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IMF agrees bailout for Ukraine | IMF agrees bailout for Ukraine |
(about 4 hours later) | |
The International Monetary Fund has agreed a $14bn to $18bn bailout for Ukraine, a deal that will unlock further credits to reach a total of $27bn over the next two years. | |
The agreement is intended to help Ukraine meet debt payments looming this year after months of anti-government protests that culminated in the overthrow of President Viktor Yanukovych and a standoff with Moscow in which Russia annexed the Crimea region. | |
"The mission has reached a staff-level agreement with the authorities of Ukraine on an economic reform programme that can be supported by a two-year standby arrangement with the IMF," the organisation said in a statement. | |
"The financial support from the broader international community that the programme will unlock amounts to $27bn over the next two years. Of this, assistance from the IMF will range between $14-18bn, with the precise amount to be determined once all bilateral and multilateral support is accounted for." | "The financial support from the broader international community that the programme will unlock amounts to $27bn over the next two years. Of this, assistance from the IMF will range between $14-18bn, with the precise amount to be determined once all bilateral and multilateral support is accounted for." |
The agreement is subject to approval by the IMF's management and executive board, which will consider it in April. | |
"Following the intense economic and political turbulence of recent months, Ukraine has achieved some stability, but faces difficult challenges," the IMF statement said. | "Following the intense economic and political turbulence of recent months, Ukraine has achieved some stability, but faces difficult challenges," the IMF statement said. |
Announcing the agreement in Kiev, the IMF mission chief, Nikolay Gueorguiev, declined to say how big the initial tranche of aid would be. | |
Kiev has said it desperately needs cash to cover expenses and avert a possible debt default. The country's finance minister has predicted the economy will contract by 3% this year, weakened by years of mismanagement and political turmoil. | |
The bailout will help prop up Ukraine's economy and clear the way for several billion dollars in aid from the US, EU, Japan and other nations. | |
Ukraine's new leaders announced a radical 50% increase in the price of domestic gas on Wednesday with effect from 1 May, meeting an unpopular IMF condition that Yanukovych had refused. |
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