mission is to arrive in Kiev in mid-November, but only after we’ve confirmed the Cabinet of Ministers,” Poroshenko said.

As a result of the ongoing political crisis in the country, Ukraine is currently on the verge of a default. Kiev authorities are trying to rescue the country’s economy with international loans, including a $17 billion loan from the International Monetary Fund. To receive this financial support, Ukraine earlier agreed to a severe austerity program that includes raising taxes and selling off state assets.

President Poroshenko said that IMF executive directors were to decide on a new financial assistance program for Ukraine and submit it to Kiev by mid-December.

In May, Ukraine received the first tranche of the IMF loan measuring $3.16 billion, with the second installment of $1.4 billion coming in early September. The IMF said Kiev might need an additional $19 billion loan if clashes in the east continued.

Tags:
gas, loans, International Monetary Fund, Petro Poroshenko
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