Ukraine to receive $1.5b. from World Bank to support reconstruction

The funds will be provided with guarantees from the Japanese government and channeled to support social security and economic development.

 A driver walks near his burned car after Russian military strike, as Russia's invasion of Ukraine continues, in central Kyiv, Ukraine (photo credit: REUTERS)
A driver walks near his burned car after Russian military strike, as Russia's invasion of Ukraine continues, in central Kyiv, Ukraine
(photo credit: REUTERS)

Ukraine will receive $1.5 billion from the World Bank to support reconstruction and recovery, Prime Minister Denys Shmyhal said on Friday.

The funds will be provided with guarantees from the Japanese government and channeled to support social security and economic development, Shmyhal, whose country has been invaded by Russia, said on the Telegram messaging app.

"In particular, the loan will help support subsidies for internally displaced people and pension payments," Shmyhal said.

Relying on foreign partners

Ukraine relies on financial aid from its foreign partners to be able to cover its budget deficit. On Thursday, the International Monetary Fund's board completed its Ukrainian loan review, allowing Kyiv to immediately withdraw $890 million for budget support.

 Service members of pro-Russian troops drive a tank along a street past a destroyed residential building during Ukraine-Russia conflict in the town of Popasna in the Luhansk Oblast, Ukraine May 26, 2022.  (credit: Alexander Ermochenko/Reuters)
Service members of pro-Russian troops drive a tank along a street past a destroyed residential building during Ukraine-Russia conflict in the town of Popasna in the Luhansk Oblast, Ukraine May 26, 2022. (credit: Alexander Ermochenko/Reuters)

The government hopes for a modest economic recovery this year after the economy shrank by about one-third in 2022 because of Russia's war on Ukraine, and is working with foreign partners to secure financing for so-called 'fast' recovery.

Ukraine is rebuilding schools, hospitals, roads and bridges and implementing repairs in the energy sector despite continued fighting in the south and east of the country.