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Thursday, 22 June 03:55 (GMT -05:00)



Business And Politics News

Sixteen Structural Reforms Is the Cost of the Next IMF Tranche to Ukraine


Anders Aslund, a Swedish economist and a Senior Fellow at the Atlantic Council, commented on the current and future cooperation between the IMF and Ukraine. He claims that Kiev will have to implement at least 16 structural reforms in order to get another tranche from the International Monetary Fund. He also explained why the IMF is still cooperating with Ukraine.
 

 

 

 

 

The expert reminds us that on April 3, the IMF analyzed the progress made by the Ukrainian government in terms of implementing the promised reforms. As a result, the IMF found out that only 54 out of the promised 14 structural reforms where implemented. By the way, those reforms are a part of the cooperation program.
 

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Nevertheless, Ukraine still got another tranche from the IMF, around 1 billion dollars in total. Given the fact that Ukraine failed to stick to the agreement in terms of implementing the reforms by still got the money, some experts started questioning the transparency of the deal between Ukraine and the IMF.
 
There is another curious thing. Instead of focusing on macroeconomic stats, the IMF put forward a range of less significant conditions for letting Ukraine get another tranche. That’s why the expert calls for investigating into what the IMF is actually doing. First of all, no international organization can compare with the IMF in terms of efficiency and responsiveness. The IMF has a lot more money than other financial peers. The local personnel are more skilled and ready for increasing challenges, even though they are paid more handsomely.
 
Moreover, the fund is well-run and has a clear mission. They are quick to react. After the Managing Director makes a decision, a team of experts goes to the country in question in a matter of days. The agreement is usually signed in a matter of 2 weeks at most. The IMF’s Executive Council also needs a couple of weeks to make the final decision, which means that the entire procedure doesn’t require a lot of time and the money is transferred the next day without having to follow some complicated schemes involving local governments, even if this is billions of dollars.
 
All in all, the IMF is designed to support economic stability in order to help various countries around the globe avoid a default and curb inflation. Still, often times, the IMF requires those countries to practice austerity with budget spending cuts and tough monetary policies for local central banks.
 
The IMF started helping Ukraine in March 2015. Back then, the fund planned to sponsor Ukraine with 17,5 billion dollars in total. The first tranche was equal to 5 billion dollars. This nearly doubled Ukraine’s currency reserves at that time. Hardly could any other financial institution have helped Ukraine that fast.
 

 

So, why did the IMF give Ukraine another tranche? The thing is, despite implementing all of the promised reforms, Ukraine did manage to implement the key macroeconomic reforms. To be more specific, the Ukrainian government did manage to balance the budget. At first, they used to expect a deficit equal to 3,7% of the GDP. However, the deficit was reduced all the way down to 2,3%, which is a considerable and even impressive achievement for Ukraine. Inflation also turned out to be slightly less than expected, which is another achievement, though less significant. At the same time, under tough economic and financial conditions, the local government also managed to stop the national currency from devaluing fast. Given this achievements, the IMF seems to have been impressed and that’s why they decided to give more money to help the Ukrainian economy recover.

 

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Fed Raises Key Interest Rate. How Will This Affect Russian Economy?

The federal Reserve has raised the key interest rate by 0,25%. According to international experts, this may well make foreign assets (including Russian ones) less attractive in terms of investing.

 

 
The decision was made as the result of the recent 2-day FOMC meeting. The interest rate was raised up to 1-1,25%. At the same time, it’s interesting to note that the actual decision matched expectations, both from the international expert community and financial markets.
Publication date: 20 June 05:12 AM

Why Did British People Punish Theresa May During Parliamentary Election?

During the recent parliamentary election in the UK, the British Conservatives failed to gain public support required to get the absolute majority in the British parliament. Now, the international expert community is discussing the reasons why Theresa May failed on her expectations.

 

 
Publication date: 20 June 03:09 AM

Why Does Trump Fail to Be a Good President?

As you probably know, the scandal around Donald Trump’s decision to fire FBI Director Comey is just one of the unpleasant incidents in his presidential career started in early 2017.

 

 
The truth of the matter is, after the investigation against Michael Flynn started, Donald Trump asked FBI Director Comey to let the investigation slide. While Director Comey didn’t dare object to President Trump openly, he didn’t do that. On the contrary, the investigation got even more intensive.
Publication date: 16 June 01:46 AM

Trump Accuses Qatar Of Financing Terrorists

Donald Trump thinks that Qatar has been involved in sponsoring terrorists in the Middle East. That said, the USA joined other nations accusing Qatar of this kind of financing. President Trump thinks that it’s time to put an end to this. However, he didn’t specify what exactly Qatar did to sponsor terrorists.

 
Publication date: 15 June 05:35 AM

Trump Is a Boomerang Russians Have Hit Themselves With

Experts say that Donald Trump is gradually turning into a boomerang launched by Russia, and the thing is, this boomerang is going to hit Russia, thereby disappointing the Kremlin instead of letting them. President Trump is turning from Russia’s hope into Russia’s disappointment.
 

 

The Kremlin celebrated Trump’s victory with champagne while today Vladimir Putin says he didn’t expect anything from Donald Trump as the next president of the United States. He moved to the White House 5 months ago, but none of his decisions was made in favor of Russia.
Publication date: 13 June 06:25 AM

Will Macron Become Anti-Trump?

 New French President Emmanuel Macron seems to be getting more popular both in France and outside. The 39-year-old President of France seems to have challenged his 70-year-old American peer.

 

 
Not so long ago, he made his TV speech in English. While some older representatives of the French people were indignant at this move since no other president in the history of France had ever dare do so, but the French youth seemed to like this.
Publication date: 12 June 01:52 AM

Google Reveals Near-Term Forecast

Google Technical Director Ray Kurzweil has revealed his forecast for the period until 2030. Previously, he also made similar prediction for the near future related to IT. Strange as it may see, most of his predictions did really become a reality. That’s why the international community has been closely watching his predictions over the last few years, even though sometimes it’s very difficult to believe that the future will be the same as he described in his forecast.

Publication date: 10 June 11:54 PM

25th Amendment Threatens Trump with Impeachment

President Trump is reported to have found himself in another unpleasant situation. To be more specific, just for revealing some top-secret information to Russian Foreign Minister Lavrov, he is now threatened with a possible impeachment. They say that the 25 amendment to the American constitution, this becomes a very likely scenario. In particular, this assumption was put forward by an advisor who used to work for George Bush Jr.

 

 
Publication date: 07 June 12:25 AM

Chinese IT Innovations as an Example for the Resto of the World

China seems to have been trying hard to revolutionize the Internet and entire IT industry through innovation. The international expert community has been seriously discussing the possibility of China setting a good example for the rest of the world when it comes to innovation.
 
Publication date: 05 June 06:04 AM

Europe Cannot Trust Trump, Merkel Says

Market Leader reports that after talking to Donald Trump, some European leaders came to a conclusion that this president is unreliable and the EU cannot trust the USA anymore while Donald Trump is in charge of the White House. This is what Angela Merkel gave everyone to understand while answering questions after the G7 summit.

Publication date: 01 June 11:41 AM