IMF and Ukraine Reach Agreement for Loan Programme to Support EU Accession
By The International Monetary Fund (IMF) and Ukraine have reached a staff-level agreement, paving the way for talks on a full loan programme that would support Kyiv's economy and its bid to join the European Union. The agreement is subject to approval from IMF management.[0]
According to Bloomberg News, the IMF is exploring a multiyear aid package for Ukraine worth as much as $16 billion to help cover the country’s needs and provide a catalyst for more international funding while Kyiv tries to repel Russian forces.[1] On February 13, an IMF mission, led by Gavin Gray, began policy discussions with the Ukrainian authorities to prepare for the review of Program Monitoring with Board Involvement (PMB).[2]
IMF Managing Director Kristalina Georgieva said, “Ukraine does need the IMF at this very critical time. Financial needs are significant: We put them somewhere between $40-48 billion for this year.”[3] Governor of the National Bank of Ukraine Andriy Pyshnyy posted on Facebook, “The National Bank has a strong position, we have fulfilled all the obligations stipulated by the program. A successful revision of the Program Monitoring will be a bridge to the transition to a new program that will provide funding.”[4]
Gavin Gray, IMF mission chief for Ukraine, said, “The authorities are making progress in reforms to strengthen governance, anti-corruption and rule of law, and lay the foundations for post-war growth, although the agenda of reforms in these areas remains significant.”[5] He added, “A fully-fledged IMF programme would be supportive of the Ukrainian government’s efforts toward EU accession.”
Pyshnyy also said, “We are ready for reforms, we are ready to implement long-term plans, we have a sufficient expert resource, an internal foundation of responsibility for our work before the state, before the people of Ukraine.”[4]
The agreement between IMF and Ukraine sets the stage for a full loan programme that could significantly help the Ukrainian government’s efforts toward EU accession. It comes at a crucial time for Ukraine, which is approaching the first anniversary of Russia's invasion.[3] The IMF estimates that the country could require financial support in excess of $40 billion this year.[6]
0. “Ukraine and IMF move forward towards expanded funding program” Yahoo News, 18 Feb. 2023, https://news.yahoo.com/ukraine-imf-move-forward-towards-053600026.html
1. “Ukraine Latest: US Says Putin Struggles, Swapping Out Generals” Financial Post, 13 Feb. 2023, https://financialpost.com/pmn/business-pmn/ukraine-latest-imf-to-begin-talks-with-kyiv-on-loan-package
2. “IMF Mission Starts Its Work In Ukraine” MENAFN.COM, 13 Feb. 2023, https://menafn.com/1105564545/IMF-Mission-Starts-Its-Work-In-Ukraine
3. “Ukraine ‘weeks' away from full IMF support program, says fund chief” CNBC, 18 Feb. 2023, https://www.cnbc.com/2023/02/18/ukraine-weeks-away-from-full-imf-support-program-says-fund-chief.html
4. “National Bank fulfils conditions of IMF’s program monitoring, ready to discuss new one — governor” Ukrinform, 13 Feb. 2023, https://www.ukrinform.net/rubric-economy/3669680-national-bank-fulfils-conditions-of-imfs-program-monitoring-ready-to-discuss-new-one-governor.html
5. “Ukraine Clears Hurdle to Begin Talks on Fully Fledged IMF Loan” Yahoo Canada Finance, 17 Feb. 2023, https://ca.finance.yahoo.com/news/ukraine-clears-hurdle-begin-talks-191109489.html
6. “IMF, Ukraine Meet in Warsaw, Reach Staff-level Agreement. During a Meeting in … – Latest Tweet by The” LatestLY, 17 Feb. 2023, https://www.latestly.com/socially/world/imf-ukraine-meet-in-warsaw-reach-staff-level-agreement-during-a-meeting-in-latest-tweet-by-the-kyiv-independent-4855474.html
