The International Monetary Fund’s board on Tuesday approved disbursement of $3.3 billion in fresh financial support to Ukraine, one of the world’s economies hardest hit by recession, the Financial Times reported. This, the third tranche from a $16.4 billion standby loan programme, brings the total amount of funds disbursed to Kiev to $10 billion since the global financial crisis struck last autumn. To secure the fresh aid, Kiev’s government agreed to reduce expenditures and begin increasing natural gas prices this autumn for households to market levels.

Just months after an epic banking collapse forced Iceland into the arms of the International Monetary Fund, this island nation is locked in a fierce debate over how to pay off its creditors without ceding too much of its vaunted independence, The New York Times reported. The balance Iceland strikes between bowing to the policy demands of the global financial community and satisfying the desires of its increasingly resentful population of 300,000 will be closely watched as I.M.F. programs in beaten-down economies from Latvia and Ukraine to Hungary and Romania enter a crucial phase.

The International Monetary Fund has corrected an embarrassing error that led to the publication of exaggerated estimates of the external debt levels of crisis-hit eastern European states, the Financial Times reported. In its latest Global Financial Stability Report, published in April, the IMF provided key numbers on 38 selected emerging market countries, including their 2009 external debt refinancing needs as a ratio of their foreign exchange reserves.

The Russian factory known as Avtovaz is one of the least efficient automobile factories anywhere in the world--each worker produces, on average, eight cars a year, compared with 36 cars a year at General Motors’ assembly line in Bowling Green, Ky., for example. Yet the government is giving Avtovaz billions of dollars in aid, no strings attached, The New York Times reported. “The key issue is too much government protection,” Yegor T. Gaidar, a former prime minister, said.

Ukraine's central bank on Monday placed two more banks in receivership, Rodovid Bank, the country's 20th largest, and BIG Energia, which ranks 66th of the more than 180 banks operating in the country. The decisions brought to 11 the number of banks in Ukraine in receivership and operating under restrictions. At the end of last month, Rodovid's shareholders proposed that the government play a role in adding to the bank's capitalisation and said they were ready to transfer no less than 50 percent of its shares plus one to state hands. The government has yet to agree to the proposal.

Russian Prime Minister Vladimir Putin on Thursday said Ukraine was on the verge of bankruptcy but promised Moscow would not push its ex-Soviet neighbour over the edge with high gas bills, local news agencies reported. The global crisis has battered Ukraine's economy, with industrial output down more than 30 percent year-on-year, GDP seen shrinking six percent in 2009 and its currency losing 50 percent of its value against the dollar at one point last year.

Just off Kiev's busy Khreshchatyk thoroughfare, armed and masked security officers barged into the offices of state-owned energy giant Naftogaz, placing the Ukrainian company once again at the center of government infighting and corruption allegations, Forbes reported on an Associated Press story. The raid Wednesday underscores the Naftogaz problem at the heart of the country's crucial energy sector, and the threat its sprawling, inefficient and impoverished condition poses to European energy security. Ultimately, Naftogaz is Europe's problem.

Ukraine, once considered a worldwide symbol of an emerging, free-market democracy that had cast off authoritarianism, is teetering, The New York Times reported. And its predicament poses a real threat for other European economies and former Soviet republics. The sudden, violent protests that have erupted elsewhere in Eastern Europe seem imminent here now, too. World leaders are increasingly worried about the discontent and the financial crisis in Ukraine, which has 46 million people and a highly strategic location.

A group of multilateral lenders on Friday unveiled a lending package of up to €24.5 billion ($31 billion) to help central and eastern Europe’s battered banking systems weather the financial crisis, the Financial Times reported. The World Bank, the European Bank for Reconstruction and Development and the European Investment Bank, which announced the package in London, hope the move will encourage the international banking groups that control most of the region’s banks to support their subsidiaries.

Bank analysts predict that Ukraine is heading for a historic default on its national debt, in a scenario that could complicate EU-Ukraine relations and have an impact on the recent Russia-Ukraine gas transit deal, BusinessWeek reported. "The market is pricing in a probability of sovereign default of almost 90 percent," Commerzbank analyst Ulrich Leuchtmann told EUobserver on Monday. "It could happen in the next couple of quarters." Ukrainian industrial production has plunged 26 percent compared to last year.