IMF Lets Ukraine Use Reserves to Cover Gas Payments

(Bloomberg) — Ukraine won approval from the International Monetary Fund to tap into reserves and cover gas payments, though the Fund will continue to freeze loan disbursement until parliament can commit to budget cuts.

Ukraine was due to receive a $3.4 billion tranche of its $16.4 billion bailout in November, though that installment was delayed after the government failed to meet budget demands, including spending cuts. The former Soviet state is relying on the IMF cash to stay afloat and to pay Russia for natural gas on time after the credit crisis undermined demand for its exports such as steel and crippled its financial sector.

The IMF