BRUSSELS: Ukraine is set to receive about $40bn in funding over the next four years, nearly half of which will come from the International Monetary Fund, IMF chief Christine Lagarde said in Brussels.
Lagarde told reporters that the IMF team working in Kiev had reached an agreement with the Ukraine government on a new economic programme with about $17.5bn coming from the IMF and additional resources from the international community.
“From these various sources taken together, a total financing package of around $40bn is estimated over the four year period,” she said. The IMF’s staff-level agreement, which still needs to be approved by the IMF’s board, came after Ukraine’s government showed “a determination to reform like we have never seen.”
Ukraine has agreed to front-load reforms including energy tariff increases, bank restructuring, governance reform of state-owned enterprises and an anti-corruption agenda. “The main risk of course relates to the geopolitical developments that may affect market and investor confidence,” Lagarde said.
Meanwhile, a ceasefire between Russian separatists and Ukrainian forces and surprisingly aggressive stimulus from Sweden’s central bank injected optimism into global equity markets, which had been numbed by a stalemate in Greek debt negotiations.
Stocks on Wall Street climbed while European shares reversed opening losses as they also took heart from a broadly positive raft of results on one of the busiest days in Europe’s earnings calendar.
Even Greek stocks surged, with the main index rising 6.7 percent as investors held out hope that the new Greek government could reach a deal with international creditors over the country’s bailout.
Investors also took cues from the cease-fire in Ukraine that will take effect from February 15, and the Swedish Riksbank’s decision to cut interest rates below zero and buy government bonds. Reuters
