The European Commission is going on Wednesday, May 18, to offer a new package of financial assistance to Ukraine, including new loans and commitments for long-term financing of the country’s reconstruction, citing officials, according to Reuters,
KYIV. UkraineGate , 16 , May , 2022 | Ukraine News .
Details
The amount of short-term financial support is still being determined, but two officials familiar with the discussions said they expected it to “roughly cover Ukraine’s financial needs for two months, mostly through loans.”
A third official said the money would come from the EU budget and EU governments, dismissing earlier talks that funds could be raised in the market by issuing joint bonds backed by the EU budget.
The extent of EU support, as indicated, will also depend on how many G7 countries are willing to contribute. A meeting of G7 finance ministers is scheduled for the second half of this week, after the European Commission is expected to release its proposals.
Member States must sign the European Commission’s plan and may try to adjust it.
Governments differ on how to support Ukraine, with many preferring loans, despite the IMF’s view and Ukraine’s likely inability to repay them. According to EU diplomats, Germany is one of the EU countries that supports grants.
According to officials, the package could be a mixture of grants and loans. The money will go to pay salaries, pensions and hospital expenses.
The European Commission is also expected to announce on Wednesday its commitment to supporting Ukraine’s long-term recovery, officials said, outlining the principles of what is estimated to be a colossal trillion-euro financial effort.
Addition
In April, the International Monetary Fund (IMF) estimated that Ukraine needed about $ 5 billion a month for at least three months to cover the deficit caused by the Russian invasion. The head of the Foundation, Kristalina Georgieva, called for this support to be provided in the form of grants, not loans.
The new package will be provided in addition to the EU’s 1.2 billion-euro emergency loan to Kyiv, agreed by the EU in January, half of which has already been disbursed and part of which is expected to be disbursed soon, a European Commission spokesman said.
Source: Ukrgate
