The International Monetary Fund has named conditions (prior actions) in addition to the adoption of the State Budget for 2026 for a new program with Ukraine, as stated by IMF spokesperson Julie Kozack at a briefing on December 4, UNN writes.
Details
Kozack indicated that on November 26, IMF staff and Ukrainian authorities reached a staff-level agreement on a new four-year EFF program with potential access to $8.1 billion.
The program remains subject to the completion of prior actions, obtaining adequate financing assurances from donors, and, of course, approval by the IMF Executive Board.
She commented on the budget issue in this context.
The adoption of the 2026 budget was one of the prior actions agreed with the authorities. The team is currently evaluating the full text of the budget, but the preliminary assessment is that it is broadly consistent with program commitments.
She also named other prior actions.
In addition to the budget, which I just mentioned, some other areas include the tax base, expanding the tax base by adopting legislation on taxing income received through digital platforms, closing customs loopholes for consumer goods imports, and abolishing VAT registration benefits. Agreement was also reached on measures to combat informal economic activity, including by strengthening competition in public procurement and eliminating loopholes in the current labor code.
According to her, "the authorities have made it clear that they remain committed to the reform agenda, and this includes mobilizing domestic revenues, combating the informal economy, protecting independent anti-corruption institutions, and debt restructuring to restore sustainability."
"Regarding the new program, the authorities, as I noted, have reaffirmed their strong commitment to maintaining a properly resourced and independent anti-corruption institutional complex. They also agreed to continue reforms of the tax and customs services, including by appointing a new head of customs and improving IT systems to increase efficiency, as well as working to restore public trust, increase revenues, and ultimately support the reconstruction that Ukraine will need. And on the part of state-owned enterprises, the authorities have committed to improving financial planning, reporting, and auditing, as well as reforming nomination procedures for state-owned enterprises and state-owned banks," said the IMF spokesperson.
The National Bank of Ukraine, according to the IMF spokesperson, "aims to reduce inflation while providing greater exchange rate flexibility to absorb shocks and maintain adequate foreign exchange reserves."
Regarding financing
"As for financing, the program is expected to catalyze large-scale external support to help close or fully close the financing gap in Ukraine," the IMF spokesperson continued.
According to her, the size of the financing gap, which, according to her information, "has been the subject of some discussions here or questions, we estimate the size of the financing gap over the life of the program at $136.5 billion." "This is over the entire term of the program. In particular, for 2026, or perhaps for the period from 2026 to 2027, we estimate the remaining financing gap at $63 billion. So, our message is that prompt donor action is necessary to help Ukraine finance its large fiscal and external financial needs and avoid a liquidity shortfall during the ongoing war," Kozack said.
Regarding debt restructuring
"Regarding some questions about GDP warrants, at this point regarding the restructuring of GDP warrants, I can say that we have taken note of the proposal made by the Ukrainian authorities to warrant holders on December 1. We are closely monitoring the reaction and also analyzing the proposed terms of the offer," the IMF spokesperson said.
And, according to Kozack, "as always, any debt restructuring agreement will be assessed in the context of ensuring debt sustainability and, of course, ensuring adequate financing or financing assurances that Ukraine will need under the program."
Regarding the fight against corruption
"Regarding some more specific issues regarding the fight against corruption, we see that recent developments in Ukraine once again underscore the importance of a decisive fight against corruption in Ukraine, improving governance, and continuing to reform state-owned enterprises. As we have said in the past, Ukraine needs a robust anti-corruption architecture that will help level the playing field in Ukraine," Kozack said.
This, according to her, "will help protect state resources; it will improve the business climate, and it will also help Ukraine ultimately attract private investment."
"This is a central element. These anti-corruption reforms are a central element of reforms for the donor community as a whole, as Ukraine seeks their support for critical repairs and post-war reconstruction, ultimately," the IMF spokesperson noted.