IMF approves $1.3 billion emergency financing for Ukraine

The International Monetary Fund He said on Friday that his governing council approved Ukraine’s request for an additional $1.3 billion in emergency funds to help sustain its economy as it grapples with the invasion of russia.

The funds will come from a new emergency loan program to deal with food shortages approved by the IMF board last month. Ukraine has also requested oversight of the program with board participation to strengthen political commitment and further catalyze donor support, the IMF said.

IMF Managing Director Kristalina Georgieva celebrated the decision on Twitter. “This is vital to help catalyze urgent donor support and help pave the way for a full fund program,” she said.

The IMF said Russia’s war against Ukraine, which began on February 24, had caused “tremendous human suffering and economic pain,” forecasting a 35% contraction in Ukraine’s gross domestic product in 2022.

Ukrainian President Volodymyr Zelensky thanked the IMF and said the money would arrive in Ukraine on Friday.

The IMF said the disbursement under its Rapid Financing Instrument was equivalent to 50% of Ukraine’s quota, and would help the country meet urgent balance-of-payments needs, including due to a large export deficit. of cereals.

The additional financing would also play a catalytic role for additional financial support from Ukraine’s other creditors and donors, the IMF said.

He added that the Ukrainian authorities deserved “considerable credit for having maintained a significant degree of macro-financial stability in these extremely difficult circumstances.”

The board approved the funds – which are in addition to the $1.4 billion the IMF provided to Ukraine after the Russian invasion.

IMF representatives are scheduled to meet with Ukrainian officials in Washington next week during the annual meetings of the IMF and World Bank.

IMF representatives have praised the Ukrainian government and its central bank for their handling of the economic disruption caused by the Russian invasion of the country in February.