EU lends Ukraine €1bn to stabilise economy

29 Apr 14
The European Commission yesterday agreed a €1bn loan to shore up macro-economic conditions in Ukraine

Commissioners said the new Macro-Financial Assistance loan programme was a ‘concrete sign’ of European support for the beleaguered nation. It is aimed at reducing the Ukraine’s short-term balance of payments and fiscal vulnerabilities. 

European Commission vice-president Siim Kallas said: ‘This assistance, combined with the previously decided €610m MFA programme, will provide much-needed help to the Ukrainian government for its financing needs. 

‘It is a concrete sign of EU’s support to the Ukrainian people in a difficult situation, along with the other long-term financial assistance.’

Disbursements, however, will be contingent on improvements in areas such as public financial management and anti-corruption work.

Meanwhile, in a statement to the House of Commons yesterday, UK Foreign Secretary William Hague re-affirmed that British experts were being sent to Ukraine to help it improve its PFM.

He went on: ‘[We are] working with the World Bank to strengthen governance in Ukraine, we are co-hosting a forum on asset recovery starting [today] in London to locate the proceeds of corruption, and we are helping them to support free, fair and inclusive presidential elections on 25 May.

‘We have helped to secure an increase in European Union assistance to help ensure economic stability in Ukraine, bringing the total support available from existing EU budgets to over £1.4bn and we are calling for expert EU assistance to strengthen law enforcement and the rule of law.’

Hague said the UK also supported plans by the International Monetary Fund to put in place a two-year programme worth over $17bn to help Ukraine deliver the reforms needed ‘to build a stronger and more prosperous economy for the future’. 

Last week, the US pledged an additional $50m assistance package to help the Ukrainian government implement economic and political reforms. 

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