The EU Council has decided to allocate loans to Ukraine totaling 1.2 billion euros due to the negative impact of geopolitical tensions on its economy.
The Council of the European Union approved the allocation of macro-financial assistance to Ukraine totaling 1.2 billion euros. This package will be provided to Ukraine in the form of loans and is aimed at strengthening stability in this country, which is in a situation of acute crisis, according to a statement of the EU Council issued on Monday, February 21, in Brussels.
“The EU has accelerated the allocation of economic assistance to Ukraine, as the current geopolitical tensions have a negative impact on its economic and financial stability. Constant security threats have already caused a significant outflow of capital,” the text of the statement explains. In addition, “Ukraine is already losing access to international capital markets due to increased geopolitical uncertainty and its impact on the economic situation,” the statement reads further.
The aid package is designed for 12 months and will consist of two tranches. The first will be allocated in the near future, subject to the fulfillment of the preliminary political conditions and the satisfactory implementation by Ukraine of the IMF program, as well as the entry into force of the Memorandum of Understanding on Structural Policy Measures, which must be agreed by Kyiv and the European Commission. The provision of the second tranche will be linked to the continued satisfactory implementation of the IMF program and the Memorandum of Understanding.
The package was agreed upon in a short time
A large package of assistance to Kyiv was approved just 21 days after the European Commission made a corresponding proposal. The Minister of Economy, Finance and Reconstruction of France, Bruno Le Maire, stressed that the Europeans “acted quickly and decisively” to help Kyiv. The President of the European Council, Charles Michel, announced the provision of this package to Kyiv ahead of the Munich Security Conference.
In recent days, tensions in the conflict between Russia and Ukraine have sharply increased. US President Joe Biden is confident that the Kremlin has already decided to invade, and also to seize Kyiv. According to Western intelligence agencies, about 150,000 Russian servicemen are stationed in the regions along the Ukrainian border.