Advanced search

From February 2022 to February 2024, Ukraine’s state debt increased by $50.4B. To reduce debt pressure on the state budget, Ukraine has worked to attract loans on preferential terms. For example, the last loan from the World Bank has a grace period until 2030, and repayment extends to 2057. The rates are also preferential (linked to the interbank market rates in the guarantor countries). Also, most external debt has been restructured with official creditors from the G7 and the Paris

Ukraine and the US signed an agreement to postpone public debt payments with a group of Ukraine’s creditors from the G7 countries and the Paris Club. At the same time, the debt sustainability analysis (DSA) of Ukraine carried out by the IMF provides for a partial write-off of the debt, so it is likely that such a write-off will be one of the points of Ukraine’s proposal to restructure its Eurobonds, which is expected soon. “The IMF sees our national

In March, the state budget’s general fund received ₴158.1B (over $4B) in taxes, fees, and mandatory payments. About ₴105.7B was received from taxes and ₴45.8B from the State Customs Service, but due to the border blockade, the state budget missed out on ₴6.3B in customs payments. At the same time, ₴3.1B came in the form of grants from foreign partners. According to March’s results, the general and special funds of the state budget received ₴225.9B in taxes, fees, and other

At the first auction, after the NBU decided to lower the discount rate, the Ministry of Finance lowered rates for OVDP by 20-30 basis points. The secondary market also reacted by lowering rates for hryvnia securities, noted the Head of Corporate Analysis at the ICU, Oleksandr Martynenko. He suggests that this is just the beginning and that yields will continue to move downward, leading to increased competition among banks for the instruments offered by the Ministry of Finance. At the

As Deputy Chairman of the Finance Committee Yaroslav Zheleznyak said, the lack of financial aid from international partners next year may amount to $10-15B, and the hidden additional state budget deficit this year amounts to ₴300-400B without considering additional mobilization. “I mentioned this so that we all have a clear understanding that business support this year is a condition for survival next year,” he said. In the fall of 2023, the Ukrainian Parliament adopted the state budget for 2024 with

As a memorandum with the IMF states, “Limited domestic consumption and growing domestic production limited the need for gas imports during the last heating season. For the next heating season of 2024/25, authorities do not plan additional gas imports for domestic consumption, due to Naftogaz’s expansion of production capacity”. At the same time, it is noted that Ukraine will be able to receive three billion cubic meters of additional gas for storage by non-residents for the needs of EU countries.

According to the IMF, the expectation for nominal GDP in 2024 has increased to ₴7.75T from the ₴7.64T predicted in December last year’ However, 2025’s forecast remains almost unchanged at ₴8.86T. At the same time, this year the economy’s growth rate will decrease by 3-4% compared to 5% last year. The IMF improved its inflation forecast for this year to 8.5% from 9.5% and real wage growth to 9.8% from 8.5%. However, the unemployment estimate worsened to 14.5% from 13.9%.

According to the IMF, in a negative scenario, the war will end by the end of 2025 and not at the end of 2024 as in the base scenario. At the same time, “the shock will begin in the second quarter of 2024” due to the intensification of the war. “This would lead to a sharp decline in real GDP of 4% in 2024 (compared to 3-4% growth in the baseline scenario) and zero growth in 2025,” the document says.

Deputy Minister of Economy Oleksiy Sobolev voiced this prediction at the presentation of the Monitoring of the Implementation of the Conditions of the IMF Program and Support from the EU. According to him, the document contains more than 150 indicators in 69 reform directions, which must be implemented by 2027. It is noted that in 2024, the Ministry of Economy must fulfill seven indicators. The priority task is developing and approving the Integrated National Energy and Climate Plan. An equally

The National Bank assumes that Ukraine will receive over $10B in external funding in March-April. A favorable decision by the IMF board of directors will allow Ukraine to receive the fourth tranche of $900M under the EFF program on March 21. The NBU also notes that at the end of February the EU Council approved the launch of the Ukraine Facility instrument with a total volume of €50B, and Ukraine should receive transitional financing in the amount of €4.5B in

The Executive Board of the IMF will hold a meeting on the third review of the Extended Financing Program (EFF) and the allocation of the next tranche for Ukraine in the second half of this month, said the director of the IMF’s Communications Department, Julia Kozak. The  board will consider the agreements on the third review of the EFF program that were reached at the staff level on 23 February. In this context, a decision will be made on allocating

An expert from the Center for Economic Strategy said: “The first two months of 2024 were not very fruitful for Ukraine in terms of international aid. As of February 23, we had received only $436M in funding from Japan.” At the same time, he noted that Ukraine has already agreed on another review of the IMF program at the expert level, which will allow us to receive $890M. By the end of March, Ukraine also expects to receive an additional

Bloomberg reports that Ukraine has reached a deal with the IMF, though the Fund’s executive board still needs to ratify it. The agreement is the result of the ongoing discussions over the past two weeks concerning whether Kyiv will be able to finance its activities in the absence of US aid. If the US Congress does not approve more than $60B in assistance to Ukraine for this year, IMF funds will probably become Kyiv’s second largest source of financial aid

The IMF has announced the official opening of a Ukraine Capacity Development Fund (UCDF) to support economic and financial reforms in Ukraine over the next five years. The fund’s goal is to attract $65M from donor countries. The fund’s initial resources amount to $16.5M. Latvia, Lithuania, the Netherlands, Slovakia, and Japan provided these funds. It is noted that the fund’s initial work plan envisages the allocation of $27.5M to support the main directions for Ukraine’s reform program. Areas to be

The IMF team will participate in the inaugural meeting of the Steering Committee of the Fund for the Development of Potential of Ukraine, which the IMF administers. After these meetings, on February 17, the IMF mission led by Gavin Gray will begin discussions with Ukrainian authorities in Warsaw in the context of the third review of the EFF’s extended financing program, which was approved on March 31, 2023. Ukraine has already received three tranches totaling more than $3.5B. Another tranche

The National Bank of Ukraine reported that the Financial Stability Board approved a conceptual memorandum for creating a fully functional war risk insurance system in Ukraine. This is stipulated by the Memorandum on Economic and Financial Policy between Ukraine and the IMF. The model of war risk insurance defined by the concept provides for the introduction of mandatory and voluntary insurance. The proposed model will work with the participation of local insurers, international reinsurers, and the state in the form

The International Monetary Fund raised its forecast for global economic growth in 2024 by 0.2 percentage points to 3.1%. In 2025, an increase of 3.2% is expected. The outlook has improved from last October due to stronger-than-expected US resilience and financial support in China. However, the forecast for 2024-2025 is lower than the historical average (2000-2019) of 3.8% due to increased rates by central banks to fight inflation the end of budget support amid high debt. “The global economy is

The pace of global economic growth will slow in 2024, according to more than half (56%) of the chief economists surveyed as part of the World Economic Forum (WEF) in Davos. The remaining respondents expect the global GDP growth rate to remain at 2023’s level or to accelerate. The IMF estimates that the global economy will grow by 2.9% in 2024 after growing by 3% in 2023. Economists are most pessimistic about Europe – 77% believe that growth in the

The top manager of the IMF, Julia Kozak, noted that the fund believes that decisions on the confiscation of Russian assets should be made by the countries where the frozen funds of the Russian Federation are placed, and is following current discussions to assess the possible impact of these decisions on the international financial system. In response, the Russian Federation is actively preparing to challenge any steps taken by Western countries to confiscate the frozen assets of its central bank,

The IMF is focused on supporting the work of the Ukrainian state and its social obligations, and not on the military sphere, said Alfred Kemmer, director of the European Department of the IMF. “I always emphasize very clearly – we expect domestic revenues to be generated. Strengthening the economy, structural reforms that support economic activity, and better governance will provide additional tax revenues,” said Kemmer. He emphasized that donors focus their economic support specifically on the budget’s social component and