The tough fiscal medicine required to secure a 15.2 billion USD loan agreement with the International Monetary Fund is proving too much for some critics.

But the government defended the deal by noting the money is necessary to avoid bankruptcy and keep the nation’s precarious economy afloat.

A detailed IMF memorandum, published on August 6, outlines the belt-tightening steps that our country is required to take to secure the credit.

The headline overhauls are unpopular natural gas price hikes for consumers and retirement age grows. Gas prices for households will grow 50 percent till April, on top of the 50 percent growth that took effect on August 1, and will continue rising until they reach the import price.

The retirement age for women will increase by six months per year for 10 years, eventually reaching 60.

In a statement on August 10, the Cabinet of Ministers reported the agreement will “help repair the financial system of Ukraine, ensure a stable Ukrainian currency, increase the country’s investment attractiveness and return the trust of the international community.”

The cabinet added the increase in pension age was “in line with global practice” and that help would be provided to pensioners and the needy so that they were not hit by the gas price hikes.

The most vocal proponent of the agreement has been Deputy Prime Minister Sergiy Tihipko, Ukraine’s point man for the International Monetary Fund and head of the Strong Ukraine party, a rival with President Viktor Yanukovych’s ruling Party of Regions.

Tihipko said that, if Ukraine backtracked from its commitments to the IMF as it did during prior loans in 2004 and 2008, “who will continue to take us seriously as a state?”

The IMF demands pension changes, effective in 2011. The first IMF review of the program will take place at the end of September, with the second loan tranche of 1.5 billion USD to be disbursed by November 30, if approved.