The Executive Board of the International Monetary Fund (IMF) completed the Fifth Review of the extended arrangement under the Extended Fund Facility (EFF) for Ukraine – Ukraine’s authorities can now withdraw another tranche of $1.1 billion (SDR 834.9 million) to Ukraine, IMF press release reported on Friday, 18.
The cash will be channeled for budget support.
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“The economy was more resilient than expected in the first half of 2024, with continued growth, moderate inflation, and adequate reserves bolstered by continued sizeable external support,” the press release writes.
The outlook for 2025 was worsened due to sustained Russian attacks on Ukrainian energy infrastructure and uncertainty about the war. The strikes on energy worsened the real GDP growth to 2.5-3.5 GDP for 2025.
The IMF forecasts Ukraine will end 2024 with 3% real GDP.
Authorities met all end-June and continuous quantitative performance criteria and indicative targets. That includes completed structural benchmarks relating to tax privileges, public companies affected by the war, customs reform and public investment management.
Two structural benchmarks have been reset to allow more time for completion of the reform.
“Ukraine’s financing needs remain large, driven by the continuing war. Timely and predictable external support—on terms consistent with debt sustainability—is essential to closing financing gaps and safeguarding stability. At the same time, decisive domestic revenue mobilization is critical for Ukraine,” the IMF stated in its press release.
The Ruble is Melting, Finally
The Fund also pointed out Ukraine’s successful Eurobond exchange in August, continued exchange rate flexibility under the managed exchange rate regime, stable financial sector, and reform momentum in anticorruption and governance.
Ukraine’s 48-month EFF arrangement with access of US$15.5 billion (SDR 11.6 billion)
was approved on March 31, 2023, and forms part of a US$151.4 billion support package for Ukraine.
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