Finance ministry could initiate merger of tranches from IMF, sending part of them to budget

The successful continuation of the IMF-supported Extended Fund Facility (EFF) that Ukraine hopes to see would allow the country to discuss the merger of the tranches early 2016, Deputy Finance Minister of Ukraine Artem Shevalev said in an interview with Apostrof publication on Monday.

Initially it was agreed that all the tranches in 2016 would be sent to the National Bank of Ukraine (NBU)… We believe that reserves should be supported, but maybe, we will discuss [an idea] that a part of the sum is sent to the budget," he said.

He said that now this is a minor technical issue.

The four-year Extended Fund Facility (EFF) program worth SDR 12.348 billion (about $17.15 billion at the current rate) was opened in March 2015. The EFF originally foresaw a quarterly review of the program, and allocation of three more tranches worth SDR 1.18 billion (about $1.63 billion) in 2015 and a decrease in quarterly tranches in 2016-2018 to SDR 0.44 billion ($0.61 billion).

Ukraine managed to receive only first two tranches.

The government expects that the adoption of the national budget last week with the deficit of 3.7% of GDP that is in line with the EFF program would allow resuming IMF's financing, although the date of providing the next tranche is unknown. According to sources acquainted with the negotiations, under the optimistic scenario the fund could make a positive decision on Ukraine in late January or early February.