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President of Ukraine, Volodymyr Zelenskyy. Image © Shutterstock

The money, part of the $5bn programme established in June 2020 aimed at protecting the economy from the worst impacts of Covid-19, has officially been sent to help bolster the fledgling economic recovery from the crisis.

“Ukraine’s IMF supported economic programme aims to help the authorities address the effects of the Covid-19 shock, sustain the economic recovery and move ahead of important structural reforms to reduce key vulnerabilities,” the fund said.

Those reforms include returning fiscal policy to target debt sustainability, boosting central bank independence, reducing the role of the state in the economy and continuing the government’s fight against corruption.

“I am grateful to the board of directors [at the IMF] for the positive decision to complete the review of the standby programme, which allows the allocation of a tranche of about $700m,” Ukrainian president Volodymyr Zelenskyy said on Twitter.

“We will use these funds to support the financial system and combat the consequences of Covid-19. The IMF programme will be continued.”

A total of $2.8bn has so far been paid out through the programme, which has been extended until June 2022, having previously been set to end in December this year.

The latest tranche was delayed for a year owing to slow progress on reforms. Ukraine also benefited from €600m of financing from the European Union last month to help spur reforms and encourage economic integration with the bloc.

One week ago Nato secretary general Jens Stoltenberg said the organisation was monitoring the military situation between Ukraine and Russia “very closely” following “large and unusual concentrations of Russian forces” near the border.

“Any further provocation or aggressive actions by Russia would be of serious concern,” he told a press conference.