On 20 December 2024, the IMF Executive Board approved the sixth review of the Extended Fund Facility (EFF). The successful completion of this review unlocks immediate access to SDR 834.9 million (equivalent to approximately USD 1.1 billion), which will be channeled for budget support. Following this disbursement, total IMF financing under the program will increase to around USD 9.8 billion.
The IMF release mentions that Ukraine’s performance under the EFF stays strong despite challenging conditions of war. All end-September quantitative performance criteria and indicative targets were met. Furthermore, as of the end of October, Ukraine met all end-October structural benchmarks due by the Sixth Review and three of the end-December benchmarks.
In 2024, Ukraine's economy grows more robustly than projected by the IMF, driven in part by the country's resilience to energy shocks. The IMF expects a slowdown in 2025 due to a difficult situation in the labor market, the impact of russian attacks on Ukrainian energy infrastructure, and continued high uncertainty. At the same time, the IMF notes that the risks to the forecast remain exceptionally high.
The Fund also noted that the financial sector remained stable. To ensure its stability, the NBU, in cooperation with the Deposit Guarantee Fund and the Ministry of Finance, will work on developing a framework for the financial recovery of banks. The NBU also continues to develop and implement a supervisory risk assessment methodology to establish priorities for supervisory activities.
The IMF emphasized that the recent tightening of monetary policy was appropriate given the accelerated inflation, and the NBU should stand ready to take further action should inflation expectations deteriorate.
Ukraine will continue implementing structural reforms, which, along with progress in mobilizing domestic revenues and the timely provision of external support, are essential for maintaining macroeconomic stability, restoring fiscal and debt sustainability, and improving governance. In 2025, strict budget execution will be key. Continued progress at domestic revenue mobilization is imperative for Ukraine to meet its high priority spending needs and to restore fiscal sustainability.
The EFF program provides for budget support to Ukraine from international partners: the total external financing package amounts to USD 148 billion under the baseline scenario and USD`177 billion under the downside scenario over the four-year program period. It includes new commitments from the Extraordinary Revenue Acceleration Loans for Ukraine (ERA) initiative, which provides for loans to be repaid using revenues from frozen russian assets, amounting to up to USD 50 billion.
"Russia’s war in Ukraine continues to take a devastating social and economic toll on Ukraine. Despite the war, macroeconomic stability is being preserved through skillful policymaking by the Ukrainian authorities as well as substantial external support. The economy has remained resilient, despite significant damage to the energy infrastructure, reflecting the continued adaptability of households and firms, although risks are tilted to the downside due to headwinds from attacks on energy infrastructure and a tight labor market. Preparedness and contingency planning are key to enable appropriate policy action should risks materialize’, said the IMF Managing Director Kristalina Georgieva in her statement.
"We are grateful to our partners at the IMF for their continued support and constructive collaboration. Thanks to our strong partnership, we have significantly reduced uncertainties regarding the sufficiency and regularity of international financial assistance to Ukraine in 2025. The momentum generated by the IMF program remains a key driver of our economic growth and supports the realization of our European integration goals. We are committed to building on this success and will not rest on our laurels in the years ahead", commented the NBU Governor Andriy Pyshnyy on the IMF’s decision.
On 31 March 2023, the IMF Executive Board approved a four-year Extended Fund Facility arrangement for Ukraine providing access to SDR 11.6 billion (USD 15.5 billion). The program is part of a USD 151.4 billion package for Ukraine.
Disbursements under the program are conditional on review results. In 2023, Ukraine received from the IMF three disbursement worth a total of SDR 3.3 billion (nearly USD 4.5 billion). This year, Ukraine will ultimately receive four disbursements worth a total of SDR 4 billion (about USD 5.4 billion).