The International Monetary Fund’s executive board on Thursday approved the third review of Ukraine’s $15.6 billion loan program, allowing $880 million to be released for budget support, bringing the total disbursement to $5.4 billion, the International Monetary Fund said.
The global bank said risks to Ukraine remained unusually high, particularly uncertainty surrounding the war with Russia and the outlook for external financing, although head of delegation Gavin Gray said the fund still expected the war in Ukraine to continue in 2024. End before the end of the year.
Gray told reporters that Ukraine’s overall performance on the International Monetary Fund’s Extended Fund loan program remains strong in its first year and that Kyiv has met all but one of the quantitative performance criteria. The tax revenue involved in this misstep was very small.
Gray said Ukraine should receive the funds within the next few days. This should be welcome news as Congress continues to debate whether to approve a $61 billion supplemental aid package to Ukraine. Gray said the IMF would have to study the impact on Ukraine’s debt levels if U.S. lawmakers decide to convert some of the funds into loans rather than grants.
The International Monetary Fund has approved a new debt sustainability analysis for Ukraine that does not substantially change the macroeconomic analysis but excludes Ukrainian authorities question about $3 billion in Russian Eurobond debt.
She told reporters that credible progress was being made on restructuring Ukraine’s commercial debt and the IMF expected technical discussions on the issue to begin in the coming weeks.
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The International Monetary Fund said its lending program continues to provide strong support to Ukraine’s economic plans, which remain on track and are now in their second phase despite the extremely challenging circumstances caused by Russia’s war in Ukraine. Three years.
The International Monetary Fund said that while Ukraine’s economy was more resilient than expected in 2023, headwinds returned in 2024, with growth expected to slow to 3% to 4% due to war uncertainty and supply constraints becoming tighter. .
Kristalina Georgieva, managing director of the International Monetary Fund, said in a statement: “Looking ahead, given the outlook mainly due to the extremely high uncertainty associated with the war and the possibility of delays in external financing, Risks are extremely high and the recovery is expected to be somewhat slower.”
“Authorities should remain alert to these risks. It is also important that external financing committed to Ukraine by all donors be disbursed in a timely and predictable manner to safeguard Ukraine’s hard-won macroeconomic stability.”
A key factor for Ukraine’s future remains the return of some 6.5 million people, mainly women and children, who fled the country due to the war and remain outside the country.
Nadeem said the IMF still expected net losses to be about 2 million, but that number could increase as the war drags on.
“It’s a really challenging situation that really puts a damper on society,” she said, noting that Ukraine had an aging society even before the war.
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