Reuters International

A man drinks coffee and smokes as he stands near a currency exchange office in Kiev, Ukraine March 31, 2016. REUTERS/Gleb Garanich

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KIEV (Reuters) - A political crisis in Ukraine threatens to derail a Western-backed reform drive and thwart attempts to pull its conflict-hit economy out of a two-year recession, the World Bank's country director for Ukrainesaid on Friday.

Lawmakers are under pressure to form a new coalition to end a deadlock that threatens snap parliamentary elections and has delayed disbursement of $1.7 billion (£1.19 billion) from the International Monetary Fund and other foreign loans.

"The current political crisis poses a very serious threat to the still fragile recovery and exposes a serious enough threat to continued economic reforms," the World Bank's Qimiao Fan said at a briefing. "It's very important in our view that the political crisis is resolved as quickly as possible."

The World Bank kept its forecast for Ukraine's 2016 economic growth unchanged at 1 percent and said it saw inflation slowing to 15 percent this year, compared with a previous forecast of 23.4 percent.

On Thursday, the results of a Reuters poll of 16 Ukrainian banks and brokerages forecast Ukraine's economy would grow 1.4 percent in 2016 after contracting 9.9 percent in 2015 and 6.6 percent in 2014.

(Reporting by Natalia Zinets; Writing by Alessandra Prentice; Editing by Larry King)

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