Monitoring Program Approved By IMF To Aid Ukraine In Obtaining Donor Funding

 As the war-torn nation needs more than $40 billion this year, the International Monetary Fund (IMF) said on Monday that it had approved an economic monitoring programme for Ukraine. This programme could assist Kyiv gain funds from donors.

Following the Russian invasion, the IMF noted in a statement that the monitoring programme "is meant to help Ukraine maintain stability and stimulate donor financing amid very substantial balance of payment needs and exceptionally high risks."

According to the IMF, the Ukrainian government is dedicated to making economic and financial reforms, particularly in the areas of tax collection, the domestic debt market, transparency, and the independence of the central bank.

According to the Program Monitoring with Board Involvement (PMB) scheme, they have four months to demonstrate their success.

According to Gavin Gray, the IMF's head of mission for Ukraine, the framework of policies being overseen by the organisation intends to open doors for funding, which "may come from numerous sources."

According to Gray, Ukraine needed between $40 billion and $57 billion to satisfy its operating and budgetary needs in 2023.

It would "give the donors the confidence to offer resources" if the IMF's suggestions were followed, he claimed.

According to IMF First Deputy Managing Director Gita Gopinath, the invasion by Russia "continues to have a devastating social and economic impact on Ukraine," with increasing civilian casualties and a third of the population displaced.

Gopinath said, "Despite all these pressures, the authorities have mostly maintained macroeconomic and financial stability, and they are dedicated to continuing to adapt policies to rapidly changing conditions, especially in the face of a severe downside scenario.

For the government's policy to be successful, "significant and dependable external financial support will be essential, and front-loaded payouts will help resolve pressures in early 2023," she said.

She noted that if Ukraine follows the monitoring plan properly, it "should assist pave the road toward a possible full-fledged IMF-supported programme."

Gray emphasised that it was "too early" to estimate the size of the IMF programme. Since the beginning of the Russian invasion of Ukraine in February, the IMF has given Kyiv $2.7 billion in emergency assistance. Just recently, the European Commission suggested providing loans totalling 18 billion euros in 2023.