Cabinet approves decision to attract additional financing of USD 530 million from IBRD

The Cabinet of Ministers has approved the decision to attract additional financing from the International Bank for Reconstruction and Development in the amount of USD 530 million.

This follows from a statement by the Ministry of Finance, the Ukrainian News Agency reports.

At the government meeting, a decision was made to attract additional financing in the amount of USD 530 million as part of the implementation of the joint project with the IBRD and the International Development Association (IDA) entitled Supporting public expenditures to ensure sustainable public administration in Ukraine.

Besides, the meeting participants supported the draft order of the President of Ukraine on the formation of a delegation of Ukraine to participate in negotiations with the IBRD regarding the conclusion of the Loan Agreement between Ukraine and the IBRD, as well as the authorizing Minister of Finance of Ukraine Serhii Marchenko to sign this agreement.

The loan will be granted on preferential terms under the guarantees of Great Britain and Denmark: the repayment period of the loan is 19 years with a five-year grace period.

The interest rate is 0.25% per annum (charged on the unused part of the loan).

The funds will be used to pay employees of the budget sector, provide pension payments and certain programs of state social assistance, such as the payment of housing and communal services, support of low-income families, disabled children and disabled from childhood, IDPs, as well as payment of medical services under the program medical guarantees, etc.

As the Ukrainian News agency earlier reported, the project entitled Supporting Public Expenditures to Ensure Sustainable Public Administration in Ukraine will be implemented from June 2022.

The total volume of funds raised is USD 7.3 billion.

The purpose of this project is to support the sustainable capacity of the Government of Ukraine to carry out administrative activities and provide services for the performance of basic state functions at the national and regional levels.

By the end of the year, the announced official financing is expected to arrive in the total amount of about USD 12 billion.