Ukraine braces for IMF assistance

Ukraine braces for IMF assistance



23 січня 2015 года
ICU

Yesterday's news that IMF and Ukrainian authorities would replace the previous SBA (stand-by arrangement) program for an EFF (extended fund facility) harkened back to 1998 when the IMF made a similar move under different circumstances. In both cases, Ukraine's FX reserves had fallen to cover future imports for just a few weeks rather than for the standard minimum of at least three months. The IMF most likely offered access to funding to up to 600% of Ukraine's quota, which currently is XDR1.37bn, net of scheduled repayment (XDR4.2bn or US$5.9bn). In this case, the program size could be as high as XDR12.4bn or US$17.6bn. It is quite unlikely that the IMF will grant exceptional access to Ukraine to the extent of Portugal, which received 2300% of its quota, because it was rarely used and only in cooperation with significant loans from other recognized lenders (WB and EU). For details, please see the table below. In return for extended credit, the IMF would mandate a program of extreme macroeconomic reforms, including first priority fiscal consolidation.

Источник: ICU

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