Reuters
Published Mar 05, 2022 11:57AM ET
Updated Mar 05, 2022 12:15PM ET
By Andrea Shalal and David Lawder
WASHINGTON (Reuters) -The International Monetary Fund on Saturday said it expected to bring Ukraine's request for $1.4 billion in emergency financing to its board for approval as early as next week and was in talks about funding options with authorities in neighboring Moldova.
In a statement, the global lender said the war in Ukraine was already driving energy and grain prices higher, and had sent a wave of more than 1 million refugees to neighboring countries, while triggering unprecedented sanctions on Russia.
"While the situation remains highly fluid and the outlook is subject to extraordinary uncertainty, the economic consequences are already very serious," the IMF said in a statement after a board meeting chaired by Managing Director Kristalina Georgieva.
"The ongoing war and associated sanctions will also have a severe impact on the global economy," it warned, noting that the crisis was creating an adverse shock to inflation and economic activity at a time when price pressures were already high.
It said price shocks would be felt worldwide, and authorities should provide fiscal support for poor households for whom food and fuel made up a higher proportion of expenses, adding that the economic damage would increase if the war escalated.
Sweeping sanctions imposed on Russia by the United States, European countries and others would also have "a substantial impact on the global economy and financial markets, with significant spillovers to other countries."
IMPACT ON UKRAINE, MOLDOVA
In addition to the human toll, Ukraine was experiencing substantial economic damage, with sea ports and airports closed and damaged, and many roads and bridges damaged or destroyed.
"While it is very difficult to assess financing needs precisely at this stage, it is already clear that Ukraine will face significant recovery and reconstruction costs," it said.
The board was expected to consider Ukraine's request for $1.4 billion in emergency financing as early as next week. Ukraine also has $2.2 billion available through June under an existing stand-by arrangement, the IMF said last week.
Moldova and other countries with close economic ties to Ukraine and Russia were at "particular risk" of scarcity and supply disruptions, the IMF said.
It said IMF staff were actively discussing funding options with Moldova, which has requested an augmentation and rephasing of its existing $558 million IMF loan program to help meet the costs of the current crisis.
Written By: Reuters
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.