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2014-09-01 18:25:00

UKRAINE WAS APPROVED IMF: $17 BLN

UKRAINE WAS  APPROVED IMF: $17 BLN

The International Monetary Fund on Friday approved the latest payment to Ukraine in its $US17 billion ($A18.2bn) bailout program, providing a critical boost to Kiev as it faces military, economic and political threats.

The IMF said its board approved a $US1.39bn payment, which will bring total disbursements under the program to $US4.51bn.

Months after Russia moved to annex the Crimea region this spring, Ukraine is fighting a growing Russia-backed military force along its eastern borders. Moscow has denied military involvement, blaming the fighting against Kiev on volunteers, separatist fighters and some disoriented Russian troops.

On the economic front, Russia's energy minister said Friday that negotiations on Ukraine's gas debt can't start until Kiev pays $US1.45bn of debt to Russian gas giant OAO Gazprom.

For Ukraine's government, the onset of cold winter months could exacerbate an already fragile outlook, with the economy battered by months of turmoil and civil war in the east of the country.

Prime Minister Arseniy Yatsenyuk this week called for swift steps to stabilise the hryvnia, the local currency, which has fallen steeply in the last year. The IMF backs a flexible exchange rate rather than the peg to the dollar that Kiev previously maintained.

In July, Ukraine's ruling coalition broke up, setting the stage for parliamentary elections that could strengthen the hand of President Petro Poroshenko as he backs a fight against the insurgency in the east.

theaustralian.com.au

Tags: RUSSIA, UKRAINE, GAZPROM, GAS, IMF

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