The European Parliament supported the proposal of the European Commission to provide Ukraine with an exceptional loan of up to EUR35 billion as a contribution to the initiatives of the G7 countries, with further repayment due to unforeseen revenues from frozen Russian assets
635 deputies took part in the voting, of which 518 voted “for”, 56 – “against”, 61 abstained.
The corresponding vote on the resolution of the proposal on the adoption of the resolution of the European Parliament and the Council on the creation of the Credit Cooperation Mechanism for Ukraine and the provision of exceptional macro-financial assistance to Ukraine took place on Tuesday in Strasbourg within the framework of the plenary session of the European Parliament.
The speaker was Karin Karlsbro (Karin Karlsbro, Sweden, group of liberals “Renew Europe”).
The exceptional loan of up to EUR35 billion is the EU’s contribution within the framework of the G7 initiative to support Ukraine in the amount of up to $50 billion (approximately EUR45 billion) to meet Ukraine’s urgent financial needs arising from the brutal aggressive war on the part of the Russian Federation. Repayment of this exceptional IFA loan and loans from other G7 countries will be carried out at the expense of extraordinary income received from the immobilized assets of the Russian Central Bank and secured by the Credit Cooperation Mechanism for Ukraine, recently created in accordance with the Commission’s proposal. Future revenues from frozen Russian assets, as well as possible contributions from EU Member States and other countries, should be made available to Ukraine through this mechanism to help the country repay the IMF’s exceptional loan, as well as loans from other G7 partners deemed acceptable by the Commission. These funds will be used only to service and repay eligible loans and the MFA loan.
The new IFA loan does not have a target purpose, which allows Ukraine to allocate funds at its own discretion. The management and control systems outlined in the Ukraine Plan, along with specific measures to prevent fraud and other violations, will also apply to the IFA loan. The new IFA funds will be provided by the end of 2024 and disbursed by the end of 2025.
Earlier, the Council of the EU approved the proposal and plans to adopt a resolution in writing after the vote of the Parliament. The regulation is expected to enter into force the day after its publication in the Official Journal of the EU.
As previously reported, in September the Commission announced an EU loan of EUR 35 billion for Ukraine as part of the G7 partners’ plan to issue loans of up to USD 50 billion (EUR 45 billion). Future profits from frozen Russian state assets will be used to finance loans. Assets of the Central Bank of the Russian Federation amounting to about 210 billion euros are located in the EU and were frozen in accordance with the sanctions introduced in connection with Moscow’s invasion of Ukraine in February 2022.
