The EU’s Ukraine Facility, launched in 2024, includes money for the Ukraine Plan, dedicated to rebuilding Ukraine and helping it become a member of the Union. As of now, the country has used half the funds allocated to the facility, writes Mandiner.
The Ukraine Facility has a total budget of €50 billion, €33 billion as a soft loan and €17 billion as a grant. This was agreed upon in 2024 as part of the mid-term review of the current EU multiannual financial framework, or MFF, for the period 2021-2027.
Philip Pilkington, a senior researcher at the MKI, believes that the estimated total cost of rebuilding Ukraine could exceed €1 trillion, which would further increase the financial vulnerability of already indebted EU member states.
The instrument is subject to a strict financial control and monitoring framework, and an independent monitoring body was set up for this purpose. As of early May, the European Council had approved three disbursements, bringing the total disbursement to Ukraine from the facility to €25.5 billion.
The most recent approval was in March for a €3.5 billion transfer, which Kyiv received in April.
The payment at that time was made possible because Ukraine demonstrated that it had successfully implemented 13 different measures since the last payment on Dec. 9. These include, among others, the adoption of reforms aimed at increasing the use of renewable energy, increasing the autonomy of energy regulators, simplifying border-crossing procedures, and adopting an agricultural and rural development strategy.
Deputy Prime Minister of Ukraine Olga Stefanyshyna just recently told Ukrinform that Ukraine has 12 months left to meet all the conditions for receiving the money, including eight key draft laws. These include the law on courts and adjudication, the Anti-Corruption Agency, and the reform of the Asset Recovery and Management Agency (ARMA), which has long been postponed by the Ukrainian government.
According to Stefanyshyna, however, they still have plenty of time to take the measures, and if they are successful, the remaining money will come. Funds are sorely needed, as the country is on the brink of bankruptcy due to the war, and in were unable to pay back one debt this month. As a result, several major credit rating agencies have downgraded the country’s debt rating.
Ukraine is therefore on a ventilator economically and financially, notes Mandiner, but is still forging ahead with plans to join the European Union, as well as the Organization for Economic Cooperation and Development (OECD) in 2026.
According to Ukrainian Prime Minister Denys Shmyhal, 80 percent of the conditions have already been met, and they will be able to easily join the OECD.
The OECD provided significant assistance in the economic recovery of countries such as Hungary and the Czech Republic after the collapse of the Soviet bloc.
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