Do we really need foreign loans?

The National Bank of Ukraine’s net international reserves (excess of assets over liabilities) has hit a record high of $610.3 million as of late September, compared with the $596.4 million deficit last year, Interfax- Ukrayina reports, citing the NBU.

In late September, NBU gold and hard currency reserves also reached a record high level of $2,723.3 million, compared with $1,537 million early this year. In September, gold and hard currency reserves grew by $492.5 million, following the large scale buying of foreign currency by the NBU to prevent the hryvnia from strengthening excessively and the disbursement of $375 million in loans by the International Monetary Fund as part of its EFF program and of $147.4 million by the World Bank.

According to NBU Department for Currency Regulation Director Serhiy Yaremenko, as of September 29 the gross gold and hard currency reserves of the NBU stood at $2,324 million, liquid reserves at $2,204 million, and net international reserves at $454 million.

Meanwhile, on October 3 Verkhovna Rada supported the interpolation by Communist People’s Deputy Heorhy Kriuchkov to Prime Minister Anatoly Kinakh called, On the Terms for the Resumption of IMF Loans for Ukraine Under the EFF Program, World Bank Program Systemic Loan, and Restructuring Debts for the Russian Fuel Supplies.

Mr. Kriuchkov recalls media reports about the IMF decision to resume cooperation with Ukraine under the EFF program and, specifically, to disburse $375 million, while the World Bank Board of Governors has also decided to release money for Ukraine under its Program Systemic Loan.

The lawmaker requested the prime minister brief Verkhovna Rada on the terms of these loans, including interest rates, the resulting rate of growth of Ukraine’s foreign debt, and the repayment schedule. In addition, Kriuchkov wants the prime minister to clarify the terms for restructuring Ukraine’s debt for Russian natural gas.