KYIV, June 7 - Parliament on Thursday voted to approve legislation to create an independent anti-corruption court, raising cautious hopes that Ukraine was on a path to unlock a $17.5 billion IMF loan.

The IMF said on Thursday it would assess whether a law Ukraine passed to create a special anti-corruption court would ensure the establishment of an independent and trustworthy institution.

President Petro Poroshenko said Thursday the legislation was “fully in line with the recommendations” of western backers.

Payment of a $2 billion installment of the IMF’s program for Ukraine has been held up since last year as Kyiv stalled on setting up the court.

Officials and opposition lawmakers said the law approved included amendments reached overnight as a compromise with the IMF.

But Parliament also increased doubts over the country’s commitment by confirming the ousting of Oleksandr Danyliuk from his position as finance minister.

IMF spokesman Gerry Rice said the IMF’s staff had expressed concern about the institutional role of the Ukrainian finance ministry, after Danylyuk was sacked following a public spat with the prime minister.

Danyliuk, the country’s lead negotiator with the IMF and seen as a champion of reforms, has clashed with prime minister Volodymyr Groysman, who on Wednesday asked parliament to vote to remove him from office.

Danyliuk said his falling out with Groysman was rooted in his refusal to accept “political corruption”.

Poroshenko said the anti-corruption court law did not violate Ukraine’s sovereignty and would “fully comply” with the constitution.

Pointing to previous steps to set up an anti-corruption bureau, an anti-corruption prosecutor’s office and ensure asset declarations for public servants, he said: “Today we complete the creation of an effective and transparent anti-corruption infrastructure.”

Ukraine's economy has been in turmoil ever since the Euromaidan protests in 2014 that triggered Russian annexation of its Crimean peninsula and a war with Russian-backed forces in the country's east that has engulfed 7 percent of its territory and killed more than 11,000 people.

Ukraine managed to successfully sell $3 billion in dollar bonds in 2017, helping mitigate a bit of its debt burden, but the recent sell-off in emerging markets is making borrowing costs far more expensive. The Institute for International Finance recently named Ukraine among the five most vulnerable emerging markets to a strengthening dollar and rate rises. It currently has more than $20 billion in outstanding dollar debt. (nr/ft/ez)