The International Monetary Fund announces outline plans to lend $16.5 billion to Ukraine to support a policy package the country has assembled to maintain economic and financial stability. Ukraine's economy has been affected by the global financial turmoil and falling steel prices.
Mr. Dominique Strauss-Kahn, Managing Director of the International Monetary Fund (IMF), issued the following statement on Ukraine today:
"An IMF staff mission and the Ukraine authorities have today reached agreement, subject to approval by IMF Management and the Executive Board, on an economic program supported by an SDR 11 billion (US$16.5 billion) loan under an 24-month Stand-By Arrangement. Consideration by the Board would follow approval of legislative changes to Ukraine's bank resolution program.
"Ukraine has developed a comprehensive policy package designed to help the country meet the balance of payments needs created by the collapse of steel prices, and the global financial turmoil and related difficulties in Ukraine's financial system. The authorities' program is intended to support Ukraine's return to economic and financial stability, by addressing financial sector liquidity and solvency problems, by smoothing the adjustment to large external shocks and by reducing inflation. At the same time, it will guard against a deep output decline by insulating household and corporations to the extent possible.
"The IMF is moving expeditiously to help Ukraine, and this program is focused on the essential upfront measures needed to maintain confidence and economic and financial stability. The strength of the program justifies the high level of access, equivalent to 800 percent of Ukraine's quota in the Fund," Mr. Strauss-Kahn added.