IMF clears $690 million for Ukraine after review, says reforms broadly on track despite war

The International Monetary Fund (IMF) has approved the latest review of Ukraine's financing programme, unlocking immediate access to around $690 million in fresh funding as the country continues to battle Russia's invasion while trying to preserve economic stability.

The IMF said that its Executive Board had completed the latest review of Ukraine's $8.1 billion financing arrangement, allowing the war-hit country to draw approximately $690 million. The latest tranche takes total disbursements under the programme to around $2.2 billion.

The review comes at a crucial time for Ukraine, which is grappling with mounting pressure on its economy amid intensified Russian attacks on critical infrastructure and the continuing costs of the war.

Economy remains resilient despite mounting challenges

In a statement, the IMF said Ukraine had managed to maintain macroeconomic and financial stability despite the prolonged conflict. However, it warned that the country's economic outlook had weakened due to renewed attacks on infrastructure and the spillover effects of the conflict in West Asia.

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The lender said Ukraine's performance under the programme had been "broadly satisfactory."

According to the IMF, all quantitative performance criteria and indicative targets set for the end of March were achieved. However, Ukraine missed its end-June target for net international reserves, partly because of the economic impact of the conflict in West Asia.

Reform implementation slows

While acknowledging progress, the IMF noted that structural reforms had lost momentum.

"Reform implementation has slowed, with several structural benchmarks completed with a delay or missed," the Fund said.

To address these shortcomings, IMF staff and Ukrainian authorities agreed in June on a revised timetable for implementing reforms. The updated plan also includes corrective measures to tackle policy slippages and additional commitments aimed at keeping the programme on track.

Georgieva stresses macroeconomic discipline

IMF Managing Director Kristalina Georgieva said maintaining macroeconomic stability remains Ukraine's immediate priority as the country navigates the dual challenges of war and economic uncertainty.

She called for prudent fiscal and monetary policies while urging authorities to continue safeguarding the resilience of the financial sector.

Ukraine's IMF programme has become a critical pillar of international financial support since Russia's full-scale invasion, helping the government finance essential spending, stabilise public finances and underpin broader economic reforms despite the ongoing conflict.

With inputs from agencies.