In 2022, Russia's invasion of Ukraine has had a devastating impact on the economy: activity contracted by 30 percent, a large share of the capital stock has been destroyed, and poverty levels have climbed, said Gavin Gray, an official for the International Monetary Fund.
The programme is designed in line with the new fund's policy on lending under extremely high uncertainty, and strong financing assurances are expected from donors, including the G 7 and EU. According to Gray, the agreement would mobilise large-scale concessional financing for Ukraine from international donors and partners, without giving further details. The funding needs to be approved by the IMF's executive board.
Ukrainian prime minister Denys Shmyhal said the funding would help the country finance all critical expenditure and strengthen its relationship with other international partners Earlier this year, President Joe Biden announced nearly half a billion dollars of US military aid to Ukraine. This was the equivalent of the $112 billion spent by Congress in 2022 alone.
Military aid, which accounts for more than half of US spending on Ukraine, helps with drones, tanks, missiles and other munitions systems, as well as training, logistics and intelligence support.
Money has been pour into the conflict from all over the world since Russia's invasion of Ukraine last February.
Without mentioning Ukraine, the measure applied to countries experiencing exogenous shocks that are beyond the control of country authorities and the reach of their economic policies.