IFIs to provide USD 500 mln loan to Naftogaz for gas purchases

The European Bank of Reconstruction and Development, the U.S. government, and the International Finance Corporation will provide a total of USD 500 mln in loans to Naftogaz to help pay for natural gas for the winter season, the Interfax-Ukraine reported on Sept. 9, citing Valeria Gontareva, Head of the NBU. “We anticipate gas purchases for the winter season, but they will be funded at the expense of loans from IFIs to Nafttogaz,” she said. The EBRD will provide USD 300 mln, while the U.S. government and the IFC will provide USD 200 mln. Naftogaz purchased USD 700 mln on ForEx market during the last four months, NBU said. 

Alexander Paraschiy: This is positive in terms of foreign currency inflows to the country. This loan doesn’t seem to have been included in the IMF plan for external gap financing in 2015 (worth USD 16.3 bln, excluding the debt restructuring), which means that the money comes on the top of that. This extra funding will arrive by the end of 2015, which means that gross international reserves have good chances to exceed USD 16 bln in 2015.