Statement from Odile Renaud-Basso, President of the European Bank for Reconstruction and Development (EBRD), Werner Hoyer, President of the European Investment Bank (EIB), Carlo Monticelli, Governor of the Council of Europe Development Bank (CEB), Kristalina Georgieva, Managing Director of the International Monetary Fund (IMF), and David Malpass, President of the World Bank Group (WBG).
We, the heads of the EBRD, EIB, CEB, IMF, and WBG, met today to discuss impacts on the global economy of the ongoing war in Ukraine and our respective and collective response to this crisis. We are horrified and deeply concerned about the Russian invasion of Ukraine and the ensuing crisis. The attacks on civilians and civilian infrastructure are causing tremendous suffering, creating massive population displacements, threatening international peace and security, and endangering basic social and economic needs for people around the world.
In addition to the devastating human catastrophe unfolding in Ukraine, the war is disrupting livelihoods throughout the region and beyond. The impacts will be extensive—from reduced energy and food supplies, to increases in prices and poverty and a massive undertaking of Ukraine’s reconstruction, all of which will hamper the post-pandemic recovery around the world.
The entire global economy will feel the effects of the crisis through slower growth, trade disruptions, and steeper inflation, harming especially the poorest and most vulnerable. Higher prices for commodities like food and energy will push inflation up further. Countries, particularly those neighboring Ukraine will suffer disruptions in trade, supply chains and remittances as well as surges in refugee flows. Reduced confidence and higher investor uncertainty will impact asset prices, tighten financial conditions, and could even generate capital outflows from emerging markets.
Our institutions have responded with emergency support to Ukraine and its neighbors.
The EBRD has approved a “War on Ukraine – EBRD Resilience Package”, initially sized at EUR 2 billion, to respond to the immediate needs of the people affected by the war and – when conditions permit – support the substantial reconstruction of Ukraine. The EBRD’s package comprises an immediate Resilience and Livelihoods program covering the areas of energy security, nuclear safety, municipal services, trade finance support and liquidity for SMEs in Ukraine and in neighboring affected countries. Once conditions permit, the EBRD will also be prepared to take part in a reconstruction program for Ukraine, to rebuild livelihoods and businesses; restore vital infrastructure; support good governance; and enable access to services. It envisages working with international partners including the EU and U.S., as well as bilateral donors and other international financial institutions.
The EIB has prepared an emergency solidarity package for Ukraine of EUR 2 billion, including the provision of EUR 668 million in immediate liquidity assistance to the Ukrainian authorities. This has been developed in close collaboration with the European Commission. As part of this package, the Bank is also accelerating the delivery of an additional EUR 1.3 billion of commitments made for infrastructure projects. Of the emergency liquidity assistance, EUR 329 million has been disbursed in the past week. An additional EUR 329 million will be disbursed over the coming days. In parallel, the Bank is developing a multi-billion euro package for the EU Eastern and Southern Neighborhood, the EU Enlargement Region and Central Asia to mitigate the consequences of the refugee crisis, and help address the social and economic fallout caused by the war. Within the EU, EIB will work closely with Member States, National Promotional Banks and the European Commission to prepare an action plan to help alleviate the impact of the refugee crisis on EU countries hosting refugees.
The CEB, according to its membership and special social mandate, has provided emergency grants to Ukraine’s neighboring countries to cover immediate needs of refugees, including transportation and orientation. The CEB stands ready to also provide flexible, fast-disbursing loans to address the significant financial needs of neighboring and other countries hosting large inflow of refugees, while remaining focused on the social sector.
The IMF disbursed emergency assistance of US$1.4 billion to Ukraine on March 9 under the Rapid Financing Instrument (RFI) to help meet urgent financing needs including to mitigate the economic impact of the war. IMF staff remains closely engaged with the authorities to provide policy support as they continue to design and implement effective crisis mitigation measures. The IMF is also currently working with Moldova, which has requested an augmentation of its existing IMF-supported program. The Fund stands ready to support neighboring and other countries affected by the spillovers of the war through all its relevant instruments.
The World Bank Group has already mobilized more than US$925 million for Ukraine, including fast-disbursing budget support to help the government provide critical services to Ukrainian people, of which US$350 million has been disbursed. This financing is part of a US$3 billion package of support planned for Ukraine in the coming months. The World Bank also set up a multi-donor trust fund (MDTF) that is among the most rapid, targeted, and secure mechanisms to facilitate channeling grant resources from donors to Ukraine, with contributions of US$145 million thus far. The World Bank Group is also working on options to assist neighboring countries, including to support refugee populations, and will continue to provide trade finance to support the private sector.
We acknowledge the importance of working together to coordinate our respective responses to support Ukraine and neighbors on the financing and policy fronts and maximize impact on the ground. We are committed to strengthening international cooperation and solidarity in the face of this enormous challenge.