Channel NewsAsia

Ukraine's economy minister announces resignation

Ukraine's economy minister announced his resignation on Thursday (Aug 21) following conflicts within the government on how to turn around the dire national economic situation.

KIEV: Ukraine's economy minister announced his resignation on Thursday (Aug 21) following conflicts within the government on how to turn around the dire national economic situation.

"Instead of continuing to fight yesterday's system, I have decided to focus on working with the people of tomorrow," Pavlo Sheremeta wrote on his Facebook page. His resignation has to be signed by President Petro Poroshenko to go into effect.

Politically inexperienced Sheremeta, 43, was appointed on Feb 27 as economy minister in the government of Prime Minister Arseniy Yatsenyuk, days after former leader Viktor Yanukovych was toppled.

The two politicians have clashed over the slow pace of economic reforms needed to kick start Ukraine's stalling economy and receive badly needed international aid.

Fierce fighting in the east - Ukraine's industrial heartland - between government forces and pro-Russia rebels has sapped already weak growth and caused the national currency to plunge to a record low against the dollar.

Ukraine has now been in recession for more than two years, with business activity contracting by 2.3 percent in the second quarter of 2014. The International Monetary Fund has warned Ukraine's economy could shrink by 6.5 percent this year, and has agreed to provide US$17 billion (S$21.2 billion) of aid in several instalments to help Kiev through the crisis.

Sheremeta - a western-educated economist - had come under criticism from his colleagues over the pace of economic reforms needed to receive a fresh US$1.4 billion (S$1.7 billion) lifeline from the Washington-based body.

Analysts said Thursday that lawmakers, including Yatsenyuk, were right to be worried given Ukraine's unravelling public debt and the looming risk it could default.

"Given the dire outlook for the public finances, there are growing concerns that the IMF may restrict lending," research firm Capital Economics said in a note.

Sheremeta said he was also unhappy that Kiev's cabinet had appointed a trade representative ahead of key talks next week with the Russian-led customs union and EU officials without consulting him.

"I am convinced that any official should be the one to suggest candidates to be his deputies," he told journalists. "This principle must be observed, otherwise the logic of governing is broken."

Sheremeta is the latest official to resign this month as consensus among the team that swept into government on the back of Yanukovych's ouster has started to unravel.

Earlier this week, campaigning journalist turned anti-graft chief Tetyana Chornovol said she was stepping down over a "lack of political will" from new leaders in Kiev to battle corruption.

Tweet photos, videos and updates on this story to  @channelnewsasia