The International Monetary Fund (IMF) announced it would start a virtual mission to Ukraine that, if successful will pave the way for the country to get more aid to shore up its economy after its standoff with Russia escalated, according to Bloomberg.
“IMF officials will start an online-review of their program with the eastern-European nation on Wednesday,” the IMF said in a statement.
At stake is $700mln in disbursements the government in Kyiv expects to receive after the mission is completed.
Ukraine’s dependence on foreign funds has increased since neighboring Russia started to mass troops at the country’s borders in November, threatening warnings from the U.S. and NATO of an invasion.
The Kremlin denies such intentions, but Tuesday’s recognition of self-proclaimed separatist republics and agreement that let Russia send troops to the areas marked an escalation that hit Ukraine’s hryvnia currency and debt.
The IMF and Ukraine signed a $5bln loan program in 2020, extending it to June 2022 on the condition that the country improve the corporate governance of state-run banks and companies and show its anti-graft policy is being implemented. The government also committed to appoint the head of a Special Anti-Corruption Bureau, a move whose repeated postponement has irked international donors.
Aside from IMF disbursements, Ukraine’s government relies on €1.2bln in aid from the European Union, a $1bln loan guarantee from the U.S. and assistance from other Western partners including Canada.