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  • Olga Zykova met with the leadership of the World Bank and the Ministry of Finance of the Netherlands during the visit to the IMF and WB Constituency Meeting
    Ministry of Finance of Ukraine, posted 12 July 2024 14:05

    On July 11, Deputy Minister of Finance of Ukraine Olga Zykova held a working meetings with Vice President of the Europe and Central Asia Region at the World Bank Antonella Bassani, and Director-General for Fiscal Affairs of the Ministry of Finance of the Netherlands Jasper Wesseling, as well as with representatives of other IMF and WB member countries.

    The meetings were held on the sidelines of the Constituency Meeting of the International Monetary Fund and the World Bank in Chisinau, Moldova.

    During the meeting with the World Bank representatives, Olga Zykova expressed gratitude for their comprehensive support and coordinating role in mobilizing donor financial assistance since the beginning of the full-scale war:

    “The World Bank was among the earliest supporters to provide assistance to Ukraine when it was most critically needed. To date, Ukraine has received more than USD 36 billion through additional mechanisms established by the Bank. This financing is crucial to bolster the Ukrainian economy during times of martial law, particularly to cover essential expenditures, notably in the social, education, and healthcare sectors, as well as to fund urgent reconstruction efforts.”

    The parties also discussed possible mechanisms and timeframes for attracting concessional loans through the International Development Association’s Special Program for Ukraine and Moldova Recovery (SPUR).

    Under this program, 1 donor grant dollar is converted into 3 loan dollars. As of today, SPUR has consolidated contributions from 17 countries totaling about USD 420 million, which makes it possible to attract concessional loans for Ukraine totaling USD 1.25 billion. SPUR funds are expected to be directed for new recovery projects in the areas of education, healthcare, local government fiscal management, and public investment management for reconstruction, as well as to support the private sector.

    In this context, the parties discussed the possibility of supporting the implementation of the Government of Ukraine’s priority reforms by preparing joint systemic projects aimed at supporting reforms in the following areas:

    • in the private sector to promote a green, export-oriented, private sector-led economic recovery;
    • in the education sector to increase access to full-time education in educational institutions and improve the teaching and learning environment in Ukraine;
    • in the financial sector by supporting the implementation of the Public Finance Management Strategy, which aims to improve budgeting practices and strengthen financial management capacity at the local level, and to create a strong institutional framework for effective public investment management in the post-war recovery and reconstruction.

    Progress was noted in the preparation of the LEARN project in the educational field, which is already preparing to negotiate relevant agreements.

    The project aims to improve the teaching and learning environment implemented through State Budget subventions to local budgets, including access of students, teachers and school staff to safe conditions for offline teaching and learning.

    “The RISE project has completed its initiation stage, and we are currently awaiting a letter of support from the World Bank. Concurrently, we are advancing with the preparation of the SURGE project. We anticipate the Bank’s assessment mission in the near future, during which we will agree on next steps for preparation and implementation, as well as the outcomes targeted under SURGE,” the Deputy Minister said.

    The World Bank has noted Ukraine’s transparency in implementing reforms, including those identified with international partners. Ukraine recently presented the Reforms Matrix, which was developed in cooperation with the World Bank. It is an analytical tool that systematizes all the conditionalities of cooperation programs with international partners and EU integration. On the Reforms Matrix website, everyone can find the content, timelines and schedule for fulfilling the conditions in various areas.

    During the meeting with Jasper Wesseling, the parties discussed further steps for cooperation between Ukraine and the Netherlands, in particular in the financial area.

    One of the mechanisms should be cooperation between the countries within the Multi-agency Donor Coordination Platform for Ukraine. The Netherlands became one of the countries that joined the Platform in February 2024, during the eighth meeting of the Steering Committee.

    Since February 2022, the Netherlands has provided Ukraine with budget support totaling about EUR 300 million. The funds were raised under World Bank projects aimed at financing priority social and environmental development needs, and also include a concessional loan through the IMF’s Administered Account.

    Currently, the European Union is the largest donor of direct budget support, with more than EUR 37 billion. In this context, the consistent support of the Dutch Government and lobbying in the EU institutions on issues related to the provision of financial assistance to Ukraine is significant.

    In addition, the Ministry of Finance of the Netherlands has been providing long-term advisory and technical assistance to the Ministry of Finance of Ukraine, in particular in the field of public internal financial control under the Memorandum of Understanding on Technical Cooperation. A number of measures have been taken to strengthen management accountability, the effectiveness of internal audit, and institutional capacity.