Ukrainian President Volodymyr Zelensky said on Wednesday that increased financial support from international donors will help end Russia's devastating war in Ukraine more quickly, citing the need for $38 billion to close next year's estimated budget deficit.
Zelensky, speaking by video link to finance ministers at the World Bank and International Monetary Fund annual meetings in Washington, said Ukraine needed about $55 billion - $38 billion to cover next year's estimated budget deficit, and another $17 billion to start to rebuild critical infrastructure, including schools, housing, and energy facilities.
"The more assistance Ukraine gets now, the sooner we'll come to an end to the Russian war, and the sooner and more reliably we will guarantee that such a cruel war will not spread into other countries," Zelensky said.
IMF Managing Director Kristalina Georgieva, World Bank President David Malpass, and U.S. Treasury Secretary Janet Yellen responded by underscoring the determination of the global community to continue to support Ukraine.
Georgieva said the IMF estimated that Ukraine would need $3 billion to $4 billion in external financing help per month next year - and possibly more - to keep its economy running as the Russian invasion that began in February drags on.
She said Ukraine's international partners have committed $35 billion in grant and loan financing for Ukraine in 2022, enough to close its financing gap for this year, but its financing needs would remain "very large" in 2023.
She praised Ukrainian officials for progress in normalizing economic policies and stabilizing the economy despite "extremely difficult circumstances" since the start of the war.
But risks remained "exceedingly high", as demonstrated by Russian missile attacks on Ukraine this week, and high levels of external help would remain necessary to cover ongoing budget costs and initial infrastructure repairs, Georgieva said.
Yellen said the United States would begin to disburse another $4.5 billion in grant assistance to Ukraine in coming weeks, bringing its budget assistance to $13 billion since the start of the war, and called on others to improve the "scale, predictability, and grant component of disbursements."
Georgieva said the IMF planned to work with the Ukrainian authorities to set up a new "Ukraine Economic Forum" suggested by Zelenskiy to share information, calibrate financing needs, and coordinate macroeconomic developments and policies.
She said the IMF would start talks soon with Ukraine about a new IMF monitoring instrument known as Program Monitoring with Board Involvement (PMB) and a comprehensive macroeconomic framework that would clarify external financing needs.
That in turn "should pave the way for a full-fledged IMF program once conditions allow," Georgieva said.
Zelensky said Ukraine would continue to press for an IMF lending program of about $20 billion, in addition to $2 billion in targeted credits to rebuild its electric power infrastructure and up to $5 billion in credit limits to buy natural gas and coal.
The IMF last week approved $1.3 billion in fresh emergency financing for Ukraine through a new food shock window, on top of $1.4 billion in emergency funding approved in March.
The fund has also mobilized $2.2 billion for Ukraine through an administrative account, Georgieva said.
