{ "title": "Ukraine: Owning the Reforms", "publication": "IMF News, September 26, 2017", "sourceUrl": "https://www.imf.org/en/news/articles/2017/09/25/na092617-ukraine-owning-the-reforms", "canonical": "https://www.imf.org/en/news/articles/2017/09/25/na092617-ukraine-owning-the-reforms", "overlayPath": "/en/news/articles/2017/09/25/na092617-ukraine-owning-the-reforms/index.md", "summary": "

Ukraine took tough measures to stabilize the economy, with the support of a $17.5 billion IMF credit line. Its full transition depends on carrying reforms forward. Interview with Minister of Finance Oleksandr Danyliuk.

", "publishDate": "2017-09-26", "sections": [ { "heading": "Context and recent stabilization", "content": "- Ukraine returned to growth last year after political upheaval, economic crisis, and military conflict.\n- The government implemented tough measures to stabilize the economy with the support of a $17.5 billion IMF credit line.\n- The country is at the mid-point of an IMF program; the challenge is to carry reforms forward from stabilization to sustained higher growth." }, { "heading": "Lessons from the reform period", "content": "- Reform focus over the past three years enabled the return to growth despite adverse conditions (military aggression, political turmoil, unstable commodity markets).\n- The principal lesson: \"we cannot stop halfway\" — structural reforms must continue to revive the economy and raise living standards.\n- Initial reform justification relied on IMF requirements; sustaining momentum now requires ownership and domestic commitment to the reform agenda." }, { "heading": "Social impact and political economy", "content": "- Early reform effects included lower incomes due to economic decline and currency depreciation.\n- Energy-sector reform raised gas rates to market levels; as a result, more than 50 percent of Ukrainians now receive subsidies.\n- Public expectations have shifted: citizens now expect a government that knows and is committed to its agenda, and failure to implement reform undermines credibility." }, { "heading": "Institutional and sectoral reform priorities", "content": "- Healthcare:\n - Current system: in theory free, in practice expensive due to unofficial payments.\n - Objective: formalize reforms to deliver \"world-class healthcare,\" ensure doctors receive decent legal salaries, involve private finance, and provide a state-guaranteed insurance package for those who cannot afford care.\n- Education:\n - Problems: day-to-day corruption (informal payments), inefficient funding allocation.\n - Reform direction: change funding mechanisms from financing buildings to financing services provided to real students.\n- Tax and customs administration:\n - The Ministry of Finance changed the value-added tax (VAT) refund system to be transparent, electronic, and fully automatic to eliminate corruption and improve business climate.\n - An international consultancy and an external supervisory board (including representatives from the Custom-Border Protection of the U.S. Treasury; Germany’s Ministry of Finance; the European Commission; the European Bank for Reconstruction and Development; and the government of Canada) are engaged to ensure reform progress and prevent derailment.\n- Law enforcement and anti-corruption architecture:\n - Current system described as oppressive and corrupt; largely a 20th-century structure unsuited for a liberal economy.\n - Proposal: create a compact analytical financial investigation unit of no more than 3,000 people to replace a huge army of more than 15,000 people across agencies investigating serious economic crimes.\n - Establish a specialized anti-corruption court to handle graft offenses and demonstrate seriousness in the fight against corruption." }, { "heading": "Political challenges to sustaining reforms", "content": "- Reduced external pressure (perceived lower Russian economic pressure) makes political consensus harder to sustain.\n- Domestic ownership and communication of reform benefits are crucial because referring to the IMF alone is no longer sufficient to push reforms through Parliament.\n\nIMF Country Focus — September 26, 2017. Interview with Minister of Finance Oleksandr Danyliuk.\n\n---\n\n\n References\n\n- https://www.imf.org/en/News/country-focus\n- PRESS CENTER\n- IMF Country Focus\n- conference\n- Octavian Armasu\n- Boštjan Jazbec\n- Martina Dalić\n- https://www.imf.org/en/home\n\nSource: https://www.imf.org/en/news/articles/2017/09/25/na092617-ukraine-owning-the-reforms" } ], "bullets": [ "[Markdown version](/en/news/articles/2017/09/25/na092617-ukraine-owning-the-reforms/index.md)", "[Structured JSON version](/en/news/articles/2017/09/25/na092617-ukraine-owning-the-reforms/index.json)", "[Bundle manifest](/en/news/articles/2017/09/25/na092617-ukraine-owning-the-reforms/bundle-manifest.json)", "Published: September 26, 2017", "Ukraine returned to growth last year after political upheaval, economic crisis, and military conflict.", "The government implemented tough measures to stabilize the economy with the support of a $17.5 billion IMF credit line.", "The country is at the mid-point of an IMF program; the challenge is to carry reforms forward from stabilization to sustained higher growth.", "Reform focus over the past three years enabled the return to growth despite adverse conditions (military aggression, political turmoil, unstable commodity markets).", "The principal lesson: \"we cannot stop halfway\" — structural reforms must continue to revive the economy and raise living standards.", "Initial reform justification relied on IMF requirements; sustaining momentum now requires ownership and domestic commitment to the reform agenda.", "Early reform effects included lower incomes due to economic decline and currency depreciation.", "Energy-sector reform raised gas rates to market levels; as a result, more than 50 percent of Ukrainians now receive subsidies.", "Public expectations have shifted: citizens now expect a government that knows and is committed to its agenda, and failure to implement reform undermines credibility.", "Healthcare:", "Education:", "Tax and customs administration:", "Law enforcement and anti-corruption architecture:", "Reduced external pressure (perceived lower Russian economic pressure) makes political consensus harder to sustain.", "Domestic ownership and communication of reform benefits are crucial because referring to the IMF alone is no longer sufficient to push reforms through Parliament.", "[https://www.imf.org/en/News/country-focus](https://www.imf.org/en/News/country-focus)", "[PRESS CENTER](http://presscenter.imf.org/)", "[IMF Country Focus](https://www.imf.org/en/news/country-focus)", "[conference](http://www.imf.org/en/News/Seminars/Conferences/2017/04/28/reaccelerating-convergence-in-central-eastern-and-southeastern-europe)", "[Octavian Armasu](http://www.imf.org/en/News/Articles/2017/09/05/na090617-moldova-back-from-the-brink-and-getting-better)", "[Boštjan Jazbec](http://www.imf.org/en/news/articles/2017/09/06/na091217-slovenias-central-bank-governor-institutions-are-the-people-who-govern-them)", "[Martina Dalić](http://www.imf.org/en/News/Articles/2017/09/18/na091917-croatian-economy-be-dynamic-not-only-in-tourism)", "[https://www.imf.org/en/home](https://www.imf.org/en/home)" ], "alternates": { "markdown": "/en/news/articles/2017/09/25/na092617-ukraine-owning-the-reforms/index.md", "json": "/en/news/articles/2017/09/25/na092617-ukraine-owning-the-reforms/index.json", "bundleManifest": "/en/news/articles/2017/09/25/na092617-ukraine-owning-the-reforms/bundle-manifest.json" }, "generatedAtUtc": "2026-09-25T21:13:04.189Z" }