The loan is to finance the reconstruction of Ukraine’s agriculture and other industries that suffered heavy losses as a result of Russia’s war against the country.
The loan is different from the billions Ukraine has received in grants and other forms of untied aid, as this has to be repaid.
Since Russia launched its full-scale invasion in February, at least five million jobs in Ukraine have been lost, according to the country’s finance ministry. Ukraine’s central bank estimates that eleven percent of businesses had closed in September and more than half were operating at limited capacity.
It is becoming increasingly important for Ukraine’s private sector to get loans as the Ministry of Finance will struggle in the coming years to cope with the growing budget deficit.
The IFC is part of the World Bank and is an international financial institution whose mission is to promote the private sectors of developing countries.