Ukraine on Friday received $5 billion (4.75 billion euros) from the International Monetary Fund (IMF), the first tranche of a bailout scheme totaling $17.5 billion in aid over the next four years.

The Finance Ministry said that out of the first tranche, $2.2 billion would go straight to government coffers, while the remaining $2.5 billion would be handed over to the central bank, with the lender struggling to shore up the battered national currency, the hryvnia.

With the first billions of fresh aid in its pockets, Ukraine now has no other alternative than to get serious on radical reforms as a prerequisite for receiving the remainder of the bailout in the years ahead.

Austerity measures ahead

"Without reforms today, we will not have a tomorrow," Prime Minister Arseny Yatseniuk said in a statement. "The government isn't fighting for an approval or popularity rating," hinting at reforms that meant taking on vested interests of pensioners, public-sector workers and some of the nation's most powerful oligarchs.

As part of the IMF program, Kyiv on Friday launched consultations with its creditors in an effort to restructure at least some of the nation's debt load and save some $15 billion over the next two years.

Ukraine's debt is made up mainly of billions worth of bonds. Government officials are holding talks with major bondholders such as Templeton, PIMCO and Blackrock, but have said they would also seek a solution as to bonds held by Russia, which it accuses of supporting pro-Moscow rebels in the east of the country.

hg/bk (AFP, Reuters)