Ukraine to get aid package to rebuild war-torn economy in IMF first

A residential building in Avdiivka is razed to the ground after shelling and airstrikes from Russian troops on Friday, March 17. Photo credit: National Police of Ukraine / Wikimedia Commons

IN a historic move, the International Monetary Fund (IMF) reached an agreement to provide Ukraine with a whopping $15.6bn (£12.8bn) of funding.

The decision, announced on Wednesday, March 22 is the first time that the IMF has loaned money to a country embroiled in war, and it is set to be approved in the coming weeks, subject to approval by the company’s executive board.

This funding will be a lifeline for Ukraine, which has been ravaged by Russia’s invasion, devastatingly causing the economy to shrink by 30 per cent in 2022. The IMF recently amended its rules to allow loans to countries facing “exceptionally high uncertainty”, which is why Ukraine qualifies for this massive aid package, although the IMF did not explicitly refer to Ukraine when making the rule change.

The US Treasury Secretary, Janet Yellen, called for an “ambitious and appropriately conditioned IMF programme” to support Ukraine’s reform efforts during a surprise visit to Ukraine last month. The US is the IMF’s largest shareholder and has already provided over €103 billion to Ukraine in 2022 alone.

The funding is a welcome boost to help Ukraine to finance critical rebuilding projects.