PM: "The signing of two agreements with the EIB worth EUR 600 million to be a signal of support for Ukrainian economy from the EU"

On Monday, December 22, Prime Minister of Ukraine Arseniy Yatsenyuk met with Vice-President of the European Investment Bank László Baranyay.

During the meeting the Prime Minister of Ukraine and László Baranyay signed financial agreements: the Apex Loan for SMEs & Mid-Caps (Ukraine) project and the Ukraine Early Recovery project.

Arseniy Yatsenyuk said that the signing of these agreements is for Ukraine "a signal of support for the Ukrainian economy from the European Union, as the European Investment Bank is a financial institution of the EU."

The Prime Minister of Ukraine said that the signed loan agreements aimed at "developing the economy, not the return of old debts taken by the previous governments": "The former government along with the former president doubled Ukraine's foreign debt for four years, thus they had taken almost USD 40 billion, and we are thinking how to return and serve them."

During the current year, according to Arseniy Yatsenyuk, the Government of Ukraine managed to keep the amount of external debt of the Ukrainian state to foreign creditors at the level of $72 billion, "We didn’t increase external debt, not a bit. By the end of the year the picture will probably change, but for now we are keeping a balance by all possible means and measures that we possess."

He said that Ukraine received EUR400 million under the Apex Loan for SMEs & Mid-Caps (Ukraine) project, "which can allow to finance small and medium-sized businesses through Ukrainian banks." The loan’s term is ten years.

"The European Investment Bank provided Ukraine with the most preferential terms. The current Euribor interest rate is only 1.5% per annum. Such a loan at such a low rate none of the private investors of Ukraine would give under no circumstances," the Prime Minister of Ukraine said.

The Ukraine Early Recovery project is the second bloc of credit cooperation, according to him, finally we received not just words, but concrete actions of the European Investment Bank aimed at restoring infrastructure, territories in Donetsk and Luhansk regions controlled by the Ukrainian state". Moreover, the agreement is aimed at the construction of infrastructure projects in the neighboring regions: Odesa, Dnipropetrovsk, Kharkiv as well as "assistance to temporarily displaced persons for their return to the areas where they lived before."

The total amount of such loan is Eur 200 million for 20 years.

Arseniy Yatsenyuk said that the beneficiaries of such loans would be relevant communal and municipal enterprises in the relevant territories, "This is also a part of our decentralization program, in which the Government draws funds into the Central budget to afford the municipalities to obtain long-term 20-year credit resources".

The Prime Minister appealed to the heads of cities, regional and other councils on the relevant territories, "If you want to get these funds, you ought to have a project and you should use them in a transparent and non-corrupt way".

"Together with our European partners, we ought to establish a mechanism to monitor the use of funds and efficiency of using each Euro/Dollar, we receive", he added.

"As for the overall package of macro-financial assistance, which, as a rule, shall be used to repay the external debt of Ukraine, as it has been this year, it gave us an opportunity with USD 9 billions granted by our foreign borrowers to pay 14 billion dollars", stressed the Head of Government. Arseniy Yatsenyuk expressed belief that the Ukraine's support program would be continued by our Western partners, "The entire reform plan, which was announced in Brussels, was approved by our partners. We realize that now the principal issue for our Western partners is to adopt their internal decision regarding the possible financial assistance. Therefore, the decision is awaited in particular from Brussels, Washington and Berlin".

"I call on, in the first place, the political forces in Kiev to carry out a real reform. And if someone is looking for an answer to the question, what the reforms mean, just take the statement by Leszek Balcerowicz in Poland in the 1990-ies and see what the reforms mean. They mean strict and difficult decisions we must take today in order to have our future. Tomorrow will come, but we have to fight for our future," he was quoted as saying.

"Let’s follow an example of Europe: Poland, Latvia, Lithuania, Estonia - and work for Ukraine", said Arseniy Yatsenyuk.