Officials from the International Monetary Fund (IMF) and the Ukrainian government have finalized a staff-level agreement on updated economic policies, a move that could unlock approximately $880 million in financial assistance pending approval by the IMF’s board.
Following six days of discussions between Ukrainian officials and IMF staff in Warsaw, Poland, as part of the third review of Ukraine’s $15.6 billion 4-year Extended Fund Facility (EFF) Arrangement, the agreement was reached.
The IMF noted that Ukraine’s progress in implementing the program was generally on track, with Kyiv meeting all structural benchmarks under the review and all but one quantitative performance criteria.
While Ukraine’s economy exhibited robust growth, reduced inflation, and bolstered reserves in 2023, the outlook for 2024 remains uncertain amid ongoing conflict with Russia.
Ukrainian Prime Minister Denys Shmyhal expressed optimism about the agreement, highlighting the anticipated $5.4 billion in IMF assistance for 2024, which would allow Ukraine to focus its domestic resources primarily on defense.
The agreement, reported by Reuters earlier in the day, awaits approval from IMF management and the fund’s executive board, expected to be deliberated in the latter half of March.
Despite a minor shortfall in tax revenues due to border blockades, the IMF emphasized that the EFF serves as a vital framework supporting Ukraine’s economic program, particularly during times of heightened uncertainty.
Gavin Gray, the IMF official leading the talks in Warsaw, praised Ukrainian authorities for meeting the majority of the review’s benchmarks, underscoring the program’s role as a stabilizing force amid volatile economic conditions.
