Written November 9, 2022, 5:16 p.m
Eighteen billion euros in loans to Ukraine in 2023: This is what the European Commission is proposing on behalf of Twenty-Seven on Wednesday. Or 1.5 billion per month next year. These funds would enable the war-torn country to provide just under half of its short-term financing needs, which the IMF has estimated at between 3 and 4 billion per month. By 2022, the European Union will have provided around 6 billion euros in aid to Ukraine (not including military aid from member states, estimated at 3.1 billion).
The 18 billion released for 2023 should allow Kiev to finance its schools and hospitals, salaries and pensions for civil servants, housing displaced persons or even to rebuild the infrastructure targeted by the Russian strikes (electricity networks, roads, supply in water). etc.), the Commission describes in a press release. In return, Brussels is asking for “reforms” to improve the rule of law in Ukraine and combat the fraud and corruption endemic in that country.
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The aid will “ensure that the Ukrainian state continues to function, that citizens can benefit from essential public services and that the infrastructure destroyed by Russia can be rebuilt”, declared the president of the European leadership, Ursula von der Leyen . . The Ukrainian economy has been devastated by the conflict: the IMF predicts that the country’s GDP will fall by 35% this year.
This announcement comes at a time when Europe is increasingly criticized, in the United States, for its insufficient support for Ukraine, especially in the Republican camp.
No refund before 2033
The 18 billion that the EU provides are indeed loans, not grants, but they will be provided on particularly advantageous terms. With a maturity of 35 years, the loans will not be covered by any repayment of the principal until 2033. As for the interest, they will be “subsidized by EU member states”, the Commission clarifies.
Thank you to the European Commission and the President @vonderleyen to announce a financial assistance package of 18 billion euros for 2023. This shows real solidarity with the EU. Together we resist Russia’s aggression, together we will rebuild Ukraine, together we will be in the EU. #EmbraceUkraine https://t.co/cFx7gLlAjy
— Volodymyr Zelenskyi (@ZelenskyyUa) November 9, 2022
The Commission expects this proposal to be adopted by the European Council and Parliament before the end of the year. The first funds could then be disbursed to Kiev from the beginning of next year.
Ukrainian President Volodymyr Zelensky praised the “solidarity” of the EU. “Grateful to the European Commission and its President Ursula von der Leyen for announcing financial assistance of 18 billion euros for 2023. This shows the true solidarity of the EU,” he welcomed on Twitter.
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