#AceFinanceNews says that the `International Monetary Fund‘ is under increasing pressure from all sides to give the green light to an aid program for Kiev, even as it risks its own credibility in doing so.
A team of IMF experts landed in Ukraine on Monday to launch discussions with the authorities, dissecting the economy’s problems and shaping an aid plan, even as the new government struggles with the threat of Russia in Crimea and says it needs “at least” $15 billion.
An IMF loan does not appear to be imminent but the expectation is heavy. On Sunday, finance ministers from the seven leading industrial powers — the G8 minus Russia — emphasized that the IMF is “best prepared” to lead a support program for the country.
The United States, the country with the biggest voice in the IMF, has repeatedly said the Fund should be at the heart of any rescue program.
Europe, also holding a strong voting position in the Fund, has the same view.
“No member state will move without the IMF evaluating Ukraine’s financial needs,” a European source said Monday.
The IMF said last week it was ready to respond to an official Ukraine request for help, just days after a new government took power in Kiev following the ouster of pro-Russian president Viktor Yanukovych.
But the IMF also has its strict operating rules and it must be careful not to offend some member states which have reproached it for having at times given in to Western pressures.
Under its internal rules, the IMF can only lend to a borrower in exchange for implementing austerity policies and a “viable” plan that would take the country’s public finances to the point that it will be able to repay.