Yellen and G7 urge renewed aid to Ukraine as G20 finance chiefs meet

BENGALURU (Reuters) – U.S. Treasury Secretary Janet Yellen on Thursday stepped up calls for increased financial support for Ukraine to help it fight Russia’s year-old invasion, as the United States prepared an additional $10 billion in economic aid.

Yellen, speaking at a news conference in India on the eve of the first anniversary of the Russian invasion, said it was critical that the IMF move “quickly” toward a fully funded loan program for Ukraine.

“As President Biden said, we will stand with Ukraine in its fight — as long as it takes,” she said. “Ukraine’s continued and strong support will be a major topic of discussion during my time here in India.”

Yellen will join other finance ministers and central bank chiefs from the Group of 20 nations on Friday for a meeting at a resort near the technology hub of Bengaluru. It is the first major meeting of India’s year-long presidency of the bloc, which includes the wealthy G7 democracies plus Russia, China, Brazil and Saudi Arabia.

In a joint statement, G7 finance ministers said the bloc hopes Ukraine and the International Monetary Fund will agree on a loan program by March, adding that they have increased financial aid to Ukraine for this year to $39 billion. German Finance Minister Christian Lindner said that his country already supports Ukraine, and now other countries must do their part.

Ukraine’s Prime Minister Denys Shmyhal said Monday, after meeting with the Managing Director of the International Monetary Fund, Kristalina Georgieva, in Kiev that Ukraine is seeking $15 billion for the IMF’s multi-year program.

Yellen said the previous US military, economic and humanitarian aid amounting to $46 billion allowed Ukraine to maintain economic and financial stability.

“Our economic assistance makes Ukraine’s resistance possible by supporting the home front: financing critical public services and helping to keep the government functioning. In the coming months, we expect to provide about $10 billion in additional economic support to Ukraine,” she added.

Government sources told Reuters that India, which maintains a neutral position on the war, does not want to discuss additional sanctions against Russia at the G20 meetings. G20 officials said India was also pressing participants to avoid using “war” in the language of the manifesto to describe the conflict.

But Yellen said the statement was still under discussion and that she would like to see a “strong condemnation” of Russia’s invasion and the damage it caused to Ukraine and the global economy.

However, she said the global economy is “in better shape today than many expected just a few months ago”.

China warning

Yellen said that at a time when general inflation had begun to ease in the United States and around the world, it was important for G20 finance officials to continue working to suppress inflation, adding, “We are not out of danger yet.”

She said G20 countries, especially China, need to work on debt restructuring for low- and middle-income countries in distress, especially the “most urgent” cases in Zambia and Sri Lanka. The G7 also said the bloc would also work to provide debt relief for these “weak countries”.

Yellen said talks between the US and China on economic issues would resume at an “appropriate time”, but also warned Beijing that providing any material support for Russia’s war effort would be a “very serious concern”.

Some links between Washington and Beijing have been suspended after a suspected Chinese surveillance balloon that had flown over the continental United States was shot down this month, including previously planned visits to China by Yellen and Secretary of State Antony Blinken.

Yellen told reporters that the United States would quickly appoint a candidate to head the World Bank. While the US Treasury manages the dominant US stake in the World Bank, Yellen has a big say in who leads the institution, which plans to open nominations for the post later Thursday.

(Reporting by David Lauder, Aftab Ahmed, and Christian Kramer in Bengaluru, Kiyoshi Takenaka in Tokyo; Writing by Raju Gopalakrishnan and Meral Fahmy; Editing by Nick McPhee

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