The International Monetary Fund has completed the first review of the Stand-By Arrangement and approved the allocation of the second tranche worth $700 million to Ukraine, as well as extended the programme until the end of June 2022.

This will allow Ukraine to receive the next IMF tranches totaling SDR 1.6 billion, i.e., more than USD 2 billion.

“The IMF’s decision is especially important in the face of the increasing threat of Russia’s further aggression, which makes it impossible to place government bonds on terms favourable for Ukraine,” said Hlib Vyshlinsky, Director of the Centre for Economic Strategy.

In addition, the priority areas of the Stand-By Arrangement are strengthening the NBU independence, achieving the 5% inflation target, reforming the public banking sector, and further implementing corporate governance reform.

As a reminder, the SBA with the IMF is designed for 18 months with an access of SDR 3.6 billion (equivalent to USD 5 billion). It was approved on 9 June 2020. The programme aims to support Ukraine in overcoming the effects of the COVID-19 pandemic and contains a number of requirements for important structural reforms to reduce key vulnerabilities.

Natalia Tolub

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