IMF Mission Launches Fifth Review of Ukraine Program as Kyiv Reshuffles Government – Reuters

KYIV – An International Monetary Fund (IMF) mission commenced on Wednesday to conduct the fifth review of its $15.6 billion lending program for Ukraine amidst significant changes in the wartime government.

The IMF serves as a key financial backer for Kyiv, and its four-year program is integral to a broader package of global economic assistance aimed at supporting Ukraine as it braces for a third winter of resistance against Russia’s full-scale invasion.

Currently, Ukraine is allocating approximately 60% of its total budget to sustain its military efforts, relying heavily on financial aid from Western allies to cover pensions, salaries of public sector workers, and to support social and humanitarian initiatives.

According to an IMF statement, discussions regarding policies have commenced between the Fund’s monitoring team and Ukrainian authorities.

President Volodymyr Zelenskiy is reshaping his government in preparation for the critical autumn and winter periods, resulting in the resignation of six ministers. Analysts and lawmakers anticipate that Finance Minister Serhiy Marchenko will continue in his role.

Marchenko has previously highlighted a projected funding gap of about 500 billion hryvnias ($12 billion) necessary to sustain defense efforts for the remainder of the year.

In response, the government is looking to increase revenues through tax hikes and has already put various measures into action, such as raising import and excise duties and increasing borrowing in the domestic market. Additionally, Ukraine has reached an agreement with bondholders regarding the restructuring and reduction of its debt.

Completion of the IMF review is crucial for Ukraine, as it would pave the way for approximately $1.1 billion in new financing in the coming months, according to officials.

Since the conflict began, Ukraine has received around $98 billion in financial assistance from Western partners, as indicated by finance ministry data.