Ukraine received the first tranche under a new EU macro-financial assistance program from the European Commission with a nominal amount of EUR 600 million in the form of a long-term loan with a repayment period in June 2035 and at a yield rate of 0.125% per annum. To provide the tranche, the European Commission issued bonds with a negative yield of -0.143%, due to which, after deducting the issuance commissions, Ukraine received EUR 623.5 million.
"We are grateful to the European Commission for its support, which is certainly another reflection of the friendly and strategic partnership between Ukraine and the European Union. The funds received will be used to finance state budget expenditures, which will help to maintain financial stability in Ukraine," said Serрii Marchenko.
These funds have been received by Ukraine in the framework of the Fifth Program, implemented under the Memorandum of Understanding and the Loan Agreement with the EU (for receiving EU Macro-Financial Assistance to Ukraine of up to EUR 1.2 billion ), concluded by the parties on July 23, 2020, in Brussels.
At present, the total amount of EU concessional loan assistance received by Ukraine under the implementation of five macro-financial assistance programs during 2014 - 2020 has reached EUR 4.41 billion.
All of these funds, in accordance with the terms of the relevant memorandums with the European Union, were used to reduce external financial pressure on Ukraine, improve its balance of payments and meet budgetary requirements.
Ukraine is currently in the process of fulfilling the implementation of the relevant obligations defined in the Memorandum in order to receive the 2nd tranche (EUR 600 million) (which can be provided in 3 months after receiving the 1st tranche) due to the need for Ukraine to fulfill eight special conditions (on the implementation of structural reforms) in the following spheres:
- public finance management;
- good governance and the rule of law:
- improving the business climate;
- sectoral reforms and state-owned enterprises.