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EU Council, European Parliament reach provisionary agreement on $54 billion Ukraine Facility

by Martin Fornusek February 6, 2024 8:54 AM 2 min read
The Ukrainian, the EU and the EU countries flags are seen in front of the European Parliament in Brussels, Belgium on July 28, 2023. (Thierry Monasse/Getty Images)
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The European Parliament and the Council of the EU had concluded a preliminary agreement on the Ukraine Facility of 50 billion euros ($54 billion), the Council's press service said on Feb. 6.

After months of obstruction by Hungary, European leaders agreed on the four-year financing for Kyiv during a European Council summit on Feb. 1.

The sum, which is part of a broader EU budget called the Multiannual Financial Framework (MFF), is split between 33 billion euros ($35.5 billion) in loans and 17 billion euros ($18.3 billion) in grants.

"The EU is prepared to support Ukraine as long as needed. The Ukraine Facility will allow us to channel consistent and predictable support to Ukraine to help its people rebuild their country in the midst of the unprecedented challenges brought by Russia's war of aggression," said Belgian Finance Minister Vincent van Peteghem, whose country is currently presiding the EU.

According to the Council's press release, Ukraine may request a pre-financing payment of up to 7% of the Facility.

A significant part of the sum will be earmarked for green investments, and another portion will be reserved for small and medium businesses.

One of the necessary pillars for the implementation of the Ukraine Facility was a Ukraine Plan, a Kyiv-drafted proposal for reform and recovery efforts.

The Ukrainian government submitted its plan for approval by the European Commission in late December 2023. The implementation of the plan will be regularly monitored by the EU.

"At the same time, the support will help Ukraine take forward the reforms and modernization efforts needed for it to advance on its path towards future EU membership," van Peteghem added.

The European Council agreed to start accession talks with Ukraine during an EU summit in December 2023, another major step toward a full-fledged membership since Kyiv applied for joining in February 2022.

The next step after the preliminary agreement is further discussions between negotiators on the MMF. Upon reaching the final agreement, the Facility will be formally published and come into force the next day.

BREAKING: European Council agrees to open accession talks with Ukraine, Moldova
The European Council has agreed to open accession talks with Ukraine and Moldova, European Council President Charles Michel announced on Dec. 14.

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