Ukraine expects receipt of $1.5 bln under World Bank's DPO by late March – Ministry of Finance
Finance Minister Serhiy Marchenko and World Bank Regional Country Director for Ukraine, Belarus and Moldova Arup Banerji Banerjee signed a $1.5 billion loan agreement following the corresponding decision of the World Bank Board of Executive Directors on Tuesday to provide this new loan to Ukraine as part of the Growth Foundations Development Policy Operation (DPO).
"The funds are expected to be disbursed to the State Budget of Ukraine by the end of March this year," the Ministry of Finance said in a press release on Wednesday night.
The ministry recalled that the funds will be provided under a $984 million guarantee from the Government of Japan through the World Bank's ADVANCE Ukraine Trust Fund and a $516 million guarantee from the United Kingdom.
To reduce the cost of servicing Ukraine's loan obligations under the DPO 2024 loan for the coming years from Japanese funds, the DPO Loan Agreement provides for the capitalization of interest of $99.54 million, the Ministry of Finance said.
"The funds raised will be used to support the State Budget of Ukraine and economic recovery, as well as to finance priority social and humanitarian expenditures of the State Budget," Finance Minister Serhiy Marchenko is quoted in the release.
The main areas of reforms included improving corporate governance, promoting renewable energy generation, introducing agricultural notes as a new instrument for farmers to obtain financing, strengthening the financial sector by improving access to finance for businesses (under the Affordable Loans 5-7-9 programme). It also includes the implementation of EU customs and tax experience into Ukrainian legislation, improvement of fiscal policy and regulation of capital markets, and ensuring transparency and accountability of procuring entities in the e-procurement system.