IMF’s Lagarde Praises, Prods Ukraine

KIEV, Ukraine -- The head of the International Monetary Fund Sunday praised Ukraine’s efforts to overhaul its economy, but urged Kiev to stay the course agreed upon with the emergency lender amid signs the coalition government may be beginning to fracture.

Ukrainian President Petro Poroshenko (L), speaks with International Monetary Fund Managing Director Christine Lagarde during their meeting in Kiev, Ukraine, on Sunday. Ms. Lagarde praised Kiev’s efforts at economic reform, and urged Mr. Poroshenko to adhere to the terms of its IMF bailout.

“To achieve what you have achieved in such a short period of time is just nothing but astonishing,” IMF Managing Director Christine Lagarde told Ukraine President Petro Poroshenko in a joint press conference.

The economic restructuring plan Kiev agreed to enact as part of a $40 billion international bailout program is starting to bear fruit, the IMF chief said.

“The fiscal position is getting stronger, the foreign exchange market has stabilized and the banking sector is being repaired so that banks are sounder and can start providing credit again,” she said.

But, Ms. Lagarde cautioned, “What’s critically important is to restore confidence…and to deliver on the promises that have been made, to stay within the parameters of what has been agreed.”

The IMF chief’s visit to Kiev—directly from the Group of 20 meeting in Ankara, Turkey—comes in the wake of political turmoil in Kiev that is fueling concerns outside the country that the government may lose support for its tough economic restructuring program.

Mr. Poroshenko, speaking through an interpreter, said his government “is decisively determined to deliver reforms” and hopes to secure the next tranche of emergency financing in October.

Source: The Wall Street Journal