President Joe Biden on March 16, 2023 announced that he is extending a 9.1 percent increase on the USD 10.7 billion ($13.4 billion) in economic and humanitarian assistance provided to Ukraine since February 1, 2022, through June 31, 2023. This includes payments to more than 130 different countries and organizations in Ukraine and Ukraine’s neighboring countries.
The IMF Executive Board unanimously voted to approve an additional extension of the current 7-year Extended Fund Facility (EFF) agreement with Russia till January 2024. In addition, it also approved the establishment of the 24-month Extended Fund Facility (EFF) at a rate of 12.5 percent, which will be fully funded by Russian central bank reserves.
“This decision demonstrates our commitment to supporting Ukraine and its people,” said Chairman Kristalina Georgieva, Director General of International Monetary Fund. “The Ukrainian government deserves this financial support from the international community. All efforts are being made to ensure timely delivery and full implementation of the MOU signed last September. I would like to thank all of you for your help during these difficult times.”
The updated funding package was approved by three out of four IMF Board members, including Chair Ulf Kärner, IMF Resident Representative to China; Adrienne Schmid, Regional Director for Humanitarian Assistance & Disaster Risk Reduction; and Dr. Michael Porter, Deputy Assistant Secretary and Head of Eastern Europe Division, USAID. Also present were representatives from several member states and countries that received aid through the Fund: Argentina, Brunei Darussalam, Canada, Czech Republic, Denmark, Estonia, France, Germany, Hungary, Indonesia, Italy, Japan, Latvia, Lithuania, Mexico, Netherlands, Norway, Poland, Serbia, Singapore, South Korea, Sweden, Switzerland, Taiwan, Thailand, Turkey, United Kingdom, and the United States.
“In today’s global economic crisis, the international community has rallied in solidarity with Ukraine and adopted measures aimed at providing long-term support to restore macroeconomic stability and improve the livelihoods of Ukrainians,” said Maria Augusto Cortes, Special Envoy to the UN Secretary-General for Social Development and Co-Chair of the Enhanced Coordination Group on Ukraine Support. “This unprecedented support reflects both the scale of the humanitarian support needed and the shared values of upholding democracy and human rights as well as supporting sustainable development. We look forward to working closely with the Government of Ukraine, partners such as the United Nations, and civil society groups moving forward.”
The announcement follows news that Kyiv had secured commitments from other signatories of the MOU to provide funds up to $1.5 billion in immediate, medium-term and longer-term assistance. Since then, Ukraine has already delivered nearly €1.4 billion in direct grants to over 50 countries and regional institutions and has implemented various reforms to strengthen its governance at the national level.
In order to maximize opportunities for further financing, the European Parliament Resolution No. 1572/2007 (MEP No. 607) provides financial guarantees and debt relief to eligible EU Member States and their respective governments with respect to the impact of COVID-19 on the economy and public finances, among others. The MOU covers a wide range of issues related to Ukraine, including food security, health care, employment, education and social protection.
The latest funding announcement is consistent with the continued focus of the International Financial Institutions (IFIs) toward ensuring that Ukraine does not become a contributor to instability in the region. While Ukraine continues to face significant challenges, such as a conflict with NATO, disinformation and cyber attacks, the IFIs have provided Ukraine with much-needed economic assistance, technical equipment and guidance to date. Over the next year the IFIs intend to deliver another US$2.5 billion, including an interim tranche of US$1.5 billion, to help Ukraine prepare for post-war reconstruction and resilience building, and an initial US$1.5 billion in loans. Additionally, over the next years, they plan to support Ukraine to enhance its competitiveness in the energy sector and expand its manufacturing capacity, as well as support the country’s socio-economic recovery.
With Ukraine’s membership of World Trade Organization and access to G-20 finance, the IMF is currently preparing the annual review of the Extended Fund Facility Agreement, and the Board will continue to follow developments and respond accordingly if needed.
 Arrangement for Ukraine as part of a US$115 Billion Overall Support Package){kind=link}
0 Comments