Commission welcomes the consensus reached by G7 partners to collectively provide €45 billion in financial assistance to Ukraine

The Commission welcomes the consensus reached by the EU and G7 partners to collectively provide loans for €45 billion to support Ukraine's urgent budgetary, military and reconstruction needs (approximately $50bn). This confirms that the EU and G7 partners fulfil the commitment they made in June at the Apulia G7 Leaders' Summit. These loans will be serviced and repaid by future flows of extraordinary revenues stemming from the immobilisation of Russian Central Bank assets.

This achievement underscores the unwavering commitment of the EU and its G7 partners to support Ukraine in its fight for its freedom, recovery and reconstruction.

An EU mechanism for the repayment of the loans

The consensus amongst G7 members was facilitated by the EU's creation of the Ukraine Loan Cooperation Mechanism. This mechanism, recently endorsed by co-legislators following a proposal of the Commission, will receive extraordinary revenues stemming from the immobilisation of Russian sovereign assets and other voluntary contributions made by member states or third countries. These resources will then be distributed to Ukraine to repay the principal and interest on eligible bilateral loan agreements with lenders under the G7 ‘Extraordinary Revenue Acceleration (ERA) Loans for Ukraine' initiative. 

To ensure that Ukraine would receive the full amount of financing committed by G7 Leaders, the EU showed leadership by providing the authorisation to contribute to this initiative with an exceptional EU macro-financial assistance (MFA) loan of up to €35bn.

In light of the confirmed contributions of G7 partners, ensuring support proportionate to the size of their respective economies, the EU expects to provide an MFA loan of approximately €18bn as its contribution to the ERA initiative. Through this new exceptional MFA operation, that is additional to the support provided by the EU under the €50bn Ukraine Facility, Ukraine will be able to benefit from predictable, continuous, orderly and timely support that will contribute to cover a sizeable share of Ukraine's budgetary needs.

Next steps

Following the swift adoption by co-legislators of the Commission's proposal this week, the EU will work with Ukraine and G7 partners to operationalise the Ukraine Loan Cooperation Mechanism and MFA loan by the end of this year. This would allow paying out the new EU macro financial assistance to Ukraine in 2025. 

Background

Since the beginning of Russia's war of aggression against Ukraine, the EU, together with its member states, has unequivocally condemned Russia's actions and has offered unprecedented support to Ukraine and its people. The EU, its member states and European Financial Institutions have together provided nearly €122bn in grants and loans, supporting the Ukrainian war effort and its economy, helping to maintain basic services and offer early reconstruction, humanitarian assistance and help to those fleeing the war in the EU.

More information 

G7 Leaders' Statement on Extraordinary Revenue Acceleration (ERA) Loans

G7 Finance Ministers' Statement on Extraordinary Revenue Acceleration (ERA) Loan Initiative

G7 Summit Statements

Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL establishing the Ukraine Loan Cooperation Mechanism and providing exceptional macro-financial assistance to Ukraine

Council greenlights up to €35 billion in macro-financial assistance to Ukraine and new loan mechanism implementing G7 commitment - Press release

Parliament approves up to €35 billion loan to Ukraine backed by Russian assets - Press release

European Council, 27-28 June 2024 - Audiovisual Package 

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