Political noise hinders program implementation
Overview:
Political noise continues to hamper the implementation of the Stand-By Arrangement (SBA) with the IMF approved in November. The SBA went off track in February as a Fund Mission left Kiev without recommending the completion of the First Review of the program. Since then, there have been signs that a temporary political truce may have been reached to pass measures consistent with the disbursal of the next tranche given the pressures created by a sharp fall in the level of foreign exchange reserves and the value of the hyvrnia. However, even if a resumption of disbursements is secured in coming weeks there is nothing to suggest that program implementation will continue to be anything other than piece-meal as presidential elections approach in the winter and populist rhetoric abounds.