To obtain the loan, Ukraine agreed to implement reforms in energy and financial sectors, strengthen its fiscal policy and improve business climate.

Ukraine recalls troops in Crimea

IMF's previous 15-billion-dollar stand-by loan program to Kiev was frozen in February 2011 over the unwillingness of the Ukrainian authorities to raise utility tariffs for households, reduce fiscal deficit and conduct reforms.

Ukrainian Prime Minister Arseniy Yatsenyuk said Thursday that his government expected that the country's economy will contract 3 percent in 2014.

"We should adopt tough anti-crisis measures to avoid default," Yatsenyuk told the parliament, urging the lawmakers to approve the package of laws aimed at preventing economic collapse.

Yatsenyuk said inflation in Ukraine for 2014 is likely to reach 12percent to 14 percent against the 2.6 percent estimated earlier due to the government's loose monetary policy.

The Ukrainian economy is facing bankruptcy over high budget deficit, huge state debt and low foreign exchange reserves.