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2020. In this latest document, the deadline for the reduction of the government stake in the banking system was pushed back considerably to 2025. However, even this far more modest target date may be overly optimistic. Privatization still faces a number of major obstacles that lead many to doubt whether genuine progress is possible.
One key problem is Ukraine’s dysfunctional legal system. This is a huge red line for international investors. Without credible rule of law guarantees, it will be difficult to attract the kind of investment necessary to make a success of privatization. Since 2014, Ukraine’s various attempts at judicial reform have repeatedly stalled or otherwise failed to convince.
Question marks also remain over the independence of the National Bank of Ukraine. Ukraine’s weak economic growth also detracts from the sector’s appeal.
Meanwhile, some skeptics remain unconvinced that the current government possesses the political will to proceed with privatization. They argue that Ukraine’s state-owned banks won’t be sold off anytime soon as they serve as a highly convenient instrument for the financing of the country’s budget deficit.
2.5 Politics - misc
President Zelenskiy’s White House visit now is to be in August, before Ukraine’s 30th Independence Day celebrations, on Aug. 24. Concorde Capital’s James Hydzik writes: “The delay stems from Washington’s ongoing concerns over the replacement of the head of Naftogaz. It is highly unlikely that the Zelensky administration will accede to Washington’s demands regarding Naftogaz under the present circumstances. As such, the welcome in Washington will be relatively cold.”
US Secretary of State Antony Blinken delivered a video address to a conference on reform in Ukraine being held in Vilnius on July 6-7. In the speech, Blinken named five ways the Ukrainian government can leverage its existing progress and in what ways the US can help, interfax.com.ua reported. They include ensuring the transparent selection of judges and ensuring that the leadership of governmental anti-corruption entities are selected in a manner that is “transparent, credible, and based on merit.” Passing legislation on both corporate governance that complies with OECD standards as well as on the reform of the SBU are needed. Lastly, bring corrupt top officials to justice.
Ukraine’s Finance Minister Serhiy Marchenko reported July 9 that Ukraine and the IMF have reached a compromise on anti-corruption and corporate governance reforms. Last week, Marchenko had a series of meetings with IMF officials in Washington to try to restart the IMF lending program that stalled one year ago. The Finance Ministry statement concluded: “The parties agreed on close communication and joint work to be able to reach the Staff level agreement in the near future.” Earlier in the week, Economy Minister Oleksiy Lyubchenko said Ukraine’s government expects to receive the $700mn loan tranche before the end of this year.
Ukraine's Supreme Court has overturned President Volodymyr Zelenskiy's decree dismissing the head of the Constitutional Court,
13 UKRAINE Country Report August 2021 www.intellinews.com