EU approves disbursement of EUR 500 mln in macro-financial assistance to Ukraine

EU approves disbursement of EUR 500 mln in macro-financial assistance to Ukraine

The European Commission, on behalf of the EU, has approved the disbursement of a EUR 500 million loan to Ukraine as part of its fourth macro-financial assistance (MFA) program, under which the EU has now provided Ukraine with EUR 3.8 billion in MFA loans since 2014, according to a statement posted on the website of the European Commission.

The assistance is the largest amount of MFA the EU has disbursed to any single partner country, the statement said.

"Ukraine remains high on the European agenda. We continue political, financial and technical support, especially during this time of crisis, to support Ukraine's reform agenda for building a more resilient economy. Under the EU's fourth macro-financial assistance programme Ukraine has completed necessary reform benchmarks and we are preparing a disbursement of EUR 500 million. As part of helping our neighbours cope with the fallout of the pandemic, we will provide Ukraine with further emergency MFA assistance of EUR 1.2 billion," European Commission Executive Vice-President Valdis Dombrovskis said.

According to the statement, the disbursement of the second and last tranche of the MFA operation has become possible after Ukraine has implemented twelve policy actions agreed with the EU. They included important measures in the fields of fight against corruption and money laundering, public finance management, banking sector, energy, healthcare and social policies. Ukraine is also finalising a new Stand-By Arrangement with the International Monetary Fund (IMF) and has implemented the associated prior actions.

MFA funds are made available in the form of low-interest, long-term loans. The first instalment of EUR 500 million under the current programme was released in December 2018, after the Ukrainian authorities fulfilled the associated policy conditions.

In March 2018, in response to Ukraine's request, the European Commission proposed a new MFA programme for up to EUR 1 billion. This proposal was adopted by the European Parliament and the European Council in July 2018. The Memorandum of Understanding was signed by Ukraine and the European Commission, on behalf of the EU, in September 2018 and subsequently ratified by the Parliament of Ukraine.


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