IMF Agrees £18 Billion Bailout For Ukraine

27th March 2014


I wonder why the Ukraine is so keen to join the EU?   


The International Monetary Fund has agreed rescue funds of up to $18bn (£10.8bn) for Ukraine in return for strict economic reforms.

Under the conditions of the proposed deal, Ukraine's interim government has announced a 50% increase in the price of domestic gas from May 1.

The IMF has pushed for a cut in energy subsidies which accounted for 7.5% of Ukraine's GDP in 2012.

Ukraine has said it needs the bailout to avoid a possible debt default.

The so-called Stand-By Arrangement (SBA) with the IMF will not be ratified until the executive board meets next month.

If it is agreed, it could open Ukraine up to further financial support from the US, EU and Japan amounting to a total of $27bn (£16.3bn) over the next two years.

Ukrainian Prime Minister Arseniy Yatsenyuk said on Thursday the price for Russian gas could reach $480 (£290) per 1,000 cubic metres from April 1. The current level is $268.5 (£162).

He added that if the reforms required by the IMF were not adopted, GDP could fall 10% in 2014 and the economy could default.

The country's finance minister had predicted Ukraine's economy will contract 3% this year after years of mismanagement and political turmoil.


http://news.sky.com/story/1232760/ukraine-crisis-imf-agrees-18bn-bailout-fund

hmmm what very unusual timing...