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20 Apr, 2022 15:50

IMF to expedite $5 billion loan to Ukraine

The head of the fund said the aid would keep Ukrainian economy afloat
IMF to expedite $5 billion loan to Ukraine

Ukraine likely needs $5 billion a month in financial assistance to keep its economy operating and the immediate priority was finding ways to fill that gap in the next three months, according to International Monetary Fund (IMF) Managing Director Kristalina Georgieva.

The Washington-based financial institution will start work on a future loan program, but it was “unfair” to expect Ukraine to implement a far-reaching package of reforms at the moment, Georgieva told a news conference on Wednesday.

On Sunday, Kiev requested $50 billion in financial support from the Group of Seven (G7) nations and the International Monetary Fund (IMF) to cover a budget deficit largely created by the military conflict with Russia.

Ukraine is also considering issuing 0% coupon bonds to bridge the fiscal gap, as the country is currently facing an estimated $7 billion deficit a month, according to Oleg Ustenko, the top economic adviser to Ukrainian President Volodymyr Zelensky.

The IMF and World Bank have approved more than $2 billion in loans to Ukraine since the beginning of Russia’s military operation in the country. Meanwhile, the World Bank said it was preparing nearly $1.5 billion in extra funds to allow essential Ukrainian government services to continue.

Over the weekend, Georgieva said “more [funds] would be necessary … to keep the economy functioning and prevent inflation shooting up.”

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