Recap of International Aid to Ukraine in December 2024
Tranches from the IMF, EU, US and other countries have kept flowing to cover Ukraine’s social wages, budget deficit and to add to the central bank’s international reserves.
In December 2024, Ukraine signed memorandums to receive tranches of a loan backed by Russian immobilized assets (ERA loan) and received financial aid from the EU, IMF and the US through the World Bank.
The Council of the European Union has approved the allocation of €4 billion in loans and grants to Ukraine under the Ukraine Facility. The funds will be used for priority social and humanitarian expenditures from the State Budget of Ukraine.
The Ukraine Facility has already allocated €12.1 billion to the state budget. It is expected that, by the end of 2024, EU budget support will total €16 billion.
Ukrainian Finance Minister Serhiy Marchenko and World Bank Regional Director for Eastern Europe Bob Som signed financing agreements under the Bank’s Growth Foundations Development Policy Loan (DPL) program. The total amount of the signed agreements equates to $2 billion.
On Dec. 24, the state budget received a tranche of $1 billion under the Second Growth Foundations Development Policy Loan (DPL) Program. It also received the seventh tranche of about $1.1 billion (834.9 million in Special Drawing Rights (SDR)) from the IMF under the four-year Extended Fund Facility (EFF) program.
Another $1 billion grant was received from the US within the framework of the World Bank’s Second Growth Foundation Development Policy Loan (DPL) Program.
This is the first tranche of the ERA loan.
The G7 agreed to provide Ukraine with a $50 billion loan backed by interest profits generated from Russian assets. The loan is destined to finance Ukraine in 2025. A total of $40 billion is already confirmed from the US, EU, Japan and the UK.
Since the beginning of the full-scale invasion, all domestic revenues of Ukraine’s state budget have been allocated to defense spending, which accounts for approximately half of the budget. All civilian expenditures of the state budget are financed through foreign financial aid. In 2024, Ukraine’s need for such external financing has amounted to $38 billion, according to the Centre for Economic Strategy’s war economy tracker.
Source: Kyiv Post.
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