IMF $3.9 billion for Ukraine comes just in time for Christmas
Despite martial law operational in several regions of Ukraine and ongoing Russian attacks on Ukraine’s eastern border, the IMF paid out the first installment of $1.4 bln in a 14 month plan for a total of $3.9 bln in funds.
Ukraine has received the first disbursement worth US$1.4 billion under the new Stand-By Arrangement approved by the Executive Board of the International Monetary Fund (IMF) on December 18. In this connection, Ukraine’s international reserves grew to US$20.1 billion, a five-year maximum from January 2014, the National Bank of Ukraine (NBU) said on its website on December 21. The NBU recalled that the new IMF cooperation program with Ukraine provides for disbursements worth US$3.9 billion within 14 months.
In addition, further cooperation with the Fund has opened access to related financing Ukraine is seeking. On December 18, the World Bank’s Board of Directors decided to provide Ukraine with US$750 million in guarantees that would help the Ukrainian government raise capital in international markets in 2019.
It is also reported that thanks to the bailout from international partners – the IMF, the World Bank and the European Commission – Ukraine will be able to end the current year with international reserves worth about US$20 billion, which exceeds the latest NBU forecast. This will let Ukraine maintain the reserves at the proper level in 2019. As UNIAN reported, the IMF’s Executive Board approved a new SBA for Ukraine in the amount of US$3.9 billion. The program focuses on further fiscal consolidation, a reduction in inflation, the strengthening of the financial sector and an improvement in tax administration. In addition, the World Bank’s Board of Directors approved a financial guarantee to Ukraine for US$750 million, which will help raise about US$1 billion on international markets for the country’s national budget. What is more, the European Commission decided last week to give Ukraine the first EUR 500 million tranche of macro-financial assistance (MFA). The second MFA tranche worth another EUR 500 million is expected early next year. Ukraine’s international reserves as of December 1, 2018, were estimated at US$17.712 billion.