Ukrainian leaders to be received by IMF and World Bank to consider “rebuilding” the country

How much will it cost to rebuild Ukraine? If it’s still hard to say today – probably over $ 100 billion – the site promises to be huge. While much of the infrastructure is being destroyed by the bombing of Russian bombs and artillery, and the country’s economy has become a war industry, international institutions believe the consequences are and will be terrible for the population. . Ukraine: Up to 18 years of development could be wiped out, the UN estimated in a mid-March report.

“The most extreme scenario is obviously an implosion of the economy,” Achim Steiner, administrator of the UN-affiliated United Nations Development Program, said on Wednesday (March 16th). “We estimate that up to 18 years of development progress could be wiped out in 12-18 months in Ukraine.” Achim Steiner is alarmed. And on April 10, the World Bank announced a catastrophic collapse, predicting that Ukraine’s GDP would fall by 45.1% in 2022.

Meeting next Thursday in Washington

In this context, Ukraine consults international institutions. President Volodymyr Zelensky said on April 17 that he had spoken with International Monetary Fund (IMF) Managing Director Kristalina Georgieva about Ukraine’s financial stability and post-war reconstruction.

“I spoke with IMF Managing Director Kristalina Georgieva on Ukraine’s financial stability and preparations for post-war reconstruction.”Volodymyr Zelensky said on his Twitter account. “We have clear plans for the time being, as well as a vision of the outlook. I am confident that cooperation between the IMF and Ukraine will continue to be fruitful.”added.

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Ukrainian Prime Minister Denys Chmygal had previously said he would attend IMF and World Bank meetings in Washington this week and would seek further financial assistance for Ukraine. He will be accompanied by Finance Minister Serhiy Marchenko and Central Bank Governor Kyrylo Shevchenko. They are scheduled to meet, among others, with financial officials from G7 countries and participate in a roundtable discussion on Ukraine organized by the World Bank on Thursday.

“Without support now, there will be no reconstruction in the future”

The event will be the first opportunity for Ukrainian officials to meet in person with a large number of financial officials of advanced economies since Russia invaded Ukraine on February 24.

The aftermath of the conflict in Ukraine will dominate meetings of senior officials from World Bank and IMF member countries, as well as the G7 and G20 next week, as the IMF prepares to downgrade its world growth forecasts due to the war.

Thursday’s meeting will be more of a roundtable than a donor conference, although the IMF and World Bank have opened separate accounts to process and relay donations, and new pledges will be announced next week.

It will also give officials the opportunity to discuss the devastation of Ukraine and the economic consequences of the war, as well as the continued functioning of the Ukrainian banking and financial sector. “Without support now, there will be no reconstruction in the future,” said one of the sources to Reuters.

On April 9 in Poland, the President of the European Commission, Ursula von der Leyenpour, attended the donor conference for the international fundraiser “Agir pour l’Ukraine” (“Defense Ukraine”) launched on 25 March. Thus, he announced that 10.1 billion euros had been registered in pledges to support Ukrainian refugees or displaced in his country after the invasion of the Russian army.

Specifically, 4.1 billion euros in donations have been committed by governments, companies and individuals. They will be largely distributed by the Ukrainian authorities or the United Nations. The remaining 5 billion euros are loans and grants granted by financial institutions in the European Union. They are broken down into a € 4 billion program to provide housing, education and health care to Ukrainian refugees in EU countries, and a € 1 billion program launched with the EBRD for displaced people in the EU. Ukraine.

Use frozen Russian assets to rebuild Ukraine?

The funds will be distributed worth 1.8 billion euros to support the displaced, the number of which is estimated at 7.1 million by the UN. And up to 7.3 billion euros for refugees. More than 4.3 million Ukrainians have fled the country since the invasion began on February 24, according to the UN High Commissioner for Refugees (UNHCR).

In an interview with the BBC in mid-March, the head of Ukraine’s central bank, Kyrylo Shevchenko, said that Russian assets frozen in foreign countries as a result of sanctions should be used to help rebuild the country. “The need for money will be huge”he told the BBC. “Loans and grants from multinational organizations and direct aid from other countries could be met. However, much of the funding has to be obtained as reparations from the aggressor, including funds that are currently frozen in our allied countries “.