Ukraine's Zelenskyy appeals for $55bn to cover budget gap and reconstruction

Washington: Ukrainian President Volodymyr Zelenskyy on Wednesday appealed to international donors to increase their financial support, saying more money was needed to rebuild schools and homes destroyed by months of Russian bombardment.

Zelenskyy, speaking by video link to finance ministers at the World Bank and International Monetary Fund annual meetings in Washington, said Ukraine needed about $55bn - $38bn to cover next year's estimated budget deficit, and another $17bn to start to rebuild critical infrastructure, including schools, housing and energy facilities.

"The more assistance Ukraine gets now, the sooner we'll come to an end to the Russian war, and the sooner and more reliably we will guarantee that such a cruel war will not spread into other countries," Zelenskyy said.

IMF Managing Director Kristalina Georgieva, World Bank President David Malpass and US Treasury Secretary Janet Yellen responded by underscoring the determination of the global community to continue to support Ukraine.

Georgieva said the IMF estimated that Ukraine would need $3bn to $4bn in external financing help per month next year - and possibly more - to keep its economy running as the Russian invasion that began in February drags on.

She said Ukraine's international partners have committed $35bn in grant and loan financing for Ukraine in 2022, enough to close its financing gap for this year, but its financing needs would remain "very large" in 2023.

She praised Ukrainian officials for progress in normalizing economic policies and stabilizing the economy despite "extremely difficult circumstance" since the start of the war.

But risks remained "exceedingly high", as demonstrated by Russian missile attacks on Ukraine this week, and high levels of external help would remain necessary to cover ongoing budget costs and initial infrastructure repairs, Georgieva said.

Yellen said the United States would begin to disburse another $4.5bn in grant assistance to Ukraine in coming weeks, bringing its budget assistance to $13bn since the start of the war, and called on others to improve the "scale, predictability, and grant component of disbursements."

Georgieva said the IMF planned to work with the Ukrainian authorities to set up a new "Ukraine Economic Forum" suggested by Zelenskyy to share information, calibrate financing needs and coordinate macroeconomic developments and policies.

She said the IMF would start talks soon with Ukraine about a new IMF monitoring instrument known as Program Monitoring with Board Involvement (PMB) and a comprehensive macroeconomic framework that would clarify external financing needs.

That in turn "should pave the way for a full-fledged IMF program once conditions allow," Georgieva said.

Zelenskyy said Ukraine would continue to press for an IMF lending program of about $20bn, in addition to $2bn in targeted credits to rebuild its electric power infrastructure and up to $5bn in credit limits to buy natural gas and coal.

The IMF last week approved $1.3bn in fresh emergency financing for Ukraine through a new food shock window, on top of $1.4bn in emergency funding approved in March.

The fund has also mobilized $2.2bn for Ukraine through an administrative account, Georgieva said.