IMF board approves $15.6bn Ukraine loan package

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The Russian invasion has devastated Ukraine's economy, causing activity to contract by around 30 percent last year, destroying much of its capital stock and fuelling poverty, according to the IMF. The 48-month Extended Fund Facility programme approved by the fund's board is worth roughly $15.6bn. It forms the IMF's portion of a $115bn overall support package comprised of debt relief, grants and loans by multilateral and bilateral institutions, the organisation confirmed in a press conference Friday.

The IMF recently changed its rules to allow loan programmes for countries facing "Exceptionally high uncertainty".

The EFF loan is the first major financing programme approved by the IMF for a country involved in a large-scale war.

If the current conflict were to continue into 2025, it would raise Ukraine's financial needs from $115bn to around $140bn, said the IMF. Kyiv had already agreed on the loan programme with international donors about two weeks ago.

An IMF official said the $115bn package includes the IMF loan, $80bn in pledges for grants and loans from other countries and $20bn worth of debt relief commitments.

The IMF said that multiple stakeholders, including international financial institutions, private sector firms, and most of Ukraine's official bilateral creditors and donors, are supporting a two-step debt treatment process for Ukraine that includes adequate financing assurances on debt relief and concessional financing during and after the programme.

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