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                        FRIDAY, MARCH 29, 2024
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Yushchenko signs anti-crisis legislation
Journal Staff Report

KIEV, Nov. 3 – President Viktor Yushchenko signed into law anti-crisis legislation that clears the way for a $16.5 billion loan from the International Monetary Fund, the presidential press service reported on Monday.

The legislation, which among others things calls for creation of a stabilization fund worth several billions of U.S. dollars to rescue ailing banks and companies, was approved on Friday.

“This is a stabilization package and it will be enough calm down the economic unease,” Yushchenko told reporters on Monday.

The legislation also increases the size of bank deposits guaranteed by the government to 150,000 hryvnias, up from 50,000 hryvnias currently, in a move aimed at stopping the run on deposits. In addition, Ukraine's budget will be tightened and spending cut.

Ukraine has been among the countries hardest hit by global financial turmoil as a plunge in the price of steel, its main export, exacerbates a credit crunch and a sharp fall in stock prices.

At the same time, the downturn has become increasingly politicized, with the president earlier in the week blaming the government for the country's problems.

The IMF and Ukraine agreed on the $16.5 billion package more than a week ago, but the approval of the legislation was needed before the IMF’s executive board could approve the loan.

Yushchenko said earlier the money from the IMF will be used to stabilize the national currency as well as to pay corporate foreign debts to avoid defaults.

Ukraine owes about $100 billion on foreign debts, including $15 billion in state debt and $85 billion in corporate debt, and analysts have repeatedly said servicing the debts may be a challenge.

The National Bank of Ukraine, which had about $37 billion before the crisis had emerged in early October, spent more than $6 billion to support the hryvnia against the dollar.

Valeriy Lytvytskiy, the chief analyst at the NBU, said the loan from the IMF will be a kind of “psychological support.” (nr/ez)




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Currencies (in hryvnias)
  28.03.2024 prev
USD 39.23 39.14
RUR 0.425 0.422
EUR 42.44 42.44

Stock Market
  27.03.2024 prev
PFTS 507.0 507.0
source: PFTS

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