Valery Gontarev and Dominique Strauss-Kahn held an open discussion on the situation in the financial sector of Ukraine

04 November 2016

Dominique Strauss-Kahn, IMF Managing Director for 2007-2011, Independent Member of the Supervisory Board of Bank Dnipro Credit, and Valeriy Gontarev, NBU Chairman, discussed the current situation in the financial sector of the country. The participants of the meeting talked about the main challenges facing the financial system today and directly affect both the relations with foreign investors and the overall economic growth rate of the country.

The reform of the banking system, which at this moment is at the final stage, without changes in other areas, without rigid anti-corruption measures at all levels, without eradicating political populism, can not give the expected effect. This was emphasized by the head of the National Bank of Ukraine.

"The NBU's position on the need for financial sector reform is fundamental, and we understand that not all of them approve and support it. But this is exactly the essence of the reforms - they are by definition not easy and painless. For example, due to the purification of the financial sector, we have achieved an increase in its transparency, reduced lending to related parties and a growing level of capitalization of banks, - said Valery Gontarev. - At the same time, reforms should cover all areas. Without cardinal modernization of other areas, the economy will not be able to function effectively and to develop. Yes, we see how sometimes it is difficult for our parliament to adopt a series of fatal and important financial bills, or how courts work, by abolishing the decision of the central bank to recognize some financial institutions insolvent. "

In turn, Dominique Strauss-Kahn called the resistance of a number of Ukrainian politicians in the fight against corruption, which is carried out not in words, a reason that slows down the entire development of Ukraine.

"In the Ukrainian civil society, Western partners, foreign business has the same expectations. Everyone wants to see that the country is undergoing reforms. Everyone wants to see that Ukraine is ready to become an open economy. Everyone wants to be sure that the law enforcement and judicial authorities take only one side - the side of justice. Business asks: "What is the guarantee that I will have comfortable and transparent conditions for work here?". You urgently need reforms in the public sector and the judiciary, "said Dominique Strauss-Kahn. - Implementation of the e-declaration system is a very difficult but very important step. It is important both from a legal point of view and from the point of view of forming a public inquiry. Everyone is equally responsible for the law - an official he or not, a representative of the state or corporate sector. Ukraine should first of all get rid of privileges for the authorities. "

The financier also emphasized that the second important factor is a qualitative judicial reform. It started a month ago, and the whole world, which is investing money in the country's development today, expects real results.

"As an Independent Member of the Supervisory Board of Bank Dnipro Credit, I know for sure what the financial sector is facing due to massive non-repayment of loans, including those big business clients and even some people's deputies that deliberately evade their obligations. For example, we are faced with a situation that reflects all the imperfections of the current judicial system in the country. An old problematic borrower of the bank, whose loan was partially repaid through the implementation of mortgage property, becoming a deputy of the Verkhovna Rada, decided to take advantage of the situation and to sue the financial institutions significant sums of fictitious losses. It is unacceptable in a civilized legal world, in a real European country. And we all want to see Ukraine among the European family of states, "said D. Strauss-Kahn.

At the same time, the former IMF Managing Director noted that Ukraine is not simply looking for operational reforms. Both citizens and the whole world should see the true effect. "Rapid reforms on paper, but without qualitative results, will not satisfy anyone," summed up Dominique Strauss-Kahn.

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