President Joe Biden’s administration is offering Ukraine a sovereign loan guarantee of up to $1 billion to help the country’s economy as it faces the continued threat of a Russian invasion.
Secretary of State Antony Blinken announced the loan offer on Feb. 14. saying that it served to help the former Soviet nation with its economy by supporting it to “implement a bold economic reform agenda underpinned by ambitious cooperation with the International Monetary Fund (IMF).”
Blinken said the offer, combined with the strong partnership between Ukraine, the IMF, other international financial institutions, as well as the G7, would “bolster Ukraine’s ability to ensure economic stability, growth, and prosperity for its people in the face of Russia’s destabilizing behavior.”
“This action builds on the support the United States, our allies, and partners, including the G7 and international financial institutions, have provided Ukraine to help protect its economy amid Russian pressure in recent years,” Blinken said.
Ukraine has previously received three separate $1 billion sovereign loan guarantees from the United States between 2014 and 2016, as well as over $2 billion in development assistance since 2014.
“The Export-Import Bank of the United States intends to make available up to $3 billion to facilitate procurement of U.S. goods and services for projects in Ukraine, while the U.S. International Development Finance Corporation has a current investment portfolio in Ukraine of approximately $800 million across more than a dozen projects,” Blinken announced.
The Biden administration is looking at other ways it can also support Ukraine, Blinken said, adding that officials will continue to work with Congress to advance such efforts.
Ukraine is one of the poorest countries in Europe in terms of GDP, which stood at $3,726 per capita in 2019, according to World Bank data. A combination of political, security, and economic challenges over the past decade as well as large public debt repayments obligations have hindered economic growth.
The situation has worsened still owing to heightened tensions over the possibility of an invasion by Russia.
Russia has amassed more than 100,000 troops situated near Ukraine’s borders while simultaneously asking the United States and its allies to deny Ukraine and other former Soviet nations membership into NATO.
However, the country’s President Vladimir Putin denies that he has plans to invade Ukraine.
The loan announcement comes after White House officials warned that Russia could invade Ukraine imminently by next week.
White House national security adviser Jake Sullivan told reporters that Russia could invade Ukraine “any day now,” noting that it might do so before the completion of the Beijing Olympics, which are scheduled to end on Feb. 20.
Sullivan doubled down on those comments in an interview with CNN on Feb. 13.
However, Sullivan has stressed that the Biden administration is “not saying that a … final decision has been taken by President Putin” and credited the increasing concern to data from intelligence analysts “on the ground.”
Ukrainian President Volodymyr Zelensky has demanded proof from the United States regarding the alleged imminent invasion and cautioned against such warnings of a potential attack, which he said is creating “panic” in his country.
Zelensky has reiterated on multiple occasions that Ukraine wants to deescalate tensions with Russia but has said that his country will rely on its own forces in responding to any “surprises … from any side, from any borders.”
Following Monday’s official announcement regarding the loan, Blinken also wrote on Twitter that the United States is “working closely with allies to mobilize robust international support for Ukraine, including a U.S.-backed sovereign loan guarantee of up to $1 billion to support key reforms.”
“This support will bolster Ukraine’s ability to deliver prosperity for its people,” Blinken said.