The International Monetary Fund (IMF) has announced it has struck a deal with Ukraine, giving the country access to badly needed loans. The agreement is contingent on Kyiv's economic reforms in the years ahead.
The IMF said Thursday it had agreed to an aid package for Ukraine worth between $14 and $18 billion (10.2 and 13 billion euros) as the country tried to come to terms with post-turmoil realities and the aftermath of the Crimea conflict.
"The mission has reached a staff-level agreement with the authorities of Ukraine on an economic reform program that can be supported by a two-year stand-by arrangement with the IMF," the lender said in a statement.
It added the deal could potentially unlock further credits to reach a total of $27 billion over the next two years.
Cash for reforms
Kyiv had said it desperately needed more cash to cover expenses and avert a possible debt default. The Finance Ministry said the economy would contract by 3 percent this year as a late result of years of mismanagement and the recent political turmoil that had rocked the nation.
Ukraine's new leaders announced a radical 50-percent increase in the price of domestic gas from May 1 in response to an unpopular prerequisite for IMF aid. It marked a move that former President Viktor Yanukovych had refused to make before being ousted.
The IMF had long urged Kyiv to cut energy subsidies, saying they ate up 7.5 percent of Ukraine's gross domestic product in 2012.
hg/kms (Reuters, AFP)