The EU Council and the European Parliament have reached a preliminary agreement on a new mechanism to support Ukraine through the creation of a Ukraine fund worth 50 billion euros.
This was reported by the press service of the EU Council.
The Ukraine Fund will combine EU budgetary assistance into one single instrument that will provide consistent, predictable and flexible support to Kiev for the period 2024-2027, tailored to the unprecedented challenges posed by war.
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— The EU is ready to support Ukraine as long as necessary. The Ukraine Fund will channel support to Ukraine to help its people rebuild their country amid the unprecedented challenges posed by the Russian war — said the Minister of Finance of the Belgian EU Presidency Vinsert Van Peteghem.
This support will also help Ukraine advance the reforms and modernization needed to move towards its future EU membership, he said.
The Ukrainian fund will consist of three components
The first is that the Cabinet of Ministers will prepare a plan that will set out the intentions for the recovery, reconstruction and modernization of the country, as well as the reforms that are planned to be carried out as part of the EU accession process. Financial support in the form of grants and loans to Ukraine will be provided based on the implementation of this plan.
The second component: within the framework of the investment program, the EU will provide support in the form of budget guarantees and a combination of grants and loans from public and private institutions.
The third pillar includes EU accession assistance and other measures to support Ukraine's adaptation to EU legislation and the implementation of structural reforms towards future membership.
Financial aspects
The Fund's total budget of €50 billion will be distributed between €33 billion in loans and €17 billion in grants.
Grants will be mobilized through a new special instrument proposed in the context of the mid-term review of the EU's multiannual budget. Loans will be guaranteed from reserves of own resources.
Ukraine may request an advance payment of up to 7% of the Fund amount.
— A significant share of the investment part of the Ukrainian plan and program will be directed to “green” investments, and part of the resources will be reserved for small and medium-sized enterprises. The plan will also aim to support national authorities, — the message says.
On February 1, the leaders of the European Union at a meeting of the European Council approved financial assistance to Ukraine in the amount of €50 billion for the next four years.
