IMF board approves release of $880 million for Ukraine

WASHINGTON

The International Monetary Fund's executive board has confirmed it will disburse $880 million to Ukraine in the third phase of a $15.6 billion aid package to support the country's war-torn economy.

"Russia's invasion of Ukraine continues to bring enormous social and economic costs to Ukraine," IMF managing director Kristalina Georgieva said in a statement confirming the board's decision.

"However, macroeconomic and financial stability has been preserved, reflecting skillful policymaking by the Ukrainian authorities as well as substantial external support," she added.

The board's approval comes around a month after an IMF staff visit to Ukraine found that the authorities had met most of the necessary criteria to release the money - aside from a "small miss" on tax revenues due to border blockages.

More than two years since the Russian invasion began, Ukraine still faces near-daily aerial bombardments of its major cities, including the capital Kiev, while the grueling ground war continues in the east of the country.

Despite this, Ukraine's economy proved to be "more resilient than expected in 2023, with robust growth outturns, continued sharp disinflation, and the maintenance of adequate reserves," the IMF said.

"However, headwinds are re-emerging in 2024, with growth expected to soften to 3-4 percent due to uncertainty about the ongoing war and as supply constraints become more binding," it added.

The IMF recently estimated the cost of post-war reconstruction at close to $490 billion.