The European Commission adopts a decision to disburse €600 million in assistance to Ukraine
Yesterday, the European Commission adopted
a decision to initiate a process towards disbursing €600 million to Ukraine in the
form of a loan. This corresponds to the first instalment
under the new macrofinancial assistance (MFA) programme for Ukraine, which amounts
to a total of €1.8 billion in medium-term
loans. The decision builds on the Memorandum of Understanding (MoU) and Loan
Facility Agreement (LFA), which Ukraine and the EU agreed on 22 May 2015 in Riga. The MoU came into force on 3 July 2015. Macrofinancial assistance (MFA) operations
are part of the EU's wider engagement with neighbouring
countries and are designed as an exceptional EU crisis response instrument available
to EU neighbouring countries experiencing severe balance
of payments problems. Through this programme, the EU contributes
to cover the urgent financing needs faced by Ukraine, while supporting the country's
economic stabilisation. In addition, the EU's MFA package
will assist the Ukrainian authorities in implementing important reforms in the areas
of public finance management, governance and transparency, the energy sector, social
safety nets, the business environment and the financial sector. By supporting the
Ukrainian government's reform agenda in those areas, the EU intends to help Ukraine
lay the ground for a durable return to economic growth.