By: M. Dinata *)
The International Monetary Fund (IMF) has approved the bailout deal for Ukraine on Wednesday, 11 March 2015. IMF has dealed to give $10 billion to Ukraine in order to help the country revives from its financial problem over the next year. IMF Managing Director Christine Lagarde said this program as an “immediate economic stabilization” to a country beset by conflict with Russia and uncertainty about its territorial integrity.
The IMF official said that IMF will divide the $10 billion assistance into two times transfer, the first $5 billion will be transfered by the end of this week and another $5 billion in next month. Ukraine will also get another $7.5 billion loans from other international organization and additional $15.4 billion of debt is still under negotiation between Ukrainian officials with their bondholders.
Before this, IMF already gave Ukraine a $17 billion loan last year, but it seems insufficient to help Ukraine rise up from its crisis when the Government still in the fight with pro-Russia separatists in eastern Ukraine. “The program is very strongly front-loaded during the first year,” Christine Lagarde said in Berlin. “Ukraine has satisfied all the prior actions that were expected and required of it in order to start running the program… We are off to a good start.”
After a year of dynamic political movement and war, Ukraine’s economy suffer with their lowest currency, the highest interest rates in 15 years, and central bank reserves in only $6.4 billion, which only enough for five weeks of imports. Prime Minister Arseny Yatseniuk says, “The program will enable us to stabilize the economy and the financial sector. It will be used to stabilize the currency. It will enable the Ukrainian economy to grow from 2016.”
*) The Author is Brunei Darussalam’s Contributor.
