Despite Russia's objections, the IMF will provide Ukraine with $1 billion
On Wednesday, the Board of Directors of the International Monetary Fund (IMF) issued a positive decision on the allocation of financial assistance to Ukraine. This was announced by Ukrainian President Petro Poroshenko.
“The IMF Board of Directors have just now adopted a positive decision to extend the program of cooperation with Ukraine and to allocate financial assistance,” Poroshenko posted on Twitter.
The press service of the Ukrainian President quoted Poroshenko as saying that this decision paves the way for the allocation of financial assistance to Ukraine in the amounts of $1 billion from the US and €600 million from the EU. According to him, as a result of this, the hryvnia should stabilize, macroeconomic stabilization should occur, and “the first sprouts of economic growth” should be seen.
The deputy head of the National Bank of Ukraine (NBU), Oleh Chury, had previously announced that the third tranche of $1 billion from the IMF should be received by the end of September.
Meanwhile, the executive director of the Fund from the Russian Federation, Alexei Mozhin, stated that Russia was the only country that voted against the allocation of the next tranche of financial assistance to Ukraine. Moscow has repeatedly spoken out against this as Kyiv has not fulfilled the obligation to repay a debt owed to them.
The four-year program of the IMF’s financial assistance provides for the allocation of $17.5 billion to Ukraine. Kyiv received the first tranche in the amount of $5 billion in March 2015. The second tranche amounting to $1.7 billion was received in August that same year. Ukraine is now waiting for the third installment, which was postponed.
Bloomberg reported that the Fund's Executive Board temporarily allowed Ukraine not to comply with the performance criteria related to the volume of international reserves, arrears on external payments, and restrictions on the foreign exchange market.