EU to grant Ukraine €35 billion in aid, Russia set to cover the cost

The European Commission's proposal to allocate €35 billion ($39 billion) in new macro-financial assistance to Ukraine stipulates that the funds will be provided on a non-repayable basis, according to the Ministry of Finance of Ukraine.

The repayment of the loan will be exclusively covered by future proceeds from frozen Russian sovereign assets in the EU. A new mechanism, the Ukraine Loan Cooperation Mechanism (ULCM), will be established for this purpose.

The European Commission's decision is part of the G7 initiative on additional loans to boost Ukraine's budget revenues (Extraordinary Revenue Acceleration Loans for Ukraine), rather than an alternative to it.

Ukraine will independently decide how to spend the money. The macro-financial assistance will not be tied to specific expenditures, but it will help cover the country's most urgent needs.

The European Commission's proposal will take effect after it is reviewed and approved by the European Parliament and the EU Council.

The funds may become available in the coming months.

"This is an unprecedented and just decision to help restore peace in Europe. I am deeply grateful to the European Commission for understanding Ukraine's needs and its proactive stance. €35 billion is a crucial investment to maintain our financial stability and strengthen our ability to resist the enemy. Importantly, this proposal envisages that investment will be covered by revenues from the frozen assets of the aggressor country — the very country responsible for Ukraine's economic and financial losses. Confiscation of all frozen assets of the Russian Federation should remain on the agenda. The use of profits is one of the first steps on this path," said Finance Minister Sergii Marchenko in response to the European Commission's proposal.

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