Ukraine receives $1.7 bln U.S. grant to finance budget
MOSCOW. July 12 (Interfax) - Ukraine's has received a U.S. grant of $1.7 billion to finance the state budget, Prime Minister Denys Shmyhal said.
"The Ukrainian budget has received a grant $1.7 billion from the Trust Fund of the World Bank and USAID. This is the second U.S. grant in the last two weeks, the total amount of assistance being $3 billion," Shmyhal said on social media.
Ukraine received a $1.3 billion grant from the United States as part of the state budget financing package of $7.5 billion at the end of June. The funds were received through the World Bank's Multi-Donor Trust Fund as part of additional financing for the project Public Expenditures for Administrative Capacity Endurance in Ukraine.
The U.S. Senate approved financial assistance to Ukraine and its allies in the amount of almost $40 billion on May 9.
Vladyslav Rashkovan, alternative executive director at the International Monetary Fund, said at the end of May that U.S. President Joe Biden had endorsed U.S. budget amendments to additionally allot $40 billion in connection with the events in Ukraine, including $7.5-billion grants to compensate for the Ukrainian budget deficit.
IMF European Department Director Alfred Kammer said in April that tax collection by the Ukrainian budget might more than halve because of the ongoing events, while 7 million internally displaced persons created a monthly state budget deficit of $5 billion in May-June, which required external support to the budget, predominantly with grants. He noted that the assessment of the monthly budget deficit of $5 billion in May-June was made by the Ukrainian authorities in tandem with the IMF.
As for the available instruments of support to Ukraine, Kammer mentioned the IMF administered account, the multi-donor trust fund of the World Bank, and the solidarity trust fund of the European Union.
Ukraine had a state budget deficit of UAH 405.2 billion or $13.85 billion at the current exchange rate for January-June 2022, the Finance Ministry has said, quoting preliminary data.The General Fund deficit was UAH 406.1 billion, way below a planned deficit of UAH 642.6 billion.
External financing for the deficit rose to UAH 60.5 billion in June from UAH 27.9 billion in May, not including grants, which are treated as budget revenue; internal financing was UAH 124.2 billion, of which UAH 105 billion from the National Bank.
External debt repayments were UAH 214 billion in H1 2022, 0.5% below target, including UAH 44.7 billion in June; debt servicing expenditure was UAH 86.6 billion or 0.6% below plan, of which UAH 11.6 billion in June.