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Ukraine to hike gas rates by up to 50% to meet IMF loan demand

Published on Mar 27, 2014 1:21 AM

KIEV(AFP) - Ukraine agreed on Wednesday to drastically hike domestic gas prices by up to 50 per cent in order to meet a key loan condition from the International Monetary Fund for the crisis-hit ex-Soviet state.

The new Western-backed government in Kiev that came to power in the wake of last month's fall of a pro-Kremlin regime is seeking US$15-20 billion (S$19-25 billion) in IMF assistance in order to balance its books and make maturing foreign loan payments.

An IMF team was meeting with Prime Minister Arseniy Yatsenyuk in Kiev on Wednesday for what Ukrainian officials hope will be a final round of talks before the package is approved in Washington next month.

The Fund has made an immediate end to Ukraine's costly gas subsidies one of its prime conditions for the programme's approval.

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