The IMF allocates an extra 1,300 million euros to Ukraine to tackle a possible food crisis

MADRID, 8 Oct. (EUROPA PRESS) -

The Executive Board of the International Monetary Fund (IMF) has approved this Friday the disbursement of 1,300 million dollars (a similar figure in euros) to Ukraine to tackle a possible food crisis.

Specifically, the financial organization has argued that the Ukrainian authorities "deserve considerable credit" for having maintained a significant degree of macro-financial stability in these "extremely difficult" circumstances, as detailed by the agency in a statement.

"More than seven months after the start of the Russian invasion of Ukraine, the humanitarian and economic cost remains enormous, generating large and urgent external and fiscal financing needs," the IMF said, anticipating that the new financing to Ukraine It is part of the 'Window of Shock' Food Program.

"The authorities deserve considerable credit for having maintained a significant degree of macrofinancial stability in these extremely challenging circumstances," the financial institution added in its letter.

The IMF has asserted that Ukraine faces risks and uncertainties related to its security situation, its ability to implement policies across the country, and other external developments.

That is why the organization's Executive Board has expressed its understanding for the added difficulty in assessing with sufficient precision what Ukraine would require to guarantee the sustainability of Ukraine's debt.

Still, the IMF has calculated that amid massive population displacement and the destruction of homes and key infrastructure, Ukraine's Gross Domestic Product (GDP) will contract by 35 percent in 2022 relative to 2022.

For this reason, the agency has announced its intention to help meet "urgent needs" of the Ukrainian balance of payments, including due to its large cereal export deficit. It will also play "a catalytic role" in garnering more financial support from Ukraine's creditors and donors.

"The Fund will continue to work closely with the Ukrainian authorities, with whom talks will soon begin to further catalyze donor support and help pave the way for the higher credit tranche agreement," the IMF said in its statement.