European Union countries will likely back a proposal from the bloc’s executive arm for a €50 billion ($54.6 billion) financing package for Ukraine, EU Commissioner Valdis Dombrovskis told Bloomberg TV.
(Bloomberg) — European Union countries will likely back a proposal from the bloc’s executive arm for a €50 billion ($54.6 billion) financing package for Ukraine, EU Commissioner Valdis Dombrovskis told Bloomberg TV.
The commission earlier this week announced a funding plan through 2027 comprising grants, loans and guarantees to cover part of Ukraine’s current expenditure and to fund urgent reconstruction projects, as it continues to fight back against Russia’s invasion.
“We expect the support for the package,” Dombrovskis, a vice president of the commission, said Thursday. “Of course there is going to be discussions with member states, this may bring some adjustments.”
The cash will be disbursed provided Ukraine fulfills reforms to improve the rule of law and address corruption. Leaders are due to decide whether to open negotiations by the end of the year on Ukraine’s bid to join the EU.
Dombrovskis said that the EU is paying another €1.5 billion to Ukraine on Thursday under the macro-financial assistance package “and now we are looking more at the medium term focus, that’s where this 50 billion package comes in.”
Dombrovskis said he expected support from other donors, adding that “we also need to work on the absorption capacity and capacity to use this money in Ukraine, how quickly it can be deployed.” The reconstruction needs are huge, he said, but “there are obviously capacity limits on how much simultaneously can be reconstructed.”
While some progress has been made in areas including judicial reform, Kyiv needs to boost efforts in fighting graft and money laundering, according to an interim EU report published Wednesday.
At an international conference in London this week, UK Prime Minister Rishi Sunak announced the creation of a framework for war-risk insurance to encourage private investors to help rebuild Ukraine. More than 400 businesses from 38 countries signed up to the Ukraine Business Compact.
The World Bank has estimated that the cost of reversing the damage inflicted by Russian forces will be about $411 billion over the next decade, with $14 billion needed for critical spending this year alone.
–With assistance from Katharina Rosskopf.
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