"Get up in morning and roar": IMF chief calls on Ukraine to scrap electricity subsidies
Ukraine needs to accelerate structural reforms, abandon energy subsidies, and distribute the tax burden more fairly in order to ensure sustainable economic growth.
According to Censor.NET, this was stated by Kristalina Georgieva, Managing Director of the International Monetary Fund, during a public speech.
According to her, despite the war, Ukraine has a real chance to become one of the leaders of economic growth in Europe, but this requires a series of painful but necessary reforms. In particular, this involves the gradual phasing out of subsidies for electricity and heating, as well as fiscal reforms.
"Electricity and heating are still subsidized. We understand why the country does this, but it needs to be eliminated. The tax burden also needs to be distributed more fairly. It's difficult, but necessary," Georgieva said.
She emphasized that countries in Central and Eastern Europe, particularly Bulgaria, had already gone down this path, and that the process had been painful but effective.
Reforms, the labor market, and the role of the private sector
The IMF chief drew attention to the importance of removing barriers to private sector development. She placed particular emphasis on security issues and labor shortages, which are increasingly cited by Ukrainian businesses.
According to Georgieva, during a meeting with business leaders in Kyiv on January 15, the issue of access to workers proved to be even more important than security risks for many of them. In this context, the IMF is ready to assist Ukraine in addressing practical issues, including the return of citizens from abroad, overcoming structural unemployment, and integrating veterans into civilian life.
She also noted that during the war, Ukraine has demonstrated better results in implementing reforms than in the pre-war period. Eight reviews have already been successfully completed under the four-year extended financing program launched in spring 2023.
The European Union and Ukraine's "lion-hearted" confidence
Separately, Kristalina Georgieva emphasized the critical importance of completing Ukraine's accession to the European Union within a reasonable time frame. According to her, EU membership will become a powerful economic magnet and ensure the full integration of the Ukrainian economy into the European market.
At the end of her speech, the IMF chief called on Ukrainians to be confident and united, using a vivid metaphor.
"You must believe in yourself like a lion. So get up in the morning and roar. Confidence matters. If you leave internal disputes behind, bury corruption once and for all, and demonstrate this confidence every day, you will succeed," Georgieva concluded.
- On the eve of the meeting, Ukrainian Prime Minister Yuliia Svyrydenko met with Kristalina Georgieva, Managing Director of the International Monetary Fund, in Kyiv. The key topic of the talks was preparations for the adoption of a new IMF support program.
At the same time, she reminded that, according to agreements with the IMF, Ukraine must adopt a roadmap for the gradual liberalization of gas and electricity markets after the end of martial law. According to the Fund's estimates, in 2025, tariffs for the population covered about half of the market value.
