- The IMF Board approved a new 48-month extended arrangement under the Extended Fund Facility (EFF) of SDR 11.6 billion (about US$15.6 billion) as part of a US$115 billion total support package for Ukraine.
- Ukraine’s EFF-supported program aims to anchor policies that sustain fiscal, external, price, and financial stability and support economic recovery, while enhancing governance and strengthening institutions to promote long-term growth in the context of post-war reconstruction and Ukraine’s path to EU accession.
- The approval of the EFF is expected to mobilize large-scale concessional financing from Ukraine’s international donors and partners, to help resolve Ukraine’s balance of payments problem, attain medium-term external viability, and restore debt sustainability on a forward-looking basis in both a baseline and downside scenario.
By Caribbean News Global
WASHINGTON / UKRAINE – The executive board of the International Monetary Fund (IMF) on Friday, announced it “approved a 48-month extended arrangement under the Extended Fund Facility (EFF) with an amount of SDR 11.6 billion (577 percent of quota or about US$15.6 billion).”
In a press release, the IMF continued:
“This arrangement is part of a US$115 billion total support package for Ukraine. The Executive Board’s decision allows the immediate disbursement of around SDR 2 billion (or US$2.7 billion).
“The overarching goals of the authorities’ program are to sustain economic and financial stability at a time of exceptionally high uncertainty, restore debt sustainability on a forward-looking basis in both a baseline and downside scenario, and promote reforms that support Ukraine’s recovery on the path toward EU accession in the post-war period. The program, together with financing assurances from the G7, EU, and other donors, is designed to solve Ukraine’s balance of payment problem and restore medium-term external viability. It is in line with the IMF’s policy requirements under the recently modified financing assurances policy (Press Release 23/78) on Upper Credit Tranche-quality financing for countries facing exceptionally high uncertainty, with adequate safeguards for IMF lending.
“In view of the exceptionally high uncertainty faced by Ukraine, its IMF- supported program envisions a two-phased approach.”
Meanwhile, US secretary of treasury Janet L. Yellen released the following statement:
“I welcome the IMF approval of a $15.6 billion economic program for Ukraine. I commend Ukraine’s efforts to pursue broad-based structural reforms under the program despite Russia’s brutal and immoral war and strongly support the program’s measures aimed at securing economic and financial stability. The program’s policies and reforms will support economic growth, strengthen good governance and anti-corruption efforts, and set the foundation for longer-term reconstruction.
“The IMF’s financial assistance is a critical component in the international community’s collective support to Ukraine and will supplement the economic assistance provided by the United States to fund essential services like schools, hospitals, and first responders, as well as the funding from our partners. I want to thank IMF staff for their tireless work and close engagement with the Ukrainian government, the United States, including our dedicated staff at treasury and other partners of Ukraine in bringing this program to fruition.
“I’m also pleased that the group of official creditors to Ukraine, consisting of the United States, Canada, France, Germany, Japan, and the United Kingdom, have provided financing assurances to support Ukraine’s debt sustainability under the IMF program. I call on all other official and private creditors to join this initiative to assist Ukraine as it defends itself from Russia’s unprovoked war. The United States will continue to stand by Ukraine and its people for as long as it takes.”
Group of creditors of Ukraine provides financing assurances to support the IMF’s approval of an upper credit tranche programme