Ukraine will get another $500 million from World Bank / Photo from ZN.UA
The World Bank's Board of Executive Directors on August 25, 2015, approved a $500 million IBRD loan to finance the Second Multi-Sector Development Policy Operation in Ukraine.
"This new financing supports a number of high-priority structural and macroeconomic reforms to improve the country's public sector governance, business environment, energy and social assistance," the World Bank said in a statement.
World Bank Country Director for Belarus, Moldova, and Ukraine Qimiao Fan announced that the package of reforms supported by this operation would help address the deep-rooted structural problems that have contributed to Ukraine's current economic crisis.
"We are helping Ukraine to implement an urgent set of measures, which will be essential to stabilize the economy, provide quality services to all Ukrainians and return the country to a sustainable growth path," he said.
In particular, reform measures supported by this loan – the second in a series of two – will promote good governance, transparency, and accountability in the public sector. The loan ensures that scarce public resources will be used effectively to provide quality public services at a crucial time.
At the same time, the operation will support efforts to strengthen the regulatory framework and reduce the cost of doing business. This should help unleash the private enterprise and help create sustainable and good quality jobs for Ukrainians.
Finally, this operation will assist the authorities to continue reforming inefficient and inequitable utility subsidies while protecting the poor from tariff increases by strengthening social assistance.
This operation is part of the World Bank Group's broader financial support package announced in February this year, which aims to provide Ukraine with up to $2 billion in 2015. The $750 million First Multi-Sector Development Policy Loan was disbursed in May 2014.
As UNIAN reported earlier, the Cabinet of Ministers of Ukraine supported the idea of borrowing $500 million from the World Bank under the Second Programmatic Financial Sector Development Policy Loan, or Programmatic Financial Sector DPL 2. This is stipulated in Cabinet resolution No. 830-r dated August 12, 2015, which is available on the government's official website.
The World Bank is a major development partner of Ukraine. With this new investment, the Bank's active lending portfolio will amount to over $5 billion. The Bank's current investments go into improving basic public services that directly benefit people of the country, such as water, sanitation, heating, power, roads, social safety net programs and health services.
Since Ukraine joined the World Bank in 1992, the Bank's commitments to the country have totaled over $9 billion for 45 projects and programs.