The Kremlin will pay directly for the damage caused by the brutal war against Ukraine. This was stated by Valdis Dombrovskis, executive vice-chairman of the Committee on Economic Affairs in the People's Interest.
„This unique loan package, developed together with our G7 partners and with a strong role for the EU, will allow Ukraine to cover its immediate needs, ensure macroeconomic stability and provide the country with the financial resources it needs to withstand Russia's increased aggression. By using windfall revenues arising from frozen Russian assets, the Kremlin will pay directly for the damage caused by its brutal war. "Today's package further demonstrates the EU's unwavering commitment to supporting Ukraine's sovereignty and economic sustainability," Dombrovskis said.
The European Commission has proposed a comprehensive financial support package for Ukraine, consisting of a loan cooperation mechanism of up to EUR 45 billion and an emergency macro-financial assistance loan of up to EUR 35 billion.
Through this package, the European Commission reaffirms its commitment to stand up for Ukraine in times of need, ensuring that EU support remains constant and effective.
President Ursula von der Leyen said: “Relentless Russian attacks mean that Ukraine needs continued support from the EU. The Commission will provide a loan of up to €35 billion to Ukraine as part of the G7 commitment. This is another significant contribution of the EU to the reconstruction of Ukraine.“
This package will include windfall profits from frozen Russian assets and sends a clear signal that the burden of rebuilding Ukraine will be borne by those responsible for its destruction. This approach will be implemented for the first time in a structured way and on such a scale among EU and G7 creditors, ensuring long-term and stable financial support for Ukraine's recovery and resilience.
The Commission first proposes to set up a loan cooperation mechanism for Ukraine, which will support EU and G7 partners in lending up to €45 billion to Ukraine. Ukraine can use this support to repay eligible loans from the EU and other creditors participating in the G-7 initiative “Extraordinary Loans to Accelerate Revenues for Ukraine”.
As the EU's contribution to the loans under this initiative, the Commission is proposing an extraordinary MFA loan of up to €35 billion. This financial support is crucial to meet Ukraine's urgent budgetary needs, which have grown significantly in the context of increased and sustained Russian aggression, including under the IMF's Extended Financing Facility arrangement. The remaining amount of the covered loan must be provided by other G-7 partners.
To enter into force, the proposal requires the approval of the European Parliament and a qualified majority of EU member states, in the Council. In view of the urgent nature of the proposal, the Commission will work together with the co-legislators to ensure its swift adoption.