Despite Congress delay, US preps for Ukraine aid

by Erik Wasson - 03/13/14 4:08 PM ET

Treasury Secretary Jacob Lew and Ukrainian Prime Minister Arseniy Yatsenyuk on Thursday moved forward with laying the groundwork for a $1 billion U.S. loan guarantee, despite the inability of Congress to give it a green light this week.

According a readout of the Washington meeting, Lew and Yatsenyuk agreed that a congressional Ukraine bill should include reforms to the International Monetary Fund, which are opposed by some Republicans.

{mosads}Congress is set to leave town Friday without approving a Ukraine bill due to a dispute over the IMF reforms. So far a bill without the IMF language has passed the House, while one containing the language awaits a full Senate vote after being approved in committee.

Meanwhile, Russian-occupied Crimea is set to vote Sunday on leaving Ukraine, a referendum called illegitimate by the capital Kiev and the U.S.

During the meeting, Lew outlined the possible loan guarantee and its conditions and asked Yatsenyuk’s suggestions on provisions to the agreement.

Lew said that Ukraine’s willingness to “commit to ambitious reforms would impact the timing of the guarantee,” the readout said.

An administration official said that the congressional delay lasting over next week’s recess can be overcome.

“Given our ongoing background work and preparation, a one- to two-week delay in the approval of the loan guarantee by Congress would not have a meaningful impact on timing on which the Ukraine guarantees would be done,” the official said.

Separately, IMF Managing Director Christine Lagarde said the IMF is making profess on its own effort to provide aid to Ukraine.

“The IMF fact-finding mission working in Kiev since March 4 has made good progress in assessing the situation,” she said. “Following an informal briefing today of the IMF’s executive board, management has asked the team to stay in Kiev and begin a process of negotiation. The team will work with the Ukrainian authorities to develop an economic reform program that will result in sound economic governance and sustainable growth, while protecting the vulnerable in society, and that can be supported by the IMF in accordance with its policies.”

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