The situation with the financial assistance to Ukraine during the full-scale invasion by Russia revealed that developed countries and the IFIs, including the IMF, are not fully ready for the financial challenges and global impacts of such an affront to international law.
Ukraine was on track with economic policies during recent years, which resulted in a sound banking and financial sector, and a sustainable state debt situation. However, Ukraine (like any other country similarly situated) cannot stand alone against such an aggressor as Russia as the war comes at an incredible cost, resulting in losses of lives and a sharp decline in the economy.
Unfortunately, at this time, financing from international partners is irregular and substantially lower than verified by the IMF USD 5 bn need by Ukraine every month.
The IER together with other members of RRR4U coalition suggest the IMF –as a lender of last resort– approve a big supporting program for Ukraine either in the framework of existing instruments or through the elaboration of a new mechanism of support: an ‘External Shock Facility’
