UKRAINE'S CENTRAL BANK SAYS NO EVIDENCE OF MISUSE OF IMF MONEY... The National Bank on 7 March issued a statement saying that an international audit has not produced any evidence that the bank misused IMF credits in 1997, Interfax reported. In January, the "Financial Times" had quoted former Premier Pavlo Lazarenko as saying $613 million in IMF funds were diverted from the central bank in December 1997 and invested in speculative government bonds. Lazarenko also alleged that some $200 million in proceeds were deposited in the Belgian and Swiss accounts of people close to President Leonid Kuchma. The allegations prompted the IMF to announce that it would not consider releasing new loans for Ukraine until a probe is completed. The National Bank commissioned PricewaterhouseCoopers to audit transactions between September 1997 and January 1998. A second audit covering all of 1997 and nine months of 1998 will be released later this month. JM

...WHILE WORLD BANK REQUESTS PROBE INTO USE OF ITS LOANS. The World Bank has requested that Ukraine's Finance Ministry expand the second audit to include the $1.81 billion in structural adjustment loans that the bank has granted Ukraine since 1994. The bank's mission in Ukraine said that the money was mostly used to cover foreign debt payments and that there was no immediate evidence of wrongdoing. It added, however, that the World Bank wants "to take advantage" of the ongoing audit to check the use of its loans, too. JM

UKRAINE, RUSSIA STILL DISAGREE OVER GAS DEBT. Russian First Deputy Premier Mikhail Kasyanov on 7 March said Moscow and Kyiv have so far not agreed on the size of Ukraine's debt for Russian gas deliveries, Interfax reported. According to Kasyanov, Kyiv admits owing $1.4 billion for Russian gas, while Gazprom maintains that the debt totals $1.9 billion. Kasyanov noted that the debt is a "key problem" in bilateral ties, adding that Moscow is drawing up proposals of both an economic and political nature on how to resolve the issue. JM