EU and Ukraine Finalize Macro-Financial Assistance Deal, First Disbursement Mid-June
Key Details of the EU-Ukraine Macro-Financial Assistance Agreement
Memorandum of Understanding and Disbursement Timeline
BRUSSELS, May 20 (Reuters) - The European Commission signed on Thursday a memorandum of understanding with Ukraine on a macro-financial assistance programme that paves the way for a 3.2 billion euro disbursement in mid-June, once it is ratified by the Ukrainian parliament.
Overview of the EU Financing Scheme
The macro-financial assistance is part of the EU's bigger, 90 billion euro financing scheme that is to keep Kyiv funded throughout 2026 and 2027 as it fends off Russia's invasion.
Statements from EU Officials
"We have finalised our negotiations with Ukraine on the memorandum of understanding underpinning our macro financial assistance program as part of the Ukraine support loan," European Economic Commissioner Valdis Dombrovskis said.
"I signed it this morning, and now it's still for Ukrainian side to sign, and it also needs to be ratified by the Rada in Ukraine, ...so that we can then proceed with disbursements," he told reporters.
Loan Structure and Disbursement Schedule
The agreement on the whole loan of 90 billion euros could be signed in a matter of days, Dombrovskis said. Of the overall 90 billion euro loan, 45 billion will be disbursed this year and another 45 billion in 2027.
Allocation of Funds
Of the money coming this year, 28.3 billion is earmarked for military spending and 16.7 for general budget support. The general budget cash is split in half between the macro-financial assistance and the so-called Ukraine facility dedicated to Ukraine's recovery, reconstruction, and modernization.
Conditions and Coordination with International Partners
Dombrovskis said the macro-financial assistance money was conditional on Ukraine implementing reforms with a strong fiscal focus, to boost domestic revenue mobilization, public spending efficiency and public financial management systems.
"We also coordinated closely with the International Monetary Fund so that conditions are consistent and where necessary, let's say additional or complementary to the IMF program," Dombrovskis said.
Reporting
(Reporting by Jan Strupczewski)
