International reserves went up to USD 16.7 billion – the highest level since mid-2014 – owing to support received from external partners.
First, on Tuesday, 5 April 2017, the National Bank of Ukraine received another tranche under the IMF’s EFF program for replenishing international reserves.
As a reminder: on 3 April 2017, the IMF Executive Board completed the Third Review of Ukraine’s EFF and approved the fourth tranche disbursement.
Funds under the fourth tranche in a total amount of USD 1 billion were received in several packages in different currencies, in particular: SDR 367, GBP 200 million, EUR 146 million, and USD 92 million.
Second, the European Union disbursed its second tranche of macrofinancial support to Ukraine for EUR 600 million.
Therefore, the international reserves grew to USD 16.7 billion as of today, up from USD 15.1 billion as of late March. This amount of reserves covers 3.6 months of future imports and is sufficient for performing Ukraine’s obligations and for current transactions by the Government and the NBU.
Overall, since March 2015 when the EFF program started, Ukraine has received four tranches from the IMF under the EFF arrangement totaling USD 8.5 billion. Some USD 5.9 billion of the above amount was channeled to replenish reserves.
Combined with the NBU’s net purchases of USD 3.2 billion in the interbank market since early 2015, this helped ensure a threefold increase of the international reserves from their lowest point of USD 5.6 billion in February 2015, just before the EFF program started.
The NBU is expecting three more tranches under the EFF for a total amount of about USD 4.5 billion before the end of 2017. Receipt of all four tranches within the current year is a vital prerequisite for raising the international reserves up to nearly USD 21 billion.
Ukraine also hopes to receive a further USD 3.9 billion of IMF funding next year. Then, the reserves will reach nearly USD 26 billion by the end of 2018.