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IMF mission starts review of Ukraine's new loan program

FILE PHOTO: The IMF logo is seen outside the headquarters building in Washington

By Olena Harmash

KYIV (Reuters) - An International Monetary Fund mission started work on Tuesday on the first review of a $15.6 billion loan program that it approved in March, the Ukrainian finance ministry said.

The IMF's four-year program for Ukraine is part of a $115-billion global package to support the country's economy as it battles Russia's full-scale invasion.

The ministry said in a statement that Ukraine's economic performance, the situation in the energy sector, and efforts to ensure the rule of law, increase transparency and fight corruption would be discussed during meetings in Vienna.

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Some meetings between Ukrainian officials and IMF experts will also take place in an online format.

"We are working to create an international compensation mechanism in order to direct confiscated Russian assets towards Ukraine's reconstruction," Prime Minister Denys Shmyhal said on the Telegram messaging app.

"We count on the IMF's support in this area, as well as further assistance to consolidate financial support from partners from around the world."

To ensure continued IMF support, Ukraine must meet a number of conditions, including steps to boost tax revenue, maintain exchange rate stability, preserve central bank independence, and strengthen anti-corruption efforts.

Ukraine's economy has been devastated by the war and the government relied heavily on Western aid to finance its social and humanitarian payments.

Ukraine's Extended Fund Facility (EFF) loan is the first major conventional financing program approved by the IMF for a country involved in a large-scale war.

(Reporting by Olena Harmash, Editing by Timothy Heritage)