Remarks by the IMF’s Managing Director Kristalina Georgieva at the Third Ministerial Roundtable Discussion for Support to Ukraine
IMF News, April 12, 2023
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- Published: April 12, 2023
Context and recent observations
- Delivered "As Prepared for Delivery" on April 12, 2023.
- Noted devastating missile attacks on electricity and other critical infrastructure, causing loss of lives and hardship.
- Reported first-hand observations from a February visit to Kyiv and Irpin:
- Disturbance at the cruelty of the war; specific mention of a child's drawing of a tank.
- Impressed by "the remarkable resilience of the Ukrainian people and their determination to overcome the impact of the war."
- Shops open, people working, banks operating, and companies and households paying taxes.
- Example of recovery: a waste water treatment plant in Irpin that was bombed was "completely restored and fully operational, and also freshly painted."
- Digital technology has improved access to social and administrative services compared to before the war.
- Most businesses have fully resumed operations; some are expanding thanks to rapid restoration of power, water, and heat.
- Engagements with women leaders, members of parliament, and businesspeople who showed confidence in the country's future.
IMF program, approvals, and financing packages
- IMF Board approved a new four-year program for Ukraine under the Extended Fund Facility (EFF) for a total of US$15.6 billion.
- Upon approval on March 31, the IMF disbursed the first tranche of US$2.7 billion.
- The IMF loan is part of a larger international support package totaling US$115 billion comprising grants and concessional loans from donors, as well as flow relief from debt operations.
- At the start of Russia’s invasion, Ukraine was "counting money by the week"; by the last roundtable the needs for 2023 were discussed and a multi-year framework was developed.
Program goals, design, and conditionality
- Stated goal of the IMF program:
- Support Ukraine in sustaining economic and financial stability.
- Carry out critical reforms to promote growth.
- Advance accession to the EU.
- Program design considerations:
- Tailored to work under different potential scenarios given the ongoing war and "conditions of exceptionally high uncertainty."
- Aimed to restore macroeconomic stability and achieve debt sustainability.
- Framework designed to encourage private investors to play an active role in recovery and reconstruction.
- Emphasized policy risks and the importance of external financing:
- Critical role of timely disbursement of financing by external partners to avoid resorting to sub-optimal policies such as monetary financing.
Reconstruction, coordination, and next steps
- Acknowledged work by the World Bank, European Commission, and Ukrainian authorities on the latest damage and needs assessment and identification of critical needs, noting alignment with on-the-ground observations in Kyiv.
- Highlighted challenges:
- Advancing key projects during wartime and securing timely, sufficiently concessional financing.
- Policy stance on reconstruction projects:
- Such projects are "vital to support growth and address essential needs."
- Commitment to work closely with Finance Minister Sergii Marchenko and his team to ensure essential projects can be integrated into the financing envelope under the EFF "without jeopardizing the hard-won efforts to restore macroeconomic stability and debt sustainability."
- Closing appeal: work ahead should "be soonest carried out in peace."
Source: Remarks by the IMF’s Managing Director Kristalina Georgieva at the Third Ministerial Roundtable Discussion for Support to Ukraine (April 12, 2023).