KYIV: The International Monetary Fund (IMF) and Ukraine have agreed to continue a four-year programme with a total volume of over €15 billion (US$15.5 billion), reported German news agency (dpa).
“Effective and well-coordinated cooperation with the IMF is one of the key elements in maintaining Ukraine’s financial stability in the face of uncertainty. Ukraine continues to work fruitfully on the implementation of the jointly agreed reforms,“ Finance Minister Serhiy Marchenko said, according to a statement.
Kyiv expects further payments of around €5.4 billion as part of the agreements made in 2023. The IMF programme is part of an international support package amounting to slightly more than €142 billion for the years 2023 to 2027.
The Ukrainian central bank said risks to the country’s economic outlook “remain exceptionally high” in its statement. Without foreign aid, Ukraine’s budget deficit would stand at 19.6 per cent of the country’s gross domestic product (GDP). A value of three per cent is considered the threshold for financial stability.
The state budget of the country invaded by Russia in 2022 is financed about half from abroad. Annually, around €40 billion of foreign funds are necessary.
A potential loss of US support could put Kyiv under severe pressure. According to the Ukrainian Finance Ministry, the United States contributed an average equivalent of about €10 billion annually to Ukraine’s budget.
The previous day, talks between US President Donald Trump and Ukrainian President Volodymyr Zelensky at the White House were cut short, with a planned cooperation agreement in the commodity sector left unsigned.
