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1 1 (March 14, 2022)

handle is hein.crs/govefki0001 and id is 1 raw text is: Congressional *.Research Service Russia, Ukraine, and the International Financial Institutions March 14, 2022 On March 1, in the wake of Russia's invasion of Ukraine, the International Monetary Fund (IMF) and the World Bank issued a joint statement, noting that both institutions are working to assess the economic and financial impact of the conflict and refugees on other countries in the region and the world, and provide enhanced policy, technical, and financial support to neighboring countries as needed. In addition to efforts to support Ukraine, the conflict raises questions about Russia's continued participation in the international financial institutions (IFIs). A senior European official, for example, told Reuters that, there is on ongoing discussion to kick Russia out of all international financial institutions. Legislation has been introduced in the House (H.R. 6899) that would restrict Russia's and Belarus's abilities to exchange into hard currency any of their foreign reserves held at the IMF. Congress may consider examining the effects of these efforts, as well as other policy options, including bilateral and/or multilateral debt relief for Ukraine and financial assistance for neighboring countries to help with the refugee inflows and mitigate the economic contagion from the conflict. Support for Ukraine The IMF is the major intergovernmental organization dedicated to international monetary cooperation and stability. A primary activity of the IMF is providing financial assistance to crisis-impacted countries. Prior to Russia's invasion of Ukraine, the IMF had a $5 billion loan in place for Ukraine, which was extended through June 2022. The lending program was approved in June 2020 to help Ukrainian authorities address the Coronavirus Disease 2019 (COVID-19) pandemic and implement various economic reforms. Following the invasion, Ukraine cancelled its preexisting program and sought immediate assistance. On March 8, 2022, the IMF approved a $1.4 billion assistance package to help Ukraine cope with the economic shock of the Russian attack. In contrast to the IMF's traditional lending, the March 2022 funding is through an IMF Rapid Financing Instrument (RFI), which provides faster assistance at lower interest rates to meet an urgent crisis. The IMF's executive board statement on the new funding expressed the board's strong support for the Ukrainian people. In addition to IMF lending, Ukraine is able to utilize its allocation of so-called Special Drawing Rights (SDRs), international reserve assets created by the IMF, to supplement its official foreign exchange Congressional Research Service https://crsreports.congress.gov IN11888 CRS INSIGHT Prepared for Members and Committees of Congress

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