IMF announces new $17.5bn bailout package for Ukraine

February 13,2015

The International Monetary Fund announced a new $17.5 billion lifeline for Ukraine, which would bring the total bailout package to $40 billion. The new sum would be a four-year program.

Lagarde will propose the $17.5 billion expansion program to the IMF by the end of the month.

“The program is not yet approved by the governing council. I hope to offer it for approval by the end of February,” she said Thursday.

“This new four-year arrangement would support immediate economic stabilization in Ukraine as well as a set of bold policy reforms aimed at restoring robust growth over the medium term and improving living standards for the Ukrainian people,” Lagarde said in a statement.

In return Ukraine will have to present a “program of deep economic reforms,” which includes the whole economy and a plan to transform Naftogaz, Ukraine’s state oil and gas company.

“It’s a large program, it’s a longer-term program than the previous one, which was a traditional SBA [Stand-By Arrangement] for two years,”the IMF chief said.

“It’s ambitious, it’s not without risk, but we believe it is a realistic set of macroeconomic framework, ambitious reforms, but reforms the authorities feel confident they can deliver,” Lagarde said.

IMF head Christine Lagarde didn’t answer the question as to whether the four-year international bailout program for Ukraine included credits from Russia.

“The sum includes funds from the IMF and the EU, and also bilateral and multilateral loans.”