Tuesday, May 6, 2014

The International Monetary Fund (IMF) has approved a $17.1bn (£10.1bn) bailout for Ukraine to help the country's beleaguered economy. The loan comes amid heightened military and political tension between Ukraine and neighbouring Russia.
The loan is dependent on strict economic reforms, including raising taxes and energy prices.
The money will be released over two years, with the first instalment of $3.2bn available immediately.
The head of the IMF, Christine Lagarde, said the IMF would check regularly to ensure the Ukrainian government followed through on its commitments.
In March Ukraine put up gas prices by 50% in an effort to secure the bailout.
The government has also agreed to freeze the minimum wage.
The bailout had to be approved by the IMF's 24-member board, which includes a Russian representative.
The IMF loan will also unlock further funds worth $15bn from other donors, including the World Bank, EU, Canada and Japan.
Russian recession

In December last year, Ukraine agreed a $15bn bailout from Russia, but this was cancelled after protests forced out pro-Russian President Viktor Yanukovych....
The IMF bailout will also make available $1bn in loan guarantees from the US, which was recently approved by Congress.

"Today's final approval for the $17bn IMF programme marks a crucial milestone for Ukraine," said US Treasury Secretary Jacob Lew in a statement.
He added that the bailout will "enable Ukraine to build on the progress already achieved to overcome deep-seated economic challenges and help the country return to a path of economic stability and growth".
Earlier on Wednesday, an international conference in London ended with a commitment to help Ukraine recover tens of billions of dollars worth of assets which were allegedly stolen by the ousted President Yanukovych and his allies.

The IMF warned that Russia was "experiencing recession" because of damage caused by the Ukraine crisis.

1 comment:

Anonymous said...

In recent days, security forces have launched a crackdown on pro-Russian separatists in the east of the country, triggering clashes outside the town of Sloviansk.

Interior Minister Arsen Avakov said on Tuesday that four soldiers and an estimated 30 separatists had been killed in the "anti-terrorism operation".

He said that up to 800 well-trained militants armed with large-calibre weapons and mortars were hiding among civilians in the town, where government buildings have been seized and checkpoints set up.

A Russia Today reporter in Sloviansk said residents were stockpiling food and there were barricades on almost every road.

Meanwhile, many flights in and out of Donetsk were suspended. The Ukrainian aviation authorities gave no reason for the move.