IMF to review new loan agreement for Ukraine in coming days

The International Monetary Fund has said its Executive Board will consider a new US$8.1 billion loan programme for Ukraine in the coming days.

Source: Reuters

Details: If approved, the new programme would replace the current US$15.5 billion IMF arrangement. It is intended to support Ukraine's economic stability and public spending as the country enters the fifth year of Russia's full-scale war.

IMF spokesperson Julie Kozack said Ukraine had met the prior conditions required to move forward with the request, including submitting draft legislation on the labour code and adopting the state budget.

She said that Ukraine's economic growth in 2025 is expected to be below 2%. The country's economy is expanding more slowly and with higher budgetary expenditure due to the war.

Quote from Kozack: "Russia's invasion continues to take a heavy toll on Ukraine's people and its economy."

Background:

• The IMF agreed to drop the prior actions required for a new US$8.1 billion lending programme for Ukraine, removing requirements on VAT for sole traders, duties on parcels, a tax on digital platforms and the retention of the wartime levy.
• It was also reported that the IMF Board of Directors may approve a new four-year Extended Fund Facility (EFF) programme for Ukraine in February, but this will depend primarily on whether Ukraine has fulfilled the previously agreed prior actions.

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