Ostrikova: The IMF sends a clear message – either we fight corruption or think about where to get the money

The Chairman of the parliament received a letter from the heads of the IMF and World Bank missions, who are responsible for Ukraine, and the US and EU ambassadors in Ukraine. The letter says that they see no appropriate draft law on the restoration of criminal responsibility for illegal enrichment that would meet international standards, and offers technical assistance to the parliament and the committee. This is reported by MP Tetiana Ostrikova representing the Samopomich faction.

According to her, the technical mission of the International Monetary Fund left Ukraine last week. This mission visited our state to see how we were fulfilling those 4 requirements, the deadline for which is spring 2019. The mission made its report and the next revision of the program will take place in May, says Ostrikova. “Accordingly, in May, it will be clear whether Ukraine will receive the next tranche of 1.3 billion dollars. So far, from what we see, the situation is not in favour of Ukraine. First of all, against the background of all the other conditions, the number one requirement is the anti-corruption agenda. Moreover, in accordance with the memorandum, by the end of April 2019 Ukraine must elect at least 35 judges to the Supreme Anti-Corruption Court. To date, the selection is still ongoing, but we don’t know whether this court will start its work in the near future.”

Ukraine is being largely criticized for the fact that the Constitutional Court recognised the provisions of the Criminal Code on liability for illegal enrichment as unconstitutional. The President introduced his bill on illegal enrichment, but, according to Ostrikova, there were more than ten bills drafted by MPs, including the one by Samopomich representatives; whereas the presidential bill only worsens the situation as compared to what it used to be. Even the parliament’s scientific department recommends that the President finalize it due to numerous shortcomings.

“International creditors and partners of Ukraine insist that this rule should be returned to the Criminal Code of Ukraine. At the same time, it is necessary to find a way to continue the investigations into the illegal enrichment of top officials of the previous years, which had been launched. After all, if we simply return the illegal enrichment to the Criminal Code, for example in April 2019, this will not restore those criminal cases because the law on criminal liability does not have retroactive effect.

Another requirement of the IMF is the legislation on the so-called financial split. This means that the commission for regulating the financial services market should be finally liquidated, and this sector should be transferred under the supervision of the NBU,” explains the lawmaker.

“The government is in no hurry to pass the relevant bills, because they will have to determine who will control the insurance market. The insurance market is not transparent.

The IMF also requires clearly dividing the State Fiscal Service into two separate legal entities — the State Tax and Customs Services. They have radically different functions. The first one has fiscal functions — the collection and administration of taxes, while the second one is responsible for the economic security of customs borders and the facilitation of international trade. Apart from this, our international partners require holding a competition for choosing the management of these services. As of today, the provisions of the government have been approved, but have not been made public, and the ones on competition for the election of leaders have not been announced yet.

If the IMF reckons that we have not fulfilled all these requirements, they will not give us the next tranche or will delay it, as it was already the case last year. But this year the situation is different — we need to give back large borrowings, and the Ministry of Finance will have to go to other borrowing markets and borrow money not from the IMF at low interest, but from private lenders at high interest rates.

Tetiana Ostrikova notes:

“This time, the lack of a tranche will be disastrous because Ukraine will be weakened by the elections. We know this judging by the level of confrontation present between the headquarters. There are risks of unrest and people’s taking to the streets. And if it suddenly happens so, there will be no confidence in the head of state. No creditor will lend money to such a country.”

Tetiana Ostrikova believes that the anti-corruption bills should be voted for immediately after the law on language. If we wait any longer, it will be too late.

“We received an absolutely clear message — unless we comply with our obligations, we will not receive the tranche; either real reforms or try think for yourself where to get the money.”

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