April 21, 2017 / 10:38 PM / in 6 months

Ukraine not worried relations with U.S. fraying in Trump era

WASHINGTON (Reuters) - The United States has strongly signaled it will continue to support Ukraine, Finance Minister Oleksandr Danylyuk said on Friday, adding that the war-torn country had a “good, pragmatic” relationship with Washington.

National flags of Ukraine and the U.S. fly at a compound of a police training base outside Kiev, Ukraine, May 6, 2016. REUTERS/Valentyn Ogirenko

Ukraine has previously expressed some nervousness about the possibility the Trump administration might try to cut a deal with Russia over Crimea and the eastern part of Ukraine that has been seized by Russian-backed separatists.

President Donald Trump promised a thaw in relations during his 2016 election campaign, but relations between Washington and Moscow currently remain tense due to the countries’ military involvement in the Syrian crisis.

“Support of Ukraine is not a snapshot, it’s a movie,” Danylyuk told Reuters on the sidelines of the International Monetary Fund and World Bank spring meetings in Washington.

Asked about recent rhetoric from some senior U.S. officials that appeared to imply an easing of support for Ukraine, he said that actions spoke louder than words.

“On that front we are getting strong signals from the U.S. that support will continue ... we have a good, pragmatic relationship,” Danylyuk said. “There is obviously a U.S. interest for a stable Ukraine.”

He added that he had met U.S. Treasury officials as well as Trump administration economic advisers this week.

REFORMS EXPECTED TO PASS

The IMF stepped in with a $17.5 billion bailout program for Ukraine as the nation neared bankruptcy following the annexation of Crimea by Russia in 2014 and the outbreak of the Russian-backed separatist insurgency in its industrial east.

Ukraine expects three more tranches of loans this year but disbursement is dependent on meeting IMF conditions including structural reforms and tackling corruption. Since 2015, Kiev has received about $8 billion in IMF aid.

The global lender has called for an overhaul of the pension system to cut Ukraine’s large deficit and action to further liberalize its agricultural sector.

There have been concerns about opposition from vested interests, particularly on land market reform.

“There is a pushback, they’ve been successful for many years. What will change is this time they are going to lose,” Danylyuk said.

The minister said he wanted to have reform laws for both sectors finalized by mid-May and expected Ukraine’s parliament to pass them by the end of June, at which point he also hoped for agreement from the IMF to release the next tranche of aid.

He also said that Ukraine plans to issue new sovereign bonds in September or October and submit its appeal in June against a ruling by a British court last month that it failed to offer a court-ready defense for not paying back $3 billion it borrowed from Russia in 2013.

Ukraine had argued that the debt was taken out under duress.

Reporting by Lindsay Dunsmuir; Editing by Paul Simao

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