G7 countries have approved almost $20 billion in financial assistance for Ukraine on Friday, following two days of meetings in Germany, which focused on the Russian invasion crisis and growing global inflation, food shortages, and persisting supply chain issues.
“We will continue to stand by Ukraine throughout this war and beyond and are prepared to do more as needed,” a joint G7 statement said of the $19.8 billion package just approved.
“We are working closely with Ukraine to safeguard its macroeconomic stability in face of the challenges posed by Russia’s war of aggression, massive destruction of critical infrastructure and disruption of traditional shipping routes for Ukrainian exports,” the statement explained.
Initially Ukraine’s government had requested a whopping $50 billion in April in order to prop up its heavily export-dependent economy, which has been devasted by the invasion.
Germany, which currently hosts the G7’s rotating presidency, itself pledged €1 billion ($1.1 billion) for Ukraine which is to come out of the 2022 budget. “We are currently collecting the various commitments for direct liquidity support,” German Finance Minister Christian Lindner said at the G7 summit hosted near Bonn.
The EU is contributing €9 billion of the total. “We feel responsible for the capability of the Ukrainian state and its people to defend themselves,” Lindner also stated, expressing the collective mood of summit participants, which included central bankers.
The International Monetary Fund in its latest figures said Ukraine needs at least $5 billion a month, or $15BN for three months, just to keep up salary and wage payments, also to maintain expanded and strained public services which now includes running refugee facilities for the millions of internally displaced citizens due to the war.
Ukraine was represented at the summit, with Ukrainian Prime Minister Denys Shmyhal giving a virtual address, and the country’s finance minister also participating via video feed.
“Ukraine protects the whole civilized world. Support of partners will speed up our victory. During a meeting with G& finance ministers discussed practical steps to recover [Ukraine] from the consequences of war,” Shmyhal had tweeted. “Despite Russia’s efforts to destroy our economy, together we will win!”