You're reading: Financial Times: Ukraine to Greece – just do it !

Another lesson from eastern Europe on how to implement unpopular reform. Just do it – and blame the IMF and the markets, writes Roman Olearchyk.

Ukraine’s parliament, in a late-night session on Thursday-Friday, hiked the retirement age for women from 55 to 60 as part of pension reform legislation needed to unfreeze a $15bn International Monetary Fund loan program that has been frozen since March.

Ukrainian President Viktor Yanukovych is expected to sign into law the reform, which is key to improving the public finances and international credit ratings for a country which is still recovering from a 15 percent drop in gross domestic product during the 2009 global recession.

Pointing to low monthly pensions of about $100-140 per month, opposition groups say the pension reforms is unfair to citizens that have some of the lowest salaries, life expectancy and living standards in Eastern Europe.

Yulia Tymoshenko, opposition leader,pledges to challenge the pension law in Ukraine’s constitutional court, arguing that it was adopted when only a small number of lawmakers out of the 450-seat parliament were present.

A dozen or so lawmakers voted on behalf of 248 by using their voting cards. While such voting would seem to violate Ukraine’s constitution, it has long been an accepted practice by the nation’s leadership. Tymoshenko’s chances of cancelling the vote are slim given Yanukovych’s strong grip on power – and the overwhelming pressure from the IMF and the markets. A timely example for other troubled economies. Are the Greeks watching?

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