The IMF has approved changes to the Fund’s financial guarantee policy and will now approve a new loan program for Ukraine.
The Board of Directors of the International Monetary Fund (IMF) has approved changes to the Fund’s financial guarantee policy, which will now allow the approval of a new loan program for Ukraine. The IMF reported this.
The changes are applied in situations with very high uncertainty associated with exogenous shocks that are beyond the control of the country’s authorities and create higher than usual risks.
Previously, Country Crisis Fund rules did not allow for non-emergency loans to countries facing significant uncertainty: as a result of major wars or long-term natural disasters caused by climate change.
The IMF said the revised rules would remove major obstacles to such loans. It will also allow official bilateral creditors and donors to provide a pre-guarantee for IMF repayment and debt cancellation to the borrowing country.
As previously reported, in August last year, the IMF provided Ukraine with $2.7 billion in emergency financing. The fund also said they consider a full loan for Ukraine possible, although it is not usually granted to warring countries.
Ukraine expects that the new IMF program will be implemented in two phases – military and post-war.
In addition, The Financial Times said a new four-year $15.6 billion loan program for Ukraine is about to be announced.
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Source: korrespondent
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