During President Viktor Yanukovich's rule, loans worth $37 billion had gone missing from state coffers, Ukraine's new prime minister declared.
Arseniy Yatseniuk warned that unpopular measures would be needed to salvage the economy, Reuters reported.
Yatseniuk, who will be visiting Kiev next week, said the country urgently needed loans from the International Monetary Fund with the hryvnia currency in freefall and concerns about the low level of foreign currency reserves growing.
Even with tales of Yanukovich's extravagance and lavish lifestyle, including his luxury residence outside Kiev being popularized over the years, the scale of alleged theft implied by Yatseniuk in a speech to parliament was jaw-dropping, according to Reuters.
Around $500 a month is the average salary in Ukraine.
Apart from the missing $37 billion, as much $70 billion had been sent out of the country during Yanukovich's three-year rule, Yatseniuk said. He did not comment on whether much of this capital flight was illegal.
"I want to report to you - the state treasury has been robbed and is empty," he said before the national assembly voted him in as head of a national unity government.
"Thirty-seven billion dollars of credit received have disappeared in an unknown direction ... (and) the sum of 70 billion dollars was paid out of Ukraine's financial system into off-shore accounts."
At today's rate, $70 billion is equal to about half of Ukraine's gross domestic product in 2013, Reuters reported.
Although the central bank's foreign currency reserves stand at $15 billion, Yatseniuk said only 4.3 billion hryvnia - $430 million - was left in government accounts.
Any funds found to be linked to Yanukovich would be frozen, the Swiss government said shortly after Yatseniuk spoke.
In Ukraine, the situation was so grave that there was no choice but to take "extraordinarily unpopular measures," Yatseniuk said, looking around the solemn faces in parliament as he listed the depth to which the economy has sunk.
"With prospects for foreign aid growing, Ukraine's dollar bond maturing in 2017 rose 1.5 points on Thursday to trade at 91.65 cents in the dollar, while bonds issued by state energy company Naftogaz maturing this September rose 1 point," Reuters reported. "The cost of insuring Ukraine's debt also slid as approval of the interim government opened the possibility of negotiating a deal with the IMF."
In response for Ukraine's request for help, an IMF fact-finding team is to visit Ukraine in the coming days, Managing Director Christine Lagarde said.
However, signaling that the possibility of a short-term default is still worrying investors, the June 2014 government bond weakened.
"The hyrvnia traded as low as 11.0 to the dollar and markets were signaling more depreciation, with 6-month currency forwards pricing it at around 12 per dollar," Reuters reported. "A former economy and foreign minister, and ex-deputy head of the central bank, Yatseniuk's immediate task is to draw up an anti-crisis plan and secure international aid to prevent a default and shore up the hyrvnia."
A $15 billion aid package was required from the IMF, finance minister Oleksander Shlapak said.
More than $30 billion was needed over two years for the country of 46 million people, acting President Oleksander Turchinov had said this weekend. The previous government had said last year that $20 billion was needed, Reuters reported.
Neuberger Berman said in a research note that many hurdles lay ahead for the Ukrainian economy. "We are also unsettled by the seemingly endless increases in headline figures needed for Ukraine to avoid default in two years," it said. "To us, this trend fosters doubt as to the commitment of future leadership to undertake much-needed reforms."
