Ukraine obtains $1.4 bln tranche from IMF, forex reserves exceed $20 bln - NBU
Ukraine has received the first tranche under the new Stand-By Arrangement (SBA) with the International Monetary Fund (IMF) in the amount of SDR 1 billion (around $1.4 billion), which boosted the country's forex reserves to $20.1 billion as of December 21, 2018.
"This is a five-year maximum. For the last time this level of forex reserves was recorded in January 2014," the National Bank of Ukraine (NBU) said in a report on Friday.
The central bank recalled that the new 14-month SBA foresees the provision of financing to Ukraine for the amount of SDR 2.8 billion (near $3.9 billion). It will focus on continuing the ongoing fiscal consolidation, further reducing inflation, while maintaining a flexible exchange rate regime, strengthening the financial sector, and advancing a focused set of structural reforms, particularly to improve tax administration, privatization and governance.
The continuation of cooperation with the IMF also opened access to binding financing for Ukraine: on December 18, the Board of Executive Directors of the World Bank has approved the provision of guarantees to Ukraine in the amount of $750million in support of government policy. The government seeks to borrow up to $1 billion on the external market.
The NBU early November lowered the forecast of forex reserves at the end of 2018 to $19.2 billion from $20.7 billion, for 2019 to $18.6 billion from $18.8 billion and for 2020 to $19.1 billion from $19.7 billion.