Agreement on Financial Support for Ukraine

WASHINGTON (Reuters) – International Monetary Fund (IMF) staff and Ukrainian authorities have reached an agreement that would grant Ukraine access to approximately $1.1 billion. The IMF stated on Tuesday that the executive board must approve the deal.

If granted, this agreement would increase the total funds disbursed to Ukraine under the program to $9.8 billion. The IMF's statement indicated that the board is expected to review the deal in the coming weeks.

> "The outlook remains exceptionally uncertain and Russia's war in Ukraine continues to have a heavy toll on Ukraine's people, economy, and infrastructure," said the IMF staff. Despite these challenges, the program is reported to be "on track."

The report further noted that Ukraine's economy has shown resilience amid the devastating impacts of the war, which has now lasted 1,000 days.

However, risks remain exceedingly high due to uncertainties regarding the war's intensity and duration, especially concerning continued attacks on energy infrastructure.

IMF staff, who met with Ukrainian officials from November 11-18, projected that the country's real GDP growth would reach 4% this year, but may slow to 2.5%-3.5% by 2025 due to damage to energy infrastructure and labor shortages.

In October, inflation in Ukraine hit 9.7% year-over-year, driven by escalating food and labor costs, although IMF staff noted that "inflation expectations remain well anchored."