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War-torn Ukraine seeks emergency funding; IMF to consider request

IMF has noted that the ongoing war has forced the global lender to push a request from Ukraine to its board for approval.

The ongoing war after Russia initiated military operations in Ukraine is expected to create a humongous financial problem in the country. This has created a situation of concern, and the International Monetary Fund (IMF) has predicted major worries.

The IMF has noted that the ongoing war has forced the global lender to push a request from Ukraine to its board for approval, Ukraine has requested emergency financing to the tune of $1.4 billion. The IMF will bring before its board this request for approval as early as next week.

It is also being reported that the global lender has initiated parleys on financing options with neighbouring Moldova. A report has the IMF as saying that the situation remains highly fluid and the outlook is subject to extraordinary uncertainty, the economic consequences are already very serious.

IMF board to consider request by next week

Pointing out that the ongoing war and associated sanctions will also have a severe impact on the global economy, the IMF has said that the “crisis was creating an adverse shock to inflation and economic activity at a time when price pressures were already high”.

The statement from IMF came after a meeting of its board chaired by Managing Director Kristalina Georgieva. According to the global lender, the war in Ukraine was already driving energy and grain prices higher. It also added that more than 1 million refugees have fled to neighboring countries. It is a known fact that the war has sparked decisions on unprecedented sanctions on Russia.

Escalation of war could push up prices

Warning that the escalation of war could push up prices, the lender has called upon authorities to make sure that fiscal support is provided to poor households who find food and fuel expensive. The sanctions imposed on Russia are expected to create a big impact on the global economy and financial markets, it added.

In particular, the impact would be huge in Ukraine as the country braces for immense economic damage. With the ports and airports already closed or damaged, bridges and roads destroyed, the economic impact would be substantial.

Reportedly, the IMF board will tale up for consideration Ukraine’s request for $1.4 billion in emergency financing by the coming week.

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Sanjeev Ramachandran

A journalist with 23 years of experience, Sanjeev has worked with reputed media houses such as Business Standard, The Ne More »
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