The International Monetary Fund (IMF) gave the final seal of approval for an $8.1 billion loan to Ukraine, with more lenient terms for the war-torn country than initially planned.
The fund's executive board signed off on the new program in Washington, D.C. on Feb. 26, the IMF announced in a press release. Ukraine, which relies on continued injections of foreign cash to keep its finances afloat, will receive financial support from the fund in tranches through 2029, with the first payment arriving as an immediate disbursement of $1.5 billion.
The Washington-based lender and Kyiv had initially agreed to a more stringent version of the program in November 2025, requiring Ukraine to adopt or table legislation on a series of unpopular taxes to unlock the program.
But amid a severe energy crisis caused by Russian strikes and pushback from parliamentarians, Kyiv successfully secured the IMF's blessing to postpone those demands to later on in the year.
The legislation — which the Ukrainian parliament must pass down the line to receive future payments from the IMF — includes raising taxes on online retailers, imported consumer parcels, and changes to the country's value-added tax for self-employed entrepreneurs. Those changes are intended to "de-shadow" parts of Ukraine's economy.
"Under the program, the authorities are committed to tackling longstanding bottlenecks to growth, including through combatting corruption, promoting the formalization of economic activities, addressing tax avoidance and evasion, reforming energy markets, and strengthening financial market infrastructure," Kristalina Georgieva, Managing Director of the IMF, said in a statement.
The fund's approval comes just days after European leaders had hoped to sign off on a 90 billion euros ($106 billion) loan to Ukraine on Feb. 24 to mark the fourth anniversary of Russia's full-scale invasion.
Despite agreeing in principle to the 90-billion-euro loan initiative at a key leaders' summit in December 2025, Hungary's foreign minister, Peter Szijjarto, unexpectedly said on Feb. 20 that Budapest would block the plan, in a deepening spat between Budapest, Bratislava, and Kyiv over Russian oil transit.
The Druzhba oil pipeline, which runs through Ukraine and supplies Russian oil to Hungary and Slovakia, has been offline since a Russian strike in late January. Both countries accuse Ukraine of stalling repairs.
Budapest said it would not approve the loan until it started receiving oil — and also derailed the EU's 20th sanctions package, which leaders had also hoped to approve on Tuesday.
The loan is intended to provide two-thirds of Ukraine's military and financing needs through 2027 — without which Kyiv will run out of cash by mid-2026.
Hungary's move raised fears that the IMF may not approve the program, since the fund requires a high degree of certainty that borrowing countries can keep their finances in order.
The board's approval likely reflects expectations that the European loan will be resolved quickly.
European Commission president Ursula von der Leyen and European Council president Antonio Costa both rebuked Hungary's actions — with von der Leyen saying that Brussels will find a way to make the loan happen "one way or another."
Prime Minister Yuliia Svyrydenko welcomed the IMF decision, saying that, "It is very important for us that in the fifth year of full-scale war, amidst systematic attacks on the energy sector, Ukraine has guaranteed international financial support from partners and resources for the stable functioning of the state."
This is the second IMF program approved since Russia began its full-scale war against Ukraine in February 2022.
The IMF and Ukraine agreed on a first program in March 2023, which totalled $15.6 billion.
Netflix walks away from its deal to buy Warner Bros. after Paramount came back with a better offer