IMF managing director advises Ukraine to abolish electricity subsidies

MOSCOW. Jan 20 (Interfax) - Ukraine needs to continue reforms in order to ensure economic growth, Ukrainian media quoted International Monetary Fund (IMF) Managing Director Kristalina Georgieva as saying on the sidelines of the World Economic Forum in Davos.

"We still have electricity, heating subsidized [...] But that has to go. We still have in terms of fiscal position work to be done. Right now, we are looking into how we can make the burden sharing of taxation fairer, and it's not an easy thing, but it has to be done," Georgieva said.

Furthermore, everything that is an obstacle to private sector dynamism should be eliminated, she said, highlighting security and workforce availability in Ukraine.

The IMF stands ready to help Ukraine with practical matters such as helping Ukrainian return home and tackling structural unemployment problems, Georgieva said.

It is important for Ukraine to complete its accession to the European Union within a reasonable timeframe, because it is a magnet for the Ukrainian economy, enabling it to fully integrate into Europe, she said.

Ukraine actually has better outcomes during the crisis than before it, including with the help of the four-year Extended Fund Facility (EFF) arrangement opened in the spring of 2023.

As reported, the Ukrainian government pledged under the EFF to adopt a roadmap for gradually liberalizing the gas and electricity markets within six months after martial law is lifted, including a time-limited plan for its adoption in the period after martial law is lifted.

The IMF said in mid-2025 that gas and electricity tariffs for the population were at around 50% of the market price.

Ukraine and the IMF reached a staff-level agreement on a new four-year EFF arrangement at the end of 2025. According to Director of Communications at the IMF Julie Kozack, the IMF Executive Board could review it in February 2026.