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Ukrainian President: Enormous IMF Loan Won’t Help Ordinary Ukrainians — Its for War

Ukrainian President Petro Poroshenko has admittedthat a new $17.5 billion loan from the International Monetary Fund and its associated austerity measures will not improve the lives of ordinary Ukrainians—but will help pay foreign creditors and fund the country’s ongoing civil war.

“Life won’t improve shortly,” Poroshenko said in televised comments on March 10, one day before the IMF approved the loan. “If someone understands the reforms as improvement of people’s living, this is a mistake.”

One reason for the cooled expectations is what he called the “tough wartime conditions.” He also announced a fourfold increase in defense spending, a boost that according to Business New Europe, “will inevitably impactalready limited means for social welfare and pensions.”

BNE continued:

Those tough wartime conditions seem to secure—for now—the population’s support for the defence spending hike to $3.8bn, or 5.2% of GDP. People are anxious about pro-Russian rebels in eastern Ukraine pushing westward in the fierce fighting of recent weeks, and fearful that they could take more ground if February’s shaky ceasefire collapses. “In the current situation, [more defence spending] is a good thing,” said 33-year-old Kyiv businessman Vitaliy Zanadvorov.

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