Because of the Russian attack, according to President Volodymyr Zelenskyy, Ukraine needs support of seven billion dollars (about 6.5 billion euros) a month just to make up for economic losses. “And we’re going to need hundreds of billions of dollars for reconstruction,” Zelenskyy said in a video speech Thursday at an International Monetary Fund (IMF) and World Bank meeting in Washington.
Russian forces destroyed infrastructure, schools, universities, hospitals and countless houses and apartments in Ukraine, he said. “Russian artillery, Russian missiles, Russian bombings do not distinguish who they kill and which buildings they bomb or burn,” Zelenskyy said, according to a simultaneous English translation.
The German government wants to provide around 37 million euros for the reconstruction of Ukraine. The funds will be used to repair the damage caused by the Russian war of aggression. “Ukraine urgently needs housing for millions of internally displaced people and needs an intact power grid. German development cooperation can help here in the short term. My ministry has reallocated funds for this through an emergency program,” he said. Development Minister Svenja Schulze (SPD) ahead of the “Augsburger Allgemeine” World Bank conference (Friday).
According to information in the newspaper, 22.5 million euros will go towards building the electricity grid, which was massively destroyed by Russian attacks, and a further 12.4 million euros towards building apartments for those who fled inside the country. Two million euros are earmarked for medical equipment.
Ukrainian Prime Minister Denys Schmyhal told the meeting in Washington that Ukraine will need about four to five billion US dollars in external support in each of the next few months. International Monetary Fund (IMF) chief Kristalina Georgieva praised the Kiev government for still ensuring relative macroeconomic stability through prudent actions despite the war.
Georgieva campaigned for help to Ukraine “as much as possible” in the form of grants rather than loans. Funding needs and how they are to be met need to be more precisely identified, she said. But to prevent Kiev from accumulating significant debt, the support should not be given as a loan, Georgieva said.
Because of the war in Ukraine, for the first time there was no joint declaration at the biannual IMF ministerial meeting. “Russia’s war against Ukraine has made it impossible to find a consensus,” said IMF steering committee chairman, Spanish Finance Minister Nadia Calviño, on Thursday. But she has the support of the “overwhelming majority” of the 189 members.
There was “almost unanimity on the substantive issues at the table,” explained Calviño. Finance ministers and central bankers called for an end to the war in Ukraine and expressed concern about the economic impact that “has global reach”.
The war and numerous sanctions against Moscow are jeopardizing the global recovery from the economic fallout from the corona pandemic. The Russian attack on the neighboring country has driven up food and energy prices around the world and fueled already soaring inflation. As a result, the IMF significantly lowered its growth forecast for the global economy.