EU approves extra EUR 1 bln of macro support for Ukraine

The European Commission approved an extra EUR 1 bln of macroeconomic support for Ukraine on the top of EUR 610 mln approved previously, the UNIAN news agency reported on March 19. The first wire of EUR 100 mln will arrive promptly after an IMF agreement is reached. The next EUR 510 mln will be wired within a short period of time after the first tranche. Ukraine will receive the rest of the support, EUR 1 bln, by the year end.

Alexander Paraschiy: Such commitments create positive signals for Ukraine’s creditors and the ForEx market. After the hryvnia devaluation, Ukraine’s currency deficit should decline. We see less than USD 10 bln needed to cover external liabilities and foreign currency demand this year. Given that the U.S. has already committed USD 1 bln in macro- support and the IMF agreement has good chances to be signed (up to USD 15 bln in new loans are expected), we are quite positive about Ukraine’s solvency.