EU Approves €35 Billion Loan For Ukraine
The Council of the European Union has approved a financial support package, which includes an extraordinary macro-level loan of up to €35 billion, as well as a credit cooperation mechanism that will help Ukraine repay €45 billion of loans, the EU council announced.
As part of the new macro-level financial assistance (MFA) approved by the member states, interest income from the funds of the Russian central bank frozen in EU banks will be made available to Ukraine.
The funds will help Ukraine cover the costs of the EU loan and loans provided by G7 partners and to also repay these loans; however, Kyiv can use the amount from the MFA at its discretion.
As Remix News reported just a year ago, the EU approved €66 billion to Ukraine. Between contributions from individual member states and the EU itself, the Kiel Institute Ukraine Support Tracker indicates that Europe has allocated €118 billion in aid, with €74 billion yet to be allocated but slated to go to Ukraine. That does not include huge sums sent to Ukraine from the United States and other countries.
The amounts from the new macro-level financial support will be disbursed until the end of 2025. The disbursement of the loan is conditional on Ukraine’s continued commitment to maintaining effective democratic mechanisms and respecting human rights.
As part of the sanctions introduced by the EU against Russia, since February 2022, the assets of the Russian central bank stored in the financial institutions of EU member states, worth around €210 billion, have been frozen. The generated profit is estimated at around €2.5 billion to €3 billion annually, depending on the interest rate.
According to the EU, these revenues are not state assets and do not have to be made available to the Russian central bank even after the end of the freeze. Following the adoption by the European Parliament, the Council of the European Union approved the text through a written procedure with the aim of making the MFA loan available in 2024, disbursed in 2025, and repaid in a maximum of 45 years. The decree enters into force on the day following its promulgation.