IMF Managing Director Kristalina Georgieva said a full support program for Ukraine was “weeks away.”
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The IMF is several weeks away from finalizing its full support program for Ukraine, the fund’s Managing Director Kristalina Georgieva told CNBC Saturday.
This comes hours after the IMF said that it has reached a staff-level agreement with the Ukrainian authorities, paving the way for negotiations on a comprehensive loan program that will support Kyiv’s economy and further offers to join the European Union. The plan now needs approval from IMF management.
“Time is not Ukraine’s friend in this extraordinary state of war,” Georgieva told CNBC’s Hadley Gamble at the Munich Security Conference.
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“We’re talking about a few weeks, not too long,” he added when pressed on the timeline for implementing the program.
Georgieva said that the UN financial body is confident that Ukraine meets the requirements regarding fiscal policy, governance, anti-corruption and stability of the financial sector.
“We have a country where institutions work. Where pensions are paid. Where social services are in place. Where the government is keenly interested in continuing reforms, even when the bombs are falling,” he noted.
The program comes at a crucial time for Ukraine, which is approaching the first anniversary of the Russian invasion on February 24. The IMF estimates that the country may need financial support of more than $40 billion this year, although Ukraine’s economy is predicted to return to growth after a 30% contraction in 2022.
“Ukraine needs the IMF at this critical time,” Georgieva said. “Why? Because the financial needs are important: We put between $40-48 billion for this year.”
“And two, because the country needs the policy support provided by the IMF. To run a war economy is not a trivial matter,” he added.
Accelerating Ukraine’s path to EU accession
As well as supporting Ukraine’s economy amid the conflict, Georgieva said the reforms would also help “accelerate” Ukraine’s efforts to join the European Union.
The European Parliament adopted a resolution calling for the immediate granting of candidate EU membership status to Ukraine on June 23, 2022. The European Council granted candidate country accession status to the European Union on the same day.
“We make Ukraine’s desire to join the European Union a priority in our work,” Georgieva said on Saturday.
“He was there,” he added. “And the Fund, of course, can help them go faster on that path.”